```

[Senate Hearing 107-799]
[From the U.S. Government Publishing Office]

                                                        S. Hrg. 107-799

                  A PROGRESS REPORT ON 10 + 10 OVER 10

=======================================================================

                                HEARING

                               BEFORE THE

                     COMMITTEE ON FOREIGN RELATIONS
                          UNITED STATES SENATE

                      ONE HUNDRED SEVENTH CONGRESS

                             SECOND SESSION

                               __________

                             OCTOBER 9, 2002

                               __________

       Printed for the use of the Committee on Foreign Relations

 Available via the World Wide Web: http://www.access.gpo.gov/congress/
                                 senate

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                            WASHINGTON : 2003
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                     COMMITTEE ON FOREIGN RELATIONS

                JOSEPH R. BIDEN, Jr., Delaware, Chairman
PAUL S. SARBANES, Maryland           JESSE HELMS, North Carolina
CHRISTOPHER J. DODD, Connecticut     RICHARD G. LUGAR, Indiana
JOHN F. KERRY, Massachusetts         CHUCK HAGEL, Nebraska
RUSSELL D. FEINGOLD, Wisconsin       GORDON H. SMITH, Oregon
PAUL D. WELLSTONE, Minnesota         BILL FRIST, Tennessee
BARBARA BOXER, California            LINCOLN D. CHAFEE, Rhode Island
ROBERT G. TORRICELLI, New Jersey     GEORGE ALLEN, Virginia
BILL NELSON, Florida                 SAM BROWNBACK, Kansas
JOHN D. ROCKEFELLER IV, West         MICHAEL B. ENZI, Wyoming
    Virginia

                   Antony J. Blinken, Staff Director
            Patricia A. McNerney, Republican Staff Director

                                  (ii)

  
?

                            C O N T E N T S

                              ----------                              
                                                                   Page

Biden, Hon. Joseph R., Jr., U.S. Senator from Delaware, prepared 
  statement......................................................     3
Bolton, Hon. John R., Under Secretary of State for Arms Control 
  and International Security Affairs, Department of State, 
  Washington, DC.................................................     8
    Prepared statement...........................................    12
    Responses to additional questions for the record from Senator 
      Biden......................................................    77
    Response to an additional question for the record from 
      Senator Bill Nelson........................................    79
Bronson, Lisa, Deputy Under Secretary of Defense for Technology 
  Security and Counter-Proliferation, Department of Defense, 
  Washington, DC.................................................    31
    Prepared statement...........................................    32
    Responses to additional questions for the record from Senator 
      Bill Nelson................................................    80
    Responses to additional questions for the record from Senator 
      Jesse Helms................................................    88
Brooks, Hon. Linton, Acting Administrator, National Nuclear 
  Security Administration, Department of Energy, Washington, DC..    35
    Prepared statement...........................................    37
Holgate, Laura S.H., vice president for Russia/New Independent 
  States Programs, Nuclear Threat Initiative, Washington, DC.....    63
    Prepared statement...........................................    66
Lugar, Hon. Richard G., U.S. Senator from Indiana, prepared 
  statement......................................................     6
Luongo, Kenneth N., executive director, Russian-American Nuclear 
  Security Advisory Council, Princeton, NJ.......................    48
    Prepared statement...........................................    52
Wolf, Hon. John S., Assistant Secretary of State for 
  Nonproliferation, Department of State, Washington, DC..........    26
    Prepared statement...........................................    29
    Responses to additional questions for the record from Senator 
      Biden......................................................    80
    Responses to additional questions for the record from Senator 
      Bill Nelson................................................    83
    Responses to additional questions for the record from Senator 
      Helms......................................................    84

                                 (iii)

  

 
                  A PROGRESS REPORT ON 10 + 10 OVER 10

                              ----------                              

                       WEDNESDAY, OCTOBER 9, 2002

                                       U.S. Senate,
                            Committee on Foreign Relations,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 10:20 a.m., in 
room SD-419, Dirksen Senate Office Building, Hon. Joseph R. 
Biden, Jr. (chairman of the committee), presiding.
    Present: Senators Biden, Bill Nelson, and Lugar.
    The Chairman. The committee will come to order. I apologize 
for the brief delay.
    In June of the last summer at a meeting in Canada, the 
heads of state of the G-8--the United States, Great Britain, 
France, Germany, Italy, Japan, Canada, and Russia--agreed to 
establish a Global Partnership Against the Spread of Weapons 
and Materials of Mass Destruction. Under this initiative, which 
has become known as ``10 + 10 over 10,'' the United States and 
other members of the G-7 club of the advanced industrial 
democracies agreed to commit up to $20 billion in funding over 
the next 10 years to support specific projects in 
nonproliferation, disarmament, counterterrorism, and nuclear 
safety. These projects will initially focus on Russia, but they 
could expand to other nations, including other states of the 
former Soviet Union.
    The United States appropriated approximately $1 billion in 
fiscal year 2002 on threat reduction efforts in the former 
Soviet Union, so it remains unclear whether the Global 
Partnership will result in additional U.S. funding above and 
beyond our current spending levels. At the very least, it may 
leverage increased funding on those important projects by our 
allies in Europe, Japan, and Canada.
    The Global Partnership contains an agreement on a set of 
common guidelines to govern future nonproliferation projects. 
These include consensus on tax exemption, liability protection, 
and adequate access by donor representatives to work sites to 
ensure funds are being well spent, issues that have complicated 
previous international efforts in nonproliferation assistance 
to Russia. The announcement of this new Global Partnership 
pleased many of us who have been calling for a more focused 
international commitment to reduce the threat posed by weapons 
of mass destruction in the former Soviet Union, in particular.
    We live in an age in which, as the President has put it, 
``The greatest threat to the U.S. national security is the 
danger that outlaw states or terrorist groups will acquire 
weapons of mass destruction for use against the United States 
and our allies.'' This concern is the principal reason why the 
U.S. Senate is now debating a resolution to authorize the 
President of the United States to use force, if necessary, 
against Iraq. It is also why we must focus on the vast 
repository of nuclear, chemical, and possibly biological 
weapons that still exist in Russia today, more than a decade 
after the Soviet Union collapsed. Nothing, in my view, poses a 
more clear and present danger to our security. Our greatest 
concern remains that groups like al-Qaeda or states like Iraq 
will steal or illicitly purchase poorly guarded stocks of 
weapons of mass destruction in Russia.
    Russia is committed to securing and destroying its excess 
weapons, but it needs help, financial and technical, to do so. 
Although the United States has provided billions of dollars in 
threat-reduction assistance to Russia, there remain, under 
varying conditions of security, roughly 1,000 metric tons of 
high enriched uranium, 40,000 metric tons of chemical weapons, 
including 2 million artillery shells containing nerve gas at 
one of Russia's facilities alone, and an unknown supply of 
biological pathogens.
    Russia is making fitful progress in disarmament and 
dismantlement, but with military budgets of roughly $7 billion 
a year, it can only do so much without significant 
international assistance. The United States and our allies have 
fundamental responsibility to do all we can to help Russia 
destroy its excess weapons and better secure its remaining 
stocks.
    The announcement of the G-8 Global Partnership was a 
significant achievement, in my view, but it was only a first 
step. We cannot allow this important international commitment 
to dissolve into empty words and failed implementation.
    At the request of my colleague and the leader in this 
entire area, Senator Lugar, I called this hearing to examine 
how the United States plans to work with its allies in carrying 
out the terms of the G-8 Global Partnership. How will the 
existing nonproliferation programs in Russia be affected? 
Should we increase the current levels of U.S. assistance, or do 
we envision the Global Partnership only as a means to leverage 
greater contributions by our allies in Europe, Canada, and 
Japan? What role do we envision for ``debt for 
nonproliferation'' as a potential funding mechanism? And to 
what degree will the G-8 members coordinate assistance efforts? 
What benchmarks will we use in measuring progress in coming 
years for carrying out this commitment?
    To help us answer these questions, we have today an 
impressive set of witnesses. First, the Honorable John R. 
Bolton, the Under Secretary of State for Arms Control and 
International Security Affairs, will provide the committee with 
an overview of the G-8 Global Partnership and the long-term 
U.S. vision for this agreement.
    On the second panel, representatives from the Departments 
of State, Defense, and Energy will explain how the Global 
Partnership will affect existing U.S. programs and whether new 
avenues of cooperation may yet exist.
    For the final panel, we are pleased to have distinguished 
outside witnesses to discuss how the Global Partnership is 
faring in Europe where outside experts recently held an 
important nonproliferation conference.
    I will hold off for now on individual introductions of the 
witnesses of the last two panels. Before Mr. Bolton begins his 
statement, let me yield the floor to my colleague, Senator 
Lugar.
    [The prepared statement of Senator Biden follows:]

           Prepared Statement of Senator Joseph R. Biden, Jr.

    In June, at their summit meeting in Kananaskis, Canada, the Heads 
of State of the G-8--the United States, Great Britain, France, Germany, 
Italy, Japan, Canada, and Russia--agreed to establish a Global 
Partnership against the Spread of Weapons and Materials of Mass 
Destruction.
    Under this initiative, which has become known as ``10 Plus 10 Over 
10,'' the United States and other members of the G-7 club of advanced 
industrial democracies agreed to commit up to $20 billion in funding 
over the next ten years to support specific projects on non-
proliferation, disarmament, counter-terrorism and nuclear safety. These 
projects will initially focus on Russia, but they could expand to other 
nations, including other states of the former Soviet Union.
    The United States appropriated approximately $1 billion in FY 2002 
on threat reduction efforts in the former Soviet Union. So, it remains 
unclear whether the Global Partnership will result in additional U.S. 
funding above and beyond our current spending levels. At the very 
least, it may leverage increased funding on those important projects by 
our allies in Europe, Japan, and Canada.
    The Global Partnership contains an agreement on a set of common 
guidelines to govern future nonproliferation projects. These include 
consensus on tax exemption, liability protection, and adequate access 
by donor representatives to work sites to ensure funds are being well 
spent--issues that have complicated previous international efforts at 
nonproliferation assistance to Russia.
    The announcement of this new Global Partnership pleased many of us 
who have been calling for a more focused international commitment to 
reduce the threat posed by weapons of mass destruction in the former 
Soviet Union in particular. We live in an age in which, as the 
President has put it, the greatest threat to U.S. national security is 
the danger that outlaw states or terrorist groups will acquire weapons 
of mass destruction for use against the United States and our allies.
    This concern is the principal reason why the United States Senate 
is now debating a resolution to authorize the President of the United 
States to use force if necessary against Iraq.
    It is also why we must focus on the vast repository of nuclear, 
chemical, and possibly biological weapons that still exists in Russia 
today, more than a decade after the Soviet Union collapsed.
    Nothing poses a more clear and present danger to our security. Our 
greatest concern remains that groups like al-Qaeda or states like Iraq 
will steal or illicitly purchase poorly guarded stocks of weapons of 
mass destruction in Russia.
    Russia is committed to securing and destroying its excess weapons. 
But it needs help--financial and technical--to do so.
    Although the United States has provided billions of dollars in 
threat reduction assistance to Russia, there remain, under varying 
conditions of security, roughly 1000 metric tons of highly enriched 
uranium, 40,000 metric tons of chemical weapons, including two million 
artillery shells containing nerve gas at one of Russia's facilities 
alone, and an unknown supply of biological pathogens.
    Russia is making fitful progress in dismantlement and disarmament, 
but with a military budget of roughly $7 billion per year, it can only 
do so much without significant international assistance.
    The United States and our allies have a fundamental responsibility 
to do all we can to help Russia destroy its excess weapons and better 
secure its remaining stocks.
    The announcement of the G-8 Global Partnership was a significant 
achievement in my view, but it is only a first step. We cannot allow 
this important international commitment to dissolve into empty words 
and failed implementation.
    At the request of my colleague and the leader in this entire area 
Senator Lugar, I called this hearing to examine how the United States 
plans to work with its allies in carrying out the terms of the G-8 
Global Partnership.

   How will existing U.S. nonproliferation programs in Russia 
        be affected?

   Should we increase current levels of U.S. assistance, or do 
        we envision the Global Partnership only as a means to leverage 
        greater contributions by our allies in Europe, Canada, and 
        Japan?

   What role do we envision for debt for nonproliferation as a 
        potential funding mechanism?

   To what degree will the G-8 members coordinate assistance 
        efforts?

   What benchmarks will we use in measuring progress in coming 
        years for carrying out these commitments?

    To help us answer those questions, we have an impressive set of 
witnesses today. First, the Honorable John R. Bolton, the Under 
Secretary of State for Arms Control and International Security Affairs, 
will provide the committee with an overview of the G-8 Global 
Partnership and the long-term U.S. vision for this agreement.
    On the second panel, representatives from the Departments of State, 
Defense, and Energy will explain how the Global Partnership will affect 
existing U.S. programs and whether new avenues of cooperation may 
exist.
    For the final panel, we are pleased to have distinguished outside 
witnesses to discuss how the Global Partnership is faring in Europe, 
where outside experts recently held an important nonproliferation 
conference. I will hold off for now on individual introductions for the 
witnesses on the last two panels.
    But before Mr. Bolton begins his statement, let me yield the floor 
to my colleague Senator Lugar.

    Senator Lugar. Thank you very much, Mr. Chairman. I thank 
you, personally, for having this hearing and for your own 
enthusiasm on this subject.
    President Bush has enumerated Iraq's violations of U.N. 
Security Council resolutions. He has also outlined in detail 
the risks of failing to enforce those resolutions. As the 
President, Congress, and the Nation focus increasing attention 
on Iraq, it is important we not lose sight of the purpose of 
this debate.
    Underlying American and international concern with Iraq is 
the fact that Saddam Hussein possesses chemical and biological 
weapons and is aggressively pursuing nuclear weapons. The 
possibility that he may transfer such weapons to terrorists or 
use such weapons to blackmail the United States and our allies 
is substantial if no action is taken. Iraq is, indeed, an acute 
problem, but it is one proliferation problem among many. We 
must pursue the containment and elimination of weapons of mass 
destruction on a global basis with the same intensity that has 
characterized our debates on Iraq.
    The purpose of this hearing is to look beyond Iraq to 
achieve better perspective on the broader problem of keeping 
weapons of mass destruction out of the hands of terrorists. For 
almost 11 years, the United States has been engaged in efforts, 
through the Cooperative Threat Reduction Nunn-Lugar program to 
address proliferation in its most likely source, the former 
Soviet Union. Those efforts have been highly successful, with 
approximately 6,000 nuclear warheads destroyed along with 
hundreds of bombers, missiles, and submarines. The program has 
facilitated the transfer of all nuclear weapons out of Ukraine, 
Kazakhstan, and Belarus. It's employing tens of thousands of 
Russian weapons scientists so they are less tempted to sell 
their knowledge to the highest bidder. The program has also 
made strides toward protecting and safeguarding nuclear 
warheads, biological weapon laboratories, and chemical-weapons 
stockpiles. We have come further than many thought we could, 
but much more needs to be done, and it needs to be done 
quickly.
    Eleven years ago, when the Nunn-Lugar program was 
conceived, the terrorist threat was real, but vague. Now we 
live in an era where catastrophic terrorism, using weapons of 
mass destruction, is our foremost security concern. We must not 
only accelerate weapons dismantlement in Russia, we must 
broaden our capability to address proliferation risks in other 
countries and attempt to build a global coalition against the 
proliferation of weapons of mass destruction.
    Today, we will discuss one of the most promising vehicles 
to achieve such a result. On June 27, 2002, leaders of the G-8 
member states, attending a summit meeting in Canada, agreed to 
form and participate in a global partnership against the spread 
of weapons and materials of mass destruction, also known as 
``10 + 10 over 10.'' The goal of the initiative was to increase 
international efforts to eliminate the threat posed by the 
proliferation of weapons of mass destruction from the states of 
the former Soviet Union. I would add that such a coalition 
could be expanded to address proliferation threats around the 
globe.
    Under this new G-8 agreement, the United States pledged to 
spend at least $10 billion, and the other members states agreed 
to match this commitment over the next 10 years. The focus will 
be on nonproliferation, disarmament, counterterrorism, nuclear 
safety, and containing environmental damage. In effect, 10 + 10 
over 10 will double the resources currently being expended in 
these areas.
    Still, the future of the G-8 initiative is not assured. 
Many of our international partners will find it difficult to 
increase nonproliferation funding in a period of stagnating 
domestic economies. And equally difficult will be ensuring 
Russia's willingness to extend full audit rights and exemptions 
from taxes and liability to nations other than the United 
States.
    After visiting several G-8 capitals and meeting with their 
leaders, I have come to the conclusion that the 10 + 10 over 10 
initiative will be successful only if the United States leads 
this effort vigorously. I understand that administration 
officials, including several testifying before the committee 
today, recently returned from a 10 + 10 over 10 meeting in 
Ottawa. I'm hopeful they will be able to report on their 
progress.
    Notwithstanding G-8 coordination and organization issues, 
it is clear that the United States will have to continue to 
press Russian officials to abide by President Putin's 
commitments at the summit. President Putin has committed Russia 
to a path that will provide the international community with 
another effective tool to combat the threat of proliferation of 
weapons of mass destruction. But, as we have learned in other 
fora, President's Putin's biggest obstacle could be his own 
governmental bureaucracy.
    Over the August recess, I visited several Nunn-Lugar 
dismantlement sites and met with Russian leaders on 
nonproliferation issues. I found our Russian counterparts eager 
to discuss the 10 + 10 over 10 initiative. Shipyard directors, 
former biological weapon facility directors, and military 
commanders looked forward to the opportunities that will be 
provided by the G-8 agreement. Likewise, interest in this 
initiative is keen in some European capitals. Great Britain is 
already moving forward to set aside as much as $750 million for 
the 10 + 10 over 10.
    And Norway, although not a G-8 country, has been a leader 
in working with the Russians to address the security and 
environmental problems posed by Russia's decaying nuclear 
fleet. Our own experience with Norway and Russia in the 
trilateral Arctic Military Environmental Cooperation program, 
AMEC, may provide instructions for integrating G-8's nations 
into a broader dismantlement effort.
    Russian Defense Minister Ivanov has already identified a 
number of nonstrategic items for which Russia will request 
destruction assistance because of the potential threat they 
pose and the costs associated with their maintenance. But 
interest alone is insufficient. President Putin has committed 
to provide G-8 member states with the umbrella legal agreements 
necessary to permit the initiative to go forward. But perhaps 
more importantly, the government bureaucracies of the Russia, 
the United States and other G-8 states must be committed to the 
program's success.
    I commend the Bush administration for efforts to win allied 
and Russian support for the G-8 weapons of mass destruction 
initiative, but there is hard work ahead of us. Each of you 
have been provided with a copy of my own top 10 list. And, in 
my opinion, this should be a guide that directs the United 
States in G-8 spending over the next several years. This top 10 
list is an effort to assist the administration in setting out 
goals of 10 + 10 over 10, as well as the Nunn-Lugar program and 
its partner programs at the departments of State and Energy.
    I thank you again, Mr. Chairman, for this important forum.
    [The prepared statement of Senator Lugar follows:]

             Prepared Statement of Senator Richard G. Lugar

                              INTRODUCTION

    President Bush has enumerated Iraq's violations of U.N. Security 
Council resolutions. He also has outlined in detail the risks of 
failing to enforce those resolutions.
    As the President, Congress, and the nation focus increasing 
attention on Iraq, it is important that we not lose sight of the 
purposes of this debate. Underlying American and international concerns 
with Iraq is the fact that Saddam Hussein possesses chemical and 
biological weapons and is aggressively pursuing nuclear weapons. The 
possibility that he may transfer such weapons to terrorists or use such 
weapons to blackmail the United States and our allies is substantial if 
no action is taken.
    Iraq is indeed an acute problem, but it is one proliferation 
problem among many. We must pursue the containment and elimination of 
weapons of mass destruction on a global basis with the same intensity 
that has characterized our debate on Iraq. The purpose of this hearing 
is to look beyond Iraq to achieve better perspective on the broader 
problem of keeping weapons of mass destruction out of the hands of 
terrorists.
    For almost eleven years the United States has been engaged in 
efforts through the Nunn-Lugar program to address proliferation at its 
most likely source: the former Soviet Union. These efforts have been 
highly successful, with approximately 6,000 nuclear warheads destroyed, 
along with hundreds of bombers, missiles, and submarines. The program 
has facilitated the transfer of all nuclear weapons out of Ukraine, 
Kazakstan, and Belarus. It is employing tens of thousands of Russian 
weapons scientists so they are not tempted to sell their knowledge to 
the highest bidder. The program has also made strides toward protecting 
and safeguarding nuclear warheads, biological weapons laboratories, and 
chemical weapons stockpiles.
    We have come further than many thought that we could, but much more 
needs to be done, and it needs to be done quickly. Eleven years ago 
when the Nunn-Lugar program was conceived, the terrorist threat was 
real, but vague. Now we live in an era when catastrophic terrorism 
using weapons of mass destruction is our foremost security concern. We 
must not only accelerate weapons dismantlement efforts in Russia, we 
must broaden our capability to address proliferation risks in other 
countries and attempt to build a global coalition against the 
proliferation of weapons of mass destruction.
    Today we will discuss one of the most promising vehicles to achieve 
such a result. On June 27, 2002, leaders of G-8 member states attending 
a summit meeting in Canada, agreed to form and participate in a Global 
Partnership Against the Spread of Weapons and Materials of Mass 
Destruction, also known as ``10 + 10 over 10.'' The goal of the 
initiative is to increase international efforts to eliminate the threat 
posed by the proliferation of weapons of mass destruction from the 
states of the former Soviet Union. I would add that such a coalition 
could be expanded to address proliferation threats around the globe.

                      SENATOR LUGAR'S ``TOP TEN''

1. Chemical Weapons Destruction
   Two million rounds of chemical shells and warheads await 
        destruction at Shchuch'ye.

   Chemical weapons are also stored at six other sites awaiting 
        destruction: Kizner, Pochep, Leonidovka, Gorny, Maradyokvsky, 
        Kambarka.

   Russia is falling far behind their commitments under the 
        CWC.
2. Securing Biological Pathogens
   Russia has refused to grant access to four closed military 
        institutes: Kirov 200, Yekaterinburg (formerly Sverdlovsk), 
        Sergeyev Possad, Military Medicine Institute at St. Petersburg.
3. Tactical Nuclear Weapons Elimination and Secure Storage
   Tactical nuclear weapons are more portable, less secure, and 
        deployed closer to potential flashpoints than strategic 
        systems.
4. Engagement of former Weapons Scientists and Engineers
   ISTC and IPP programs engage tens of thousands of former 
        weapons scientists.

   A successful end-game must include American corporate 
        investment or purchase of Russian laboratories.
5. Material Protection, Control & Accounting Programs
   Only 40% of the facilities housing nuclear materials in 
        Russia have received security improvements and only half of 
        these have received complete security systems.
6. Radioactive Sources (Radioisotope Thermal Generators)
   The Soviet Union manufactured RTGs to supply power at remote 
        sites.

   These generators pose a proliferation threat and are spread 
        all over the states of the former Soviet Union.
7. Shutdown of Plutonium Producing Reactors
   Three nuclear reactors produce 1.5 metric tons of weapons-
        grade plutonium each year.

   Russia has agreed to shut down the reactors if replacement 
        power sources are built.
8. Plutonium Disposition
   The U.S. and Russia have agreed to eliminate 34 tons of 
        plutonium by fabricating it into MOX fuel that will be 
        irradiated in commercial nuclear reactors.

   Disposition will require sizable up-front costs to construct 
        required facilities.
9. Dismantlement of Non-Strategic Submarines
   Nunn-Lugar can only dismantle strategic submarines, but non-
        strategic subs are also a threat because some carry cruise 
        missiles and others have highly-enriched nuclear fuels which 
        are a proliferation threat.
10. Reactor Safety
   Converting reactors that utilize HEU to lower enriched fuels 
        and safely storing spent fuel. (Concerns in Georgia led to 
        Operation Auburn Endeavor, a classified mission to remove 
        weapons-grade nuclear material from a dangerous situation.)

                SHUTDOWN OF PLUTONIUM PRODUCING REACTORS

    There are three nuclear reactors in Siberia that produce 1.5 metric 
tons of weapons-grade plutonium as a natural byproduct of their 
operation. Russia will not shutdown these reactors until replacement 
power sources are available because the reactors are the sole source of 
power and heat in the region. As we continue to safeguard and eliminate 
nuclear material in Russia we must also take steps to ensure that no 
additional weapons-grade material is created. This must be started 
immediately.

                         PLUTONIUM DISPOSITION

    The U.S. and Russia have agreed to dispose of 34 metric tons of 
weapons-grade plutonium. Both sides will fabricate the material into 
mixed oxide fuel that will be irradiated in commercial nuclear 
reactors. The processes, on both sides, will require significant 
investments in new facilities that will be needed to fabricate the 
fuel. An estimated $2 billion will be needed to build and implement the 
Russian effort.

                        NON-STRATEGIC SUBMARINES

    Each time I visit Russian shipyards I'm startled by the enormity of 
the task that lies before us in the area of submarine dismantlement. 
Nunn-Lugar is limited to dismantling strategic missile submarines. This 
is a mistake. There are important non-proliferation and security 
benefits to the timely dismantlement of conventional submarines. Many 
carry cruise missiles which could prove valuable to rogue nation 
missile programs. Other submarines, such as the Alfa attack submarine, 
is powered by nuclear fuel enriched to very high levels which could 
pose serious proliferation risks if unsecured.

                             REACTOR SAFETY

    The United States and our allies must work together with Russia and 
other states of the former Soviet Union and elsewhere to convert 
reactors that currently use weapons-grade material to a lower fuel 
level. Potential threats stemming from these kinds of reactors are not 
hypothetical. Operation Auburn Endeavor was launched to take material 
from a Georgian reactor to safekeeping.

    The Chairman. Thank you, Senator, for your leadership.
    Secretary Bolton, the floor is yours.

STATEMENT OF HON. JOHN R. BOLTON, UNDER SECRETARY OF STATE FOR 
ARMS CONTROL AND INTERNATIONAL SECURITY AFFAIRS, DEPARTMENT OF 
                     STATE, WASHINGTON, DC

    Mr. Bolton. Thank you very much, Mr. Chairman. I appreciate 
you and Senator Lugar taking the initiative in calling the 
hearing. I have a prepared statement, which I'd just ask be 
submitted for the record, and I'll try and summarize the----
    The Chairman. The entire statement will be placed in the 
record.
    Mr. Bolton. We have tried to address in there several of 
the important questions that you raised in your letter of 
invitation.
    The subject of Russian proliferation and the threat of 
proliferation from its existing stocks of weapons of mass 
destruction has been one of the three main areas of 
concentration for the administration in the elaboration of our 
new strategic framework with Russia. We were concerned and 
remain concerned with questions of strategic offensive weapons 
and strategic defensive weapons.
    On defensive weapons, we tried extensively to work with the 
Russians to find a way that we could mutually move beyond the 
ABM Treaty, but being unsuccessful in that, we announced our 
withdrawal from the treaty, which has now become effective. We 
are beginning to have exchanges with the Russians on the 
subject of cooperation in the missile defense field.
    On the subject of strategic offensive weapons, the 
committee is familiar with the Moscow Treaty, which is pending 
before it, which codifies the decisions of both sides to reduce 
their operationally deployed strategic nuclear warheads from 
their present levels to a range of between 1,700 and 2,200 over 
a 10-year period.
    We appreciate the work, Mr. Chairman, that the committee 
has done to move the treaty toward Senate consideration, and we 
remain very hopeful that it will be possible to do that before 
the Senate adjourns for this session.
    The third critical element, as I mentioned, is the subject 
of proliferation.
    The Chairman. I should note--if you don't mind me 
interrupting you; I do apologize for this--it is our intention 
to try to do that. But, for the press here, it should be known 
that I know of no outright opposition to that treaty. I don't 
know when we're leaving, whether that is next week or later, 
and we may not get it done by then. We may have a lameduck 
session. It would be my intention to bring it up in a lameduck 
session to get it finished if we, in fact, have a lameduck 
session. And if that is not the case, if I am reelected, 
whether I am ranking member assisting the chairman or the 
chairman, I think we could both say we'd be prepared to move it 
immediately. So I just want the message to go out that there is 
no delay related to opposition to this treaty.
    Anyway, I'm sorry for the interruption, but I think it's 
important, because a lot of people have been asking, and that's 
why I interrupted you.
    Mr. Bolton. Right. You'll permit me, then, to digress to 
say that the Russian Federation, of course, is looking at its 
schedule, and the Duma, as well. Their most recent prediction, 
which is no more perfect than our predictions, is that they 
would be able to bring it to the State Duma probably in late 
October, early November, although that remains a target, as 
well. In any event, the ratification by both parties of the 
Treaty of Moscow would be an important step forward.
    But on proliferation, there are really two aspects of our 
concern with Russia, the first being what they continue to do 
in terms of outward proliferation activity. I think the 
committee is familiar with our extensive consultations, from 
the Presidential level on down, with the Russians to try to get 
them to reduce the flow of technology and materials to 
countries like Iran and Syria and others in the field of 
nuclear weapons cooperation, ballistic missile technology, and 
others, to avoid the existing Russian programs being a source 
of support for proliferation by these rogue states.
    But the other aspect, and really the centerpiece of this 
hearing, is what to do about the existing stocks of weapons of 
mass destruction. On that point, obviously, our alpha and, at 
least up to this point, our omega, is the Nunn-Lugar program, 
beginning back in 1991. It has gone through a series of 
modifications. It's been expanded, not only from work at DOD, 
but to the other departments which you've mentioned and which 
you'll hear about in more detail.
    The administration conducted a review of the wide range of 
programs going on in all of those departments, concluding last 
year with, I think, an extremely positive assessment of the 
work that had been conducted over the past 9 years and which 
resulted, as you have indicated, in a request for funding last 
year and this year in the range of about 1 billion U.S. 
dollars.
    But it was clear from our review of the programs and from 
the extensive travels and discussions that Senator Lugar and 
others on the committee have made that the amount of activity 
that could be conducted in Russia and the other states of the 
former Soviet Union was substantially in excess of our 
available resources. And I think the need and the importance of 
addressing these problems was certainly highlighted by the 
events of September 11, and the risk of what terrorist 
organizations would do if they were able to get their hands on 
weapons of mass destruction, whether through acquisition of the 
requisite technology or whether through getting the weapons and 
delivery systems themselves.
    So building on thoughts that many had, President Bush took 
the lead in working with G-8 colleagues to come up with the 10 
+ 10 over 10 program, in effect to achieve close to a doubling 
of the international resources available for work in the former 
Soviet Union on these kinds of programs. And that, as you've 
said, was successfully negotiated and announced by the leaders 
at Kananaskis.
    I do want to say we owe a particular debt to Canada, the 
host of this year's G-8 Summit, because, without their work, I 
think we would not have come as far as we did.
    The commitments that we have so far from the other G-8 
members don't quite get us to the ``plus 10'' that we're 
looking for, and work remains to be done on that subject. And 
it was one of the principal subjects of conversation at our 
first followup meeting to Kananaskis, which took place a couple 
of weeks ago in Ottawa.
    One, I think, very important development that emerged from 
that meeting was that the French, who take over as G-8 Chairman 
for the year 2003, followed up on a speech that President 
Chirac made, where he underlined the importance of 10 + 10, or 
the Global Partnership, as we call it in the G-8 context, and 
made it clear that that would be a priority for the Government 
of France during their Presidency.
    I think it's also important that we are actively seeking 
non-G-8 participation in funding of these programs in the 
former Soviet Union. Senator Lugar, as you mentioned, Norway is 
a good example. We think the Nordic states, in general, because 
of their concern for nuclear and other military activities in 
their region around the Port of Murmansk, in the Kaliningrad 
enclave, and other areas may well be quite interested in 
participating.
    I can say, from my own experience at Kananaskis, that 
getting this agreement was not easy. I fully support what both 
Senators have said about this being a good beginning, but a lot 
of work remains. There's just no question about it. And one of 
the things that we have been working on in particular, along 
with getting the other G-7 members to get large pledges on the 
table and to get nonmembers to participate, is working with the 
Russians to get them to do what they must do to support the 
activities and to help those of us in the G-7 and elsewhere in 
getting the amount of resources that we need.
    There are two aspects to this with respect to Russian 
performance. One is Russian financial contribution. It is the 
case here in Congress, it is the case, our G-7 partners have 
told us, in other parliaments, that elected officials want to 
know not only what they're going to contribute to the 
elimination of Russia's weapons of mass destruction, but what 
the Russians are going to contribute to it. And that remains a 
subject that we're in close consultation with the Russian 
Government on to make sure that their financial commitment and 
support is adequate to the task at hand.
    In that connection, we have been in the forefront among G-7 
countries in considering the option of debt-for-program swaps, 
whereby existing official Russian debt could be converted or 
utilized in ways that provide additional resources inside 
Russia. We're considering now exactly how to implement that. We 
appreciate your work here in the committee and in Congress to 
get the authorizing authority for that adopted, and we intend 
to pursue it. It's not a subject that carries a lot of favor 
with some of our other G-7 partners, those that have heavier 
official debt than we do with the Russians. But it's something 
that may well require our leadership and experimentation, and 
we're certainly working away on it.
    The second aspect, though, of Russian involvement is more 
troubling. I must say this was an area that we spent a 
considerable amount of time on in Ottawa. As you know, we have 
been operating for most of the past 10 years under an umbrella 
agreement that was negotiated with the Russian Federation at 
the beginning of the Nunn-Lugar program. That agreement 
expired. It's now up for Duma reconsideration. And it has all 
of the protections that both you Senators have enumerated, in 
terms of liability protection, transparency, audit and access 
rights.
    The Government of Russia has expressed a number of concerns 
about the provisions of that agreement on liability insurance 
in a nuclear context, and on a variety of other things. And 
we're going to be working closely with the Government of Russia 
to ensure that the political commitment is there to get the 
Duma to ratify this extension without crippling amendments or 
reservations.
    I think our feeling is that if we are able to get the 
umbrella agreement ratified, the extension of the umbrella 
agreement ratified, that we can clear the way for the other 
members of the G-8 to participate. And that, frankly, was one 
of the things most on our mind when we began to organize this 
and looked at ways that we could coordinate with other G-7 
members.
    Alone, they could not solve the problems that they had 
encountered. And I'll just give you one example. The Japanese 
have a substantial interest in the dismantlement of general 
purpose nuclear submarines, and they had appropriated and 
actually expended a certain amount of money on that subject. 
But, over the years, they've run into enormous difficulties in 
gaining access to the facilities where the submarines would be 
dismantled. They didn't feel there was adequate coordination 
among the different Russian ministries involved. And so the 
project has been basically on dead stop for a number of years.
    The Japanese argued, I think, persuasively to us, that 
they're not in a position to contribute more money to the 
Global Partnership until they've resolved these difficulties on 
implementation that they've already run into. And I think you 
will find this a persuasive point. They said their Diet members 
would say to them, ``Why should we appropriate new money for 
you when you haven't even spent the money we've already 
appropriated?''
    So that, to us, was a signal that we had to work with the 
other G-7 members and get through the, what sounds like the 
mundane business of these agreements and protections for 
liability, but which are, in fact, show stoppers for expansion 
of the program for all of the G-7 members, if they're not 
resolved.
    Another major subject that we discussed at Kananaskis and 
in Ottawa was how to coordinate, how to assist each other, and 
how to make sure that others, particularly, could benefit from 
our experiences. That is something that I expect will take a 
lot of our time and attention, as well as making sure that as 
the new contributions flow into the pot of the Global 
Partnership money, that they're expended in a coordinated 
fashion and that we're not duplicating or overlapping efforts.
    Finally, let me just conclude by expressing our 
appreciation for the work that you've done on the question of 
waivers of the certification authority, both on the CTR program 
broadly and on the Shchuch'ye chemical weapons facility. This 
has been something that you've taken the lead on here, both 
Senators have. And we're hoping that those will be adopted, 
perhaps at the same time the Moscow Treaty is considered, or 
even before, that we can get that waiver authority and proceed 
with exercising it to begin, to continue funding those 
programs.
    That's a very general overview of where we are. I know, in 
your opening statements, both of you were concerned, and I 
think importantly so, with the implementation of the G-8 Global 
Partnership. It is something that we are committed to working 
on, because we don't want to come to the Evian Summit in France 
next summer and find that we're in the same position that we 
were last year, that is to say with projects stopped, without 
new money being committed, without the expression of support 
and progress on the Russian side. And I think having this 
hearing will be very helpful in that regard.
    I'd be pleased to answer any questions you may have.
    [The prepared statement of Mr. Bolton follows:]

Prepared Statement of Hon. John R. Bolton, Under Secretary of State for 
      Arms Control and International Security, Department of State

    Mr. Chairman, Senator Helms, Senator Lugar, distinguished members 
of the Committee, I'm pleased to appear before you to discuss the new 
G8 Global Partnership Against the Spread of Weapons and Materials of 
Mass Destruction and the Administration's plans to implement that 
initiative. Over the past decade, this Committee and its members have 
been strong advocates of nonproliferation and threat reduction 
cooperation programs with Russia and other former Soviet states, while 
at the same time demanding that the programs fulfill their mandate.
    Let me begin by putting that initiative within the larger context 
of the changed international security situation and the U.S.-Russian 
relationship. From the beginning of the Administration, President Bush 
has worked with President Putin to forge a New Strategic Framework for 
a cooperative relationship with Russia that deals with the security 
problems we face in the post-Cold War world.
    The first element of the new framework involved issues of strategic 
defense and the Anti-Ballistic Missile Treaty. Signed in 1972, the ABM 
Treaty posed fundamental problems to our need to defend against a 
growing missile threat from rogue states intent on acquiring weapons of 
mass destruction and the missiles to deliver them--a threat that did 
not exist when the ABM Treaty was written. The Treaty prevented us from 
defending our country and our friends and allies from missile attacks, 
and hampered the development of partnership and cooperation with 
Russia. This phase of our work came to a conclusion with the 
announcement in December 2001 of our decision to withdraw from the ABM 
Treaty.
    That opened the way to an intensive effort on the second element of 
the New Strategic Framework, substantial reductions in strategic 
offensive weapons. Starting during the presidential election, Governor 
Bush had promised to reduce such weapons to the lowest level possible 
consistent with our national security. Through the 2001 nuclear posture 
review, and embodied in the Treaty of Moscow signed in May, we have 
decided to reduce operationally deployed strategic nuclear warheads 
over the next 10 years to between 1,700 and 2,200. We are pleased that 
the Committee has completed its hearings on the Moscow Treaty, and look 
forward to action on the Treaty before the Senate adjourns.
    Success in the strategic offensive and defensive fields now allows 
us to focus our attention with Russia on the third critical element of 
the New Strategic Framework, nonproliferation. One critical aspect of 
our nonproliferation work with Russia is the assistance program 
launched in 1991 by the Nunn-Lugar legislation. Last year the 
Administration reviewed U.S. nonproliferation and threat reduction 
programs and concluded that, with a few adjustments, they were 
effective and should be continued. The Global Partnership that is the 
subject of today's hearing represents a broadening of this program to 
encompass other G8 members.
    Before turning to the Global Partnership, however, I'd like to note 
the second element of our nonproliferation effort with Russia: ensuring 
that WMD and their delivery systems, related materials and technology 
do not flow from Russia to other countries. We remain very concerned 
that the nuclear and missile programs of Iran and others, including 
Syria, continue to receive the benefits of Russian technology and 
expertise. President Bush has raised this issue with President Putin at 
their meetings in Moscow and Kananaskis and in their correspondence. 
Secretary Powell, Secretary Rumsfeld and Secretary Abraham have 
addressed this problem at length with their Russian counterparts, and 
we continue to press this issue.
    Iran is seeking all elements of a nuclear fuel cycle, from mining 
uranium to enrichment to production of reactor fuel. There is no 
economic justification for this effort, given Russia's commitment to 
supply all the fuel for the Bushehr reactor, not to mention Iran's 
abundant supplies of energy in the form of oil and gas. The inescapable 
conclusion is that Iran is building a nuclear fuel cycle to support a 
nuclear weapons program. Equally worrisome is Iran's long-range missile 
program. They have developed and tested a 1300 kilometer range missile, 
the Shahab 3, based on North Korean technology, and are pursing longer 
range missiles that could threaten Europe, Russia, and eventually the 
United States.
    Concerns about Russia's performance on its arms control and non-
proliferation commitments have already adversely affected important 
bilateral efforts, and unless resolved could pose a threat to new 
initiatives including the Global Partnership.
    Having established the overall context of the New Strategic 
Framework, let me turn to the Global Partnership. In the aftermath of 
September 11, the United States not only elaborated the New Strategic 
Framework with Russia, but also intensified dialogue with other allies 
regarding the need to expand and accelerate efforts to address 
nonproliferation and threat reduction goals, especially in Russia and 
other former Soviet states. As a result of these discussions, the 
President early this year proposed to the Group of Eight the ``10 plus 
10 over 10'' initiative--commitments of $10 billion from the United 
States would be matched by $10 billion from the other G8 for 
nonproliferation cooperation for Russia and other former Soviet states 
over the next ten years.
    After several months of intense work by G8 officials, G8 Leaders 
(the United States, Canada, France, Germany, Italy, Japan, Russia, and 
the United Kingdom) launched the Global Partnership Against the Spread 
of Weapons and Materials of Mass Destruction at the Kananaskis Summit 
in June. We owe a particular debt of gratitude to Canada, host of the 
Kananaskis Summit, for its tireless efforts to make the Global 
Partnership a reality. Under this initiative, the Leaders pledged to 
raise up to $20 billion over ten years to support specific cooperation 
projects, initially in Russia, to address nonproliferation, 
disarmament, counter-terrorism, and nuclear safety issues. The 
President has committed to provide half of this amount. The U.S. 
continues to believe that the nonproliferation concerns are paramount, 
and we will be pressing members to ensure that the most critical 
proliferation threats are addressed.
    Among the priority concerns, the G8 specifically named destruction 
of chemical weapons, disposition of fissile materials, employment of 
former weapon scientists, and dismantlement of decommissioned nuclear 
submarines. The full scope of programs under the Partnership is much 
broader; in fact, U.S. nonproliferation and threat reduction programs 
implemented by the Departments of Defense, Energy, and State, Commerce, 
and Treasury (through the Customs Service) are all encompassed under 
the Partnership. My colleagues in the panel presentation will address 
these programs in more detail.
    This initiative, a major achievement for the G8 and this 
Administration, represents a significant expansion of international 
commitment to provide financial resources address proliferation issues. 
The United States has pressed allies to provide such support since the 
U.S. launched the Nunn-Lugar programs in 1992. But while from FY1992 
through FY2002 the U.S. Government has provided over $7 billion for 
security assistance to Russia and other former Soviet states, G7 
members have contributed less than $1 billion. Under the Global 
Partnership, the G7 members' commitments should represent a fairer 
share of the responsibilities. From early indications from other G8 
members, we are about halfway toward meeting the $10 billion target. At 
current exchange rates, Canada will contribute $650 million US; the UK, 
$750 million; Germany, $1.5 billion; the European Commission, $1 
billion; and Japan, initially, $200 million. Other pledges have not 
been publicly announced; and not all members have taken decisions on 
pledges.
    In addition, we are pleased that under the French G8 presidency in 
2003, the Global Partnership will continue to be a priority. In August 
remarks about the upcoming French presidency, President Chirac has 
announced that ``all the necessary impetus will be given to this 
programme's implementation.''
    But participation in the Global Partnership will not be limited to 
the G8. The Global Partnership statement invited other countries ``that 
are prepared to adopt its common principles and guidelines to enter 
into discussions on participating in and contributing to this 
initiative.'' Other countries are already making valuable 
contributions; Sweden, Norway and the Netherlands are examples. The 
Senior Officials will be addressing outreach strategies in more detail 
at their next meeting, but have agreed to take advantage of bilateral 
and multilateral opportunities to inform other countries and encourage 
their participation. One such opportunity will be the Nonproliferation 
and Disarmament Cooperation (NDCI) Conference on nonproliferation 
cooperation with Russia and Eurasian states in Brussels on December 16-
17, 2003. The European Union, Canada, and the U.S. are sponsoring this 
multilateral conference of experts from current and potential donor and 
recipient countries to discuss implementation and coordination of new 
programs as well as new projects to meet outstanding needs.
    From my personal involvement in negotiating this initiative I can 
attest that getting to agreement at Kananaskis was not an easy task. 
Many G8 members have experienced serious difficulties in implementing 
their nonproliferation cooperation commitments with Russia. Some have 
been unable to conclude government-to-government implementing 
agreements because of inability to reach agreement with Russia on 
adequate provisions for liability protections, exemption from taxation, 
access to work sites, and other conditions. Program delays due to poor 
coordination within the Russian Government and among federal, regional, 
and local entities have been another concern. Millions of dollars 
previously committed by G8 members remain unexpended at present due to 
these problems, and G8 members will have difficulty committing new 
funds if these difficulties persist. In response to these difficulties, 
we negotiated Guidelines for New or Expanded Cooperation Projects, 
which outline basic elements to be incorporated into legal frameworks 
for implementation. For the new Global Partnership to be successful, 
the Russian Federation will need to take concrete actions to resolve 
outstanding problems.
    On September 26-27 in Ottawa, I attended the G8 Senior Officials 
first meeting following the Summit to discuss concrete implementation 
of the Kananaskis commitments. A major part of the meeting was devoted 
to the implementation problems, and we pressed the Russians hard on 
this issue. The Senior Officials agreed that we should continue to meet 
to provide the coordinating mechanism called for by the Leaders. This 
welcome development will help ensure high-level attention on any areas 
of difficulty. We have already planned another meeting before the end 
of the calendar year to engage further on implementation guidelines, 
projects for cooperation, and outreach to countries beyond the G8.
    It came as welcome news that G8 governments are engaged in 
implementing the Global Partnership; establishing interagency 
coordination mechanism, identifying potential projects, and beginning 
to budget resources. With respect to contributions, not all members 
have made commitments. From initial indications some have shared 
current thinking on anticipated pledges; others have not yet been able 
to do so. For the Evian Summit, we intend to press to have total 
commitments reach the $20 billion goal.
    The G8 as a group and individual members will be working on 
projects to be pursued. The Russian Federation has identified chemical 
weapons destruction and general-purpose nuclear submarine dismantlement 
as program priorities. Some members intend to contribute to cooperation 
in these areas; some have reiterated their commitments to support 
plutonium disposition. In addition, members will continue to address a 
range of other projects under the Partnership, including employment of 
former weapon scientists.
    In general, G8 members, including the United States, intend to fund 
and implement cooperation projects of their choice on a bilateral basis 
under government-to-government agreements with the Russian Federation. 
We do not intend to establish a Global Partnership multilateral 
implementation mechanism or common fund. However, the G8 Senior 
Officials, as the coordinating mechanism, will address priorities, 
identify program gaps, and to prevent duplication and overlap.
    Mr. Chairman, as I mentioned earlier, all current U.S. 
nonproliferation programs in the former Soviet Union are encompassed 
within the scope of the G8 Global Partnership and reflect U.S. plans to 
address the goals that are reflected in the Partnership. The 
Administration's FY03 request for these programs is about $1 billion. 
The President has indicated that the U.S. will maintain this level of 
effort for a ten-year period. Of course, the President's annual budget 
request will include our specific requests by program based on need for 
that specific year, within the overall context of the Administration's 
budget priorities.
    The U.S. programs have a significant role in shaping cooperation 
under the Global Partnership. We had already provided information on 
U.S. programs and noted projects where substantial resources are needed 
from others. We believe that this information has been useful to other 
G8 members as they consider how to direct resources. The Administration 
will of course continue to assess where and how our resources can be 
most usefully directed.
    With respect to financing, the inclusion of authorities to reduce 
Russian Soviet-era debt in exchange for nonproliferation program 
spending by the Russian government in the recently passed Foreign 
Relations Authorization Act provides welcome flexibility to the 
Administration. I very much appreciate the Committee's role in enacting 
these provisions. The Administration is actively considering debt for 
nonproliferation program options, and we look forward to consulting 
with you on the outcome of these deliberations.
    In closing, I'd like to express my appreciation for the support of 
this Committee for these critical national security concerns. We 
welcome the passage of the authorization of debt exchanges with Russia 
for nonproliferation projects. We are looking forward to completion of 
FY03 appropriations at the President's requested levels. There are two 
other provisions still under consideration in the Congress which are 
very important to the Administration's ability to meet our 
nonproliferation goals. First, we are seeking in the Defense 
Authorization bill Congressional approval of authority for the 
President to waive the annual certification requirement for Cooperative 
Threat Reduction and Freedom Support Act Title V funding when it is in 
the U.S. national security interest to do so. Second, we are seeking 
authority to waive the conditions for cooperation with Russia on 
construction of a chemical weapons destruction facility at Shchuch'ye. 
We hope that both these provisions can be passed before the Congress 
leaves for the fall elections.

    The Chairman. Thank you very much, Mr. Secretary.
    I have a very basic question. What is the operational 
mechanism for implementing this initiative? Who's in charge? Is 
there a committee of your counterparts in each of the other 
countries--a council, in effect? How, other than principals 
being involved, do we get from this commitment to actually 
having boots on the ground somewhere dismantling something that 
is categorized as a weapon of mass destruction? Mechanically, 
how does this happen?
    Mr. Bolton. We made a very basic decision before Kananaskis 
that each country would essentially run its own program. That 
is to say, we would not set up a new multilateral organization. 
We would not set up a bureaucracy to do it. We felt that each 
country knew best how to handle its own political system, knew 
best what its priorities were. Some, in the case of Japan, more 
concerned about nuclear submarines, others more concerned with 
chemical weapons, others more concerned with fissile material 
disposition.
    Particularly for the countries that are relatively new, 
they have actually gone ahead, in many cases, Canada being a 
good example, and set up their own internal structures, 
appointed people to head this up, committed money in their 
budgets, and have gone to their parliaments seeking the 
requisite legislation. We've had representatives from several 
countries here looking at what we do to learn from our 
experience, to see where they might be interested in launching 
new programs, so that each country is responsible for getting 
the money and for its allocation and expenditure.
    We will use the so-called ``senior officials gathering'' to 
coordinate, to gather information, to make sure that there is 
not duplication and overlap in this. I don't think, as an early 
matter, that's much of a concern, because the level of need is 
substantially higher than the resources as they buildup. Some 
of the countries are going to have to start and get, ramp up to 
a higher level of expenditure. I think that's a prudent thing 
to do. They don't want to be in a position of not being able to 
tell their parliaments how the money is being spent.
    But all of these countries have experience in programs of 
bilateral assistance, and, just as we did in the early years of 
Nunn-Lugar, drawing on that experience. We're working 
cooperatively with them since we have the largest program, and 
I think, so far, that's going fairly well.
    The Chairman. So that again, to be very practical, the 
Canadian Government would contact the Russian Government and 
discuss specific, site-specific initiatives. Are the Canadians, 
for example, at liberty, under this agreement, to, in effect, 
set their own guidelines? Could they yield--I'm not suggesting 
they should--on some aspect of liability insurance or some 
other matter? Were the outlines of the agreement, relative to 
improper taxation, bureaucratic obstacles and the like, just 
meant as broad guidelines, or did we all agree, so none of us 
are out of sync with one another?
    Mr. Bolton. Yes, these are really bare minimums. In other 
words, these express what I think the contributing governments 
absolutely have to have in order to be able, confidently, to go 
to their parliaments.
    The Chairman. Right.
    Mr. Bolton. They need to say, ``We believe that we have 
adequate oversight and supervision over the expenditure of 
these funds.''
    I think what we did was, we exchanged our umbrella 
agreement and other agreements we had had. Other nations had 
their own agreements. We looked over them, and there is, I 
think, surprising agreement among the contributors, or 
potential contributors, that these protections that we've 
outlined in the guidelines are absolutely essential. I think 
it's hard to imagine a circumstance where a particularly 
important one would be omitted from any significant agreement.
    The Chairman. To use a Washington word that my folks back 
home always are confused by, for good reason, do we think it's 
important that there be certain ``benchmarks'' of knowing who 
spent what for what? And how do we establish those? How do we 
know? Is it a year from now, when the next G-8 meeting occurs, 
that each contributing country reports what they committed, 
what they've spent, what action they've taken? Is that the 
effective benchmark, the yearly meetings?
    Mr. Bolton. The leaders tasked the Sherpas, and then, 
effectively, the people actually working in this senior 
officials group, to report to them and to report to each other 
for consideration at the next summit what they had done. And 
the Canadians, because this is still their year of leadership 
of the G-8, have begun to get that material pulled together. 
We've exchanged information before. We need to make it a little 
bit more regular so that we can start understanding different 
accounting systems and whatnot.
    But we all know what the priorities are. We've discussed, 
and, at this most recent meeting in Ottawa, we discussed what 
the newer participants actually are beginning to focus on. And 
I am confident that, by the time of the Canadian handover to 
the French at the end of this year, that we will have in place 
the requisite reporting mechanisms so that the countries can 
lay out in a more common system exactly what programs are 
involved. Because we have the most elaborate, most extensive 
programs, I think a lot of countries have looked at the kind of 
reporting and allocation that we've done, and are modeling much 
of what they've done on the way we've proceeded, taking into 
account that they have their own particular budgeting 
procedures, fiscal years, and the rest of it.
    But we're not going to wait, in other words, until the 
summer of 2003. Work on accumulating that information has begun 
already.
    The Chairman. My last question, before I turn it over to 
Senator Lugar is: What can the next Congress expect from the 
administration in terms of requests for this program? Is it 
``steady as she goes,'' a billion dollars next year, like this 
year? Are we talking about upping the ante ourselves? Is there 
a baseline that we're starting from that is a billion above 
what we, in fact, already have committed? Or is it that we're 
meeting an obligation, and this is just used to leverage 
outside assistance? How is it viewed in your administration?
    Mr. Bolton. The expectation had been that because we were 
at about a billion dollars of appropriations request a year, 
that it was foreseeable we could extend that out over a 10 year 
period, and that that was a substantial enough projection, at 
least, that we should go to the allies and say, ``This is 
something that benefits us, to be sure, benefits you, as well, 
and that we'd like to see a more equitable burden sharing.''
    Over the life of Nunn-Lugar, up until last year, we had 
spent approximately $7 billion, and the other G-7 members had 
spent approximately $1 billion, so we were trying to move it 
up.
    I don't think any of us believe that we can really project 
out 10 years, in budget terms, or maybe even 5 years, and I 
wouldn't rule out that we could look at other possibilities. 
But, on the other hand, what we said was 10 + 10. We didn't say 
15 + 5. And I think it's important that we get the commitments, 
at least, that get us to the 10 + 10 level and then see how 
things are going inside Russia, look at their absorption 
capacity, look at how, for example, if we get the Shchuch'ye 
chemical weapons destruction facility up, how production is 
going. Is it ahead of schedule? Is it behind schedule? And 
these are things we would need to take into account.
    But I think the commitment is certainly there to do this as 
expeditiously as we can.
    The Chairman. Well, actually, I have one followup on that. 
What is the progress and status of Shchuch'ye right now, in 
terms of constructing the chemical destruction factory that we 
are building, that we are intending to build? Can you tell us 
what the status of that is?
    Mr. Bolton. Well, I think a certain amount of work on local 
infrastructure and so on has gone ahead. But in terms of the 
major construction, it awaits our appropriation. That was 
always the expectation, that we would have the lead on it. The 
Germans had the lead on Gorny. We had the lead on Shchuch'ye.
    The Chairman. OK, thank you.
    Senator Lugar.
    Senator Lugar. Thank you, Mr. Chairman.
    Secretary Bolton, just picking up from that question 
because you have mentioned the waiver authority, and I 
appreciate the letter that National Security Director 
Condoleezza Rice wrote requesting a waiver authorization. I 
incorporated her views into an amendment that's in the Senate 
appropriation bill giving the President waiver authority with 
regard to congressional requirements. That doesn't mean that 
the President doesn't take those into consideration, but he has 
the ability to permit the destruction of chemical weapons might 
proceed. And, as you know, about $200 million or more has been 
spent at this facility. Now it's stymied because the funds 
cannot be obligated and expended.
    Last week, in a visit to the White House, I asked Secretary 
Powell and Dr. Rice to weigh in once again. Both have reached 
out to Members of House and Senate conferees, which is ongoing, 
I believe, again today.
    Last week, in a conversation with the President on the 
telephone, we continued our discussion on these important 
subjects. Our dislog began during a meeting Senator Biden and I 
had with the President about the Moscow Treaty in June. The 
President was very concerned about about the lack of progress 
on Nunn-Lugar. He referred to his commitment to President Putin 
to get on with the dismantlement.
    I had a meeting with 15 Members of Congress this morning at 
breakfast, many of them on the House Armed Services Committee, 
who were relevant to both the appropriation and authorization 
situations. Participants indicated that the difficulty lies on 
the Republican side.
    I passed out a Los Angeles Times editorial which condemned 
the House for its failure to support the Nunn-Lugar program. It 
is not the House. It is just a few Members who refuse to agree. 
And I don't know at what level we have to go. The President, 
the Secretary of State, Secretary Rumsfeld in his testimony 
before this committee and Dr. Rice on two occasions, have 
expressed their strong support for waiver authority. I have 
offered an amendment based on their request but the House has 
expressed strong opposition to permitting U.S. assistance for 
the destruction of chemical weapons in Russia.
    I have visited Shchuch'ye on two occasions. I have returned 
with pictures of the dangerous weapons stored there. In one 
picture I am holding a briefcase easily holding an 85 mm shell 
filled with VX. There are 1.9 million shells and warheads 
ranging from 85 mm to Scud warheads all with sarin and VX. The 
Russians claim that each can kill 85,000 people in a stadium.
    Now, I appreciate the fact that the appropriation level 
requested by the administration and the review of the programs 
was a very generous appraisal. The President was under the 
impression, when Senator Biden and I met with him in July, that 
things are on track, but they are not on track. As a matter of 
fact, not just the chemical weapon thing had been shut down at 
that point, but the whole program after a certification could 
not be made by the Secretary of State. And it was on that basis 
the administration asked for a permanent Presidential waiver. 
The Senate bill contains that. The House bill, as I understand, 
has a 3-year waiver.
    But there has been no movement on that. So we had a hiatus 
during consideration of the supplemental appropriation for 
about 2 months. But finally things re-started. I was over in 
Russia. I saw everything getting going again, but it all 
stopped again as of October 1. Nothing. No new programs.
    Now, the general public doesn't understand that. I don't 
understand it. But, nevertheless, that's the way it is. And we 
have two very significant conferences going, on authorization 
and appropriation.
    So I plead with you and everybody in the administration to 
weigh in, because we can talk about all of this conceptually, 
we can appropriate the money for it, and we assure our allies 
that we're contributing the billion dollars for, but I'm here 
to tell you it has stopped. It has stopped because our own 
bureaucracy, our own congressional machinations, our own 
micromanagement at the staff level stops it.
    Now, I've found that the Russians have the same problems. 
And when I visited with Minister Ivanov in Defense and we 
reviewed all the stymies that I had had during my Russian 
visits, including difficulty in getting into the Kirov 200, 
including their stiffing us on an anthrax strain they promised 
to send to us. He pledged to get into the bowels of the 
bureaucracy. He understands the gravity of the situation. The 
President of our country understands the gravity. But somewhere 
down in the bowels of the situation, the worker bees are trying 
to undermine all of this.
    So it's tough work, and I appreciate that, and you are one 
of these that has to deal with this at all levels in your 
negotiations, and you've done so very well. But I make this 
plea at the outset, because I think it's relevant.
    Now, I would also mention that you have discussed the 
possibility of other countries, in addition to the G-8, getting 
involved. this is very important, because they could and 
should. However, the success of the G-8 is, of course, of the 
essence in enticing others and giving some confidence that we 
have a structure.
    As you pointed out an umbrella agreement is crucial to our 
success. Without the right protections on liability/taxation 
issues that we have continually had to wrestle with and which 
we have to wrestle with in behalf of out G-8 friends and 
others, the chances of success plummet. Norway and other 
nations are facing similar problems. So that's a problem, but 
hopefully not insuperable. President Putin, as you and others 
have testified, certainly pledged in Canada to go about this 
and presumably will try to make that happen.
    My basic question is, can you develop a plan or a chart 
that illustrates the contributing countries, their monetary 
commitments over the next 10 years and the progress they will 
sponsor as a part of the existing threat. I understand that 
appropriations can't be guaranteed, governments change, but can 
we start applying allied commitments to the threats and 
dismantlement requirements. We could fill in ours, at least 
conceptually, $10 billion across the chart. And then you can 
drop down to Great Britain. As I have mentioned, their Under 
Secretary of Defense, the comparable one in their ministry, 
says $750 million. The French are still uncommitted, as far as 
I can tell, so question marks across. But, it seems to me, you 
know, bit by bit, for our purposes of oversight, we would like 
to see who is living up to their commitments and where the 
priorities lie.
    Now, as you say, there's a lot of work to be done. For 
example, Russian general purpose submarines. I visited the 
Nerpa shipyard, near Murmansk, in August. The shipyard 
director, wants to destroy 150 general purpose submarines. Now, 
a lot of countries all around want that to happen, too. While 
all of the so-called Nunn-Lugar equipment is there: the cutting 
machines, the bailors, et cetera because you can do it fairly 
economically. But we have no authority to do that now.
    The Cooperative Threat Reduction can dismantle the 41 
strategic subs: no more, no less. I had to say that in a public 
forum with national television broadcast back in Moscow, that 
we would not pay to dismantle these submarines. We had to. We 
don't have the authority. But, in fact, it's in our general 
strategic interest, as well as in terms of the nuclear 
situation, to extract that fissile material and dismantle the 
sub.
    The other day, USEC celebrated the delivery of 150 tons of 
low enriched uranium taken from nuclear warheads. This is part 
of a deal to eliminate 500 tons of material. This comes at a 
time when fears about Iraq and Saddam getting a few pounds of 
fissile material, not tons? There is plenty out there in the 
world. It'll be out there in the world if we don't take care of 
the general purpose subs.
    And so I appreciate that you and those who crafted this 
agreement understood these threats and the need to respond to 
them. There is grave suspicion in the Nordic states the 
Russians may already have dumped something in the past, in 
terms of nuclear cores. And the need to prevent this from 
occurring now or in the future really is of the essence.
    So I suppose my only basic question to you is, is it 
reasonable to try to fill in the blanks, at least in some 
suppositions of money, sort of across a hypothetical chart? 
General purpose submarines might be one category. Tactical 
nuclear weapons might be another, which is a priority as 
Secretary Powell testified. And maybe there are others that the 
administration will want to put forward.
    So I've offered a list of ten. That's just for sake of 
argument, to, sort of get it going. What are our priorities? 
What are anybody's priorities? And what should we fill in to 
the chart?
    Mr. Bolton. Right. Well, I think that is one of the 
critical questions. Some of the countries in the G-7 have given 
us notional amounts that they've asked not be made entirely 
public yet. Others have not really given us a number at all, or 
certainly not given us a number that you could consider 
satisfactory, looking at the general size of their economies 
and so on. And we will continue to work on getting the--both 
the public commitment and the necessary followup.
    For a number of them, one of the major inhibitions is the 
point I mentioned a moment ago about the difficulties they've 
had in prior projects in states of the former Soviet Union, 
particularly Russia where, being unable to show progress on 
these earlier appropriations, they have found resistance at the 
political level at home to trying to get more appropriation. So 
that's why getting these what seem to be, sort of, nitty-gritty 
issues of liability and audit and access resolved is critically 
important----
    Senator Lugar. Very important.
    Mr. Bolton [continuing]. Not just to make our books look 
pretty, but to free up the existing money that's tied up, and 
then to be able to induce parliaments to see the worth of 
appropriating additional money.
    In terms of the priorities, you're obviously quite familiar 
with things we've been doing. I'll maybe leave it to my 
colleagues to talk about what the different programs are moving 
ahead on. I think some of the other countries are beginning to 
establish their own priorities. I think there's a lot of 
interest in President Putin's two highest, that being chemical 
weapons destruction and general purpose submarine 
dismantlement. So I think there will be a lot of interest in 
that.
    We have problems. We see lack of funding in, for example, 
the plutonium disposition field where there's a much larger 
need than we can currently see filled. Some governments, like 
Germany, don't want to get into plutonium disposition questions 
at all. That's obviously their prerogative, and they've just 
had an election, which I'm sure will confirm that policy, but 
we see that as an area that could certainly use substantial 
additional work.
    I think, given that we've got countries that are relatively 
new to this, we have to give them a certain amount of time to 
talk about where they want to focus their efforts. Again, 
Canada comes to mind as a country that's moving very 
aggressively, working with us, looking to see where they can 
add on, where they might have a special role for themselves. 
And I think as others proceed along, that we'll be in a better 
position to answer your question.
    But the kind of chart you're talking about is very much on 
our minds. And, with your permission, I will give the top 10 
list, not only back to our executive branch, but to the other 
G-8 partners, as well.
    Senator Lugar. I'd be very pleased if you would do that 
and, likewise, I expect the committee will, at least 
periodically, ask you and others to testify about this so that 
we have some flow of information. After this initial 
enthusiasm, the follow-through becomes tedious, and we don't 
mean it to become that way, but I think it is important.
    Mr. Bolton. It's very important, because when the G-8 is 
successful, it's as an incubator of ideas that then tend to run 
on their own. But on something like this that's a little bit 
far afield from some of the things that they've done before, I 
think it's important that we keep attention at the leader 
level. That's why a French commitment is so important coming 
into this next Presidency.
    But I think as you and other members of the committee are 
meeting with officials from the other G-8 countries, the 
expression of your interest, obviously, gets their attention, 
so that would be helpful, as well. And we will figure out a way 
to keep you informed on a regular basis. I think that's----
    Senator Lugar. That would be great.
    Mr. Bolton [continuing]. Very much in everybody's interest 
to do that.
    Senator Lugar. Let me just ask one more thing, and it's 
really a request for your department to try to think ahead. 
Recently, under the work of the Nuclear Threat Initiative that 
my former colleague, Sam Nunn, now heads, about $5 million of 
private funds that came from the Nuclear Threat Initiative was 
spent, along with $2-plus million funds from our Department of 
Energy, to take fissile material from Belgrade, Yugoslavia, to 
Russia. It was significant, and perhaps you were responsible 
for the opening in Russia. Again, Russia has not been willing 
to accept the spent fuel or other fissile material in such 
endeavors for many years, but did so on this occasion, perhaps 
because President Putin has given the authority. So that was 
important.
    As it was reported, about 1,500 Yugoslav soldiers were 
involved in guarding the highways, the airports, as well as the 
site, and it was perceived as a dangerous operation, as 
movement of this and other proliferation threats would be. But, 
for the moment, it meant Yugoslavia had decided not to indulge 
in any fantasies with regard to nuclear capabilities. It was 
important. And there are 24 more sites around the world, as I 
understand, identified by the State Department as probably 
worthy of similar attention.
    Now, one of the problems that is still a hangup in the 
conference with the House is the authority requested, in fact, 
by the Defense Department. At their request, I offered an 
amendment, and it was adopted in the Senate legislation, to 
give the administration at least authority to shift as much as 
$50 million of Nunn-Lugar funds quickly, if necessary, to 
emergencies where we are involved in the war against terrorism 
if proliferation problems are perceived. The current 
legislation says Russia and the former Soviet Union only.
    Strangely enough, in the House, there is resistance to even 
this degree of flexibility in the midst of the war on 
terrorism, despite administration testimony by Secretary 
Rumsfeld, Secretary Powell, and others, which is almost 
inconceivable to me. But, nevertheless, inconceivable or not, 
it's happening. Right now. So I ask you once again to think 
about that.
    Now, second, I would hope that the State Department, and 
maybe Defense, too, will have suggestions as to how flexibility 
for the administration in all of these things might come about, 
how many of the past restrictions imposed over 11 years of 
Nunn-Lugar are still worthy of consideration and which really 
have been rendered obsolete.
    There were times, 10 or 11 years ago, where many Members of 
Congress said, ``Not a penny for the Russians. We will throw up 
almost every barrier conceivable to make sure they don't get a 
dime.'' And there are some who may still have that point of 
view. You're not one of them, nor is the chairman or myself. 
We're trying to think constructively, how we work with Russia 
to gain their cooperation in addressing these threats. Their 
cooperation is necessary if this G-8 program is going to work.
    So I would like to work with you, and I'm sure the chairman 
would, too, in trying to think through legislation next year 
that clears away some of the bramble bushes, but, even more 
importantly, thinks about how this administration could be more 
effective in the war against terrorism, given the locus of this 
material in so many places, so that you have the necessary 
powers at your disposal. Because, for the moment, there will 
not be another $5 million coming from the Nuclear Threat 
Initiative. The other 24 places are still out there, but 
somehow our Government--State, Energy, Defense, whoever--will 
have to help deal with that and, prayerfully, will do so.
    Mr. Bolton. Well, I think we would look forward to working 
with you on those questions, and, indeed, my colleagues have 
been considering what to do on those other----
    Senator Lugar. Great.
    Mr. Bolton [continuing]. 24 locations. And I feel certain 
that President Bush and President Putin will be addressing this 
as a priority in just a couple of weeks at the APEC Summit.
    Senator Lugar. That'll be good news.
    Mr. Bolton. They will be meeting again on it.
    Senator Lugar. Thank you very much.
    Mr. Bolton. Thank you.
    The Chairman. I know you have to go; I have just two more 
questions if I may, Mr. Secretary. Senator Lugar said he is 
perplexed by the House inaction. I find it absolutely 
astonishing, in the years that I've been here, how, either the 
left or the right would push, in the political context of the 
Congress, and then all of a sudden you'd find them taking 
action completely contrary to their overall objective.
    Now, the very people who are for the broadest authority to 
go after Saddam Hussein are reluctant to deal with the very 
thing that our intelligence community tells us is the greatest 
risk, which is his ability to get hold of fissile material. 
There is a reluctance to give the Defense Department the 
flexibility, and right to waive conditions, so as to be able to 
do the kinds of things which will at least make it more 
unlikely that he would be able to purchase or steal the very 
thing everyone says that, if he stole or purchased, would leave 
us in real trouble. I mean, I find that mind-boggling.
    But one of the things I want to ask you about, and it's 
sort of an offshoot of that, is the bureaucratic recalcitrance, 
once you get below Putin, to carrying out Nunn-Lugar and/or any 
new initiative in the 10 + 10, with each country involved. The 
other seven countries are essentially adopting their own Nunn-
Lugar-type program here. And once you get below the very top 
level in Russia, we find these roadblocks that are thrown up 
that are, you know, either old apparatchik hangovers or 
bureaucratic inertia or whatever it is, and that's on one side 
of the equation.
    On the other side of the equation, there is the second 
reality: Russia has no money. I mean, we're in a circumstance 
where the intelligence community indicates to us--and I'm not 
revealing anything that's classified--we're talking about a 
modest military budget and a total budget for all the Russian 
Federation of around $30 billion. And that's a reality, as 
well.
    Now, I find it suspect when the phrase is used, ``what we 
expect from the Russians financially.'' That is part of the 
equation here in determining whether or not we and our G-7 
partners go forward with this roughly $20 billion commitment 
over 10 years.
    Can you flesh out for us any more, what dialog in Canada 
took place relative to what is at least a generic expectation 
of Russian financial contributions? I'm not talking about 
removing roadblocks. I'm not talking about liability insurance, 
tax issues. I'm talking about direct Russian appropriations. I 
assume that's what we mean by ``what we expect of Russia 
financially.'' Is that correct?
    Mr. Bolton. Right.
    The Chairman. Can you flesh that out a little for me? What 
are we, in broad proportions--if we're talking about spending 
$20 billion as a world community, G-8, over the next 10 years, 
what are we looking for Russia to, quote, ``spend'' over that 
same period? Do we have a sense of that? Can you help me out?
    Mr. Bolton. We have not put quantitative assessment to that 
yet.
    The Chairman. I didn't think you did. I'm just trying to 
get a notion.
    Mr. Bolton. Right. What we have in mind, though, is for 
them, for any kind of projects like those we're talking about, 
to bear associated local costs. I think I mentioned earlier the 
local infrastructure in connection with the Shchuch'ye chemical 
weapons destruction facility, and there are other such things 
that we would expect them to be forward-leaning on.
    And I should say we also need them to avoid the kind of 
problem that we had on the missile fuel facility that we 
constructed that's been the subject of press reports, in which 
Secretary Rumsfeld put very directly to his counterpart several 
months ago when he was here, about how that money had actually 
been used for something else. Now, that's still being 
considered and discussed. It was troubling when we found out 
about it. At least the Russians admitted it. We're going to 
have to deal with it. I don't need to tell you that that can 
cause political difficulties in explaining that we're 
appropriating all of this money, some $1 billion a year, and 
finding that maybe it's not actually going for the purposes for 
which it was intended. I think the Russians understand the 
seriousness of that point.
    But I did not mean to suggest, and I don't think you meant 
to ask, you know, are we asking for the same amount from them 
or something like that.
    The Chairman. No, I just want to get a sense because, as 
you know, John, there are still--it is a diminishing number, 
but there are still--a number of Senators and Congressmen who 
believe that this is fungible money and, therefore, we 
shouldn't be involved in this at all. There are still those who 
truly believe that we just shouldn't be involved in this at 
all, because whatever money we spend, they, quote, ``won't 
spend,'' and they'll do bad things with the money that they 
save.
    I'm not belittling the argument; I'm just outlining it. And 
so what I hope we can avoid is, a year from now, when we're 
analyzing what progress has or hasn't been made, the assertion 
that, well, the Russians didn't put up their share, and it be 
something that is either unrealistic, unreasonable, or beyond 
their capacity, even if they had the will. It's a different 
thing if there are diversions of those moneys. It's a different 
thing if there is no willingness to participate in any way, 
when they could and it's clearly within their means to do it. 
That's the reason I asked the question.
    Mr. Bolton. Right. And I think it does tie in with this 
question of the guidelines and the transparency and the audit 
rights and the rest of it, because other countries that don't 
have the kind of sophisticated, not to say complex, programming 
mechanisms that we have that might make contributions directly 
to the Government of Russia, might find themselves in some 
difficulty if they couldn't explain how that money has actually 
been expended. And I think they recognize that, and that's one 
of the reasons why, not only, obviously, did we want these 
guidelines because of our umbrella agreement, we felt it was 
critical to get them so that the other G-7 members would have 
the protections that we have essentially had these last 10 
years.
    The Chairman. Well, I thank you. You've been generous with 
your time. You told us ahead of time you had a meeting with the 
boss downtown, and we'll accommodate that. But I have about a 
half dozen questions for the record. They're just expansions on 
some of what the Senators have already asked you.
    The distinguished Senator from Florida says he does not 
have any questions for you.
    Senator Nelson. I will submit some to you in writing, as 
well.
    The Chairman. We thank you very much, Mr. Secretary, for 
being here, and we wish you God speed on making sure we're able 
to take this very promising development, which you are 
responsible for in the administration, and turn it into 
something that will actually make us safer.
    Mr. Bolton. Well, I appreciate that, Mr. Chairman. And, as 
I said earlier, we're pleased to work with the committee in 
terms of priorities as they develop and making sure that you 
are supplied with information about what the Global Partnership 
is doing and we would be happy to come up at whatever time is 
convenient and keep you and your colleagues briefed on it.
    The Chairman. Speaking only for myself, but I expect it 
would even be a greater commitment if this chairmanship 
changes. The single highest priority this committee is going to 
focus on, if I am chairman, for the next year will be the whole 
notion of cooperative threat reduction. We know, that 
international events intervene and we must respond, and we're 
going to have a lot else going. But this, to me, is the single 
most significant and potentially most promising thing that we 
could do in order to enhance the prospect that we avoid the 
most disastrous consequence: weapons of mass destruction ending 
up in the hands of non-nation states or nation states that are 
rogue states.
    So we're going to be spending a lot of time on this, and 
I'm positive, if my friend is the chairman, that that will be 
the case.
    Mr. Bolton. I won't comment on that.
    The Chairman. But, either way, either way, this is 
something we're going to, on a frequent basis, be focusing on.
    But thank you very, very much.
    Mr. Bolton. I look forward to working with both of you and 
the entire committee.
    Senator Nelson. Mr. Chairman, I would just add, thank you--
and I know Senator Lugar feels the same way--about the focus of 
the committee. Take, for example, as we've approached this 
question of the vote this week on the Iraq resolution, we know 
Saddam Hussein has the chemical and biological weapons, we know 
he's trying to develop nuclear weapons, and what do we hear 
over and over from all of the experts? It is that if he's got 
to develop it himself, it's going to take some number of years; 
but if he gets the fissile material from elsewhere, he can do 
it in a matter of months.
    And so what better proof do we have than the debate we're 
having right now that this is one of the most important things 
that the United States can do, is to stop the proliferation.
    The Chairman. Thank you, Senator.
    We thank you for your leadership, John.
    Mr. Bolton. Thank you. Thank you, Mr. Chairman.
    The Chairman. And we look forward to working with you.
    Mr. Bolton. Thank you.
    The Chairman. Now, our second panel is the Honorable John 
S. Wolf, Assistant Secretary of State for Nonproliferation, 
U.S. Department of State; Lisa Bronson, Deputy Under Secretary 
of Defense for Technology Security and Counter-Proliferation, 
the Department of Defense; the Honorable Linton Brooks, Acting 
Administrator of the National Nuclear Security Administration, 
U.S. Department of Energy.
    And then we'll have a third panel, I say to those who are 
in the audience, with two additional witnesses whom I'll 
introduce at that time.
    Secretary Wolf, if you would begin, we would appreciate it.

 STATEMENT OF HON. JOHN S. WOLF, ASSISTANT SECRETARY OF STATE 
   FOR NONPROLIFERATION, DEPARTMENT OF STATE, WASHINGTON, DC

    Mr. Wolf. Thank you, Mr. Chairman, and I thank the 
committee for the support that you give on these vital 
programs.
    Under Secretary Bolton has already talked about the big 
picture of the Global Partnership and the importance that it 
has and the possibilities that it has, and I'm not going to try 
and duplicate that discussion except to say that there's still 
work to do, first, within the G-8 to make sure that we're 
actually able to use the guidelines to accomplish the kinds of 
purposes that the leaders set at Kananaskis, and then to expand 
the effort to include other donors.
    I guess I should have said at the outset, I have a 
statement, and I'll just paraphrase parts of it and then leave 
the rest for questions.
    So I would start by saying that the Global Partnership, 
though, is also--is more than a fundraising effort, and it's 
very important to remember that at Kananaskis the leaders 
incorporated a set of principles that all the partners signed 
up to, and we actually use those principles to help shape the 
way in which we, at the State Department and in the inter-
agency, focus our worldwide efforts. And it's important to 
think of the Global Partnership and remember the word 
``global,'' because it does have application beyond Russia and 
the former Soviet Union.
    So we use the principles within State to organize efforts 
that are related to curbing the supply of weapons of mass 
destruction, missile technology expertise and materials, to 
interdict weapons of mass destruction in international 
commerce, to restrain programs, to curb demand, to strengthen 
the international treaties and export groups and the norms, and 
also to improve cooperation on nuclear safety and security.
    In that context, for this purpose, I'll talk largely about 
how we're working on supply possibilities, things that are 
related to curbing supply. And there, State, DOD, and, 
increasingly, Treasury all have roles to play. Let me talk a 
little bit about what we do.
    First, the International Science Centers in our biological 
and chemical engagement, designed to keep Russian and Eurasian 
scientists from working for terrorists or proliferant states. 
We use numbers that are very significant, when we talk about 
this. We have, at one time or another, engaged 50,000 
scientists. I think it's important, impressive though that 
achievement may be, to remember that this is only a fraction of 
the total population or the total man-years, when you look at 
it over 10 years, if there were 50,000 to 70,000 weapons of 
mass destruction scientists, 10 years is 700,000; or 50,000 is 
a fraction. We are working to expand that effort. We need to do 
it ourselves, and the Global Partnership anticipates that our 
partners will also do more on the Science Centers in biological 
and chemical engagement.
    We're also, importantly, working with U.S. businesses to 
accelerate the transitions of the Science Centers work from 
stopgap efforts to things that will enable the Science Centers 
to promote long-term fixes and to enable the labs to get onto 
long-term sustainable work that will provide peaceful private 
sector jobs for these former Soviet Union scientists.
    We began the Bio-Industry Initiative to work with our 
Russian partners to reconfigure former Soviet biological 
weapons production facilities, engage more of the scientists in 
collaborative R&D. They're working on a variety of things: 
accelerated vaccine and drug therapy for highly infectious 
diseases, such as drug-resistant tuberculosis. There are a 
variety of opportunities for U.S. and Russian industry, and 
we're looking to develop a sustainable Russian biotech 
industry.
    Congress has given us other tools that include the 
reauthorization of the Soviet Scientists Act that was included 
in the State Department authorization. And this will provide a 
way in which we can enable former weapons scientists to 
emigrate to the United States and work with our scientific 
community instead of being at risk for proliferant states.
    We have a variety of anti-smuggling efforts that we conduct 
with our colleagues from the Department of Energy, Defense, 
Commerce, and this is an important focus of the State 
Department's work. We oversee an interagency effort that draws 
on our worldwide presence and DOE's extraordinary analytic and 
technical capabilities. We marry these up in our work with 
local law enforcement officers, and it's designed to stop the 
risk of nuclear smuggling, roll up rings of criminals that are 
engaged in the activity.
    You read lots of reports; there was another report today 
about 27 tons of uranium. Most of these turn out to be scams or 
to be legitimate commerce, and the one today, according to our 
reports and the IAEA's, was a paperwork problem, not an illegal 
effort.
    Another important part of our strategy is to work on export 
control programs and to assist states that need to shore up 
their capabilities to prevent and stop smuggling. Effective 
export and border controls, vigorous enforcement are all part 
of the tools that we're trying to put in place to stop the 
spread of weapons of mass destruction and their delivery 
systems. We work with a variety of agencies on this, in terms 
of equipment and in terms of technique.
    We're also working with our international partners to make 
clear that export controls not only cover things, but they 
cover the technology, the intangibles, the data and the 
intellectual property that a lot of proliferant states are 
trying to get. They find that they can get the dual use 
technology that they need, but what they really need is the 
scientific knowhow. And so we're trying to make sure that the 
export of that is illegal and that countries enforce those 
laws. More needs to be done.
    We're working to interdict weapons of mass destruction, 
missile-related shipments. We do a variety of things in the 
Australia group, the Missile Technology Control Regime, the 
Nuclear Suppliers Group. In this regard, we use diplomacy, we 
use intelligence, we use law enforcement, we use multilateral 
means, we use pluri-lateral means, and we are--and we will use 
unilateral interdiction where it is necessary to stop these 
kinds of shipments and where the opportunities present 
themselves.
    We have a rapid flexible response capability in the 
Nonproliferation and Disarmament Fund [NDF]. It works in the 
kinds of ways that we also anticipate the Global Partnership 
will. Over the past few months, NDF has helped negotiate, fund, 
and organize the removal of highly enriched uranium [HEU] from 
the Vinca Research Reactor in Yugoslavia. We have deployed 
radiation detection systems on the Turkish border with Syria, 
Iran, and Iraq. We're currently overseeing the destruction of 
SS-23 and Scud missiles in Bulgaria. There are a number of 
operations, a number of potential projects like this.
    Linton Brooks and I are working together to come up with a 
plan that will deal with the remaining 24 research reactors. 
We're working with DOE and DOD on the wider question of 
dangerous materials worldwide. We intend to assist countries to 
strengthen and modify their laws, regulations, develop and 
deploy tracking systems and secure stockpiles, when 
appropriate, and to remove materials when necessary.
    This is a difficult job, as you all have stated today and 
previously, and we thank you for the support that you give. It 
requires active diplomacy. The facilities we often want to see 
are very sensitive facilities, and host governments are 
reluctant to let in either our program officials or visiting 
Senators.
    That said, Senator Lugar, I know you're interesting in 
getting access--you were interested in getting access to the 
bioweapons facilities in the Kirov area you mentioned earlier. 
We are, too. And so we have just made an initial--we've got 
some initial entree now to the Kirov 200 BW facility, and we 
are working on the production of drugs to combat multidrug-
resistant tuberculosis. It's a small first step, but journeys 
all start with a small step.
    Global Partnership: big opportunity. We intend to work with 
our international partners to deal with the problems of weapons 
of mass destruction, as you said and as Under Secretary Bolton 
said. We've been doing a lot. We're trying to do more, but we 
think that our partners have an important role, and that's why 
10 + 10 over the next 10 years provides an opportunity to 
engage a greater degree of focus by our G-8 and other partners.
    Thank you very much.
    [The prepared statement of Mr. Wolf follows:]

 Prepared Statement of Hon. John S. Wolf, Assistant Secretary of State 
               for Nonproliferation, Department of State

    Good morning, Mr. Chairman and members of this Committee. It is an 
honor to appear before you with my colleagues from the Energy, and 
Defense Departments. The Administration relies on these three agencies 
to work together to combat the spread of weapons of mass destruction 
and dangerous technologies.
    Under Secretary Bolton has given you the big picture on the Global 
Partnership initiative. It provides a golden opportunity to leverage 
our own threat reduction programs, and to galvanize long overdue 
international support to deal with the WMD proliferation.
    While the Partnership's initial focus is on Russia and Eurasia, 
there is a basis for the partnership to operate more broadly. But, the 
first task is to build G-8 support--this includes gaining financial 
commitments and designing projects. And, Under Secretary Bolton said 
Russia bears significant responsibility to assure that the projects can 
be implemented under the guidelines and also to use its own resources 
to help accomplish the tasks.
    My staff and I have been active diplomatically first to rally 
support among the G-8 for the Partnership concept and then to maintain 
it. While we still need to do more with our G-8 partners, I hope we 
will soon be able to approach other countries outside the group to seek 
their contributions to this effort as well. I suspect we will have 
better chances when we have cleared away some of the implementation 
issues discussed at the G-8 Senior Officials meeting in Ottawa last 
month.
    The Global Partnership is more than a fundraising effort--it 
includes a set of core nonproliferation principles that all the 
partners signed up to. We use these principles within State to organize 
efforts to:

   Curb the supply of WMD and missile technology, expertise and 
        materials

   Interdict WMD transfers

   Restrain WMD programs

   Strengthen WMD norms, regimes, and treaties, and

   Promote nuclear cooperation in the context of safety and 
        security

    In the context of the Global Partnership, we are focusing largely 
on curbing supply possibilities. State, DOD and, increasingly, Treasury 
all have roles to play in this effort. Let me talk a bit about our 
efforts at State.
    First, through the International Science centers and bio and 
chemical engagement, we are keeping Russian and Eurasian scientists 
from working for terrorists or proliferant states. The break-up of the 
USSR left thousands of former WMD scientists and engineers without a 
future. After ten years of effort we estimate that we have engaged half 
of them, at one point or another. But impressive though that 
achievement may be, the fact is that the science center projects 
account for only a fraction of the projected weapons scientist man-
years available--we are expanding our efforts and persuading others to 
do likewise. More importantly, we are working with U.S. businesses to 
accelerate the transition of science center work from stopgap measures 
to long-term fixes built on new, sustainable, peaceful, private sector 
jobs for these former Soviet weapons scientists.
    Recently, we began the Bio-Industry initiative to work with our 
Russian partners to reconfigure former Soviet biological weapons (BW) 
production facilities and engage more Soviet biological and chemical 
Weapons scientists in collaborative R&D projects for the purpose of 
accelerated vaccine and drug therapy development for highly infectious 
diseases such as drug resistant tuberculosis. Our strategy in this area 
is to create new Russian-U.S. Industry partnerships as well as help 
develop a sustainable Russia biotech industry.
    Congress has given us other tools to prevent proliferation of WMD 
expertise. The reauthorization of the Soviet Scientists Act included in 
State's authorization legislation will provide a way for former weapons 
scientists to immigrate to the United States and work with our 
scientific community instead of to proliferant states.
    Our anti-smuggling efforts, conducted with our colleagues from the 
Department of Energy, Defense, and Commerce, are another important 
focus. We oversee an interagency effort that draws on State's worldwide 
presence and DOE's extraordinary analytical and technical capabilities. 
We marry up these capabilities with local law enforcement to detect 
nuclear terrorism and roll up rings of criminals engaged in scams. For 
example, in 2000, State facilitated the safe retrieval of the HEU 
seized at a border checkpoint in Rousse, Bulgaria. The HEU underwent 
nuclear forensic analysis at Lawrence Livermore National Laboratory. 
This case was linked to other cases and law enforcement and 
intelligence authorities are continuing to follow-up on it.
    Another important part of our strategy is our export control 
program which assists states that need to shore up their capabilities 
to prevent and stop such smuggling. Effective export and border 
controls, combined with vigorous enforcement, are crucial tools in 
stemming the proliferation of WMD and their delivery systems. We are 
working with implementing agencies such as the Departments of Commerce 
and Energy and the U.S. Customs Service to ensure that potential 
supplier countries have proper controls on exports, and that transit 
and transshipment countries in the region have the tools to interdict 
illicit shipments crossing their territories. Potential source 
countries remain our highest priority. But even as we work with them on 
export control lists, we find a number of countries still lack the 
trained personnel and enforcement infrastructure necessary to carry out 
nonproliferation commitments. We are also working with our 
international partners to make clear that export controls must not only 
cover ``things'' but also intangibles, such as data and intellectual 
property. And in fact, more needs to be done.
    We're putting considerable effort into the interagency effort we 
lead to strengthen enforcement, and have recorded measurable success. 
In several NIS states, U.S.-trained officials, using U.S.-provided 
detection equipment, have made seizures of potentially dangerous 
radioactive materials. In one Caspian basin country, U.S.-trained 
officials detected a shipment of military equipment bound for a 
suspicious end-user in the Middle East. Following consultation with our 
in-country Export Control and Border Security program advisor, the 
equipment was detained. But much more needs to be done in Central Asia, 
as well as countries like Russia, China, India, and the countries in 
Southeast Asia.
    State is also working to interdict WMD- and missile-related 
shipments of concerns to proliferant states. We work very closely with 
our partners in the Australia Group, Missile Technology Control Regime, 
and the Nuclear Suppliers Group to prevent shipments of concern from 
reaching CEW, missile and nuclear, programs around the world. We use 
diplomatic, intelligence, and law enforcement channels as appropriate 
to disrupt the flow of raw materials, production equipment and 
technological know-how to these programs.
    I should also add that State maintains a rapid, flexible response 
capability to respond to emerging dangers. Our Non-proliferation and 
Disarmament Fund (NDF) supplements initiatives such as the Global 
Partnership that focus on Russia and the NIS by providing similar 
capabilities worldwide. Over the past few months NDF helped negotiate, 
fund and organize the removal of HEU from the Vinca Research Reactor in 
Yugoslavia; deployed radiation detection systems on Turkish borders 
with Syria, Iran and Iraq; and is currently overseeing the destruction 
of SS-23's and SCUD missiles in Bulgaria.
    Sadly, many sites like Vinca pose a proliferation danger. Over the 
next several months, the NDF working with DOE will begin work to 
protect dangerous material worldwide. This initiative will assist 
countries to strengthen and modify their laws and regulations; develop 
and deploy automated means of tracking inventories and shipments of 
these materials; secure stockpiles; and when necessary, remove 
dangerous materials from insecure locations.
    State recognizes that advancing nonproliferation in Russia and the 
NIS is difficult. As members of this committee can attest, much of this 
work involves increasing the security of facilities so sensitive, host 
governments are reluctant to let in either U.S. program officials or 
congressional delegations. That said, we have made a lot of progress 
with a very small budget. Senator Lugar, I know you were interested in 
getting access to bio-weapons facilities in the Kirov area. We are too. 
For example, we have begun discussions with the Kirov 200 BW facility 
on the potential production of drugs to combat multi-drug resistant 
tuberculosis. We hope this is the first step toward greater engagement 
of scientists and facilities in that region.
    Global Partnership provides us an opportunity to spread the burden 
and expand the scope of these non-proliferation effort, and State will 
aggressively move ahead to increase international support for the 
initiative while vigorously pursuing the programs we already have 
underway.

    The Chairman. Secretary Wolf, I thank you, not just for 
your statement, but for your enthusiasm. You sound like you're 
committed to this, which makes me feel a lot better.
    I think next would be Secretary Bronson. Welcome.

 STATEMENT OF LISA BRONSON, DEPUTY UNDER SECRETARY OF DEFENSE 
 FOR TECHNOLOGY SECURITY AND COUNTER-PROLIFERATION, DEPARTMENT 
                   OF DEFENSE, WASHINGTON, DC

    Ms. Bronson. Thank you.
    Thank you for inviting me to discuss the Department of 
Defense Cooperative Threat Reduction program and how the CTR 
program can support the G-8 Global Partnership against the 
spread of weapons and materials of mass destruction. I have 
submitted a written statement, so I will keep my remarks this 
morning brief.
    The Chairman. Your entire statement will be placed in the 
record.
    Ms. Bronson. The Department of Defense's Cooperative Threat 
Reduction program has helped to reduce WMD and WMD 
infrastructure. It has improved accountability for WMD and 
improved the storage and transport security of WMD. In 
addition, the CTR program has helped provide secure storage for 
weapons-grade fissile material.
    The Global Partnership offers a means to accelerate and 
expand this effort. In today's security environment, CTR's 
technical and regional expertise will serve well the global 
security cooperation we envision that our G-8 partners can 
undertake and help sustain our longstanding commitment to work 
with other countries to prevent the proliferation of weapons of 
mass destruction.
    With over a decade of CTR experience, success, and lessons 
learned, the Department is prepared to work with our G-8 
partners to help them address implementation and government-to-
government procedural issues that may have blocked expenditure 
of nonproliferation and threat reduction funding. The CTR 
umbrella agreements we have negotiated with the FSU states, 
with their liability protections, exemption from taxation, and 
access to work sites, offer an excellent template for the 
assistance contemplated by the Global Partnership.
    We hope that this interaction will promote a coordinated 
effort between the G-8 partners that is beneficial to the 
recipient nations. We are confident that a common approach to 
the challenging implementation issues will strengthen our 
efforts of each participating party.
    To ensure a coordinated and mutually reinforcing effort, it 
is vital that DOD and others share the lessons we have learned. 
For example, the administration has developed more stringent 
guidelines for cooperative research with Russia on dangerous 
pathogens in response to our continuing concerns over Russia's 
commitment to comply with the biological weapons convention. 
These guidelines should be shared with other donor states if 
they are to decide to fund similar research.
    We have invested over $229 million in the design and site 
preparations for the chemical weapons destruction facility. The 
President's budget has requested $126 million for fiscal year 
2003 to construct the pilot plant.
    The Chairman. I beg your pardon, Madam Secretary, how much 
did you say that was? Requested how much?
    Ms. Bronson. The request is $126 million, sir.
    The Chairman. Thank you.
    Ms. Bronson. We are working with Russia on meeting 
congressionally mandated conditions so that construction can 
begin. We intend to continue to press Russia to address the 
concerns embodied by these conditions. However, as Dr. Rice 
stated in her July 30 letter to Senator Lugar, at a minimum, 
the information gathering process will be very time-consuming. 
But the proliferation threat gives us no time to delay. 
Therefore, the Department joins Under Secretary Bolton in 
urging that Congress approve the administration's request for 
authority for the President to waive these conditions if he 
deems it is in the national interest.
    Given the magnitude of the effort required, it is critical 
for other donor states to invest heavily in this effort if 
Russia is to eliminate all of its CW stocks by 2012.
    We are working with other donors to identify the work and 
to break it down into pieces that they can afford to fund. Thus 
far Canada has committed nearly $4 million to this effort. The 
United Kingdom is providing up to $18 million, and Italy 
approximately $7 million. Germany has already committed $1.3 
million and has also built a blister agent destruction 
facility. The EU has committed $1.8 million in 2001. Other 
states, including Netherlands, Norway, Sweden, and Switzerland, 
will provide additional money for chemical weapons destruction.
    DOD has developed an effective and efficient means to 
eliminate WMD intercontinental delivery systems. Several 
nations have indicated that they are interested in eliminating 
shorter-range WMD delivery systems. We are prepared to share 
with them what we have learned about the capabilities of a 
variety of Russian enterprises involved in this area. We are 
also prepared to share the numerous contracting procedures, the 
rules of thumb that we have learned work best, such as 
insisting on fixed-price contracts with recipient country 
contractors, with pay after the work is completed, and unique 
government cost-estimating experience.
    The Chairman. You sound like you've tried to build a home.
    Ms. Bronson. Whether it be responding to a specific 
proliferation threat keeping WMD and related technologies out 
of the terrorists' hands, or other scenarios, the Comprehensive 
Threat Reduction program has a key role to play in securing 
U.S. interests and in more actively engaging our G-8 partners 
to accelerate the proliferation prevention solutions to the 
issues that affect the entire international community.
    Once again, congressional support for these efforts is 
essential. As Under Secretary Bolton has testified, we are 
seeking, in the Defense authorization bill, congressional 
approval of the authority for the President to waive the annual 
certification requirement. In this, and in all of our CTR 
endeavors, we look forward to working with the Congress, which 
has played such an important role in founding and improving 
this program.
    Thank you very much.
    [The prepared statement of Ms. Bronson follows:]

 Prepared Statement of Lisa Bronson, Deputy Under Secretary of Defense 
           for Technology Security and Counter-Proliferation

    Thank you for inviting me to discuss the Department of Defense 
Cooperative Threat Reduction (CTR) Program and how the CTR program 
supports the G-8 Global Partnership Against the Spread of Weapons and 
Materials of Mass Destruction.
    The Soviet Nuclear Threat Reduction Act of 1991--the Nunn-Lugar 
Act--charged Department of Defense (DOD) with establishing a program to 
assist the Soviet Union and any successor state to destroy, safeguard 
and prevent the proliferation of weapons of mass destruction (WMD). 
Following the negotiation of the Umbrella Agreements with Russia, 
Ukraine, Kazakhstan, and Belarus by the State Department, the DOD 
created the CTR program to implement the Nunn-Lugar Act. Subsequently, 
Moldova, Georgia, and Uzbekistan were added to this program. Through 
CTR, the U.S. has assisted these states to dismantle, consolidate, and 
secure WMD and their associated delivery systems, infrastructure, and 
technology. CTR's defense and military cooperation with these states 
has also furthered the objective of preventing proliferation.
    Sustained support from Congress will remain essential as DOD 
completes its ongoing programs to destroy or secure WMD in the States 
of the former Soviet Union (FSU) and as DOD works with the interagency 
to build a self-sustaining border security program in the non-Russian 
States. In this respect, I want to take a moment to recognize the 
vision shown by Senators Lugar and Nunn in creating this program and 
continuing to support it for over a decade.
    Since 1992 DOD has obligated over $3 billion for CTR assistance. 
This investment has produced real dividends. The CTR program has helped 
deactivate 5,990 nuclear warheads and eliminate 831 ballistic missile 
launchers, 97 heavy bombers, 24 ballistic missile submarines and 815 
ballistic missiles. Belarus, Kazakhstan and Ukraine acceded to the 
Nuclear Nonproliferation Treaty in 1993 and 1994 based on promises of 
United States assistance to rid their countries of nuclear weapons. The 
CTR program helped fulfill this promise by 1996.
  dismantling fsu wmd, delivery systems, and associated infrastructure
    The potential proliferation of FSU nuclear weapons, delivery 
systems and related technologies continues to pose a threat to U.S. 
national security. Several CTR program areas assist the FSU in 
dismantling these items at their sources.
    Russia. The President's FY 2003 budget request includes funding for 
the Strategic Offensive Arms Elimination (SOAE) program area to assist 
Russia in reducing its strategic nuclear delivery systems, including 
the elimination of SS-24 and SS-25 mobile ICBM systems. We are also 
moving forward with the design and site preparation of a chemical 
weapons (CW) destruction facility at Shchuch'ye, and continuing 
demilitarization of former CW production facilities.
    Ukraine. Strategic Nuclear Arms Elimination projects have 
eliminated all of Ukraine's START-accountable nuclear delivery vehicles 
and are helping to dismantle WMD infrastructure and remaining delivery 
systems (i.e., SS-24 missiles, Tu-22M bombers, and Kh-22 nuclear 
capable air-to-surface missiles).
    Kazakhstan. We have completely eliminated all strategic arms from 
Kazakhstan. We plan to continue efforts to destroy equipment and 
facilities that were used to support the deployment and operation of 
Soviet WMD and delivery systems, including liquid missile propellant 
and a chemical weapons production facility.
    Uzbekistan. DOD conducted a CTR project in FY 2002 in Uzbekistan to 
destroy anthrax that the Soviet military buried at the biological 
weapons testing complex on Vozrozhdeniye Island there, and DOD 
completed dismantlement of the former Soviet chemical weapons research, 
development and testing facility at Nukus, Uzbekistan.
  consolidate and secure fsu wmd and related technology and materials
    DOD's CTR and DoE's nonproliferation programs support U.S. efforts 
to prevent the proliferation of FSU WMD and related technology by 
consolidating and securing nuclear weapons, fissile material, chemical 
weapons and dangerous pathogen collections. We continue to be concerned 
with the potential for theft or diversion of Russian nuclear weapons, 
and plan to complete integration and installation of enhanced storage 
site security systems, as well as secure better access to sites under 
Russian law. The two chemical weapons sites storing artillery shells 
and missile warheads are receiving security upgrades as are dangerous 
pathogen collections. In Kazakhstan we are continuing efforts to 
consolidate and secure fissile and radioactive material.
    The Nuclear Weapons Transportation Security program with Russia 
will continue assisting the consolidation of nuclear weapons from 
Russia's Ministry of Defense (MoD) operational sites to Ministry of 
Atomic Energy nuclear weapons dismantlement facilities. DOD will 
continue funding rail shipments designed to carry nuclear warheads to 
dismantlement sites, the maintenance of Russian railcars, and the 
provision of specialized emergency response vehicles and nuclear 
weapons recovery equipment to support MoD training for accidents or 
incidents involving nuclear weapons.
    We anticipate completing construction of a Fissile Material Storage 
Facility at Mayak, Russia in 2003. Once operational, it will provide 
centralized, safe, secure, and ecologically sound storage of up to 50 
metric tons of weapons-grade plutonium and 200 metric tons of weapons 
grade highly enriched uranium (HEU). The Russian Government has 
informed us of its plans to begin loading it ``with fissile materials 
derived from destruction of nuclear weapons'' in late 2003.

  SUPPORT FOR DEFENSE AND MILITARY COOPERATION WITH THE OBJECTIVE OF 
                        PREVENTING PROLIFERATION

    We are increasing our contribution to the USG effort to combat the 
smuggling of materials that could contribute to nuclear, biological, 
and chemical weapons programs. The WMD Proliferation Prevention 
Initiative is designed to enhance non-Russian FSU capabilities to 
prevent, deter, detect and interdict illicit trafficking in WMD and 
related materials, and to respond effectively to trafficking incidents 
at the border. This initiative will provide training, equipment and 
infrastructure designed to enhance recipient countries' capabilities to 
prevent WMD or related materials from falling into the hands of 
terrorists and rogue states. We are working with our interagency 
counterparts to finalize an overall U.S. government strategic plan for 
the future of WMD border security assistance to ensure that DOD's 
efforts are fully coordinated with those of other agencies. We have 
begun development of prototype projects that DOD expects to begin 
implementing in FY 2003.
            dod's role in supporting the global partnership
    The CTR program has helped: 1) reduce WMD and WMD infrastructure; 
2) improve accountability for, and storage and transport security of, 
WMD; and, 3) provide secure storage for weapons grade fissile material.
    The Global Partnership provides a means to accelerate and expand 
this effort. In today's security environment, CTR's technical and 
regional expertise will serve well the global security cooperation we 
envision with our G-8 partners and help to sustain our long-standing 
commitment to work with other countries to prevent the proliferation of 
WMD. With a decade of CTR experience, success, and lessons learned, DOD 
is prepared to work with our G-8 partners to help them address 
implementation and government-to-government procedural issues that may 
have blocked expenditure of non-proliferation and threat reduction 
funding. The CTR Umbrella Agreements we have negotiated with FSU 
states--with their liability protections, exemption from taxation and 
access to work sites--offer an excellent template for the assistance 
contemplated by the Global Partnership. We hope that this interaction 
will promote a coordinated effort between the G-8 partners that is 
beneficial to the recipient nations. We are confident that a common 
approach to challenging implementation issues will strengthen the 
efforts of each participating Party.
    To ensure a coordinated and mutually reinforcing effort, it is 
vital that DOD and others share the lessons we have learned. For 
example, the Administration has developed more stringent guidelines for 
cooperative research with Russia on dangerous pathogens in response to 
our continuing concerns over Russia's commitment to comply with the 
Biological Weapons Convention. These guidelines should be shared with 
other donor States if they decide to fund similar research.
    We have invested over $229 million in the design and site 
preparations for the Chemical Weapons Destruction facility. The 
President's budget has requested $126 million for FY 2003 to construct 
the pilot plant. We are working with Russia on meeting Congressionally 
mandated conditions so that construction can begin. We intend to 
continue to press the Russians to address the concerns embodied by 
these conditions. However, as Dr. Rice stated in her July 30, 2002 
letter to Senator Lugar, ``At a minimum, the information-gathering 
process will be very time consuming, but the proliferation threat gives 
us no time to delay.'' Therefore, we join Under Secretary Bolton in 
urging that the Congress approve the Administration's request for 
authority for the President to waive these conditions if he deems it is 
in the national interest.
    Given the magnitude of the effort required, it is critical for 
other donor states to invest heavily in this effort as well if Russia 
is to eliminate all its CW stocks by 2012. We are working with other 
donors to identify the work and break it down into pieces they can 
afford to fund. Thus far Canada has committed nearly $4 million to this 
effort, the United Kingdom is providing up to $18 million and Italy 
approximately $7 million. Germany committed $1.3 million in 2002, and 
has also built a blister agent destruction facility. The EU committed 
$1.8 million in 2001. Other states, including The Netherlands, Norway, 
Sweden, and Switzerland will provide an aggregate of approximately $24 
million for chemical weapons destruction.
    DOD has developed an effective and efficient means to eliminate WMD 
intercontinental delivery systems. Several nations have indicated they 
are interested in eliminating shorter-range WMD delivery systems. We 
are prepared to share with them what we have learned about the 
capabilities of a variety of Russian enterprises involved in this area.
    We are also prepared to share the numerous contracting procedures 
and rules-of-thumb we have learned work best, such as insisting on 
fixed price contracts with recipient country contractors, with pay 
after the work is completed, and unique Government cost estimating 
experience.

                     EMERGING OPPORTUNITIES FOR CTR

    Whether it be responding to a specific proliferation threat, 
keeping WMD and related technologies out of terrorists' hands, or other 
scenarios, CTR has a key role to play in securing U.S. interests and in 
more actively engaging our G-8 partners to accelerate proliferation 
prevention solutions to issues that affect the international community. 
Once again, Congressional support for these efforts is essential. As 
Under Secretary Bolton has testified, we are seeking in the Defense 
Authorization bill Congressional approval of the authority for the 
President to waive the annual certification requirement for the 
Cooperative Threat Reduction funding. In this and all other CTR 
endeavors, we look forward to working with Congress, which has played 
such an important role in founding and improving this program.

    The Chairman. Thank you very much.
    Ambassador Brooks.

STATEMENT OF HON. LINTON BROOKS, ACTING ADMINISTRATOR, NATIONAL 
    NUCLEAR SECURITY ADMINISTRATION, DEPARTMENT OF ENERGY, 
                         WASHINGTON, DC

    Mr. Brooks. Mr. Chairman, thank you very much, members of 
the committee. Like my colleagues, I have a statement, and, 
like my colleagues, I will truncate it, with your permission.
    You will find when you review our formal statements that 
there's a great deal of overlap. That's because we seek to 
present before you our common enthusiasm for the Global 
Partnership and our common determination to work together to 
make it succeed.
    Under Secretary Bolton has spoken about the 
administration's general support. I would just like to add, on 
behalf of Secretary Abraham, that this is a very high priority 
for the Department of Energy, as well, and he has made that 
clear most recently in his dealings at the International Atomic 
Energy Agency's General Conference.
    From the standpoint of the Department of Energy, we were, 
of course, working on proliferation well before the Global 
Partnership. Of the roughly $1 billion for nonproliferation in 
Russia for fiscal 2003, our share is about $443 million, and I 
would expect comparable figures in future years.
    We look forward, as Secretary Bolton said, to support from 
our G-8 partners. We've made substantial progress in Russia, 
but there still exists hundred of tons of poorly guarded 
weapons grade material, a large nuclear weapons complex, and 
there's still three reactors producing plutonium.
    If I may digress, we are working, as Secretary Wolf said, 
on the shutting down of various research reactors. Our next 
step in that, I hope, will occur with the return of spent fuel 
from Uzbekistan later this year. That's somewhat more 
challenging than the Vinca operation, which involved only fresh 
fuel, but we believe that the Russians have finally gotten 
their legal system in order to let this happen.
    Now, in all of these areas, if our allies choose, and we 
hope very much they will choose, they can make a substantial 
contribution. But most important, from the standpoint of the 
Department of Energy, is participation in the Russian portion 
of plutonium disposition.
    The Chairman. Plutonium disposition.
    Mr. Brooks. Plutonium, yes, sir. Gaining full funding for 
that program is crucial to our attempts to eliminate 34 tons of 
Russian weapons plutonium, which is enough for well over 8,000 
warheads.
    There are other areas where contributions by our allies 
would be particularly valuable. They would permit us to carry 
out the decommissioning of reactors in Russian Kazakhstan that 
produced plutonium, carry that out more rapidly. They would 
assist in preventing the hemorrhage of WMD expertise. They 
would assist in expediting the research reactor fuel return 
that I just mentioned. And, in particular, a relatively new 
task, we see a role for our allies in assisting in securing 
radiological sources.
    We also think that there is a value beyond the financial. 
The visible involvement of the world's leading economies in 
cooperative nonproliferation demonstrates that this is, in 
fact, a global response to a global challenge.
    Now, as Secretary Bolton mentioned, we have to be 
realistic. In agreeing this year on a Global Partnership, the 
G-8 laid the foundation, but there's a good deal of work that 
we have to do to turn promise into performance. It'll take time 
to realize the potential of this partnership. Our partners have 
to continue to match their words with financial commitments, 
and Russia has to cooperative on implementing arrangements. And 
that's a key question.
    The G-8 is committed to resolving the type of sensitive 
implementation issues that have impeded all of our efforts to 
work effectively in Russia. The guidelines call for effective 
monitoring and transparency, for exemption from taxes, duties, 
and levies, for privileges and immunities.
    In implementing our program, we have regularly run into 
problems in this area. For example, our efforts to expand down-
blending of highly enriched uranium under the Material 
Consolidation Conversion Program are being hampered by Russian 
issues that relate to taxes and liabilities and by other 
Russian bureaucratic problems. We continue to face access 
issues in the closed cities and in the serial production 
points. Access restrictions, of course, hinder our ability to 
conduct the program, but they also hinder our ability to 
demonstrate the transparency that allows us to assure you and 
the skeptical colleagues you referred to earlier that our funds 
are being spent on the purpose for which they are intended.
    I don't mean to overstate our problems. In general, I'm 
quite pleased with our cooperative efforts, but it would be 
foolish to ignore these difficulties. Secretary Bolton pointed 
out our allies have faced similar problems. And if the Global 
Partnership is to fulfill its potential, Russia has to work 
with us to resolve these issues.
    Despite these challenges, however, it's clear that the 
Global Partnership is an opportunity to write a new chapter in 
nonproliferation and cooperative efforts. And, under the 
President's leadership, we intend to work tirelessly to make 
this happen. And, as we do, we continue to be extremely 
grateful for both the leadership and the support shown by this 
committee.
    Thank you, sir.
    [The prepared statement of Ambassador Brooks follows:]

    Prepared Statement of Hon. Linton Brooks, Acting Administrator, 
     National Nuclear Security Administration, Department of Energy

    Mr. Chairman, Members of the Committee. I am pleased to have the 
opportunity to appear before you and discuss the impact of the G-8 
Global Partnership on Department of Energy non-proliferation programs. 
At the outset, I want to thank the Senate, and Senators Biden, Lugar 
and the other members of this Committee in particular, for the support 
and leadership shown in passing the Foreign Relations Authorization Act 
and its specific language that is relevant to the Global Partnership. 
We agree completely with the legislation's conclusion that addressing 
threats of under-secured nuclear and radiological materials in Russia 
is ``a burden that will have to be shared by the Russian Federation, 
the United States, and other governments, if these threats are to be 
neutralized.'' The President's initiative in establishing the G-8 
Global Partnership illustrates how firmly the Administration shares 
this view.
   laying the groundwork for expanded global nonproliferation efforts
    Under Secretary Bolton has made it clear that the Administration 
strongly supports the Global Partnership, which we regard as a 
significant step toward more effective nonproliferation. The Department 
of Energy and the National Nuclear Security Administration share that 
strong support. We look forward to helping to implement, the Global 
Partnership initiative. During last month's IAEA General Conference in 
Vienna, Secretary Abraham commented to our G-8 partners that the United 
States is ``especially excited about the G-8 Global Partnership 
Initiative because it . . . binds us together in a spirit of resolve. 
And I know that the Global Partnership will increase and accelerate the 
good works that we can do.''
    The Global Partnership has the potential to establish a coordinated 
nonproliferation effort with a global reach. This is reflected in the 
substantial resource commitments that the G-8 allies have set as their 
goal to address proliferation threats in Russia, and in the six 
principles for action that the G-8 agreed to in their June 27th 
statement. These principles provide measures that all states can look 
to as they fashion responses to proliferation threats.

                              DOE IMPACTS

    The United States was moving to deal with the challenges of 
nonproliferation well before the establishment of the Global 
Partnership. The Administration has requested approximately $1 billion 
for nuclear nonproliferation programs in Russia and other former Soviet 
states for FY 2003, and is committed to maintaining that general level 
of commitment over the ten-year period of the Global Partnership. The 
Department of Energy's budget for nonproliferation programs in Russia 
and other NIS is approximately $443 million for FY03 and I anticipate 
comparable or increased funding for FY04. Thus it is clear that the 
United States is already making its contribution toward its Global 
Partnership commitment. We look forward to comparable support from our 
G-8 partners.
    The Global Partnership will affect the Department of Energy's 
nuclear nonproliferation programs in many ways. While we have made 
enormous progress in Russia by securing hundreds of tons of weapons-
usable material, facilitating the consolidation and downsizing of 
Russia's nuclear weapons complex, and fostering the conversion of 
former weapons scientists and experts to civilian activities, much 
remains to be done. There still exist hundreds of tons of poorly 
guarded weapons-grade nuclear material, a very large nuclear weapons 
complex that is still fading serious economic and employment hardships, 
and a nuclear infrastructure that continues to produce plutonium via 
three operating plutonium production reactors. If our allies choose--
and we hope they will choose--the Global Partnership could lead to 
projects providing much-needed resources to areas being addressed by 
the Department of Energy. International funding will be especially 
important to support Russia's participation in the plutonium 
disposition program. Gaining full funding for this program is crucial 
to our attempts to eliminate 34 metric tons of Russian weapons 
plutonium, enough for over 8,000 nuclear Weapons.
    Contributions by our allies would also help in other areas. For 
example, they would permit us to carry out the decommissioning of 
reactors in Russia and Kazakhstan used to produce plutonium. We have 
also encouraged other G-8 members to contribute to cooperative efforts 
aimed at preventing the hemorrhaging of WMD expertise, expediting 
research reactor fuel return, and securing radiological sources, and we 
continue to support multilateral civil nuclear reactor safety programs.
    Beyond the benefit of additional resources, the visible involvement 
of all of the world's leading economies in cooperative nonproliferation 
efforts will demonstrate that securing and eliminating weapons of mass 
destruction and related materials is truly a contribution to global 
security. The challenges we face are global; the solutions must be 
global as well.

                           POTENTIAL PROBLEMS

    As these brief examples make clear, the United States sees great 
potential benefit from the Global Partnership. But I am also a realist. 
In agreeing on June 27 of this year to the Global Partnership, the G-8 
nations laid the foundation for expanded global nonproliferation 
efforts, but much work remains to be done to turn promise into 
performance. It will take time to realize the potential of this 
Partnership, and it will require leadership and persistence on the part 
of the United States. Our partners must match their words with 
financial commitments and Russia must cooperate on implementing 
arrangements. A key question is whether the leadership of the Russian 
Federation will take the implementation decisions necessary for the 
Global Partnership to succeed.
    Through the Global Partnership the G-8 has committed to resolving 
the type of sensitive implementation issues that have at times impeded 
our ability to work effectively in Russia. The implementation 
guidelines call, among other things, for ``effective monitoring . . . 
and transparency measures,'' for provisions to ensure assistance will 
be ``exempt from taxes, duties, levies and other charges,'' and for 
``appropriate privileges and immunities.'' In implementing our 
programs, the Department of Energy has regularly had to address 
obstacles in several of these areas. For example, our efforts to expand 
downblending of highly enriched uranium under the Material 
Consolidation and Conversion Program or to move forward with other 
cooperative projects have been delayed by bureaucratic problems 
associated, in part, with issues of taxation and liability. In 
addition, we continue to face access problems at Ministry of Atomic 
Energy's (MinAtom) closed cities and serial production plants. Access 
restrictions hinder both our efforts to conduct our joint programs and 
our ability to ensure the transparency that is correctly required by 
Congress.
    I do not mean to overstate our problems, which we are working to 
resolve. In general, I am pleased, with our cooperative efforts. But it 
would be foolish to ignore these difficulties. Some of our allies have 
faced similar problems that they have not yet been able to resolve. If 
the Global Partnership is to fulfill its potential, Russia must work 
with the other G-8 nations to resolve these and other issues related to 
liability protection, exemption from taxation, and access.

                               CONCLUSION

    Mr. Chairman, the Global Partnership offers an opportunity to write 
a new chapter in cooperative non-proliferation. If we are able to bring 
its promise to fruition, we can help create a safer world for all 
humanity. Under the President's leadership, we intend to continue to 
work vigorously with our G-8 partners to seize this new opportunity. As 
we do so, we continue to be grateful for the leadership and support 
shown by this Committee.
    Thank you for your attention, and I look forward to your questions.

    The Chairman. Thank you.
    Let me begin by asking you something, Mr. Brooks, that I 
think is important for folks to understand. You pointed out 
that the Plutonium Disposition Initiative relates to 34 tons of 
plutonium.
    Mr. Brooks. Yes, sir.
    The Chairman. Enough for 8,000 nuclear weapons, roughly. 
Describe for the committee where the 34 tons of Russian 
plutonium is and what, from your perspective--and I'd invite 
Defense or anyone else to chime in--what the nature of the 
security relating to this plutonium is.
    Mr. Brooks. It's in various locations throughout the 
Ministry of Atomic Energy's complex. We are working--and this 
is an area where we've had a good deal of success--to improve 
the security of those facilities. Rather than give figures in 
terms of number of facilities, we tend to like to give figures 
in terms of amount of material.
    We see about 600 tons of plutonium and uranium in the 
MinAtom complex. By the end of this year, we'll have had 
initial upgrades on between 80 and 90 percent of those. And 
we'll be starting on the more robust comprehensive upgrades. We 
will complete----
    The Chairman. Upgrades in security?
    Mr. Brooks. Upgrades in security. We will complete the 
upgrades throughout the MinAtom complex by 2008, which is about 
3 years earlier than I would have testified a year or so ago, 
as a result of a combination of the very strong support of the 
Congress and some work that Secretary Abraham and his 
counterpart have done in clearly away bureaucratic obstacles.
    The Chairman. Let me tell you why I asked the question. I'm 
going to make a comparison that is not completely appropriate. 
Years ago, when we were trying to get a handle on the drug 
problem in the United States, we identified source countries, 
the type of materials they were producing, the type of activity 
they were engaged in, precursor chemicals and their sources, et 
cetera. And we found that it was an incredibly broad problem. 
And to be able to do everything one would ideally like to do 
have exceeded the resources we had available to us.
    But we found there were 34 agencies within the Federal 
Government that had responsibility for dealing with the drug 
problem in America, and there was no master plan. There was no 
list of priorities. There was no place you could go and ask one 
person, what is the Federal Government's plan to deal with this 
problem? What are you going to attack first? Are you going to 
attack poppy fields or coca fields? What continent are you 
going to look to? How are you going to allocate your resources?
    Everyone, over the past years, who has testified about the 
problem relating to weapons of mass destruction and vehicles 
that can deliver them, and the application of Nunn-Lugar 
funding, has said the extent of the work to be done far exceeds 
the resources available to do it. And now we are engaging, in a 
very positive way, the energies, and hopefully, the funds of 
other industrial nations. As Senator Lugar said, we hope to go 
beyond the G-8 promise and get participation here.
    But what confuses me--and this is not a criticism--is that 
I cannot find one place in the Federal Government and get one 
document that says, ``These are our priorities. This is our 
wish list. This is where we're going to expand our limited 
energies and our funds, and this is and this is where we're 
going to try to get our allies and our friends and those who 
share our concern to weigh in, to be helpful.'' Ms. Bronson 
came as close as anybody to dealing with this issue.
    There seems to be, to me, a disconnect between the real 
system and what you would get if you gave this problem to a 
management kid at the Wharton School and said, ``How would you 
manage this effort?'' I would respectfully suggest they 
wouldn't manage it the way we're managing it. Now, granted, 
this is all building on an initiative that was incredibly 
important, started by Senator Lugar and Senator Nunn, and in an 
environment that's rapidly changed, and we've learned more. 
We've learned more about the difficulty in access, the 
credibility of the assertions, the bureaucratic difficulties 
getting there, the total amount of the offending material, et 
cetera.
    But if I were to ask the question--I ask all three of you 
this--is there any one place I could go to get a single 
document that said, ``The U.S. Government believes that the 
single most dangerous elements of this problem are the 
following, and we are attempting to match our resources to the 
degree to which we think a danger exists,'' has that kind of 
inventory, has that kind of list, has that kind of 
prioritization been done? Does one exist?
    And, second, if it exists, how have we begun to use 
opportunity to work with our allies in dealing with what we 
think are the priorities?
    So that's my question, the only question I'll ask you, Is 
there a place I could go and get one document that said, ``This 
is our wish list based on the threat that is presented by the 
existence of this material''? And, two, what resources we're 
going to assign to that, and what we're going to seek from the 
Congress or interagency? And, three, how do we begin to 
interface with our allies who are only now coming to grips with 
this by virtue of their recent commitment?
    Mr. Brooks. With respect to nuclear materials, the one 
place you can go is me, under the supervision of the Secretary 
of Energy, because that's clearly our responsibility. We do 
have an overall strategy, and your question reminds me that we 
may not have done as good a job about setting it forth in a 
written form, so let me describe it.
    The first part of the strategy is to stop making the stuff; 
in particular, to stop making it in the Russian Federation. 
There, we seek to shut down the 3 remaining plutonium 
production reactors, and we seek allied cooperation to make 
that happen sooner.
    The second thing is to take what exists and try and 
consolidate it. We're spending about a quarter of the material 
protection, control, and accounting funds in trying to 
consolidate material, both within sites and among sites.
    Third is to guard the material that is consolidated. I want 
to talk about the Russian Federation. I'll talk about the rest 
of the world in a minute. There, we seek to do, first, the 
quick upgrades, and then the more comprehensive upgrades, and 
we are not now limited by money. We are limited by the ability 
of the Russian Federation to absorb this in a meaningful way. 
So there, although there may come a time when we want our 
allies to contribute, that's less high on my priority list for 
allied cooperation. And then, finally, wherever possible, to 
eliminate it.
    Senator Lugar mentioned the HEU Purchase Agreement which 
eliminates HEU. An experts group which I chaired for the U.S. 
side was chartered by the two Presidents to look at other ways 
to eliminate materials. Our results are a foot in the door, but 
we are working to implement them. Plutonium production is 
another major form of implementation. And there, once again, I 
need to have the support of my partners internationally.
    Now, if you look at that chain, and then you step outside 
of the Russian Federation, you look at consolidation, and say, 
highly enriched uranium at research reactors--you want to 
consolidate that by moving the material back. That's a 
combination effort for Secretary Wolf and myself, because it 
has both diplomatic and technical efforts. We, as he alluded, 
are working to see if we can move that process a little faster. 
There have been problems with Russian legislation which 
allegedly are almost overcome. When one deals with Russian 
legislation, the word ``allegedly'' is used advisedly.
    Then there is material which is part of the fuel cycle in 
the rest of the world. There are, for example, about 200 tons 
of separated plutonium in the world. The part that's not in 
Russia is largely in western Europe and Japan. There, the 
Secretary has begun a dialog with his counterparts to try and 
look, not at U.S. funding, but at best practices to make sure 
that we are all focusing on this material. Within the United 
States, we have long held very strong controls over materials, 
and we upgraded and improved those in the aftermath of last 
September.
    So that's the strategy.
    Now, priorities. I'm reluctant to give priorities, because 
I want to do it all. But, if you notice, I've fully funded 
protecting the stuff, and I am drawing on my partners for 
elimination and cessation of production. So that's probably a 
pretty good judge of the near-term priority, is to protect what 
exists. The long-term priority is to reduce the amount of 
material. That's the broad strategy, and the lead for that is, 
on the materials side, firmly within the Department of Energy.
    The Chairman. That's very helpful. I would like to ask you, 
either in open forum or in a classified forum, and there is no 
hurry--between now and you tell me a reasonable time, a month, 
whatever it takes--to submit to this committee in writing those 
points which you outlined for me just now and, attached to each 
of the points you made, what are the problems related to that 
effort, what are the Russian absorption capacities? Be specific 
in the response. What is that absorption capacity problem? I'm 
not asking you now. How does that play out? What kind of 
bureaucratic problems are you running into? I'd like to have as 
specific an analysis as we can.
    And, again, if you conclude that it needs to be in 
classified form, I'm not sure why it would, but if it does, if 
you conclude that, then you let us know. But it would be a very 
helpful guidepost for us in being able to follow and fully 
understand the nature of this undertaking. Although it would 
not be your purpose, you may find, as we authorize moneys, that 
we insist you have more than you say you need, because no one 
ever says they need more than the OMB tells them that they can 
say they need.
    And, to the extent that each of you would be willing, 
within your sphere, to prepare a similar document for us, 
please do so. I know I'm making work for you, but I know it's 
all available. This is a matter of gathering this together. It 
would be a very useful three sets of documents for this 
committee to have, in order for us--and not that Senator; 
Senator Lugar, as an old joke goes, has forgotten more about 
this than most people are going to learn--but it would be a 
useful three documents for the rest of the members of this 
committee, including myself, if you'd be willing to do that.
    Mr. Brooks. I'd certainly be delighted in the materials 
area, and we'll look at the other areas where it's appropriate.
    The Chairman. And, Senator Lugar--I kind of warned him of 
this ahead of time--I'm going to ask, since I must go to a 
12:15 meeting, and I apologize to the last panel, if you'd be 
willing to chair this to its conclusion.
    But I'm going to submit, with your permission, to each of 
you, about three to five questions.
    But the main thing, if you did nothing else for me, is to 
try to organize what we've just spoken about from each of your 
perspectives. That would be a very, very helpful--at least for 
me, and I think the rest of my committee--if you'd be willing 
to do that.
    Yes, Mr. Wolf.
    Mr. Wolf. I'd just make one point. I think some of this is 
also going to be evolutionary, and we can take the stock photo 
of where we are in the issues that we've talked about today. 
But after September 11, we've defined additional new problems 
that we're looking at, the whole question of dangerous 
materials and trying to get our hands around what the nature of 
the problem is, and some of them are almost unbounded, like BW-
type problems.
    The Chairman. I agree.
    Mr. Wolf. But we have the whole set of radioactive 
materials that Ambassador Brooks didn't talk about, but 
radioactive materials all around the world. He mentioned it 
briefly in his remarks. And some of this, for instance----
    The Chairman. We have a problem here in the United States 
with radioactive materials.
    Mr. Wolf. And we're trying to use--we will try to look--
we're doing an NDF survey, for instance, and I think NTI is 
doing something----
    The Chairman. They are.
    Mr. Wolf [continuing]. Looking at the nature of this 
problem. We're working with the IAEA. We will not be able to 
tell you the answer to that one this week, but we're working on 
it.
    The Chairman. No, but you will be able to tell me where you 
are now.
    Mr. Wolf. Yes, sir.
    The Chairman. I understand, we fully understand this is not 
a static issue. We fully understand that this changes; for 
example, it could change in direct proportion to our knowledge 
of what terrorist groups were seeking.
    Mr. Wolf. Yes, sir.
    The Chairman. I mean, it may very well change. There are 
certain things that are clear. For example, as bad as, and as 
lethal as biological pathogens could be, and are, if, in fact, 
there were a nuclear device in the hands of a terrorist group, 
and/or even state actors, we know that the consequences of 
that, at least in terms of limiting our potential ability to 
respond to the actions of the state actors, would be 
substantial. So obviously, plutonium is a big deal. We also 
know that anthrax is a problem.
    But if you're in a world, in which Presidents and 
Secretaries have to make these hard decisions. As my deceased 
father used to say, ``If everything's equally important to you, 
nothing is very important to you.'' And these are tough calls.
    I just want to know where you are at the moment. It is not 
to hold anyone accountable. This is not to go back and say, 
``Wait a minute now, man, you said this and you didn't do, 
that.'' That's not the purpose of this. Truly. The purpose of 
my inquiry relates to the state of your thinking and how it's 
evolving. How it's evolving.
    So I realize your thinking is not static, but it is, 
nonetheless, important that we get a sense of where you are in 
the game. Because you may find the three of you, what I have 
found after 30 years of being a United States Senator in 
oversight hearings: that sometimes a circumstance arises where 
a committee in the Congress may actually be able to be helpful 
in meshing what we find upon submission are slightly different 
perspectives.
    As an old bad joke goes, you know, ``We're from the 
Congress; we're here to help.'' But that's really the purpose 
here, for us to have a better grasp.
    Secretary Bronson, you had a comment, and then I'll yield 
to Senator Lugar.
    Ms. Bronson. Mr. Chairman, we would be happy to respond to 
your request. I can give you a partial answer that has two 
parts. First, the administration undertook a review of all the 
assistance that we're providing to Russia. And, in that review, 
the administration identified general priorities. And that 
process led to the shifting of some of our priorities. I'll 
give you three examples.
    One example can be seen in the funding requests we have for 
the chemical weapons destruction facility. Last year, we 
requested $35 million. This year, to reflect our increased 
priority on this project, we have requested $126 million. In 
the area of biological weapons, the Department last year asked 
for $17 million. We renotified $33 million, and this year we 
have asked for $55 million. We've added an additional program 
of $40 million to work specifically on WMD border security. In 
the----
    The Chairman. That's exactly the point I'm making. And let 
me be bold enough to suggest that, in addition to the 
incredible and enlightened initiative of you and others at 
Defense, there were two other intervening acts. One was 9/11, 
and the other was Richard Lugar. And that is a fact. The truth 
of the matter is, you are all as concerned as Senator Lugar and 
others are about those close to 2 million artillery shells at 
Shchuch'ye. Were it not for Senator Lugar, there would have 
been no public discussion about that particular facility. 
Internally, you'd all discuss it. But it's kind of amazing, you 
know, when a spotlight is focused on something that everybody 
at home can understand: It is palpable. They can taste it. They 
understand it. They can feel it. They can sense it. They know 
it. They don't need to have a degree in physics. They don't 
have to be a United States Senator or a Secretary. They 
understand.
    It makes no sense to have 2 million of these shells lying 
around, like in a Wal-Mart, on shelving and us not destroying 
them, no matter what else they're doing with their money. Even 
if they're taking every penny we're putting in there and going 
and building tactical nuclear weapons, it makes no sense not to 
destroy those chemical weapons shells. None. Zero. People get 
that. They didn't need any education, except Senator Lugar 
showing up with a briefcase in that facility and showing it 
would fit in it. All of a sudden, the focus went ``whoom.'' And 
that's why we like to know these things, because we may be able 
to help.
    At any rate, I yield to the man with the briefcase.
    Senator Lugar [presiding]. Let me extend your question, and 
I appreciate the over-generous comments you made.
    You know, as you pointed out, Secretary Bronson, the 
administration did request, for chemical destruction, $126 
million, as opposed to $35 million last year. That's a fourfold 
increase, and it reflects this place, Shchuch'ye, we've been 
discussing today and other things that you might be able to do. 
That is, I suppose, our frustration, that despite the 
Administration request, despite all of the weeks and months of 
impetus to do this, it simply is not happening. That's where 
focus has to come now, to the Appropriation bill conference.
    House and Senate people meeting now are going to determine 
whether a dime of that goes there, despite the fact the whole 
world is interested in it. And I really, seriously underline 
that. This is not a theoretical problem. It's a very practical 
political problem in Washington, DC, within miles of us today, 
or within a few hundred yards, maybe, of where that conference 
is going to meet.
    But I think Senator Biden's question of Dr. Brooks is so 
important, because you pointed out the strategy. That is the 
first time I have heard such a comprehensive explanation of the 
strategy. So the record you have created already is a written 
record, which is extraordinary. Now, for all of you who are 
insiders, it may not be--you discuss this all the time. But, 
for us who are in the outside world, even though each of these 
elements is fairly evident, the composition of them certainly 
has not been, the quantification at least of these elements--
you've suggested 34 tons of plutonium and 600 tons of highly 
enriched uranium--that may be the amount, and maybe you want to 
quantify that some more. As I said, the USEC people the other 
day thought that it was 500.
    Mr. Brooks. Senator, 500 is what we have an agreement to--
--
    Senator Lugar. To do. But you----
    Mr. Brooks [continuing]. 600 is the----
    Senator Lugar. What you think is out there.
    Mr. Brooks [continuing]. The material that I'm guarding in 
Russia. That's not all plutonium, though.
    Senator Lugar. So here we are on the threshold of potential 
hostilities with Iraq, over the potential of their obtaining 
some of this, and it makes all the difference between whether 
they have the potential to make a bomb this year or 5 years 
from now, according to intelligence estimates. They're now 
quite public, and we all discuss them daily. That's a huge 
difference.
    Now, in fact, we know how much highly enriched uranium, or 
we think we know, is in Russia and how much plutonium. And as 
you say, you're trying to stop the production so that the 
latter figure doesn't increase. Very important, just in a 
logical sequence. But to quantify this helps us, that is, the 
Congress.
    Now, it may not help you. You got beat up within the 
bureaucratic process, the budget process. You have requests. 
You ardently argue your case. As loyal soldiers, you march back 
down the hill, because that's the way that it is. We don't have 
those constraints. We can say, in behalf of the American 
people, it might be wise--and, granted, this requires Russian 
compliance, because this is cooperative threat reduction; it's 
on their soil, their plutonium--we might decide we want to 
destroy that much more rapidly. But we might decide that even 
though the upgrades, as you say, are now very substantial--and 
they are, thank goodness, for both of our countries, Russia, 
the United Sates, and the world, it would take to 2008 for 
these to be completed. And that, at least under your work and 
that of the Secretary, Mr. Abraham, is now 3 years sooner than 
it might have been.
    I've sat in briefings in which I have listened to how the 
upgrades were going to go, and it was like building college 
dormitories, one a year almost at that same degree of--not 
casualness, but this is not that kind of a project. It had to 
be, because you didn't have the money and there really was not 
the commitment by the last administration or this one, thus 
far.
    All I'm saying is that, you know, given the head of steam 
you saw with the chairman this morning, there may be much more 
commitment. Once again, Russian cooperation required, because--
--
    The Chairman. If I could interrupt you for a second to make 
that point. The hearings on the FBI, when the Director of the 
FBI sat there and said their computers would not be up to the 
job, that they needed to be able to deal with what happened 
from Minneapolis and Arizona for, I think he said 2007 or 
something, people went, ``What? What? We are building highways 
and we're doing tax cuts and we're doing health insurance, and 
we're doing all that and you're telling me that we don't have 
the money to give to the FBI to do that tomorrow?''
    Because if the money were totally available, that time gets 
cut by 75 percent. But they had it planned, based upon their 
budget. And when people heard that, they went, ``Give me a 
break.''
    Now, granted, it was all before us anyway. You know, it was 
all laid out there. But what you can help us do, for us, is 
help us be able to explain to our colleagues. I believe, for 
example, if we went to the floor and said, look, folks, it's 
going to cost an extra $10, $20 billion to front end load 
within the next 18 months to increase the destruction of the 
plutonium stockpile by whatever--I'm making the numbers up, 
because I don't know what they are--by 75 percent, and we made 
the case on the floor, we'd get the $20 billion.
    But you all have to operate, as planners, based upon what 
you anticipate--what you're told you are likely to be able to 
get. All we need to know is what your timeframe is. And we may 
not win. We may go to the floor, and they'd say, ``No, we would 
rather go out there and provide for building a--you know, a 
Lawrence Welk Museum in somebody's home state.'' OK, so be it, 
but at least we would be able to make the--I shouldn't have 
said that, because there is a Lawrence Welk Museum somewhere. 
I'm sorry. It's built. At any rate----
    You understand what I'm saying here, OK? But the point is--
and I will stop with this--it makes a gigantic difference, 
because our colleagues who don't do this every day, any more 
than I do health care every day, not being on that committee. 
Our colleagues, if they knew what the danger was relative to 
the amount of money to deal with that danger, they may make a 
different decision.
    And the separation of powers deal, it is ours to propose. 
The President can do it, too. But we have it fully within our 
authority to say, ``Mr. President, we love you. We're going to 
give you more money to do it faster. You may not like that, but 
that's our priority.'' Just like the President is--he gets to 
propose Justices and Secretaries, we get to dispose. It's a 
flip here.
    And so it's really very important. And, again, if you think 
we're exaggerating, think of when Director Mueller sat there 
and said, ``By the way, we won't be able to have--even have 
Internet connections among''--or excuse me--``e-mail among our 
own people for the next''--whatever the heck he said, you know, 
x number of years.
    People went, ``Wait a minute. My company does that. I'm 
going to go out of business if I don't get mine upgraded.''
    And we may go out of business, in a different way if we 
don't upgrade ours.
    And so that's, sort of, the context, in case you think 
we're exaggerating our ability with your help to be able to 
maybe do the job, help you front-end load the job. You sit 
there, because, look, if I go to bed staring at the ceiling 
sometimes wondering about this, each of you go to bed every 
night confident you're doing your best, but staring at the 
ceiling going, ``Whoah, whoah.'' We may be helping you sleep a 
little better.
    Senator Lugar. Mr. Chairman, let me just say 
parenthetically that the President of the United States, two 
Presidents ago, did not ask for the Nunn-Lugar Act. It happened 
here. You've had to struggle with that ever since. But, 
nevertheless, you're doing so remarkably.
    The Chairman. I apologize to the third panel. I really do. 
But thank you, Senator.
    Senator Lugar. Let me just mention----
    The Chairman. By the way, this may be the only committee in 
the U.S. Senate where a Democrat would leave a Republican in 
charge of the whole operation.
    Senator Lugar. Thank you. I thank the chairman.
    Let me just say, Dr. Brooks, you have been negotiating with 
the Russians for a long time. I remember visits with you during 
your START II negotiating days, long, tedious days with Russian 
counterparts across the table, so you know these subjects 
extraordinarily well. And this is why we are imposing upon your 
good nature today, it's because we understand you know a whole 
lot about it, much more than we do.
    In order to make the arguments that Senator Biden has 
suggested, we really need to know more, and we think we can be 
helpful without causing difficulty for you. But we are sincere 
in saying we think are colleagues really are of a mind in the 
same way that our intelligence committees, and I'm part of that 
joint inquiry, have been inquiring, how in the world do we 
upgrade our intelligence in this country? There is a very great 
desire on the part of the Congress. But in order to channel 
that constructive element, we need the expertise of people who 
have hands-on, who are working the problems.
    And there's no doubt in my mind we're talking about 
something here that shares that same degree of enthusiasm. If 
we knew how to get through the quantities of materials--and 
you've stated the priorities, how to help you enhance your 
success--I think we can be helpful. And, as you can tell, 
there's a certain degree of bipartisan support in this 
committee and, I think, elsewhere to do that.
    Let me just say, first of all, Secretary Wolf, you 
mentioned specifically the Kirov situation, and that is a good 
case in point. Although I did not enter the specific building 
suspected of agent production at Kirov 200, I did visit with 
persons who have worked there. They had moved down the street, 
and they conveyed to us everything that's going on up the 
street. We had an agreement in hand, an ISTC agreement; our 
State Department is responsible for that. And we signed that 
with the university people that very day. The people--the 
former employees already had an ISTC agreement, and, therefore, 
as you say, they had been working for a few months on very 
vital projects, such as how to protect against biological 
threats and various other things to which they could contribute 
a lot of expertise.
    So even within Kirov, already, ISTC is at work, in ways 
that give us a full ability to deal with these people. By 
``us,'' I mean, not just Senators, but members of the staff, 
the Departments of Defense and State and Energy as they come 
into the situation.
    And, Secretary Bronson, behind you is Colonel Jim Reid 
today, and I just must pay tribute to him, because he has been 
a faithful traveler up and down Russia for years, understands 
these questions remarkably well, and has been a tremendous 
informant for me, and I appreciate the strong partnership that 
you have with all of your staff, but I wanted to mention 
specifically Colonel Reid.
    Let me mention also that, in the case of the highly 
enriched uranium, even the troubles we've had with USEC and our 
own Government over the years are probably never going to be 
over. We live in a real world in which the purchase of highly 
enriched uranium sometimes conflicts with commercial interests, 
people dealing with uranium in our own country. In the State of 
Kentucky, for example, this has risen to the fore. And I 
compliment those who have tried to work out formulas now, a 
flexible formula for the price, and the Russians have 
cooperated in working this out, so that we are now coming into 
a much better flow in terms of offering and purchase. And that 
the public, by and large, can't follow any more than most of us 
can, because it's extremely complex, but extremely important.
    Literally, this highly enriched uranium is being blended 
down to low-enriched uranium and being utilized by nuclear 
power plants in the United States.
    Plutonium has been a tougher thing. Our colleague Senator 
Domenici, as you know, is very active in this, and he's assured 
me in the next Congress he wants to be even more active. He's 
leaving the Budget chairmanship. He's coming over now to the 
Energy Committee, either as chairman or ranking member, 
depending upon the election. So he will be a vigorous partner 
with us, as you may know.
    But the Russians that we've visited with over the past few 
years have been reluctant to destroy plutonium, and this is why 
the large Mayak storage facility has been created for storage 
of a lot of it.
    Now, your progress in moving toward disposition of it, 
whatever it may be, is tremendously important. And, once again, 
not well understood, but plutonium is not as easily converted 
as highly enriched uranium to some other purpose, but 
tremendously important in terms of the material for, not just 
Iraq, but anybody else who may come along in the war against 
terrorism. Or al-Qaeda cells, wherever they may be, if they try 
to work up something.
    So we're going to be at this, I think, for a period of time 
as it relates to this war against terrorism we are in. It's not 
projected to 2008. It's happening now. So that does change our 
perspective, I think, very substantially.
    Let me just say, finally, in the same spirit the chairman 
has asked Secretary Brooks to, sort of, write something up, I 
would request that both Secretary Bronson and Secretary Wolf. 
We really want to have a responsible set of proposals. We're 
not going at this point, late in the session, to be rewriting 
the act, because we're beyond that point. We're trying 
desperately to get the appropriation bills finished 
constructively now, and, likewise, authorization. But there is, 
as you can tell in this committee, tremendous enthusiasm for a 
comprehensive revision of this at the beginning of next 
session, and we want to work with the administration.
    This is why I've cited, because they're not confidential, 
these two meetings with the President of the United States in 
which I've had an audience, and I appreciate the generosity of 
the President taking his time to understand the same things 
we're saying publicly to you today. He absorbs this. He wants 
it to happen, and he's tried to convey that.
    Now, our bureaucracy is difficult, too, and to get that 
message all the way through is trying, but I want to help him, 
and he knows that, and so we're working together.
    I thank all three of you for your testimony and, hopefully, 
for the papers you will prepare in the next few weeks so that 
we're ready for the next session.
    Thank you.
    The chairman would like to call now the third panel, Mr. 
Kenneth Luongo, executive direction of the Russian-American 
Nuclear Security Advisory Council of Princeton, New Jersey, and 
Ms. Laura S.H. Holgate, vice president for Russian/NIS Programs 
for the Nuclear Threat Initiative in Washington, DC.
    We welcome both of you. Thank you for your patience, 
although the hearing, I think, has provided a good prelude for 
your testimony. And we appreciate the expertise that both of 
you bring to this. I'd like for you to testify in the order 
that I introduced you.
    First of all, Mr. Luongo, would you offer your testimony?

    STATEMENT OF KENNETH N. LUONGO, EXECUTIVE DIRECTOR, THE 
RUSSIAN-AMERICAN NUCLEAR SECURITY ADVISORY COUNCIL, PRINCETON, 
                               NJ

    Mr. Luongo. Thank you, Senator Lugar, and thank you for the 
invitation to testify today.
    I really applaud the committee for holding this hearing. I 
think the subject is absolutely essential. And, as both you and 
Senator Biden alluded to, high level support and attention from 
the Congress is essential, and this committee has been quite 
good in that regard.
    I have a formal statement, I ask that it be submitted for 
the record.
    Senator Lugar. It will be published in full.
    Mr. Luongo. Thank you. My testimony is about two different 
subjects. One, is the importance of threat reduction, and, the 
second, is the Global Partnership, including financing and 
prioritization.
    The Cooperative Threat Reduction program has produced 
significant and quantifiable results, which are all the more 
remarkable because of the circumstances in which the program 
has had to operate. There is intense collaboration with 
ministries and institutes that, a decade ago, were enemies.
    We've got approximately 6,000 nuclear warheads that have 
been removed from deployment, 400 missile silos destroyed, and 
almost 1,400 ballistic missiles, cruise missiles, submarines, 
and strategic bombers that have been eliminated. The 
transportation of nuclear weapons is more secure. The storage 
and the security of nuclear materials has been improved. On the 
human side, there's almost 40,000 weapons scientists in Russia 
and the other FSU states that have been provided with some 
peaceful research or commercial projects to work in.
    So there are many, many statistical measures of the 
importance of this work. But, beyond the statistics, there's 
also the political importance of this work in U.S.-Russia 
relations and, in terms of the numerous interactions between 
U.S. and Russian scientists, military officers, and political 
officials. I think that these issues provide an intangible 
benefit of this work that is not well understood, either in the 
public or perhaps in the political arena.
    But the news is not all good on threat reduction, Senator, 
as you know and you have alluded to. We have some essential 
agenda items which are lagging, and, in some cases, work has 
come to a virtual standstill. One example is this Cooperative 
Threat Reduction program where the CTR certification dispute 
stopped new contracts from being written in the spring and 
early summer. Then there was a temporary waiver that allowed 
work to begin again. Now, at the end of the fiscal year, we 
have a stoppage yet again.
    The restrictions on chemical weapons destruction in 
Shchuch'ye have created a serious crisis and may result in the 
termination of the project if it is not resolved. Access and 
transparency has been alluded to many times today. These issues 
are impeding both warhead and fissile material security 
efforts. And the redirection of weapons scientists is not 
producing lasting and career-changing employment opportunities, 
which, in my view, is a very essential issue.
    On the bioweapons side, since we don't know everything that 
we would like to know, our information baseline is incomplete. 
As a result, it's not clear that we're managing this threat to 
the degree that we would like to do so.
    With all of these problems and successes up to this point, 
we now have a major new opportunity with the global 
partnership. While the principles of the agreement are quite 
broad, most of the focus has been on what projects would be 
implemented in Russia and the FSU.
    The first priority that is obvious from this initiative is 
the issue of identifying funding. And the number that's been 
alluded to is up to $20 billion over the next 10 years. The 
projects that have been discussed in the Global Partnership 
statement and in some of the meetings that have occurred since, 
include destruction of chemical weapons, dismantlement of 
decommissioned nuclear nonstrategic submarines, disposition of 
fissile material, and the employment of weapons scientists. The 
assumption, obviously, is that the United States would bear 
about half of the $20 billion cost, because we're spending 
about a billion dollars a year.
    If you look at the non-U.S. G-8 nations that have committed 
funds publicly to date, it totals only about $3.4 to $3.8 
billion, so roughly about a third. If you add in what the EU 
has said that they would contribute, which is about a billion 
dollars over the 10 years, then you're roughly at the 50-
percent point, or actually slightly below $5 billion dollars.
    But one of the things that I think the committee should 
take note of is that there are certain loopholes about how 
contributions are credited against this $20 billion. These 
include the ability to count prior appropriations that are 
unspent against the $20 billion total. It's not clear that 
anybody will do that, but certainly that door is open.
    Another financial question is the budget pressures on the 
G-8 nations. It's not clear to me where the other $5 billion is 
going to come from, if it must be found in national budgets. 
Therefore, debt swap, as you and Senator Biden alluded to, is 
one particular option in this regard. The passage of the 
Foreign Relations Authorization Act is very important in this 
regard. But, in my view, I think it would be a mistake if the 
United States decided to enter into debt for nonproliferation 
swap with Russia and then used that money to substitute for 
current appropriations. I think only debt swap funds should be 
used as a supplement to currently appropriated levels.
    The other G-8 members, unfortunately, don't have quite the 
cohesive view that the United States does on debt swap. 
Germany, which is by far the largest creditor in the Paris 
Club, is owed about $20 billion. It has concerns about Russia's 
swapping its debt to finance nonproliferation activities. In 
fact, it's so concerned that it's made a commitment of $1.5 
billion in new money in order to not have to go through the 
debt swap route, which I think is a very interesting decision.
    Both Italy and France have expressed support for debt swap 
initiatives. Neither Canada nor the United Kingdom and Japan 
have taken a firm stance one way or the other, though perhaps 
Canada and the U.K. might be more inclined.
    But perhaps most importantly, it's not clear to me what the 
Russian position on debt swap is. We've been hearing about some 
concerns in Moscow that engaging in a debt swap might hurt the 
international credit rating of Russia and that it could spur 
inflation. But I'm not sure that I've seen a definitive 
statement on this subject.
    Let me turn now to the programmatic priorities of the 
Global Partnership. As other witnesses have alluded to, I think 
the initiative has to be carefully structured and coordinated 
to maximize the efficient use of funds and to generate real 
progress. It's clear what the interests of the G-8 nations are 
from the Global Partnership statement, but I was in Europe last 
week talking to a variety of different people about this 
subject, and I think there are some hints, beyond what was in 
the statement, that some of these nations could be interested 
in additional activities. These include assisting with the 
security of nuclear material, perhaps in concert with the 
United States, and the physical protection of nuclear warheads.
    What I think is lacking from the statements so far about 
what the G-8 nations excluding the United States, are 
interested in financing, is that there's been virtually no 
focus on ``brain drain'' and scientists. I think this is a very 
important problem, and I think it's going to be a persistent 
problem. As I understand it, there are various lists floating 
around Washington, not unlike your list, Senator, about what 
the threat reduction priorities ought to be, and that the 
conversion of defense facilities and the downsizing of the 
defense complexes is one of the high priorities on these lists. 
I think that it's inevitable that this downsizing is going to 
create additional dislocation for these weapons scientists.
    We've spent a lot of time in my organization on this 
question of the reemployment programs for weapons scientists. 
While they are essential, they are not working as well as they 
could. It's very true that there are very few conversions of 
weapons scientists' careers to non-weapon work. There is 
definitely a lifeline that is being provided by the current 
programs, but the career conversion of individual weapons 
scientists has not been very effective. I think this is 
something that both the G-8 nations and that the EU itself 
should focus on more.
    In this regard, I would like to comment on Ambassador 
Brooks' statement that the billion dollars that the EU may 
commit to the Global Partnership may be spent on plutonium 
disposition. I think plutonium disposition is important, but 
I'm not sure it's as important as dealing with the scientists 
issue, and I think some portion of the EU contribution should 
be devoted to that question.
    I won't go into the details of what individual countries 
are doing under the Global Partnership, it's in my formal 
testimony, but let me just leave the committee with five 
questions. Perhaps they are questions that the committee 
already has considered, but they're questions that I think are 
unanswered and are critical to the future and the success of 
the Global Partnership.
    The first is, are the projects identified for funding in 
the G-8 statement the most urgent global nonproliferation 
priorities, or should they be changed to reflect other 
priorities?
    Second, can the G-8 effectively coordinate their activities 
to avoid overlap and duplication, or facilitate the 
implementation of key projects where the U.S. cannot or will 
not act?
    Third, what will Russia do, both politically and 
financially, to make this process work efficiently and to clear 
away the impediments to progress that have developed over the 
last 10 years?
    And if I could just digress for a moment, I think this is 
an essential issue. There is a lot of money which is backlogged 
in some of these key threat reduction programs because of the 
inability to spend it. And, in fact, the U.K. previously has 
committed $750 million, I don't remember what exactly it is, 
and now they also have committed another $120 million over a 3-
year period. That $750 million is essentially being spent in 
support of U.S. programs because they cannot conclude an 
agreement with the Russians to spend it by themselves. So I 
think the problems of implementation in Russia are absolutely 
essential.
    Fourth, will the European G-8 nations and Japan really be 
able to find $10 billion for this initiative over the next 10 
years?
    Finally, and perhaps most importantly, will U.S. political 
support for threat reduction and leadership in this area remain 
strong over the next 10 years, or will nagging problems and 
disagreements sap the strength of the agenda?
    Thank you.
    [The prepared statement of Mr. Luongo follows:]

 Prepared Statement of Kenneth N. Luongo, Executive Director, Russian-
               American Nuclear Security Advisory Council

PERSPECTIVES ON THE G-8 GLOBAL PARTNERSHIP AGAINST THE SREAD OF WEAPONS 
                          OF MASS DESTRUCTION

    Mr. Chairman and members of the committee, thank you for your 
invitation to testify before the committee today on the G-8 Global 
Partnership, also known as the 10 + 10 Over 10 program. I am currently 
the Executive Director of the Russian-American Nuclear Security 
Advisory Council (RANSAC), a non-profit research organization dedicated 
to supporting cooperative threat reduction efforts with Russia and the 
Former Soviet States. RANSAC works closely with many governments, 
particularly in the U.S., Russia, and European states, to develop new 
cooperative nuclear security initiatives and to ensure the timely and 
effective implementation of existing cooperative threat reduction 
programs.
    I applaud the committee for holding this hearing at this time. The 
proliferation of weapons of mass destruction is a very serious issue 
and the global effort to stem this proliferation and secure and destroy 
existing weapons and materials requires high-level attention and 
scrutiny of the type that this committee is providing today.
    I am pleased to address the committee today on the subject of the 
G-8's contributions to prevent the spread of weapons of mass 
destruction as I just returned from a week in Europe where I had many 
discussions on this subject. While the Global Partnership has very 
broad principles that span many global objectives, the heart of the 
initiative is focused initially on specific non-proliferation projects 
that can be undertaken with Russia. Therefore, my remarks will focus 
primarily on G-8-Russian non-proliferation activities.
    Mr. Chairman, I will summarize my formal statement and ask that the 
full text of my testimony be included in the official record of the 
hearing.

                     THE STATUS OF THREAT REDUCTION

    The U.S. Congress, in bipartisan action in 1991, laid the 
foundation for the cooperative security agenda by enacting what became 
known as the Nunn-Lugar program, named for its primary cosponsors, 
Senators Sam Nunn (D-GA) and Richard Lugar (R-IN). This initiative has 
since developed into a broad set of programs that involve a number of 
U.S. agencies, primarily the Departments of Defense, Energy, and State. 
The government now provides these programs with approximately $900 
million to $1 billion per year.
    Among the program's highlights:

   The first success came in 1992, when Ukraine, Belarus, and 
        Kazakhstan agreed to return to Russia the nuclear weapons they 
        had inherited from the Soviet breakup, and to accede to the 
        Nuclear Nonproliferation Treaty as non-nuclear weapon states. 
        The same year, the United States helped establish two science 
        centers designed to provide alternative employment for 
        scientists and technicians who have lost their jobs, and in 
        some cases have become economically desperate, as weapons work 
        in Russia and the FSU was significantly reduced.

   In 1993, the United States and Russia signed the Highly 
        Enriched Uranium Purchase agreement, under which the United 
        States would buy 500 metric tons of weapons-grade highly 
        enriched uranium that would be ``blended down,'' or mixed with 
        natural uranium to eliminate its weapon usability and be used 
        as commercial reactor fuel. The two nations also established 
        the Material Protection, Control, and Accounting program, a 
        major effort to improve the security of Russia's fissile 
        material, and they signed an accord to build in Russia a secure 
        storage facility for fissile materials.

   In 1994, U.S. and Russian laboratories began working 
        directly with each other to improve the security of weapons-
        grade nuclear materials, and the two countries reached an 
        agreement to help Russia halt weapons-grade plutonium 
        production. Assistance to the Russian scientific community also 
        expanded, with weapons scientists and technicians being invited 
        to participate in the Initiatives for Proliferation Prevention 
        program, which is focused on the commercialization of non-
        weapons technology projects.

   In 1995, the first shipments of Russian highly enriched 
        uranium began arriving in the United States. The U.S. and 
        Russia also began to implement a new program to convert the 
        cores of Soviet-designed research reactors so that they no 
        longer use weapon-grade uranium.

   In 1996, the last nuclear warheads from the former Soviet 
        republics were returned to Russia. In the United States, 
        Congress passed the Nunn-Lugar-Domenici legislation, which 
        expanded the original cooperative initiative and sought to 
        improve the U.S. domestic response to threats posed by weapons 
        of mass destruction that could be used on American soil.

   In 1997, the United States and Russia agreed to revise their 
        original plutonium production reactor agreement to facilitate 
        the end of plutonium production.

   In 1998, the two nations created the Nuclear Cities 
        Initiative, a program aimed at helping Russia shrink its 
        massively oversized nuclear weapons complex and create 
        alternative employment for unneeded weapons scientists and 
        technicians.

   In 1999, the Clinton administration unveiled the Expanded 
        Threat Reduction Initiative, which requested increased funding 
        and extension of the life spans of many of the existing 
        cooperative security programs. The United States and Russia 
        joined to extend the Cooperative Threat Reduction agreement, 
        which covers the operation of such Department of Defense 
        activities as strategic arms elimination and warhead security.

   In 2000, the United States and Russia signed a plutonium 
        disposition agreement providing for the elimination of 34 tons 
        of excess weapons-grade plutonium by each country.

   In 2001, the Congress increased the funds for critical 
        threat reduction activities substantially above the requested 
        amounts, including in the post-9/11 supplemental appropriations 
        act.

   In 2002, the G-8 agreed to expand the scope, funding, and 
        timeline for WMD threat reduction activities in Russia and the 
        Congress again provided supplemental funding for key efforts.

    These and other efforts have produced significant, and 
quantifiable, results--which are all the more remarkable since they 
have been achieved under often difficult circumstances as ministries 
and institutes that only a decade ago were enemies must now cooperate.
    In Russia, roughly 6,000 nuclear warheads have been removed from 
deployment; more than 400 missile silos have been destroyed; and almost 
1,400 ballistic missiles, cruise missiles, submarines, and strategic 
bombers have been eliminated. The transportation of nuclear weapons has 
been made more secure, through the provision of security upgrade kits 
for railcars, secure blankets, and special secure containers. Storage 
of these weapons is gradually being upgraded at some sites, through the 
employment of security fencing and sensor systems, and computers have 
been provided in an effort to foster the creation of improved warhead 
control and accounting systems.
    With construction of the first wing of the Mayak Fissile Material 
Storage Facility, the nuclear components from more than 12,500 
dismantled nuclear weapons will be safely stored in coming years. 
Security upgrades also are under way to improve the security of the 
roughly 600 metric tons of plutonium and highly enriched uranium that 
exist outside of weapons primarily within Russia and improvements have 
been completed at all facilities containing weapon usable nuclear 
material outside of Russia. Through the Highly Enriched Uranium 
Purchase Agreement, 150 metric tons of weapon-grade uranium has been 
eliminated.
    On the human side of the equation, almost 40,000 weapons scientists 
in Russia and other nations formed from the Soviet breakup have been 
provided support to pursue peaceful research or commercial projects.
    Beyond yielding such statistical rewards, these cooperative 
programs also have created an important new thread in the fabric of 
U.S.-Russian relations, one that has proven to be quite important 
during times of tension. Indeed, the sheer magnitude of the cooperative 
effort and the constant interaction among U.S. and Russian officials, 
military officers, and scientists has created a relationship of trust 
not thought possible during the Cold War. These relationships are an 
intangible benefit that is hard to quantify in official reports, but 
they are a unique result of this work.
    However, the news in threat reduction is not all good. Progress on 
this essential agenda has been lagging in key areas and in some 
projects work is at a virtual standstill. Cooperation under the 
Cooperative Threat Reduction (CTR) program was virtually suspended this 
Spring and Summer over a dispute concerning Russia's chemical and 
biological weapons declarations. This issue is likely to linger. U.S. 
restrictions on funding for chemical weapon destruction at Shchuch'ye 
have created a crisis that could result in the termination of the 
project. Access and transparency disagreements are impeding warhead and 
fissile material security efforts. The redirection of weapons 
scientists is not producing lasting and career-changing new employment 
opportunities. And our understanding of the Russian bio-weapons complex 
and its security needs are incomplete and therefore our efforts to 
manage this threat are lacking.

             CONTRIBUTIONS FROM THE G-8 TO THREAT REDUCTION

    Many of the recent G-8 summits have addressed the danger of the 
proliferation of weapons of mass destruction. Past summit statements 
have specifically focused on: nuclear reactor safety, radioactive 
environmental dangers, and the threat of nuclear proliferation from the 
FSU. However, there has been a mismatch between U.S. and other nation's 
financial contributions to the non-proliferation agenda. Since 1992, 
the U.S. has provided approximately $7 billion to nonproliferation 
activities in Russia while G-8 nations have spent substantially less.
    Some of the key G-8 activities are:
Nuclear Reactor Safety
    During the Munich Summit in 1992, the G-7 established a 
multilateral program for financing nuclear safety improvements for 
countries in Central Europe and the FSU, and in 1993 proposed that the 
European Bank for Reconstruction and Development (EBRD) establish the 
Nuclear Safety Account (NSA) to receive contributions from donor 
countries for the financing of short-term operational and safety 
improvements of civilian reactors, specifically the VVER 440/230 and 
RBMK-type reactors.
    NSA played a critical role in officially decommissioning the 
Chernobyl site in December 2000. In addition to the NSA, the EBRD also 
administers the Chernobyl Shelter Fund (CSF). This program was 
established after the 1997 Denver Summit, during which the G-7, 
European Union, and Ukraine agreed to establish a multilateral funding 
mechanism to assist Ukraine to transform the existing Chernobyl 
sarcophagus over the destroyed Unit 4 into a stable and environmentally 
safe system. The objective of the program is to stabilize the existing 
sarcophagus and to build a confinement facility around it to isolate 
its radioactive materials from damaging the surrounding environment and 
water supplies. Stabilization is expected by 2003, while completion of 
the confinement is anticipated in 2006.
Nuclear Smuggling
    During the 1996 Nuclear Safety and Security Summit in Moscow, the 
G-8 initiated the ``Programme for Preventing and Combating Illicit 
Trafficking in Nuclear Material.'' The G-8 made the following pledges:

   Share and promptly disseminate information on nuclear theft 
        and smuggling incidents on a regular basis;

   Exchange information on significant incidents in this area, 
        especially if sensitive material is involved, and establish 
        appropriate national points of contact for this purpose;

   Foster enhanced cooperation and coordination among national 
        intelligence, customs, and law enforcement agencies and 
        cooperation to ensure prompt investigation and successful 
        prosecution in cases of illicit nuclear trafficking;

   Exchange experience and assistance to ensure safe and 
        effective nuclear material storage, protection, control and 
        accounting;

   Maintain effective national systems of export licensing and 
        control, which are important to deter and prevent illicit 
        trafficking;

   Establish training requirements pertaining to detection of 
        concealed nuclear material, radiation protection, safe handling 
        and transportation of nuclear material and radiation 
        protection, for law enforcement agencies (customs, police) in 
        accordance with their respective tasks and closely coordinate 
        relevant training activities in this area;

   Aid the exchange of scientific information and data to 
        permit the identification of the origin, history, and route of 
        seized illicit nuclear material;

   Support efforts to ensure that all sensitive nuclear 
        material (separated plutonium and highly-enriched uranium) not 
        intended for use in meeting defense needs.

    To date, the program's progress has been slow in that is has 
focused mostly on developing information exchange mechanisms, expanding 
the number of countries involved, and convening a series of conferences 
and development activities related to nuclear forensics. Most of the 
international efforts to exchange information and consult on possible 
responses in these areas are now being coordinated by the IAEA.
Plutonium Disposition
    Also during the 1996 Summit, the G-8 began to identify possible 
means of international cooperation to address the management and 
disposal of plutonium no longer required for defense purposes. Since 
1996, G-8 countries have been examining the mixed-oxide (MOX) fuel 
pathway and/or immobilizing plutonium. France, Germany, Canada, and 
Japan have all been involved in the investigation of MOX fuel 
fabrication in Russia.
    Now that both Russia and the United States have signed an agreement 
to dispose 68 metric tons (34 tons each) of excess weapons-grade 
plutonium no longer needed for defense purposes, plans are starting to 
move forward. Beyond the studies, however, limited funding has been 
provided.
     other multilateral and bilateral efforts involving g-8 nations
    Besides activities undertaken through the G-8 auspices, individual 
G-8 nations have developed specific bilateral non-proliferation 
cooperation with Russia and the FSU states and are participating in 
other multilateral activities.
International Science and Technology Center
    All of the G-8 nations are partners in the International Science 
and Technology Center (ISTC) in Moscow. Through September 2002, the 
international contributions to ISTC from the donor countries have 
totaled $452.8 million, for 1,625 projects. This program has, according 
to ISTC, provided employment to more 30,000 weapons scientists.

The European Nuclear Cities Initiative
    In December 1999, Italy's Ministry of Foreign Affairs proposed a 
program called the European Nuclear Cities Initiative (ENCI). This 
program is envisioned as a complement to the U.S.-Russian Nuclear 
Cities Initiative (NCI) in its effort to facilitate economic 
development and downsizing in the Russian nuclear weapons complex. Like 
NCI, ENCI will address ways to eliminate the economic strain on key 
facilities in the Russian nuclear complex--in particular the cities of 
Sarov and Snezhinsk--thus eliminating a source of potential leakage of 
fissile materials and knowledgeable scientists to countries posing a 
proliferation risk. The ENCI, through a working group it has 
established consisting of European, Russia, and U.S. representatives, 
hopes to coordinate the various European countries' inputs into Russian 
nonproliferation projects to avoid overlap. The immediate ENCI priority 
is to focus on the development of a ``roadmap'' of pilot projects in 
Russia's closed nuclear cities that meet key criteria such as a 
demonstrated market demand, and an ability to meet international 
product manufacturing and quality assurance requirements. As currently 
envisioned, funding for ENCI projects is likely to be channeled through 
the European Union's Technical Assistance for the Commonwealth of 
Independent States (TACIS) program, the ISTC, and bilateral programs.

Plutonium Disposition
    Throughout the 1990s, both Germany and France supported bilateral 
plutonium disposition technology development in Russia. In 1998, the 
two countries decided to merge their efforts under a trilateral 
agreement. The main objective of this program was the construction of a 
plutonium conversion facility and a MOX-fuel fabrication facility 
capable of processing 2.3 MT of weapons plutonium each year. The 
project would utilize German technology and French financing. The U.S., 
Italy, and Belgium also planned contributions to the construction of 
the facility. The total cost of the project was believed to be $1.7 
billion. This project was frozen when funding provided by the U.S. and 
France was not sufficient to meet required costs, and Siemens, the 
German contractor, discontinued its plans to produce the necessary 
equipment in 2001.

Nuclear Submarine and Fuel Management
    Since the days before the Soviet Union's dissolution, Scandinavian 
countries, particularly Norway, have been concerned about dumping of 
nuclear waste in northwest Russia in the Barents and Kara Sea region. 
Additional concerns have focused on Russia's many retired and 
deteriorating nuclear reactor-powered vessels, some of which are still 
fully fueled, and pose a proliferation threat. In 1994, after 
conducting a series of studies in search of solutions, Norway developed 
a ``Plan of Action'' to address concerns of an aging Russian nuclear 
fleet in the region. The Plan of Action has four priority areas: 1) 
safety measures at nuclear facilities; 2) spent fuel management and 
radioactive waste issues; 3) radioactive pollution in the Barents and 
Kara Seas; and 4) arms-related environmental hazards.
    In addition to its bilateral relationship with Russia, Norway is 
also involved in the Arctic Military Environmental Cooperation 
Initiative (AMEC), which includes the U.S., Russian, and Norwegian 
defense establishments. Established in 1996, AMEC focuses on 
environmental hazards associated with military activities in the 
Arctic. To a great extent, AMEC initially complemented the U.S. 
Cooperative Threat Reduction program, which, among other things, is 
assisting in the dismantlement of Russian strategic submarines. The 
three militaries work together on specific environmental issues 
associated with the removal and storage of spent nuclear fuel from 
nuclear submarines being decommissioned and dismantled in Northwest 
Russia. This spent fuel, if not properly managed, could release 
significant concentrations of radioactivity into the sensitive Arctic 
environment and ecosystems. Additionally, this nuclear fuel material 
poses a serious security issue.

Bilateral Activities of the United Kingdom
    In addition to the roughly $36 million the United Kingdom has 
contributed to the Nuclear Safety Account, a new effort was launched in 
late 2000, in which the UK government pledged up to $120 million over 
three years for nuclear problems in Russia and the FSU. This budget 
will cover work in Northwest Russia to decommission Russian nuclear 
submarines, the UK commitment to plutonium disposition, security, 
material accountancy and physical protection projects, commitment to 
the international Chernobyl shelter fund and projects to assist 
diversity and business development in the closed nuclear cities. Within 
this commitment, the U.K. intends to provide $4.5 million for 
cooperation with closed city scientists. Concerning the decommissioned 
submarines, both sides hope to begin work soon on the construction of a 
UK-funded interim spent nuclear fuel storage facility in the Murmansk 
region, costing up to $7.5 million. Discussions about other projects 
are ongoing, pending the final establishment of a legal framework for 
nuclear cooperation between the UK and Russia.

Bilateral Activities of Canada
    Bilateral relations between Canada and Russia on nuclear issues 
were established in 1989 when they signed a nuclear cooperative 
agreement. In June 1992, both countries launched a three-year, $30 
million program called the Canadian Nuclear Safety Initiative (CNSI). 
The main purpose of CNSI was to enhance the short-term safety of Soviet 
designed nuclear power stations through technical assistance and safety 
and regulatory training. Canada established the Nuclear Safety and 
Engineering Program in which nuclear experts from Atomic Energy of 
Canada Limited (AECL) work directly with Russian personnel on RBMK 
nuclear plant management and safety procedures at a handful of Soviet-
designed plants. In addition to CNSI, the Canadian government 
administers an internship program for high-level officials of Russian 
regulatory agencies to study nuclear safety issues at its Atomic Energy 
Control Board. Canada has also started receiving shipments of MOX 
nuclear fuel under the Parallex Project, which will provide technical 
information on the performance of Canadian Deuterium Uranium (CANDU) 
reactors to facilitate the disposition of excess U.S. and Russian 
weapons plutonium.

Bilateral Activities of Germany
    The Federal Republic of Germany's most sustained nonproliferation 
support to Russia has focused on chemical weapons destruction. In 1993, 
it committed funds to the production of a facility for this purpose in 
Gorny, which initiated its pilot destruction activities this year. 
Germany has committed approximately $30.5 million to chemical weapons 
destruction in Russia. Germany also supported limited upgrades of 
physical security systems and analytical and accountancy capabilities 
for nuclear materials in the Russian Federation.

Bilateral Activities of Japan
    Japan is another important contributor to enhancing nuclear 
security in the FSU. Most of its funding for nuclear efforts goes 
through nongovernmental organizations, and most of this cooperation has 
consisted of information exchanges and delegations, and seminars on 
specific topics in both countries. Japan began government-to-government 
cooperation with Russia in the 1990s. In 1993, the Japanese government 
pledged approximately $100 million to support the dismantlement of 
nuclear submarines in Russia, primarily focusing on the disposal of 
radioactive liquid waste. In June 1999, at the Cologne Summit, Japan 
pledged an additional $200 million for continued support of 
dismantlement of decommissioned submarines in the Russian Far East, 
conversion of Russian military resources to the private sector, and 
disposition of surplus weapons-grade plutonium removed from dismantled 
nuclear weapons. Japan's nuclear assistance can be largely broken down 
into four areas: 1) management of radioactive waste; 2) dismantlement 
of nuclear submarines; 3) maintenance of civilian reactors; and 4) 
fast-breeder reactor development.

Bilateral Activities of France
    France's bilateral cooperation with Russia has been somewhat 
limited, though valuable. The government of France has provided 100 
super-containers to Russia to facilitate the transport of nuclear 
warheads from heavy SS-18 missiles by railcar.

                       EUROPEAN UNION ACTIVITIES

    The European Union has been identified as a potential contributor 
to the Global Partnership and therefore it seems appropriate to provide 
a brief overview of its threat reduction related activities.
Technical Assistance to the Commonwealth of Independent States
    The European Union has provided over E140 million through the TACIS 
program for nonproliferation programs in Russia. It has provided 
assistance in market reform, grant assistance and research projects for 
weapons scientists.

Nuclear Safety
    Including the funds given by EU countries of the G-8 to aid in 
decommissioning Chernobyl, the EU, through TACIS, has over the period 
of 1991-1999 committed roughly $640 million to international efforts to 
improve FSU nuclear safety. A total number of 650 projects have been 
financed, 450 projects are ongoing and another 200 are in the pipeline. 
The EU plans to continue its nuclear safety program in the FSU well 
into the next decade.

The European Union Cooperation Programme for Nonproliferation and 
        Disarmament in the Russian Federation
    This program, also known as the Joint Action Russia Programme 
(JARP), was formed as a result of the EU Common Strategy on Russia. Its 
objectives include:

   Cooperate with Russia's efforts to dismantle or convert 
        infrastructure and equipment linked to WMD in a safe, secure, 
        and environmentally sound fashion

   Provide a framework for an enhanced EU role in cooperative 
        risk reduction in Russia

   Promote coordination of projects at the Member State and 
        international levels.

    Activities currently supported within JARP, as of a Council 
Decision in June 2001, include:

   Development of a regulatory basis by GAN for weapon-grade 
        plutonium disposition

   Study of MOX demonstration and licensing

   Study of feasibility of immobilization of waste containing 
        weapon-grade plutonium

   Support of the Russian Munitions Agency's efforts to fulfill 
        CWC obligations Construction of chemical weapons dismantlement 
        infrastructure at Shchuch'ye.

    JARP's 1999-2000 budget was E8.9 million. As of July 2001, a total 
of E6.08 million had been allocated, including E3.2 million for 
plutonium disposition activities, and E2.7 million for chemical weapons 
activities. In May 2002, E645,000 in additional financing was added by 
the council to set up units of experts stationed in Brussels and Moscow 
who would be responsible for implementing JARP. Earlier activities 
supported within JARP included facility construction at Gorny and GT-
MHR development. It appears that support for these projects was 
discontinued.

The Northern Fleet's Lepse Vessel
    Beyond reactor safety, the EU has also become involved in securing 
the Lepse fuel storage vessel, a program that was initiated by Norway. 
Between 1962 and 1981, the Lepse was used as a service ship at the 
nuclear icebreaker base in waters in Northwest Russia. Since then, the 
Lepse has been used as floating storage for spent nuclear fuel from the 
reactors of nuclear icebreakers. The 624 spent fuel assemblies onboard 
the Lepse today are under highly unsatisfactory conditions; the fuel 
has become partially jammed in the holding tubes and is now difficult 
to remove. The EU expert group appropriated $18.5 million for a 
technical solution to the Lepse problem. Funding was provided by the 
EU's TACIS program.

                       THE G-8 GLOBAL PARTNERSHIP

    The statement at the Kananaskis G-8 Summit on the Global 
Partnership Against the Spread of Weapons of Mass Destruction was a 
major step forward for G-8 threat reduction efforts. Under this 
initiative, the G-8 nations committed to support specific cooperation 
projects, initially in Russia, to address non-proliferation, 
disarmament, counter-terrorism and nuclear safety issues. Since threat 
reduction activities had recently passed their ten-year anniversary the 
agreement at the Summit, that these programs should continue for 
another decade but with substantially more funding and participation 
from countries other than the U.S., has provided a framework for 
thinking concretely about the future of threat reduction with Russia 
and the FSU.
    Further, the G-8 leaders called on all countries to join them in 
commitment to the following six principles to prevent terrorists from 
acquiring or developing nuclear, chemical, radiological and biological 
weapons; missiles; and related materials, equipment and technology:

   Promote the adoption and implementation of multilateral 
        treaties to prevent the proliferation;

   Develop and maintain appropriate effective measures to 
        account for and secure such items;

   Develop and maintain appropriate effective physical 
        protection measures applied to facilities that house such 
        items;

   Develop and maintain effective border controls, law 
        enforcement efforts and international cooperation to detect, 
        deter and interdict in cases of illicit trafficking;

   Develop, review and maintain effective national export and 
        transshipment controls over items on multilateral export 
        control lists, as well as items that are not identified on such 
        lists but which may nevertheless contribute to the development, 
        production or use of nuclear, chemical and biological weapons 
        and missiles;

   Adopt and strengthen efforts to manage and dispose of stocks 
        of fissile materials designated as no longer required for 
        defense purposes, eliminate all chemical weapons, and minimize 
        holdings of dangerous biological pathogens and toxins, based on 
        the recognition that the threat of terrorist acquisition is 
        reduced as the overall quantity of such items is reduced.

Global Partnership Funding
    While these broad principles may form the basis of a global effort 
to control WMD, the immediate objective of the G-8 initiative is to 
raise up to $20 billion for these projects over the next ten years. The 
G-8 statement does specify projects that are of interest, including: 
destruction of chemical weapons; dismantlement of decommissioned 
nuclear submarines; the disposition of fissile materials; and 
employment of former weapons scientists.
    The assumption is that the U.S. would bear the cost of about half 
the $20 billion since it is currently spending about $1 billion per 
year on threat reduction activities in Russia and the FSU. However, as 
the attached table indicates, even if the U.S. spends $10 billion over 
the next decade, only $3.4 to $3.8 billion--or slightly more than one-
third--of the remaining $10 billion has been publicly pledged by other 
G-8 nations to date. If an EU contribution of $1 billion over ten years 
is added in then the contribution percentage is raised to almost half. 
But the source of the remainder of the G-8 funding is not completely 
clear at this point.
    Further, under the terms of the statement made by G-8 leaders 
regarding the crediting of contributions against the $20 billion 
target, there are some accounting loopholes. For example, funds that 
are obligated to nonproliferation efforts by G-8 countries from the 
date of the statement can be included in the total contribution. This 
would allow prior appropriations made by member countries to be counted 
toward the $20 billion contribution.
    There are numerous sensitivities regarding the G-8 initiative and 
the financing is chief among them. Given the budgetary pressures on the 
other G-8 nations it is not clear that they will be able to find 
substantially new money to support this initiative. Therefore, one 
option is to exchange Russian debt to key nations in return for non-
proliferation activities in Russia as a source of meeting the $10 
billion pledge.
    In this regard, the passage of the Russian Federation Debt for Non-
Proliferation Act of 2002 as part of the FY03 Foreign Relations 
Authorization Act is a welcome development. The legislation could allow 
the U.S. to trade up to $2.7 billion in Russian lend-lease and 
agricultural debt for equivalent amounts of non-proliferation 
investment. I applaud the Senate Foreign Relations Committee for its 
essential role in sponsoring and passing this legislation. However, if 
the U.S. decides to trade some or all of its debt for nonproliferation 
activities in Russia, these funds should supplement the roughly $1 
billion that the U.S. is currently spending on threat reduction. These 
funds should not be used as a substitute for this appropriated funding. 
The infusion of additional funding could create new opportunity for 
progress on this agenda.
    The G-8 member state attitudes on reducing Russia's debt burden, 
however, are varied. Germany, which is by far the largest creditor in 
the Paris Club where Russia owes them over $20 billion, has concerns 
about the reduction of Russia's debt. Some states, however, such as 
Italy and France, have both expressed support for debt reduction 
initiatives. Neither Canada, the United Kingdom, nor Japan have made 
direct statements on relieving Russia's debt, although in general 
international financial negotiations, the former two have tended to be 
supportive of debt relief initiatives like the World Bank and 
International Monetary Fund's Heavily Indebted Poor Country (HIPC) 
Initiative, whereas Japan has usually been opposed.
    In addition, and perhaps most importantly, Russia's position on a 
debt-swap program is not completely clear. Some officials are arguing 
that it may hurt their international credit rating at a point when 
Russia has begun to manage its foreign debt sufficiently or that it 
could spur inflation.

Global Partnership Programmatic Priorities
    Another set of issues that the Global Partnership will need to deal 
with is the prioritization and coordination of activities. The 
initiative must be carefully structured and coordinated to ensure the 
maximum efficient use of the funds and to generate real progress. It is 
clear from the attached table that the major interests of the G-8 
nations other than the U.S. are in chemical weapons destruction, 
submarine dismantlement, plutonium disposition, and nuclear safety. 
Some of these interests overlap with the U.S. and some could cover 
areas where the U.S. is not currently focused. Coordination will be 
necessary to avoid duplicative spending. But there are some hints that 
some G-8 nations may be interested in additional activities including 
assisting with the security of nuclear material and the physical 
protection of sub-strategic warheads.
    What is lacking, however, in the statements by G-8 nations on the 
projects that they want to fund, is an urgent focus on brain drain and 
the redirection of former weapons scientists. This is a persistent 
problem that will increase in importance in coming years. In recent 
months there have been clear indications that the conversion of defense 
production facilities in Russia ranks very high on Washington's list of 
non-proliferation priorities. Such a focus will generate more excess 
weapons scientists.
    To date, the re-employment programs for weapons scientists, while 
essential, are not working well in any of the WMD complexes in Russia 
and the FSU. While some European G-8 nations believe that the issue of 
scientist conversion is to be dealt with at the EU level, it is clear 
that no G-8 country or the EU is doing enough in this area. It has been 
reported that the EU is to contribute $1 billion to the Global 
Partnership and it has been speculated that these funds may be 
primarily utilized for plutonium disposition. Addressing the 
redirection of weapons scientists is an equal if not greater priority 
than plutonium disposition and the EU and individual G-8 nations should 
seriously consider providing substantial funding for this purpose.
    Besides the U.S., Germany, Canada, and the U.K. have spelled out 
their Global Partnership contributions in the greatest detail to date. 
In Canada the top program priority is the security and disposition of 
submarine fuel.
    For Germany the top three priorities are facilitating chemical 
weapons destruction at Kambarka, submarine dismantlement, and securing 
nuclear materials and waste. While Germany has been active in plutonium 
disposition in the past, the recent election has made German 
participation in MOX-based plutonium disposition impossible. Germany 
will utilize a pre-existing agreement with Russia to implement its 
programs.
    The U.K. has increased its participation in threat reduction 
activities over the past few years, previously approving $125 million 
over three years. But at the Kananaskis Summit, the U.K. committed 
another $750 million over 10 years. The top U.K. priorities are nuclear 
safety and security, plutonium disposition, and submarine dismantlement 
and disposition. However, the U.K. has run into substantial difficulty 
in finalizing an agreement with Russia that would exempt British funds 
from taxes and protect the country from liability in nuclear projects. 
As a result, some of the original $125 million is being spent on U.S.-
developed projects and the expenditure of the promised $750 million 
awaits the finalization of the agreement.
    The experience of the U.K. raises questions about how Russia will 
improve the overall environment in which threat reduction operates. 
Financial transparency, facility access, and legal protections are all 
key issues that are impeding many threat reduction efforts among the G-
8 nations and the EU. There is also a question about the structural 
ability of Russia to absorb a potential doubling of threat reduction 
funding. Only Russia can address these issues authoritatively. 
Therefore, strong political will is necessary in that country to ensure 
that the G-8 initiative is kindled to life and that it thrives.
                               conclusion
    In conclusion, I would leave the committee with five questions that 
I believe are not yet answered about the G-8 Global Partnership.

   Are the projects identified for funding in the G-8 statement 
        the most urgent global non-proliferation priorities or should 
        they be changed?

   Can the G-8 effectively coordinate their activities to avoid 
        overlap and duplication or facilitate the implementation of key 
        projects where the U.S. cannot or will not act?

   What will Russia do both politically and financially to make 
        this process work efficiently and to clear away the impediments 
        to progress that have developed over the past ten years?

   Will the European G-8 nations and Japan really be able to 
        find $10 billion for this initiative over the next 10 years?

   Will U.S. political support for threat reduction and 
        leadership in this area remain strong over the next ten years 
        or will nagging problems and disagreements sap the strength of 
        this agenda?

    The answers to these questions are not clear at this point but the 
answers will determine whether the G-8 Global Partnership will be a 
catalyst for renewed enthusiasm and real progress in threat reduction.

                     THE 10 PLUS 10 OVER 10 INITIATIVE: CONTRIBUTIONS AND PROPOSED PROJECTS
----------------------------------------------------------------------------------------------------------------
                            Russia's
             Reported or   Paris Club
  State        Planned       debt ($      Projects                               Notes
            Contributions   billions)
----------------------------------------------------------------------------------------------------------------
Germany    $1.5 billion    20.2        CW                    Germany will not participate in the MOX aspects of
            \1\                         dismantlement                                     plutonium disposition
                                        at Kambarka;
                                        submarine
                                        dismantlement
                                        ; securing of
                                        nuclear
                                        material and
                                        waste;
                                        plutonium
                                        disposition.\
                                        2\
----------------------------------------------------------------------------------------------------------------
Italy      $400 million    7.0         Submarine         These projects were discussed in a recent Russia-Italy
                                        dismantlement                                         inter-MFA meeting
                                        ; CW
                                        dismantlement
                                        .\3\
----------------------------------------------------------------------------------------------------------------
U.S.       $10 billion     3.7         Continuation
            \4\                         of existing
                                        activities at
                                        approximately
                                        $1 billion
                                        per year;
                                        additional
                                        activities
                                        may include
                                        new efforts
                                        to reduce
                                        excess
                                        nuclear
                                        materials.\5\
----------------------------------------------------------------------------------------------------------------
France     N/A             2.0
----------------------------------------------------------------------------------------------------------------
Japan      $200 million    2.0         Dismantling     Japan has conditioned its provision of assistance within
            \6\                         the Russian    the G-8 framework on strict accountability requirements.
                                        nuclear         Japan stated that 50% of its contribution should be put
                                        arsenal;         aside to help set up an international organization for
                                        plutonium                                 surplus plutonium disposition
                                        disposition.\
                                        7\
----------------------------------------------------------------------------------------------------------------
Canada     $600 million    .8          Submarine       The $650m source indicates that this would be provided in
            \8\ to $1                   dismantlement                             $65m increments over 10 years
            billion \9\                 ,\10\
                                        security and
                                        disposition
                                        of submarine
                                        fuel.
----------------------------------------------------------------------------------------------------------------
U.K.       $750 million    .6          CW                  The $750m will be spread over a decade. The U.K. has
            \11\                        destruction;   conditioned sub dismantlement aid on its control of fund
                                        employment of          allocations and permission to analyze the entire
                                        former         dismantlement process. The Russian MFA is resolving these
                                        weapons                 conditions. The employment of scientists and CW
                                        scientists;             destruction were highlighted in addition to sub
                                        submarine        dismantlement by PM Blair in a speech to Parliament as
                                        dismantlement                               priorities for the G-8 plan
                                        ; plutonium
                                        disposition;
                                        nuclear
                                        reactor
                                        decommissioni
                                        ng; MPC&A;
                                        nuclear
                                        safety.
----------------------------------------------------------------------------------------------------------------
EU         $1 billion      N/A         ..............          This funding may primarily be used for plutonium
            \12\                                          disposition over the next 10 years utilizing the JARP

----------------------------------------------------------------------------------------------------------------
\1\ Werner Kolhoff. ``Russischer Atomschrott und deutsche Geschafte,'' Berliner Zeitung. June 28, 2002. Personal
  translation.
\2\ Agence France Press. ``G8 clinches deal to secure Russian plutonium: German source.'' June 27, 2002.
  Informal remarks of German official.
\3\ Ministry of Foreign Affairs of the Russian Federation Daily News Bulletin. ``Georgy Mamedov, Deputy Foreign
  Minister and Russia's Political Director in the Group of Eight, Meets with Gianfranco Facco Bonetti, Italian
  Ambassador to Moscow.'' September 17, 2002.
\4\ Charles Digges. ``G8 Pledges $20 billion to Secure Russian Weapons of Mass Destruction.'' Bellona. June 28,
  2002.
\5\ ``U.S.-Russia Identify New Ways to Reduce Nuclear Materials.'' Washington File, U.S. Department of State,
  International Imformation Programs, September 17, 2002. http://usinfo.state.gov/cgi-bin/washfile.
\6\ Asahi News Service. ``Japan to sweeten Russia arms proposal.'' June 29, 2002.
\7\ Kyodo News Service. ``Japan backs weapons disposal with $200 million.'' June 28, 2002. http://
  www.japantimes.co.jp/cgi-bin/getarticle.pl5?nn20020628a2.htm.
\8\ Mike Tricket. ``Russia, Mideast steal Africa's limelight: Big bucks go to Putin, media focus on peace
  plan,'' Ottawa Citizen. June 28, 2002.
\9\ Reuters. ``G8 frets on ex-Soviet nuclear arms, works on deal.'' June 27, 2002.
\10\ Nikolai Vlasov. ``Canadian PM satisfied with agreement on financing elimination of Soviet weapons of mass
  destruction,'' RIA Novosti. June 28, 2002.
\11\ Tony Blair. ``Statement on the G8 Summit in Kananaskis,'' Foreign and Commonwealth Office. July 1, 2002.
\12\ Reuters, ibid, AFP, ibid.

    Senator Lugar. Thank you very much.
    Ms. Holgate.

STATEMENT OF LAURA S.H. HOLGATE, VICE PRESIDENT FOR RUSSIA/NIS 
      PROGRAMS, NUCLEAR THREAT INITIATIVE, WASHINGTON, DC

    Ms. Holgate. Thank you, Mr. Chairman, I'm grateful for the 
chance to give testimony this afternoon before such steadfast 
and visionary leadership as this committee represents on these 
issues. This hearing on the opportunities for a greater global 
security cooperation presented in the G-8 launched this June of 
the Global Partnership is exactly what is needed right now.
    I will paraphrase my written testimony, in the expectation 
that it can be entered in the record.
    Senator Lugar. It will be included in the record in full.
    Ms. Holgate. Senator Nunn went on the record this summer 
commending the U.S. leaders for their success in achieving this 
diplomatic breakthrough, and our organization has been devoted 
to trying to assist in the conclusion of the meeting of those 
pledges.
    We have seen some early initiative from the G-8 nations to 
honor these pledges, but all member nations have much more to 
do to meet the high expectations they created with the bold 
statements at Kananaskis. The G-8 nations have given themselves 
and the world a fleeting opportunity to truly transform threat 
reduction efforts.
    The stability of a $20 billion commitment over the next 
decade creates an entirely new fiscal environment for such 
activities, and the multilateral nature of the Global 
Partnership affords new opportunities for collaboration and 
synergy, which, in the whole, really is greater than the sum of 
its parts.
    This striking opportunity could be squandered if 
governments see these pledges as status-quo-plus, just doing a 
little bit more than what they were already doing before. To 
fulfill its promise, the G-8 initiative should be seen not 
merely as an effort to address the problems, but as an effort 
to actually solve them. This calls for a concentrated, 
coordinated, and, above all, a comprehensive, strategic 
approach that analyzes the threats, assesses the risks, and 
directs resources in the most high-leverage, cost-effective 
way, taking into account the special capabilities and concerns 
of all involved countries and establishing a sensible strategic 
division of labor.
    I'll list briefly a dozen or so new approaches beyond the 
essential programmatic foundation that's currently underway 
that was so ably characterized by the last panel. These 
approaches could help the G-8 fulfill their promise to go 
beyond this bedrock and identify greater resources in a more 
comprehensive, better coordinated worldwide commitment 
reflected in this June announcement.
    I'll start with the concept of pooled funds, and this could 
be combined with the debt-for-program exchange, as the recent 
Biden-Lugar legislation has permitted.
    Second, confirming the quantity and security of Russia's 
tactical nuclear weapons. Europe has a special interest here, 
because of the range of these weapons.
    Third, an approach of adopting a closed city and trying to 
create the most comprehensive set of supports possible, whether 
it's retraining, retirement, resettlement, economic 
development, infrastructure, job creation, demolition, and 
other needs with a 3-year goal, and let's start with Sarov, 
which has been MinAtom's first priority.
    Fourth, border export controls. And here, Europe has a 
special role with the borders they share with Russia.
    Divide and conquer on material security. Have Europe take 
over the civilian nuclear material facilities, and let the U.S. 
efforts focus on the military and weapons-related materials 
facilities.
    A global ``clean out and secure'' initiative to look at the 
materials wherever the exist, and including the flexibility 
that you have so eloquently described the need for, that 
Project Vinca really clarified and demonstrated.
    Research reactor conversion, eliminating the stocks and the 
need to have continuous stocks of highly enriched uranium at 
institutions and research facilities around the world.
    Accelerating the blend-down of highly enriched uranium 
currently tied up in Russian weapons and storage facilities.
    Perhaps an outright purchase of Russian plutonium as a way 
to accelerate the security and disposition of it.
    Obviously, chemical weapons destruction is an area where 
there's been probably the most robust multilateral sharing, and 
there's opportunities to continue that with the U.S. focusing 
on Shchuch'ye or the pieces of Shchuch'ye it can do, and other 
nations focusing on other pieces. And the transportation 
questions will be a whole new set of needs as Russia makes good 
on its commitment to move some of those weapons to Shchuch'ye.
    Biological weapons--again, Europe has a very powerful role 
to play here with a strong biotechnology industry.
    General purpose submarines, we've discussed at some length 
already, but, there again, Europe and Japan are natural 
candidates to concentrate there.
    Looking at some nonsecurity assistance applied to security 
needs, in the World Bank, in the EU, in other bilateral 
programs. Economic and humanitarian assistance programs can be 
targeted regionally or contextually to areas that are dealing 
with weapons issues, whether it's at Shchuch'ye, or whether 
it's at Sarov, or whether it's other areas where these 
humanitarian or economic-assistance needs are going to be part 
of the solution to the proliferation and security problems.
    And I'll spend a couple of minutes on the legal impediments 
question, because that's a natural for a legislative body. And 
as much as legislatures around the world deserve credit for 
creating and funding existing threat-reduction programs, 
they've also authored huge impediments, sometimes 
unintentionally.
    Certainly, the certification requirements and other 
legislative restrictions attached to the U.S. CTR programs over 
its decade of life were designed to have a limiting effect, 
owing initially to the uncertainty of how the post-Soviet 
Republics would relate to the United States, and, subsequently, 
to the continued opposition of some in Congress to the threat-
reduction mission.
    In this era of partnership with Russia, these limits need 
to be removed, and I'm very pleased to hear of your initiative 
on this point and would love to work with you on that.
    In the realm of unintended consequences, U.S. Federal 
Acquisition Regulations, which were designed to assure fair 
access to Federal contracting dollars, not to disarm an enemy, 
and, more importantly, visa restrictions, more recently, 
designed to catch potential terrorists, have severely hampered 
cooperative efforts. Somehow targeted exceptions have to be 
written into the law so that our counterterrorism policies do 
not thwart the actual countering of terrorism.
    Russia has some work to do here, as well. The nine 
implementing guidelines agreed to at Kananaskis called for 
reasonable measures of tax exemption, accountability, and 
access, liability protection, and other legal terms and 
conditions governing the provision of international assistance. 
Rather than pursuing multiple bilateral agreements, all of 
which require Duma ratification, Russia should modernize its 
own legal and regulatory structures to accommodate legitimate 
threat reduction cooperative needs.
    As this list makes clear, each member of the G-8 has plenty 
to do. Some members still have their hands on their wallets and 
need to declare the amount of their financial commitment. 
Russia has reportedly already failed to apply the principles of 
the nine guidelines in ongoing bilateral negotiations. 
Reassuringly, the ad hoc group of senior officials who met 
recently in Ottawa appears to be the designated coordination 
mechanism called for in the Kananaskis Summit statement. Done 
right, this group will be very busy, both in meetings with each 
other and in pursuing their own nations' execution of their 
June pledges.
    One way to help the annually changing membership of the G-8 
remain focused on this pledge, which is, after all, one of 
multiple pledges in the G-8, would be to institute a year-end 
President's report from each departing G-8 President on the 
progress on the execution of these pledges.
    Along with the hard work needed to forge a true G-8 
partnership to address proliferation risks in Russia, it will 
take a determined effort to match the rhetoric of the Global 
Partnership into reality. The G-8 needs to develop an explicit 
plan for including nations like China, Pakistan, India, Brazil, 
and Egypt into this partnership. The G-8 also needs to move 
quickly to bring non-G-8 donors, like the Netherlands and 
Norway, into the partnership. A global partnership requires 
global participation. Recruiting new members must be seen as an 
essential and ongoing element of the effort.
    I'll close with a recent conversation with one you know 
well, Zinovy Pak, on the chemical-weapons issue, which 
clarifies both the opportunities and the perils of this G-8 
pledge. Dr. Pak has been instrumental in expanding Russia's own 
investment in its chemical weapons destruction program by 
sixfold in recent years, and he is attempting even further 
increases. Since June, however, he is challenged more and more 
by his colleagues, or, you might say, even rivals, in his 
interagency process of pulling and hauling over Federal 
budgets.
    They are telling him he doesn't need anymore Russian 
rubles, because the G-8 is clearly going to take care of his 
chemical weapons destruction problem with dollars, Euros, and 
yen. This is a pernicious situation on two fronts. First, 
because it suggests that some officials in Russia may not yet 
understand that the international commitment to funding threat 
reduction inside Russia depends on a continued, even 
intensified, demonstration of Russia's own commitment to doing 
its part.
    Second, it reflects the degree to which Russia's threat 
reduction plans are currently being structured in legitimate 
anticipation of the other G-8 nations meeting their $20 billion 
pledge. A failure of commitment on one side will weaken the 
commitment of all sides and make all of us less secure. That's 
why it's so essential that all nations everywhere do their 
part, not only because no nation wants to carry the burden 
alone, but because no nation, in fact, can.
    It would be, in my judgment, a great service to the cause 
and ideals of this partnership if this committee can continue 
to serve as a reminder to our government and to partner 
governments of the commitments they have made, the expectations 
they have raised, and the obligations they have embraced for 
making the most of this moment to increase the security of the 
world.
    Thank you very much.
    [The prepared statement of Ms. Holgate follows:]

Prepared Statement of Laura S.H. Holgate, Vice President for Russia/New 
             Independent States, Nuclear Threat Initiative

               G-8 PLEDGES FOR THREAT REDUCTION IN RUSSIA

    Mr. Chairman and Members of the Committee: My name is Laura 
Holgate. I am Vice President for Russia and the New Independent States 
at the Nuclear Threat Initiative, a charitable organization founded by 
Ted Turner, co-chaired by Mr. Turner and former Senator Sam Nunn and 
dedicated to reducing the global threat from nuclear, biological and 
chemical weapons.
    I thank you for inviting me to testify before the committee today 
on the opportunities for greater global security cooperation presented 
by the G-8 launch this June of a ``Global Partnership Against the 
Spread of Weapons and Materials of Mass Destruction.''
    I would like to begin my testimony by quoting from a statement 
Senator Nunn issued this summer in response to the G-8 announcement.
    ``The decision by G-8 leaders to establish this global partnership 
represents a major step in the right direction in terms of how the 
United States and its partners and allies must work together to prevent 
dangerous groups from gaining control of the most dangerous materials--
materials that could be used to commit catastrophic terrorism. The G-8 
pledge to spend $20 billion over the next ten years to secure the 
former Soviet Union's vast stores of nuclear, chemical, and biological 
materials suggests that member states are willing to back their 
commitments with much-needed resources.''
    We have seen some early initiative from G-8 nations to honor their 
pledges, but all member nations have much more to do to meet the high 
expectations they created with their bold statements at Kananaskis. G-8 
nations have given themselves and the world a fleeting opportunity to 
truly transform threat reduction efforts. The stability of a $20B 
commitment over the next decade creates an entirely new fiscal 
environment for such activities, and the multilateral nature of the 
``Global Partnership'' affords new opportunities for collaboration and 
synergy, in which the whole really is greater than the sum of its 
parts.
    This striking opportunity could be squandered if governments see 
these pledges as ``status quo plus''--doing a little bit more to 
address the problem, and thus merely adding more money to existing 
efforts. To fulfill its promise, the G-8 initiative should be seen not 
as an effort to address the problem, but to solve it. This calls for a 
concentrated, coordinated and above all, a comprehensive strategic 
approach that analyzes the threats, assesses the risks, and directs 
resources in the most high-leverage, cost-effective way--taking into 
account the special capabilities and concerns of all countries, and 
establishing a sensible, strategic division of labor.
    I would like to list briefly a dozen or so different approaches 
that could help the G-8 fulfill the promise of the greater resources 
and more comprehensive, better coordinated world-wide commitment 
reflected in its June announcement of the Global Partnership:

   ``Pooled'' funds. A single funding structure consolidating 
        contributions from several nations or other funders, jointly 
        administered by donors and recipients, would create 
        efficiencies and--more importantly--a greater sense of 
        partnership that is appropriate in fighting a common threat.

   Confirming the quantity and security of Russia's tactical 
        nuclear weapons. We must work with Russia to ensure an accurate 
        accounting and the security of Russia's tactical nuclear 
        weapons. Tactical nuclear weapons have never been covered in 
        any treaties or agreements--and that is an ongoing, decades-
        long mistake that requires immediate correction. Measures must 
        be developed to provide confidence that Russian tactical 
        warheads are secure and fully accounted for. The short range of 
        these weapons make them particularly risk from the European and 
        Japanese perspective, and as such, this area may be a fruitful 
        avenue for a dedicated dialogue.

   ``Adopt a closed city'' approach. Russia's Ministry of 
        Atomic Energy has identified the shrinkage of nuclear weapons 
        facilities in the closed city of Sarov as its top conversion 
        priority. Successful conversion of Sarov is the key to ``right- 
        sizing'' the entire bloated Russian weapons complex. Several 
        U.S. efforts are focusing on Sarov's challenges, but current 
        efforts fall short of what's needed. Joint development and 
        execution of a comprehensive plan to address the retraining, 
        retirement, resettlement, economic development, infrastructure, 
        job creation, demolition and other needs within 3 years would 
        allow different partners to play to their diverse strengths in 
        a way that covers all the necessary bases.

   Border controls. Given the shared borders between Europe and 
        Russia, rigorous control over trafficking in nuclear, 
        biological and chemical weapons should be a natural concern of 
        the G-8 nations. Technologies and equipment developed for 
        European borders should be extended to Russia's borders with 
        Central Asia, and borders within Central Asia. U.S. Government 
        programs in this area have been neither comprehensive nor well 
        organized; a division of labor in which Europe and Japan 
        execute the lion's share of border security assistance would 
        free U.S. funds for other priorities.

   Divide and conquer materials security. Another natural 
        division of labor comes in the security of weapons materials. 
        The Partnership needs to act swiftly and comprehensively to 
        secure vulnerable materials at nuclear and biological 
        facilities. Given Russian sensitivities about military-oriented 
        facilities--which they are only likely to open to the U.S., if 
        anyone--G-8 partners and others should focus on upgrading 
        security at civilian facilities, freeing U.S. resources for 
        more intense and thorough security improvements at nuclear 
        weapons facilities.

   Global clean-out and secure. The recent success of Project 
        Vinca demonstrates both the risks posed by unneeded weapons 
        materials around the globe but also the limitations of U.S. 
        authorities to provide the incentives required to complete the 
        removal and destruction of these materials. The U.S. should 
        expand its nascent Russian Reactor Fuel Return activity with a 
        goal of removing and destroying all excess weapons usable 
        nuclear material world-wide, specifically including adequate 
        flexibility to address incentives for such removal, which are 
        likely to be as diverse as the facilities themselves. Any 
        facilities that continue to have a legitimate use for weapons 
        usable material must have appropriate security, which may also 
        require assistance. Where the U.S. is not well positioned 
        politically to approach certain holders of such material, other 
        G-8 partners, as well as nations outside the G-8, should be 
        called upon to provide such access and resources.

   Research reactor conversion. We are rapidly approaching the 
        point where new, high-density low-enriched uranium fuels can 
        equal or exceed the performance of highly enriched uranium 
        fuels in research reactors. Within a decade, all research 
        reactors using HEU should be converted, and their spent fuel 
        secured until disposed of.

   Accelerated HEU blend down. Russia has produced, by some 
        calculations, well over 1000 tons of highly enriched uranium. 
        Of this amount, 500 tons is currently being blended down at the 
        rate of 30 tons per year, based on market absorption capacity. 
        This U.S.-Russia ``HEU Deal'' will take another decade to 
        complete. In the mean time, Russia still has much more HEU than 
        they could possibly need for defense purposes, based on any 
        reasonable calculation of warhead maintenance and naval 
        propulsion requirements. The surest way to keep this material 
        out of the hands of those who would harm us is to destroy it at 
        a pace faster than current markets can absorb it--buying it up, 
        blending it down, selling it, and storing what can't be sold. 
        This may require support to Russia to increase its industrial 
        blend down capacity, as well as to process and store the low 
        enriched uranium before it is sold.

   Plutonium purchase. One of the challenges in reducing U.S. 
        and Russian stocks of plutonium. The U.S. produced just under 
        100 tons in the last 50 years, while the total Russian 
        production is 140 to 170 tons, and rising. Current agreement on 
        plutonium disposition addresses equal reductions of 34 tons 
        apiece, which will not only leaves behind enormous quantities 
        of weapons plutonium, but leaves Russia with approximately 
        twice as much as the U.S. The goal should be to reduce stocks 
        to no more than the level required for both sides to maintain 
        agreed numbers of nuclear weapons. The U.S. or a larger group 
        of nations could purchase 100 or so tons of Russian plutonium 
        and take responsibility for storing it securely, whether in 
        Russia, Europe, or the U.S., and ultimately disposing of it. 
        Such a transfer of control and responsibility would remove many 
        of the concerns about long-term storage of plutonium pending 
        disposition, as well as address some of the problems associated 
        with reciprocity and matched reductions.

   Chemical weapons destruction. Chemical weapons destruction 
        in Russia is probably the area of most robust multilateral 
        participation. Based on largely ad hoc coordination, several 
        nations are contributing tens of millions of dollars both to 
        infrastructure needs not covered by U.S. Cooperative Threat 
        Reduction pledges for the destruction facility at Shchuchye, 
        but also to destruction facilities and equipment at other 
        locations in Russia. Even assuming that the U.S. will resolve 
        its certification problems and complete the destruction 
        facility at Shchuchye, much more will remain to be done. The 
        U.S. should be prepared to fund the second phase of the 
        Shchuchye destruction facility, which will be used to destroy 
        chemical agents currently stored at other locations. G-8 
        nations should also be prepared to commit additional resources 
        to fund the transportation needs of the project. Russia will 
        need a greater number of vehicles and improved transportation 
        infrastructure to destroy chemical weapons and consolidate 
        current stocks at a smaller number of sites.

   Biological weapons. Europe's strong biotechnology industry 
        has a powerful role to play in addressing biological weapons 
        proliferation risks, both in addressing its own research and 
        industrial practices, and in supporting efforts to redirect 
        Russia's former bioweaponeers. Industry involvement in such 
        redirection efforts has been tentative at best, in part because 
        of the political taint of working with former weapons 
        facilities and staff. Governmental leadership can highlight the 
        risks such facilities pose, and urge the bio industry to become 
        part of the solution in government-reviewed and--sanctioned 
        programs of cooperation.

   General purpose submarines. While the level of environmental 
        and proliferation risk posed of general purpose submarines are 
        not a matter of wide agreement, Russia considers the risks 
        significant and has made this problem a top priority. Taking 
        this priority seriously is part of treating Russia as a real 
        partner, which is reason enough to address these concerns. New 
        concepts are being developed, which look at the potential 
        enrichment value remaining in the nuclear fuel in these 
        reactors to partially defray the costs of dismantling them. 
        This is a natural area of cooperation for the Nordic states 
        near Russia's Northern Fleet, and for Japan near the Pacific 
        Fleet.

   Apply some ``non-security'' assistance to security needs. 
        The key to accomplishing many disarmament or nonproliferation 
        goals lies in areas that may have nothing to do with security 
        as traditionally defined. Whether the challenge is building a 
        chemical weapons destruction facility from scratch, or 
        redirecting weapon scientists to peaceful employment, or 
        creating incentives for retired nuclear military officers to 
        leave their last posted base, traditional economic and 
        humanitarian assistance is an indispensable part of the 
        package. The World Bank, the European Union, and multiple 
        bilateral efforts all have some of these types of assistance 
        programs underway. Wherever possible, these programs should be 
        regionally or topically directed so that they have the 
        additional impact of addressing security needs.

   Remove legal impediments. As much as legislatures deserve 
        credit for creating and funding existing threat reduction 
        programs, they have also authored huge impediments, sometimes 
        unintentionally. Certainly the certification requirements and 
        other legislative restrictions attached to the U.S. Cooperative 
        Threat Reduction program over its decade of life were designed 
        to have a limiting effect, owing initially to the uncertainty 
        of how the post-Soviet republics would relate to the U.S., and 
        subsequently to the continued opposition of some in the 
        Congress to the threat reduction mission. In this era of 
        partnership with Russia, these limits need to be removed. In 
        the realm of unintended consequences, U.S. federal acquisition 
        regulations (designed to assure fair access to federal 
        contracting dollars, not to disarm a former enemy) and, more 
        recently, visa restrictions (designed to catch potential 
        terrorists) have severely hampered cooperative efforts. 
        Somehow, targeted exceptions have to be written into the law so 
        that our counterterrorism policies do not thwart the actual 
        countering of terrorism. Russia has some work to do here as 
        well. The nine implementation guidelines agreed at Kananaskis 
        call for reasonable measures of tax exemption, accountability 
        and access, liability protection, and other legal terms and 
        conditions governing the provision of international assistance. 
        Rather than pursue multiple bilateral agreements, all requiring 
        Duma ratification, Russia should modernize its own legal and 
        regulatory structures to accommodate threat reduction 
        cooperation programs.

    As this list makes clear, each member of the G-8 has plenty to do. 
Some members still have their hands on their wallets and need to 
declare the amount of their financial commitment. Russia has reportedly 
failed to apply the principles of the nine agreed implementation 
guidelines to ongoing bilateral negotiations. Reassuringly, the ``ad 
hoc group of senior officials'' who met recently in Ottawa appear to be 
the designated coordination mechanism called for in the Kananaskis 
Summit statement. Done right, this group will be very busy, both in 
meeting with each other and in ensuring their own nations' execution of 
the June pledges.
    Along with the hard work needed to forge a true G-8 partnership to 
address proliferation risks in Russia, it will take a determined effort 
to make the rhetoric of a ``global partnership'' a reality. The G-8 
needs to develop an explicit plan for including nations like China, 
Pakistan, India, Brazil and Egypt. The G-8 also needs to move quickly 
to bring non-G-8 donors like the Netherlands and Norway into the 
partnership. A global partnership requires global participation; 
recruiting new partners must be seen as an essential and ongoing 
element in this new effort.
    A recent conversation with a Russian leader in threat reduction 
cooperation, Zinovyy Pak of the Russian Munitions Agency responsible 
for chemical weapons destruction, clarifies both the opportunities and 
the perils of this G-8 pledge. Dr. Pak has been instrumental in 
expanding Russia's own investment in its chemical weapons destruction 
program six-fold in recent years, and he is attempting even further 
increases. Since June, however, he is challenged more and more by his 
colleagues (or rivals) in the interagency pulling and hauling over 
federal budgets. They are telling him he doesn't need any more Russian 
rubles since the G-8 is obviously going to take care of his problem 
with dollars, euros and yen. This is a pernicious situation on two 
fronts. First, because it suggests some officials in Russia may not 
understand that the international commitment to funding threat 
reduction inside Russia depends upon continued, even intensified 
demonstration of Russia's commitment to doing its part in reducing the 
threat.
    Secondly, it reflects the degree to which Russia's threat reduction 
plans are currently being structured in anticipation of the other G-8 
nations meeting their $20 billion pledge. A failure of commitment on 
one side will weaken the commitment on all sides, and make everyone 
less secure.
    This dynamic is true not only in the natural tension between Russia 
and the other G-8 partners; it applies in every pairing and every 
possible combination of partners, within the G-8 and without. When any 
member of a partnership pulls back from a commitment--either because 
they question the importance of a task or because they believe they can 
leave that task to others--the natural advantages of partnership are 
lost, partners start calculating their investments and returns compared 
to those of other partners, and the objective of each partner suddenly 
changes--while the goal in the beginning is to ``achieve a common 
aim,'' the goal in the end becomes ``not doing more than your share.''
    That is why it is so essential that all nations everywhere do their 
part--not only because no nation wants to carry the burden alone, but 
because no nation can. It would be, in my judgment, a great service to 
the cause and ideals of the partnership if this committee could serve 
as a reminder to our government and to partner governments of the 
commitments they have made, the expectations they have raised, and the 
obligations they have embraced for making the most of this moment to 
increase the security of the world. Thank you.

    Senator Lugar. Thank you very much for that testimony.
    Let me just mention, as a point of continuity with your 
last comment, that one reason that I raised with Secretary 
Bolton the need for United States leadership in the G-8 
agreement is that things could fall apart. As Secretary Bolton 
pointed out, there needs to be a Russian commitment to meet 
their commitments made in Canada. But it has to be a good-faith 
effort. And Dr. Pak, in the chemical weapons situation, has 
been doing that. The appropriation this year by the Duma was 
substantial, and this is real money in Russia. The politics of 
that, as you suggest, are that Duma members who were exhorted 
by Dr. Pak, and, more importantly, by President Putin, to do 
this may feel, as you say, that the Europeans or the Japanese 
may take over, that we may do more, that they don't really need 
to do very much. That would be pernicious.
    On the other hand, the degree of our commitment is crucial. 
Ten billion over 10 years will extend through three more 
administrations and several Congresses, with people coming and 
going throughout that period of time. It is miraculous that 
cooperative threat reduction has gone on for 11 years at this 
point, and some feel that may have been too long and want to 
bring it to a halt. But we're now committed for another 10 
years of this at the levels that we have reached currently. And 
so that's important.
    What faith does everybody have in us, even as we're drawing 
the box and trying to think of the commitment? Well, we hope a 
whole lot. You know, the degree of enthusiasm that we all have, 
administration and Congress, assures the Russians, the G-8 and 
others that there is a fount of leadership here that is 
constant and that is reaching out to every nation in the world 
who ought to feel our urgency, and most do, in the war against 
terrorism, and the way in which weapons of mass destruction 
intersect that.
    Let me just ask this question. Mr. Luongo, I think you made 
a very important point that in all of our priorities, we 
perhaps have not paid enough attention to the scientists and to 
those who have been involved in the research effort. And, as 
you say, many people find it very difficult to change their 
career plans. As a matter of fact, your observation is probably 
correct, that most have not. They are trying to transfer at 
least what they have over to somebody else.
    Specifically, as I've stated earlier, at Kirov that I keep 
raising the scientists who were working at the defense facility 
down the street in the military installation moved up the 
street to the ISTC to our situation. Now, they're not doing the 
same thing. They're now thinking about how to stop an anthrax 
epidemic, even one in Russia, quite apart from one in the 
United States or somewhere else. What are the antidotes to 
that, or how would you detect chemical-weapon attacks upon 
their country. These are very constructive projects, which 
exercise the same expertise as when you were in the production 
mode, or thinking about that, but now you're discussin defense.
    So that's the ideal situation: by this time, at least a 
hundred or so people, sort of, moving into that. Almost all the 
rest who are in the military thing and the bankrupt affair are 
hoping to get a real job with the ISTC.
    Now, an ideal situation that relates to work that NTI, Ms. 
Holgate's organization, are doing is in the biological side. At 
the Ultrapure Laboratory in St. Petersburg, there are two to 
three hundred people--at least that was the estimate the 
director gave to me--who used to be involved in biological 
weapons research. There's not an open admission that they were 
doing that sort of thing, but what they described sounds very 
much like that. But now they are involved in aerosol antidotes 
to biological attacks. They hope to develop a process that 
would provide total immunity against all BW threats, a 
comprehensive thing. This raises the interesting scientific 
question, in a very big thought, can you finally defeat 
biological warfare by working through the science of how the 
human body adapts--preferably before an attack, but, if 
necessary, after one--so that casualties are limited or so that 
in fact, we survive? That limits the efficacy of biological war 
very substantially.
    Now, there is great debate in the scientific community as 
to whether this is doable, but it's a very important thought. 
And the Russians are pursuing it at Ultrapure and other places, 
and hopefully we're doing similar work in the United States.
    But it shows that transition is possible. And in this 
particular laboratory, they've developed three pharmaceutical 
products that they are now selling commercially, principally to 
hospitals in Russia, making up about 50 percent of the budget 
of what used to be a bioweapons plant--and the other 50 percent 
still comes essentially from cooperative threat reduction or 
various other situations.
    Now, I mention this because its the good news. The bad 
news, as you point out, is we've had maybe checks to 20,000 
people, some estimate 50,000 people--not really clear what all 
of them are doing. This was a temporary stopgap. We know many 
of them are e-mailing the United States laboratories looking 
for work. Among other things, some of us have been trying to 
promote the idea of American pharmaceutical companies 
purchasing these plants and the scientists and employing them. 
And that, I think, is doable if the commercial code of Russia 
would be improved substantially and if they did not have as 
much trouble getting in to Kirov as I did, as I pointed out to 
the Defense Minister.
    In order to resurrect this situation, really we'll have to 
change the system, and they showed some recognition, so there's 
some hope.
    But I appreciate your underlining this. What further 
thoughts do you have as to how that particular goal of dealing 
with the scientists or the technicians--how would we best 
perform that?
    Mr. Luongo. I agree with a lot of what you said, Senator. I 
think that each of the weapons complexes has its own unique 
characteristics and its own unique problems. Obviously, 
biological weapons scientists' knowledge has applicability to a 
wide range of scientific activities, where, even if you're 
doing basic science, you're contributing to the overall 
knowledge base.
    As we've analyzed the situation, part of the problem is 
that you've currently got, in essence, two extremes when trying 
to develop non-weapons employment for weapons scientists. One 
is basic research for scientists, which are often in the form 
of contracts, which extend for up to 3 years or so. However, 
it's not clear that there's a real global market for most of 
this research. At the end of the contract most of the results 
just go back to the agency that funded them.
    On the other end, you have commercialization, which is a 
solution particularly pushed by the Congress. Congress has a 
very strong interest in commercialization but it is difficult. 
I'll just give you this example. We had someone with very great 
experience in this field come and talk to us, and he showed us 
the form that a real startup business in Russia filled out on 
what the liabilities they saw were. This list was submitted to 
a venture capitalist. It included everything from ``the 
government can take your facility and your money'' to ``our 
chief might leave'' and everything in between. When you overlay 
on top of that all of the problems of a closed weapons city, as 
you said, access to facilities, a bureaucracy that still is not 
completely reformed, et cetra, commercialization is extremely 
difficult to do.
    The example that you gave in Kirov, I think is really the 
middle ground, and that's harnessing what these scientists know 
to real-world problems, not just in the biological field, but 
in a variety of different areas such as in the environmental 
field and nonproliferation analysis. We've tried to contribute 
to this process by creating, in Sarov, the city that Laura 
mentioned, a center for nonproliferation analysis which has, 
depending on how you count it, maybe 35 people working for it, 
maybe 35 FTEs, probably not 35 bodies. But they're 
contributing. They're making some analysis that's useful. The 
Russian Government has gotten wind of it, and they're giving 
assignments to this center, as well.
    So my theory is, we should keep basic science, we should 
keep commercialization, that both are important, but that 
there's this yawning chasm in the middle, which is the 
application of scientific knowledge to real-world problems, and 
that's where a greater focus needs to be.
    Senator Lugar. Well, I appreciate that comment and its 
applicability to our hearing theme today of this G-8 agreement, 
because this is something on which we really need to visit with 
our G-8 partners. Some of them, have been involved in ISTC and 
have made contributions. The United States' contribution, I 
think, unfortunately, verges toward 60 percent or so. It was 
meant to be less than 50, with other people coming in, but we 
are picking up the slack because it's so important to keep this 
going.
    But we really do need some emphasis. And even as much as I 
feel that general-purpose submarines, the tactical nuclear 
weapons, the control of the fissile material are critically 
important, as you point out, the knowhow is important. As we 
are all discussing Iraq, for example, and this is not 
irrelevant to this issue, many people are saying our basic 
intelligence of what goes on in even the nuclear, quite apart 
from the chemical and biological dual purpose facilities in 
Iraq, comes from people, from scientists, people who have been 
in there and who try to describe to you what to look for. And 
when you can pack up almost all the apparatus of a biological 
laboratory, put it in a truck, and move it, this completely 
changes the parameters of an inspection regime. Many believe 
that there are installations there, and you overfly and you see 
them, or even something on the ground that an inspector might 
drive up to, but that might not be the case. It might be an 
empty building, because the same apparatus that made anthrax 
one day could be off making something else, elsewhere the next.
    Witness, for instance, the conversion in Pokrov, a Russian 
agricultural laboratory, that was making anthrax to something 
now making Green Mama Shampoo as a commercial product. It's the 
same identical facility and awfully hard to point out on any 
one day what you're doing unless somebody knows. So it's a 
terribly difficult problem.
    As you pointed out, the scientists could go anywhere. But, 
they don't want to go anywhere. People in Kirov live in Kirov. 
They want to stay in Kirov. And our predicament, then, is to 
try to think that through, hopefully with cooperative Russians 
as well as our G-8 allies. I think it's a very important 
contribution you've made trying to outline your own experience 
in Sarov, which is substantial.
    Ms. Holgate, let me just ask you for some further comments 
about the bioweapons situation. I know that your colleague, 
Peggy Hamburg, at NTI, has been working in this issue 
extensively, and board members had a briefing yesterday from a 
brilliant person from Johns Hopkins who described this 
situation. Unlike the nuclear, it takes some time and effort to 
do this sort of thing, but given the pace of biological life 
studies in the world, there is almost no limit to how much of 
this type of thing you can produce, almost no limit 
geographically as to where it can happen. A different kind of 
problem, in terms of quantity. And although life sciences leap 
ahead and with great promise for our health, for our 
agriculture, for other things, as it was described by this lady 
yesterday, there is a dark side of this. Unlike the nuclear 
program in which there were restrictions from the time of 
Werner Von Braun over in Germany or Oppenheimer here or 
whoever, no restrictions in the bio. All of this information is 
on Web sites ad nauseam. It had been the case for years with 
all of the upgrading of either good or evil, common knowledge 
among those who get into this sort of thing.
    Now, Ms. Holgate, how can the G-8 situation we're talking 
about today, address this threat?
    Ms. Holgate. Well, the exciting thing about dealing with 
the bioterrorism risk or the bioweapons risk, in contrast to 
nuclear, is that a lot of the things that you need to do to 
deal with the bioterrorism risk have beneficial impacts, even 
if you never have a bioterrorist incident. A lot of the 
information we heard from Dr. O'Toole yesterday was about 
improving the public health systems, improving knowledge, as 
you indicated, of human immune responses and things like this. 
Those are worth knowing even if we had certainty that a 
bioterrorism event would never occur. So the process of 
preparing for bioterrorism actually has real near-term 
collateral benefits that are very helpful.
    And that's somewhat in contrast to the nuclear area, where 
the things you do to protect against nuclear terrorism are good 
for that, but do not necessarily contribute a lot else that 
needs doing.
    The G-8 contribution on the bio front, I think, is exciting 
in a couple of different areas. The very powerful biotechnology 
industry in Europe--that's where a lot of the leading corporate 
entities are located--and the slightly more planned industries 
and economies of Europe give European governments perhaps 
slightly more influence over their industrial partners than may 
necessarily be the case in the United States to do perhaps some 
more directed research or some directed commercial activity in 
Russia.
    The other area that could be very interesting there comes 
in this question--and I very much agree with Ken on the need 
for a diverse set of solutions to the challenge of human 
capital--and that is, whether it's retirement, in some cases, 
whether it's resettlement in a new type of housing or in 
another venue, there's a lot of things that the U.S. system to 
deal with the human side has been moved out of by congressional 
restrictions or other decisions by the U.S. Government. And to 
be able to have a set of partners in the G-8, who have yet to 
grow those restrictions into their own legislation, who have 
alternative models of economic development, of local 
governance, of flexibility in other kinds of assistance that's 
going to be required to really deal with these problems--that, 
to me, is what's exciting about what the G-8 can bring to 
supplement the robust efforts of the United States.
    But, finally, I would say, I'm not going to let the U.S. 
colleagues off the hook; at the November summit between U.S. 
President Bush and Russian President Putin, there was a 
statement signed to accelerate cooperation on bioterrorism 
preparation and activities. That commitment has yet to be 
fulfilled, and I was slightly dismayed at the way that Deputy 
Under Secretary Bronson discussed the narrowing, in fact, of 
cooperative activities in the area of very dangerous biological 
weapons within the military-to-military context. In fact, 
broadening that cooperation is the key to taking advantage of 
the information, however ill-gained, over the last several 
decades. Russia has information about these pathogens, about 
how to deal with the pathogens, how to address the health needs 
that come away from that, and a military-to-military, 
classified, quiet, but very targeted set of cooperative efforts 
is another key piece of the puzzle.
    Senator Lugar. Well, that's a very important suggestion, 
and I appreciate your making that, because you've had great 
experience in your travels in Russia in behalf of this 
Government for some time, and so you speak really from a 
background that is very knowledgeable.
    Mr. Luongo. Could I just make one point on that? When we 
talk about scientific knowledge and what we're going to do 
about it, it's really one area that actually could use more 
money. The current funding between ISTC and the U.S. programs 
is less than $100 million a year. It's actually substantially 
less than $100 million a year. Other programs like fissile 
material control, through the largesse of the Congress in the 
last fiscal year, are up around $320 million per year.
    So I really do think it's urgent to focus more funding on 
scientific conversion. And unlike other areas where money is 
maybe less important right now, and access and products and 
actual progress are more important, I do think this is one area 
where more money could be very usefully spent.
    Senator Lugar. I appreciate that testimony. Both of you 
know, but just for the sake of the record, that it is through 
the ISTC that most of us have gained access to any of the 
biological facilities. And it's because ISTC brought the 
directors--on one occasions, of 13 such facilities to Moscow in 
a conference that Senator Nunn and I attended, that we really 
found the roster and began to make the visits. Now, the four 
military were not there at the table, and those are visits that 
we still need to make. But the fact is, when we went to 
Obelinsk over 3 years ago, we were the first visitors outside 
of a few surreptitious types who have been in and out of there. 
It was a shocker, with barbed wire around the place, one guard 
at the gates, and a whole floor of pathogens.
    So the first thing we talked about for an hour and a half 
was how to secure the place. And in our visit this year, it is 
secure. Now there are other problems, cooperation with the 
scientists there, but at least whatever they've got in there is 
not as likely to be misappropriated.
    Now, the problem of getting an American firm involved in 
this, both of you have pointed out, is really prodigious given 
the liabilities, given the commercial codes, all the rest of 
it. This is something, in a government-to-government way at the 
highest levels, we have to continue to work with President 
Putin, who does want to bring about some resurrection of the 
Russian economy, and the economic issues for him, in many 
cases, are more important than the military hierarchy, and the 
reason the military is often overruled, in terms of the benefit 
of all Russians. We must continue to push on these issues.
    The G-8, I think, can help a whole lot in that way. These 
are people who have commercial interests, and they could have 
interests in Russia. So it serves the purpose of employing 
Russians in Russia, the proliferation of knowledge and people, 
in addition.
    But with the previous panel, we're really trying to get 
this down on paper, somebody to write a comprehensive plan, 
even if we don't have a single administrator in the government 
that deals with all of it. If we all had the same song sheet as 
to what our strategies are, what the priorities are, what the 
moneys are that are required, we can then make choices, as 
Members of Congress. Absent that, why, we're hunting and 
pecking in hearings like this one trying to glean bits and 
pieces of knowledge, sometimes promoting something on the 
excitement of one hearing that if you had another group of 
witnesses you might feel as second or third priority, not as 
keen as the one you just heard.
    Let me just ask this question, which you raised, Mr. 
Luongo, which I thought was intriguing, that we don't know as 
much as we should about the Russian reaction to so-called debt 
swap plans. The assumption being that the Russians would be 
delighted if a good part, if billions of dollars of their debt 
were removed, because they're going to have trouble in the 
coming year in keeping afloat with regard to that debt service.
    So, as you point out, you hear at least some rumblings, I 
gather, from Russian economists, or from where, that they might 
fear inflation or fear of what else, but can you amplify this 
somewhat more?
    Mr. Luongo. Certainly. We had a series of three or four 
meetings over the summertime in cooperation with the Carnegie 
Endowment for International Peace, where we tried to delve into 
how do you reshape threat reduction for the next 10 years. And 
obviously, because of the cash crunch, the issue of debt swap 
came up.
    What's obvious to me is that the people in the relevant 
military and weapon ministries view debt swap as an 
opportunity. I'm not saying that the people in these ministries 
have good ideas for the expenditure of this money; I'm just 
saying that they view it as a real opportunity. But their 
interactions with the Finance Ministry and some of the other 
economic ministries in Russia have not been particularly 
smooth.
    And some of the information that was filtered back to us 
was that there is some concern about whether or not this is 
something that the Russian Government really wants to do for a 
variety of different reasons. One concern is that it could 
affect their credit rating, because it may spur inflation. 
Second, if it was going to be done, would a swap for 
nonproliferation activities be something that the Russian 
Government would be interested in, or would it perhaps include 
other issues such as environment, or some other issues.
    So as far as I know at this point in time, there hasn't 
been a formal statement from the Russian Government on this 
subject, and the debate is still a little bit unsettled over 
there.
    Senator Lugar. Well that may well be, but as either of you 
gain some intelligence about this please share it with us. 
Senator Biden and I have taken some leadership in trying to 
facilitate the debt swap business, and I think constructively, 
but we must make certain that we--not necessarily rectify, but 
maybe sharpen up our own focus if there are these situations, 
valid or not, there.
    All I know is that we all appreciate the crisis the world 
economy fell into when the Russian economy went aground. Small 
as it may be, it generated, for many, a long-term capital 
crisis in this country with debt swaps derivatives. We had 
people coming to the IMF meeting very glumly that particular 
year anticipating bank failures all over the world generated by 
miscalculations in the Russian situation.
    So leaving aside our thrust of our weapons of mass 
destruction situation, we have an economic predicament here 
that the Russians, many feel, will be alleviated by the price 
of oil and by the expansion of the energy markets, other 
revenues coming into the system that maybe were not a part of 
the picture 2, 3, 4 years ago. And maybe so. Maybe not.
    And so we want to keep an eye on that aspect, particularly 
with our G-8 partners, because one reason for the G-8s to meet 
is often economic issues. That may be the principal reason they 
meet. And a derivative from this now has been this cooperation 
on weapons of mass destruction, which is certainly desirable.
    Well, I thank both of you for staying with us through your 
lunch hour into the afternoon. You've offered a great deal to 
the committee, as always, and we thank you for coming.
    Mr. Luongo. Thank you, Senator.
    Senator Lugar. The hearing is adjourned.
    [Whereupon, at 1:20 p.m., the committee adjourned, to 
reconvene subject to the call of the Chair.]
                              ----------                              

             Additional Questions Submitted for the Record

    Additional questions for the record were submitted to Hon. Linton 
Brooks, Acting Administrator, National Nuclear Security Administration, 
Department of Energy, but responses had not be received at the time of 
publication on March 18, 2003.

                                 ______
                                 

  Responses of Hon. John R. Bolton, Under Secretary of State for Arms 
  Control and International Security, to Additional Questions for the 
            Record Submitted by Senator Joseph R. Biden, Jr.

    Question. Under the guidelines adopted for cooperative projects 
under the G-8 Global Partnership, all governments will take necessary 
steps to ensure that assistance be exempt from taxes, duties, levies, 
and other charges. Does this agreement apply to taxes or fees imposed 
by all levels of the recipient government--national regional/
provincial, and local levels?
   For example, can a Russian province still levy taxes even if 
        the federal government has provided an exemption?

    Answer. U.S. assistance is exempt from taxation, customs, duties, 
fees and other charges under our bilateral assistance agreements with 
the former Soviet states, including the Cooperative Threat Reduction 
umbrella agreements. The exemption provisions in these agreements apply 
to all levels of government. Under our government-to-government 
agreements, the recipient national government is responsible for 
ensuring that such protections are observed. When agencies or officials 
occasionally fail to observe this commitment, we have been successful 
in ensuring corrective action is taken.
    The Global Partnership guideline on taxation does not specifically 
address the issue of exemption at the regional and local levels. Other 
GB members have stated that they share our view that exemption from 
taxation and other charges must extend to all levels of government.

    Question. Has President Putin indicated any intention to 
incorporate the guidelines for cooperative projects on future 
nonproliferation assistance into Russian law?

   If so, does he plan to announce a presidential decree or 
        will he submit the guidelines to the Russian Duma for final 
        approval?

   What are the views of the United States on the necessity of 
        further legal steps by the Russian Government?

    Answer. To date, President Putin has not indicated any plans to 
incorporate the guidelines into law. With respect to most guideline 
provisions, it appears unlikely that legislative action would be 
necessary. In the case of liability protections and exemption of 
assistance from taxation, Russian officials have argued that the 
provisions sought by the United States and other G-8 members are not 
consistent with current Russian law. U.S.-Russian agreements 
incorporating these provisions, including the CTR Umbrella Agreement, 
are being provisionally applied. Our view is that the Russian 
Government in order to open the way to contributions from G-8 members 
under the Global Partnership must take any steps required to implement 
the guidelines, including legislative changes if required.

    Question. Under the Global Partnership, the G-8 members adopted six 
nonproliferation principles to guide future actions on preventing 
terrorists or states that harbor them from acquiring or developing 
weapons or materials of mass destruction. How does the United States 
intend to work with its G-8 partners to ``turn those principles into 
concrete action?''

   What benchmarks will be used to review national progress?

    Answer. To build upon and maximize the impact of the G-8 
nonproliferation principles, the Administration is developing an action 
plan to operationalize them. This action plan will contain a list of 
goals and describe specific steps that can be taken to advance each 
principle. The U.S. expects to circulate the action plan for 
consideration by our G-8 Partners this year. We also plan to recommend 
a strategy for promoting adherences to these principles by all 
countries. We will suggest that the G-8 report on progress toward 
meeting the goals outlined in the action plan by the next Summit. Once 
the action plan is approved by the G-8, we can consider establishing 
national benchmarks.

    Question. The first G-8 nonproliferation principle is to ``promote 
the adoption, universalization, full implementation, and, where 
necessary, strengthening of multilateral treaties and other 
international instruments whose aim is to prevent the proliferation or 
illicit acquisition of such items; strengthen the institutions designed 
to implement these instruments.''

   What is the United States doing to implement this principle?

    Answer. The United States continues to support and advance the 
multilateral nonproliferation regimes that are currently in force. We 
are also working to improve their effectiveness and enforcement. 
Specifically, to reinforce the Nuclear Nonproliferation Treaty (NPT) 
and International Atomic Energy Agency (IAEA) we are seeking acceptance 
of Additional Protocols by all NPT non-nuclear weapon States Parties, 
and working to ensure the IAEA has adequate resources to do its job. We 
are strengthening the Missile Technology Control Regime by focusing it 
on the regional aspects of missile nonproliferation and by updating its 
export controls in light of evolving threats, such as unmanned air 
vehicles. We are also pressing for universal adherence to the 
International Code of Conduct against Ballistic Missile Proliferation, 
which will establish a new supplementary international missile 
nonproliferation mechanism. In the Australia Group (AC), the U.S. is 
working to address chemical-biological weapons (CBW) programs in non-AC 
countries, sources of support for such programs in non-AC countries, 
and CBW terrorism. The Nuclear Suppliers Group is considering U.S. 
proposals to enhance its ability to deal with the threat of nuclear 
terrorism. These proposals include enhanced information sharing on 
approvals of Trigger List and nuclear-related dual-use exports as well 
as denials of Trigger List exports. In the Wassenaar Arrangement, the 
U.S. is seeking to strengthen controls for items on the dual-use list 
and to add a new small arms/light weapons reporting category for the 
Wassenaar Munitions List. In addition, the Administration is conducting 
a review of multilateral nonproliferation regimes to identify further 
measures that could strengthen their effectiveness in our efforts to 
stop WMD proliferation.

    Question. For example, what is the United States doing to apply it 
to the Biological Weapons Convention? What detailed proposals will the 
United States present to the resumed BWC review conference next month?

    Answer. There are currently 146 States Parties to the Biological 
Weapons Convention. The United States takes every appropriate 
opportunity in dealing with states not party to encourage them to 
become party to the Convention, as well as to press certain States 
Party to come into compliance with the Convention.
    Additionally, in implementing the BWC, the United States works 
closely with allies to strengthen international efforts to stem the 
proliferation of biological weapons-related materials, equipment, 
technology, and know how. Examples of these efforts include the 
programs of the Science and Technology Centers in the former Soviet 
Union, which seek to redirect former biological weapons scientists to 
peaceful projects, and the harmonization of export controls on 
biological agents and related production equipment and technology in 
the Australia Group.
    We proposed at the November 2001 Review Conference a number of 
measures to help accomplish the objectives of the Biological Weapons 
Convention and to combat the BW threat. We are working closely with 
friends and allies in a variety of fora--such as the BWC, the World 
Health Organization, the G-8, and the Australia Group--to pursue such 
alternative approaches which we assess will have a real impact in 
strengthening the BWC ban on biological weapons, including:

   Investigating suspicious outbreaks of disease;

   Sound procedures for study, modification, and shipment of 
        pathogenic organisms;

   National criminalization of activities prohibited by the 
        Biological Weapons Convention; and

   Sound national oversight mechanisms for security of 
        dangerous pathogens.

    The U.S. proposals, underpinned by current efforts to counter the 
BW threat, will continue to be the basis for the U.S. approach at the 
resumed Review Conference in November 2002.

    Question. What role does the United States envision for the 
biological weapons convention in stemming biological weapons 
proliferation?

    Answer. The Biological Weapons Convention reflects the total 
rejection of biological and toxin weapons by the international 
community. The norm it reflects provides the basis for all other 
efforts to stem proliferation of such weapons and to eliminate them 
entirely as a security threat. Although specific means to deal with the 
biological weapons threat may be implemented through a wide variety of 
different mechanisms, the Convention remains the foundation on which 
they are built.

    Question. The G-8 Global Partnership envisions ``specific 
cooperation projects, initially in Russia, to address nonproliferation, 
disarmament, counter-terrorism and nuclear safety issues.'' Please 
discuss the types of projects envisioned under the objective of 
counter-terrorism.

   Will these projects be related to efforts to eliminate or 
        better secure weapons of mass destruction and related 
        materials?

   Or might they include assistance to facilitate military or 
        law enforcement operations to root out terrorist cells in 
        Russia and other nations?

    Answer. The impetus for the Clobal Partnership, in the wake of the 
September 11 attacks, is to prevent terrorists, or those that harbor 
them, from acquiring or developing weapons of mass destruction, 
missiles, and related materials, equipment, technology, and expertise. 
In a very real sense, nonproliferation and disarmament cooperation 
programs that eliminate or secure weapons and related materials help 
counter terrorist threats. The G8 statement identified chemical weapons 
destruction, fissile material disposition, nuclear submarine 
dismantlement, and peaceful, civilian employment of former weapon 
scientists as among the Global Partnership priority concerns. G-8 
members to date have not discussed military or law enforcement 
assistance projects to identify and root out terrorists.

    Question. On October 8, 2002, Senators Biden and Specter introduced 
S. 3079, a bill to permit the Secretary of State and the Attorney 
General, acting jointly to bring into the United States up to 500 Iraqi 
weapons scientists (plus their families) who provide reliable 
information on Saddam Hussein's weapons of mass destruction programs. 
Do you believe that this authority would help international inspectors 
and the United States to obtain such reliable information and to lessen 
Saddam Hussein's access to key weapons scientists?

   Does the Administration favor enactment of this measure 
        before the 107th Congress adjourns?

    Answer. The Administration strongly supports enactment of 
legislation that would accomplish the policy objectives of the proposed 
initiative before the 107th Congress adjourns. This legislation would 
support a key element of the U.S. strategy to strengthen the 
effectiveness of UN weapons inspections in order to disarm Iraq of its 
weapons of mass destruction. The ability to allow specified Iraqi 
citizens and their families authorized under this Act to reside in the 
United States would assist in determining the extent of Saddam 
Hussein's weapons of mass destruction programs. Specifically, it would 
provide an alternative means for interviewing the individuals specified 
in the bill free from monitoring or intimidation by the Iraqi regime.
    While S. 3079, as introduced, provides a good starting point for 
achieving the Administration's policy objectives, the legislation would 
require substantial technical modifications to ensure a solid 
foundation for a successful program. In response to your request that 
we review the draft legislation, we previously provided comments in a 
letter dated October 23, 2002, and we understand the Justice Department 
may soon do the same. With these proposed modifications, the 
Administration could support S. 3079.

                                 ______
                                 

  Response of Hon. John R. Bolton, Under Secretary of State for Arms 
 Control and International Security, to an Additional Question for the 
                Record Submitted by Senator Bill Nelson

    Question. Russian weapons earmarked for elimination and destruction 
under the Moscow Treaty force limits pose additional challenges to the 
Russians and to the U.S., which we have typically addressed with the 
Nunn-Lugar Cooperative Threat Reduction programs. If we are unable to 
attain $10 billion as pledged from other G-8 nations, how could this 
affect Russia's ability to destroy weapons?

    Answer. The United States, through the Department of Defense 
Cooperative Threat Reduction programs, has played a significant role in 
helping Russia eliminate strategic nuclear delivery systems, such as 
heavy bombers, SSBNs, and ICBM silos and mobile launchers. The U.S. 
originally helped Russia meet START requirements and now will help 
Russia implement Moscow Treaty reductions. There has been minimal 
assistance to Russia from other G-7 nations for strategic nuclear 
projects, and it would be particularly difficult for non-nuclear weapon 
states to be involved in this area. Therefore, the extent of funding 
for the Global Partnership from the other G-7 will not have an impact 
on Russia's elimination of strategic nuclear delivery systems.
    However, $20 billion of needs have been identified for a broad 
range of nonproliferation requirements. Shortfalls in the $10 billion 
target for other G-8 members could make it more difficult for Russia to 
undertake some disarmament activities. Among the Global Partnership 
priority programs, the G-8 leaders in the Kananaskis statement 
identified chemical weapons destruction, nuclear submarine 
dismantlement, fissile material disposition, and employment of former 
weapon scientists. Other C-7 members have indicated they intend to 
focus on projects in these and other areas. The United States 
particularly welcomes their contributions to chemical weapons 
destruction and plutonium disposition.

                                 ______
                                 

     Responses of Lisa Bronson, Deputy Under Secretary of Defense, 
  Technology Security Policy and Counter-Proliferation to Additional 
       Questions for the Record Submitted by Senator Bill Nelson

                           IRAQ'S WMD ARSENAL

    Question. Would each witness please discuss their Department's take 
on the feasibility of using these funds [$20.0 billion for G8 Global 
Partnership] to destroy Iraq's arsenal of weapons of mass destruction 
in a post-Saddam Iraq?

    Answer. The G8 established the Global Partnership Against the 
Spread of Weapons and Materials of Mass Destruction to address 
nonproliferation, disarmament, counterterrorism and nuclear safety 
issues in Russia and other former Soviet Union (FSU) states. Thus, it 
is unlikely that funds allocated for this initiative by our Allies 
would be used to destroy Iraq's arsenal of weapons of mass destruction. 
I would note that Iraq has the financial resources to fund fully this 
destruction, through sales of its oil and gas. With increased 
flexibility to use Cooperative Threat Reduction (CTR) funds for 
activities outside the FSU or to achieve long-standing U.S. 
nonproliferation goals, I could foresee the limited use of such 
authority to ensure that CTR expertise and infrastructure were 
available to an effort to destroy completely all WMD and its associated 
infrastructure in Iraq.

                          COOPERATION WITH G8

    Question. I would like for each witness to comment on the existing 
level of cooperation on nonproliferation issues with members of the G8. 
Will there be more formal and frequent fora established to address 
nonproliferation issues in the future?

    Answer. The Department of Defense (DOD) enjoys excellent 
cooperation on nonproliferation issues with members of the G8. For 
several years, we have worked with the Government of Japan to 
coordinate our support for elimination of Russian strategic submarines 
in the Far East. Japan has allocated approximately $100 million for 
this effort. Although Norway is not a G8 member, it has worked directly 
with DOD to build infrastructure to store and process low level 
radioactive waste and spent fuel from Russian nuclear submarines. 
Similarly, we have collaborated closely with several G8 and other 
donors to coordinate their participation in the project to destroy 
chemical weapons in Russia and construct the chemical weapons 
destruction facility (CWDF) at Shchuch'ye, Russia. Since DOD is 
designing and plans to construct the pilot destruction facility, we 
have encouraged other donors to fund ``outside the fence'' support 
infrastructure. As a result:

   The United Kingdom signed an agreement with Russia in 
        December 2001 to provide up to $18 million for Shchuch'ye 
        infrastructure over three years.

   Germany plans to commit $1.3 million in 2002 to fund 
        communication lines and has equipped the Gorny facility to 
        destroy blister agent.

   Italy has agreed with Russia to provide approximately $7.15 
        million over three years for Shchuch'ye infrastructure 
        projects.

   Canada provided $70,000 in 2000 and $180,000 in 2001, and 
        plans to contribute $3.4 million in 2002.

   The European Union (EU) committed $1.8 million in 2001 to 
        fund infrastructure.

   France and Japan have expressed interest in providing 
        assistance for the Shchuch'ye project.

                                 ______
                                 

   Responses of Hon. John S. Wolf, Assistant Secretary of State for 
 Nonproliferation, to Additional Questions for the Record Submitted by 
                      Senator Joseph R. Biden, Jr.

    Question. In your prepared testimony, you assert, ``we have made a 
lot of progress with a very small budget'' for nonproliferation 
assistance. What would you do with a larger budget?

    Answer. First, the supplemental funding provided by the President 
from the Emergency Response Fund (ERF) last year and the increased 
spending requested by the President for FY 2003 base programs covering 
the Nonproliferation and Disarmament Fund (NDF), Export Control and 
Related Border Security (EXBS) Assistance, and Science Centers and Bio-
Redirection programs has provided us with a larger budget than in 
previous years. The President also requested in FY 2003 as in FY 2002, 
a $50 million voluntary contribution to the International Atomic Energy 
Agency (IAEA) in addition to our regular assessment.
    Last year and in prior years, we managed to make good progress by 
focusing on the areas where we can have the greatest impact. The point 
is that these programs give the U.S. a very good return for the small 
amount of funds invested. Even at the requested level for FY 2003, the 
combined total still represents a very small budget relative to 
government spending overall. Thus we encourage your full support for 
the FY 2003 request.
    The successful NDF project in September 2002 to remove the highly 
enriched uranium from the Vinca research reactor in Yugoslavia for 
secure storage in Russia shows how we can reduce the risk that 
dangerous materials will fall into terrorist hands. We also see NDF as 
a vehicle to assist governments, companies and universities in 
automating controls over the inventories and shipments of chemical, 
biological and radiological materials.
    Our EXBS program helps foreign governments develop export and 
border controls that meet international standards and thus prevent WMD 
and their components from crossing borders. We plan to continue the 
EXBS program focus on former Soviet countries, while expanding to South 
Asia as well as key transit and transshipment states in the Middle East 
and Southeast Asia. In the future, we will seek to deploy sophisticated 
detection equipment to a greater number of significant transit 
countries more quickly.
    Our voluntary contribution to the IAEA helps support verification 
of the Nuclear Nonproliferation Treaty (NPT), which is achieved through 
the IAEA safeguards system. In today's post 9/11 world, there are 
significant new demands to improve nuclear material security. As part 
of the war on terrorism, the IAEA initiated a review of its programs to 
enhance those that will help states protect against acts of nuclear and 
radiological terrorism (the ``dirty bomb'' threat). In March 2002, the 
IAEA Board of Governors approved an action plan that will help states 
around the world address the critical problem of reducing risks 
associated with radiological terrorism or nuclear sabotage. We agree 
that the safeguard system should be strengthened as recommended by the 
IAEA.
    The 2001 White House review of Russia nonproliferation and 
security-related programs made several recommendations to strengthen 
nonproliferation efforts including the expansion of the Science Centers 
and the Bio Redirection programs. As discussed above, the President's 
actions on allocation of ERF funds and the request for FY 2003 reflects 
the priorities set forth in the review. [For your information, I have 
attached a fact sheet released by the White House that discusses the 
key outcome of the Administration's review.]
    As you know, the Administration is currently developing the FY 2004 
budget request for these programs. We are continuing our efforts to 
ensure that our programs are focused on priority threat reduction and 
that they are conducted as efficiently and effectively as possible. In 
some cases, this may result in an additional request for FY 2004, a 
reallocation of existing resources, or pursuit of alternative 
approaches. The Administration appreciates your attention to ensuring 
that necessary resources are provided to achieve U.S. nonproliferation 
goals.

    Attachment:

                Fact Sheet: Threat Reduction Assistance

 UNITED STATES GOVERNMENT NONPROLIFERATION/THREAT REDUCTION ASSISTANCE 
                               TO RUSSIA

   From 1992-2002, the Departments of State, Defense and Energy 
        have funded over $4.9 billion in nonproliferation and threat 
        reduction assistance to Russia. For FY 2002, United States 
        Government security-related assistance for Russia totals over 
        $870 million.

   The Administration review of nonproliferation assistance to 
        Russia, completed in December 2001, found that most programs 
        are effective and well run, some should be expanded and a few 
        modified. FY02 budget allocations reflect these decisions.

   State Department FY02 funding is about $41 million for 
        nonproliferation efforts under the Science Center, Civilian 
        Research and Development Foundation (CRDF), Biological Weapons 
        (BW) Expertise Redirection and Export Control and Related 
        Border Security assistance. Some of this assistance cannot be 
        obligated until Russia is certified under FREEDOM Support Act 
        Title V criteria or a waiver is authorized by Congress and 
        exercised by the President.

   Congress increased Department of Energy funding with an FY02 
        Supplemental in addition to FY02 appropriations. Assistance 
        increased for Material Protection, Control and Accounting to 
        $291 million; Plutonium Disposition to $61 million; and 
        Initiatives for Proliferation Prevention (IPP) and Nuclear 
        Cities Initiative to $57 million.

   FY02 funding for DOD's Cooperative Threat Reduction (CTR) 
        Program is estimated at $400 million; with $307 million in 
        Russian programs. CTR continued funding Strategic Offensive 
        Arms Elimination and Chemical Weapons Destruction. CTR funds 
        cannot be obligated until Russia is certified as eligible to 
        receive CTR aid or a waiver is authorized by Congress and 
        exercised by the President.

   The Administration Review resulted in direction to transfer 
        to DOE the CTR project to eliminate weapons-grade plutonium 
        production ($74 million) under the Plutonium Production Reactor 
        Agreement. In FY03, DOE will fund this effort. Also, Congress 
        directed $30 million be transferred from DOD/CTR to State for 
        BW Redirection under the Science Centers.

   FY03 request for threat reduction and nonproliferation 
        programs in former Soviet states is over $1 billion.

    http://www.whitehouse.gov/news/releases/2002/05/20020524-16.html

    Question. In your prepared testimony, you declare ``we are 
expanding our efforts'' on International Science and Technology Center 
(ISTC) and Bio Redirect projects. Yet the FY 2003 budget request for 
these programs is $52 million, while the final level of FY 2002 
appropriations, including supplemental appropriations, was $81 million. 
Do you plan to request increased funding for these programs in FY 2004? 
How much could these programs usefully spend, if the funds were 
available?

    Answer. The Science Centers--the International Science and 
Technology Center (ISTC) in Moscow and the Science and Technology 
Center in Ukraine (STCU) in Kiev--and the Bio Redirection programs are 
interagency efforts. The FY 2002 State Department appropriation of $81 
million includes $37 million for Science Centers from NADR funds and 
$15 million for use by the Department of Health and Human Services, 
Department of Agriculture and the Environmental Protection Agency for 
Bio Redirection programs from Freedom Support Act (FSA) funds.
    It also includes a Congressionally-directed one-time transfer of 
$30 million from unobligated DOD funds for a Bio Industry Initiative as 
part of the FY 2002 emergency response funds appropriation. This 
initiative supports new engagement at former biological weapons 
production facilities and an initiative of accelerated drug and vaccine 
development. DOD Cooperative Threat Reduction funding for engaging BW 
scientists under the Bio Redirection effort was $17 million in FY 2002. 
In addition to these appropriations for Science Center and Bio 
Redirect, individual USG agencies fund research proposals through the 
Science Centers' Partner Program. For example, DOE contributed about $6 
million to fund IPP projects carried out through the Science Centers in 
FY 2002. The USG also provides assistance to help nonproliferation of 
weapons expertise in the former Soviet states under the Civilian 
Research and Development Foundation, which received $14 million in FY 
2002 for this purpose. Other individual USG entities, including a 
number of U.S. military R&D components, several U.S. national 
laboratories under DOE, the National Cancer Institute of the NIH, and 
NASA also fund partner projects through the Centers, with a combined 
value of several million dollars per year.
    The overall Administration request for FY 2003 for the Science 
Centers and Bio Redirect programs was $107 million. The State 
Department request of $52 million includes $32 million for Science 
Centers and $20 million for Bio Redirection. As a new component within 
the Bio Redirection program for FY 2003, State also seeks to fund an 
expanded engagement initiative for former chemical weapons scientists, 
as recommended during the Administration's 2001 NSC review of 
nonproliferation assistance. The FY 2003 DOD Cooperative Threat 
Reduction request for Rio Redirect, now appropriated, was $55 million.
    The Administration is now preparing its FY 2004 budget request, 
which will be submitted to the Congress in February. In so doing, the 
Administration will consider the expected number of highly-ranked 
Science Center and Rio Redirect projects, along with the institutes' 
absorptive capacity, our oversight and monitoring resources, and the 
possibility of increased funding by our G7 partners under the G8 Global 
Partnership Against the Spread of Weapons and Materials of Mass 
Destruction. In addition, we want to encourage the increasing awareness 
at the former Soviet WMD institutes of the need to be able to reform 
and compete in the global science market as a means of facilitating 
greater self-sustainability; consequently, we are beginning to shift 
the State Department program focus, too, toward funding more business 
training, valorization and patent support.

    Question. Do you have enough funds and legal authority to handle 
the problem of Russian highly enriched uranium in other countries' 
research reactors? In the successful operation to retrieve HEU in Vinca 
at the end of August, the State Department turned to the Nuclear Threat 
Initiative for $5 million in private funds, but the NTI has warned that 
such private assistance is unlikely to be available in the future. If 
the Congress provides the executive branch the necessary legal 
authority, will you have enough funding for HEU retrieval? Is this an 
area where a G-8 project with other donors would make sense?

    Answer. The Department of Energy has both adequate legal authority 
and funds to repatriate Soviet/Russian supplied HEU to Russia. Funding 
for this effort has recently increased dramatically. The Russian 
Research Reactor Fuel Return (RRRFR) program was first funded at the $1 
million level in fiscal years 2001 and 2002. A $3.8 million 
supplemental for fiscal year 2002 has just been approved, and the 
President's proposed fiscal year 2003 budget of $9.5 million would 
appear to be without opposition. Additional funding will be needed for 
material transport, spent fuel management, and research reactor 
conversion to use of low enriched uranium in order to complete the 
RRRFR program.
    In addition to DOE's program, the Department of State can utilize 
resources from the Nonproliferation and Disarmament Fund (NDF) for 
projects that require immediate or urgent attention and that fall 
within its nonproliferation mandate. Although NDF funding is limited, 
the NDF has sufficient legal authority to transport and dispose of 
nuclear materials that present a proliferation risk. For example, NDF 
funds will be used to provide $3.5 million to support initial shipments 
from and conversion of a research reactor in a former Soviet state. In 
some cases, to facilitate implementation of these projects, the U.S. 
may need to address country and facility specific requirements. For 
example, some of these projects may require environmental remediation. 
In the Vinca project, funding provided by the Nuclear Threat Initiative 
(NTI) addressed radioactive hazards at the Vinca Institute.
    Each project presents its own opportunities and challenges; we 
welcome supplementary efforts from organizations such as NTI in 
appropriate situations as well as assistance and interest from our G-8 
Partners.

                                 ______
                                 

   Responses of Hon. John S. Wolf, Assistant Secretary of State for 
 Nonproliferation, to Additional Questions for the Record Submitted by 
                          Senator Bill Nelson

    Question. Would each witness discuss their Department's take on the 
feasibility of using these funds to destroy Iraq's arsenal of weapons 
of mass destruction in a post-Saddam Iraq?

    Answer. At the Kananaskis Summit, President Bush and other G-8 
Leaders agreed that the initial geographic focus of the G-8 Global 
Partnership Against the Spread of Weapons and Materials of Mass 
Destruction will be on projects in Russia, given the magnitude and 
urgency of the proliferation threat there. United States has also made 
clear that we will include our nonproliferation and threat reduction 
assistance work with other states of the former Soviet Union in the 
Global Partnership, with whom we already have agreements incorporating 
the Kananaskis implementation guidelines.
    In the future, other countries would be able to participate in the 
Global Partnership by agreeing to the Kananaskis nonproliferation 
principles and implementation guidelines. However, Iraq is a special 
case. UNSCR 1284 mandates that Iraq will be liable for all costs 
associated with UNMOVIC and the IAEA in relation to their work to 
disarm Iraq of its weapons of mass destruction. This is an appropriate 
means to finance the destruction of Iraqi WMD.

    Question. I would like for each witness to comment on the existing 
level of cooperation on nonproliferation issues with the members of the 
G-8. Will there be more formal and frequent fora established to address 
nonproliferation issues in the future?

    Answer. The G-8 has evolved from a forum that primarily addressed 
economic issues to an annual meeting of leaders with a broader focus 
and scope. In recent years, political and security issues have grown on 
the G-8 agenda and since September 11, the G-8 has placed a higher 
priority on enhancing cooperation on nonproliferation issues. The G-8 
has launched initiatives on plutonium disposition (1996 Moscow Nuclear 
Safety and Security Summit) and the Global Partnership Against Weapons 
and Materials of Mass Destruction (2002 Kananaskis Summit). It has been 
an effective and useful forum for nonproliferation cooperation.
    There is an existing G-8 mechanism for promoting information 
exchange and cooperation on nonproliferation issues, the 
Nonproliferation Experts Group (NPEG). G-8 nonproliferation experts 
meet several times each year to propose possible nonproliferation 
agenda items for the annual Foreign Ministerial and Leaders Summit. The 
NPEG discusses nonproliferation priorities and pressing concerns. NPEG 
representatives assist in implementing the commitments made by Leaders 
at previous Summits.
    Last year, the NPEG was mandated to consider practical steps to 
reduce the WMD terrorist threat and WMD proliferation. The NPEG 
developed a set of recommendations for preventing terrorist access to 
weapons of mass destruction and radiological weapons. In June, Leaders 
endorsed six nonproliferation principles based on those NPEG 
recommendations. Over the coming year, the NPEG will continue to 
consider areas for further work by the G-8.

                                 ______
                                 

   Responses of Hon. John S. Wolf, Assistant Secretary of State for 
 Nonproliferation, to Additional Questions for the Record Submitted by 
                          Senator Jesse Helms

    Question 1. What is the current state of agreement between the 
United States and the Russian Federation on the issue of taxation of 
assistance? Will this issue be resolved prior to the introduction of 
additional assistance? To what extent do prior commitments from the 
national and local Russian authorities remain unsatisfied?

    Answer. Under our bilateral assistance agreements with the Russian 
Federation, U.S. assistance is exempt from taxation, customs, duties, 
fees and other charges. The exemption provisions in these agreements 
apply to all levels of government. Under our government-to-government 
agreements, the recipient national government is responsible for 
ensuring that such protections are observed. There is no pending 
taxation issue to be resolved that would impede additional U.S. funding 
for programs covered by these agreements, nor would we characterize 
commitments of Russian authorities as unsatisfied.

    Question 2. What safeguards have been developed to ensure that the 
assistance provided is not subject to diversion? What have been the 
results of audits and analyses to date?

    Answer. U.S. assistance to the former Soviet states is provided for 
specific purposes primarily in the form of goods, services and 
training, rather than funds. This helps minimize risks and the 
possibility that such assistance can be diverted.
    Our assistance is provided under bilateral agreements which include 
protection provisions ensuring that: ``Any commodities, supplies or 
other property provided under United States assistance programs will be 
used solely for the purposes agreed upon'' . . . as well as provisions 
for audit and examination rights of the U.S. assistance provided.
    We consistently exercise the rights and protections afforded U.S. 
assistance under such agreements to ensure our assistance is used for 
its intended purposes. U.S. assistance programs implement these rights 
in different forms--for example, some programs have routine, scheduled 
external and internal audits by project; others include the presence of 
``incountry'' personnel to oversee and monitor assistance through 
random checks; others use ``national technical means'' as appropriate; 
some programs include various combinations of these safeguards.
    In particular, I would like to address the oversight mechanisms for 
the Science Centers, for which I am responsible. Although the overall 
budget represents only three percent of overall assistance for Eurasia 
security programs, we take seriously the importance of safeguarding 
funds against diversion. Internal audits and independent outside audits 
by the Science Centers and by the United States and other parties 
provide multiple layers of oversight for grants for civilian research 
by former WMD scientists.
    For example, International Science and Technology Center (ISTC) 
staff conducted financial audits on 244 projects, including 229 final 
audits and 15 annual audits during on-site visits to 367 participating 
institutes during CY2001. ISTC contracted with Deloitte Touche Tohmatsu 
to conduct an audit of the Center last year, while Lubbock and Fine 
performed the audit of the STCU. The European Union (EU) Court of 
Auditors conducts periodic audits at the request of the European 
Commission. The Department's Bureau of Nonproliferation contracts with 
the Defense Contract Audit Agency (DCAA) to perform financial audits of 
selected projects (50 projects in 2002; 60 planned for 2003), and 
engages scientific experts to conduct concurrent technical performance 
audits. Our access and audit rights extend up to three years after the 
end of a project.
    Moreover, a recent GAO audit report (GAO-01-582), submitted to 
Congress in May 2001, examined the Department's role in selecting 
projects that meet program objectives and monitoring to assure adequate 
program oversight. We believe that this report and additional 
clarifications provided by the Department as an appendix to the GAO 
report present a positive picture of the Department's oversight of the 
program as envisioned when the Science Centers were established.
    The international agreements establishing the Centers provide 
access to the former WMD laboratories and to the scientists, project 
financial records, research workbooks, and progress reports.
    Financial controls constitute a second set of checks to guard 
against diversion. The Centers arrange for direct deposit of all U.S. 
and other research grants into scientists' personal bank accounts, 
rather than through participating governments or former WMD institutes. 
Secondly, procurement for all projects is handled by the Centers, 
rather than through the WMD institutes or project teams. Finally, chief 
financial officers of both institutions and other senior positions are 
staffed by the United States.
    Results of audits and analysis suggest that for the most part, the 
systems of checks and controls are working well.
    Audit findings have generally been positive. There continue to be 
some recurring problems--failure of scientists to maintain their own 
time records, or to record their times on a daily basis, for example--
but these are usually minor problems that do not appear to involve 
fraud or diversion. A recent audit finding that ISTC was unable to 
easily match equipment procurement records with equipment inventoried 
at specific projects has led to the introduction of new software to 
obviate this problem.
    Science Center financial comptrollers are advised by external 
auditors of all audit conditions and are required to provide corrective 
remedies. Science Centers staff from the Department's Bureau of 
Nonproliferation provide oversight for this process and attend annual 
conferences under DCAA auspices to discuss audit findings and solutions 
with chief financial officers of the centers, and to plan audits for 
the following year.
    Similar safeguards against diversion are incorporated into other 
State programs implemented through the Office of Nonproliferation and 
Disarmament Fund (NP/NDF) and the Office of Export Control Cooperation 
(NP/ECC). For example, NP/ECC initiated financial audits through 
State's Office of the Inspector General in 2000. The OIG awarded 
contracts to two companies for audits of the four principal executing 
agencies (Coast Guard, Customs, Commerce and Energy) of the Export 
Control/Border Security Assistance (EXBS) Program. To date, the audits 
of Commerce, Coast Guard and Customs have been completed. No audit has 
uncovered problems of a serious nature, although auditors have offered 
useful recommendations for improving the program accounting procedures 
of each agency. An audit of the Department of Energy is in its last 
phase of completion and also appears to be headed toward positive 
conclusions.

    Question 3. Have audits been conducted to ensure that funds were 
appropriately expended down to the second and third tier of 
subcontracts in the Russian Federation?

    Answer. Audits of all second and third tier subcontracts are not 
routinely conducted, but may be identified for auditing based on 
contract size, type of subcontract, and a variety of risk factors.

    Question 4. In what government or entity does title reside for 
those items of equipment that have been provided under previous and 
current assistance programs?

    Answer. Practices vary depending on the agency providing 
nonproliferation assistance and the agreement under which assistance is 
being provided. For example, under the Export Control and Related 
Border Security Assistance program, the State Department holds title 
until a grants document is signed by both parties, then the equipment 
becomes the property of the grantee in the recipient country. Under 
some other programs, such as the Science Centers program, the U.S. 
agency or implementing body retains title to equipment, at least until 
the conclusion of activities for which the equipment was provided. In 
some of these situations, if the cost of returning equipment to the 
United States after the conclusion of the activities exceeds the value 
of the equipment, the U.S. agency may agree to transfer title to the 
host government. U.S. agencies generally impose specific conditions on 
these types of equipment transfers, such as stipulating that:

   the U.S. party has continuing audit and examination rights;
   none of the equipment may be transferred or sold to nations 
        of concern;
   if equipment is sold, all proceeds will be used to finance 
        nonproliferation efforts;
   a designated ministry or department provide the United 
        States an annual report stating the location of the equipment, 
        the purpose for which it is being used and, if equipment has 
        been sold or transferred, to whom it was sold or transferred, 
        the price and which nonproliferation programs were financed 
        with the proceeds.

    These requirements are in addition to whatever protections the 
United States has in umbrella and implementing assistance agreements.

    Question 5. What is the current state of the Blend Down Monitoring 
System (BDMS), the system associated with transparency in the HEU 
program? Will the system provide the basis for future transparency 
measures in that program? If not, what measures have been accepted and 
implemented by the Russian Federation to achieve the same level of 
transparency as would be provided by the BDMS?

    Answer. The BDMS is currently in routine operation at the Ural 
Electrochemical Integrate Enterprise (UEIE) in Novouralsk, Russia and 
provides transparency for the down blending of HEU at that facility. 
Negotiations will take place with Minatom during mid-November 2002 to 
revise the existing transparency Annex to include agreed procedures to 
implement BDMS operations at the Electrochemical Plant (ECP) in 
Zelenogorsk, Russia. Installation of BDMS at ECP is planned for the 
first quarter of calendar year 2003. We have initiated discussions for 
installation of BDMS at the remaining down blending facility in 
Seversk, Russia and currently plan to install BDMS at that facility in 
late calendar year 2004.

    Question 6. How will U.S. assistance provided through multilateral 
mechanisms be audited and tracked?

    Answer. U.S. policy is that nonproliferation and threat reduction 
assistance provided through multilateral mechanisms must be implemented 
according to strong guidelines that ensure that assistance is used for 
its intended purpose. The primary existing multilateral mechanisms are 
the International Science and Technology Center (ISTC), headquartered 
in Moscow, and the Science and Technology Center in Ukraine (STCU), 
which implement programs to redirect former weapon scientists and 
experts to peaceful civilian employment. Science Center projects are 
subject to a rigorous review during the proposal stage and are also 
subject to internal, as well as independent outside audits from the 
Centers. The United States also carries out audits, which have been 
performed by the U.S. Army Defense Contract Audit Agency. Science 
Centers staff and U.S. officials have access to the work sites where 
projects are being implemented, and have audit rights up to three years 
after the completion of the projects.
    The U.S. would require that any new multilateral mechanisms 
developed to implement multilateral cooperation, such as the program 
for cooperation on Russian plutonium disposition, currently under 
negotiation, would provide for such auditing and accountability. The 
U.S. would also require other essential elements such as exemption of 
assistance from taxation, liability protections, environmental and 
safety conditions, intellectual property rights, and fair procurement.

    Question 7. Has the Russian Federation, nationally and locally, 
enacted all legislation and issued all legal authorities necessary to 
fulfill Russian obligations under bilateral assistance programs? What 
remains to be done? What steps are being taken by the U.S. Government 
to ensure that these steps are taken prior to the provision of 
additional assistance?

    Answer. The Government of Russia is implementing the obligations it 
has undertaken in U.S.-Russian assistance agreements. The Government of 
Russia is bound by the terms of these agreements, and is responsible 
for ensuring that such protections are observed, including at the local 
levels. Some agreements are being provisionally applied, pending 
ratification by the Duma. Russian officials have indicated that 
provisions for exemption of assistance from taxation and liabiity 
protections are not consistent with current Russian law. While we 
encourage Russia to conform their domestic law, we regard that as an 
internal matter, and we insist on receiving the benefit of all 
provisions of such agreements. We can continue to provide assistance so 
long as agreements providing the necessary protections are either in 
force, or are being applied provisionally.
    With respect to others participating in the G-8 Global Partnership, 
some G-8 members have negotiated bilateral agreements with Russia that 
provide a framework for nonproliferation assistance programs. Others 
are engaged in negotiating such agreements, or have indicated that they 
hope to do so shortly. The U.S. has made clear the importance of Russia 
taking the necessary steps for the Global Partnership to succeed.

    Question 8. What is the current state of security regarding the 
storage of off-loaded and reserve U.S. strategic nuclear warheads? What 
is the current state of security regarding reserve or off-loaded 
Russian warheads? What are the prospects for increasing the level of 
security associated with Russian nuclear weapons through bilateral 
cooperative efforts? To what degree have previous efforts been 
successful in increasing the level of security of Russian reserve and 
off-loaded nuclear warheads?

    Answer. The security of off-loaded and reserve U.S. nuclear 
warheads in storage is very strong. It includes well-trained guards, 
secure storage facilities, comprehensive sensor suites and proven 
security procedures. Russian non-deployed and reserve warheads are 
generally well protected, although Moscow faces several challenges in 
protecting its weapons, including regional political instability, and 
terrorist and insider threats due to financial difficulties.
    U.S. assistance is designed to further improve the security of 
Russian warheads, including non-deployed and reserve weapons, in the 
context of this difficult threat environment. U.S. assistance includes 
improvements to physical protection (fencing, sensors, communications); 
weapons accounting (improved hardware and software); personnel 
reliability (better screening of people); and guard force capabilities 
(improved equipment and training).
    U.S. assistance provided to date has increased the security of 
Russian warheads significantly. As a result of increased U.S. access to 
those sites, we plan to expand cooperative work with Russia to provide 
comprehensive security upgrades at weapons storage sites. Thus, we 
believe we can continue to increase the security of non-deployed and 
reserve warheads in Russia through such joint efforts.

    Question 9. Describe previous efforts to conduct an information 
exchange with the Russian Federation regarding non-strategic nuclear 
weapons. What impediments remain to a full and meaningful exchange of 
information?

    Answer. Recently, the U.S. has made several efforts to exchange 
information with Russia on non-strategic nuclear weapons (NSNW), 
bilaterally and in the NATO-Russia channel.
    In February 2001, NATO presented Russia with four nuclear 
Confidence and Security Building Measures proposals as part of the 
process established by the 1999 NATO Washington Summit. One of these 
proposals calls for exchanging data on U.S. and Russian sub-strategic 
nuclear forces. NATO is planning to continue discussing these proposals 
with Russia. Thus far, Russia has shown little enthusiasm for 
exchanging data on NSNW. Instead, it has chosen to focus the 
discussions on nuclear weapons safety and security issues. 
Consequently, a NATO-Russia seminar on safety and security issues was 
held in The Hague last April. NATO and Russia have indicated they plan 
to continue information exchanges on these issues, including a follow 
up seminar.
    The U.S. has pushed for exchanges of information on NSNW in 
bilateral venues as well. During the Moscow Treaty negotiations, 
Secretary Powell proposed that the U.S. and Russia exchange information 
to improve stockpile transparency. At the September 20, 2002, 
Consultative Group for Strategic Security (CGSS) meeting, the U.S. 
stressed the importance of enhancing NSNW transparency and recommended 
that it be addressed in working group meetings.
    Exchanging data on numbers and locations of non-strategic nuclear 
warheads has not been addressed before in negotiated transparency 
measures. Such an endeavor would pose political, technical and legal 
challenges. U.S. NSNW in Europe are an issue for our NATO Allies who 
prefer to retain the ``neither confirm/nor deny'' principle; it is 
difficult to distinguish nonstrategic nuclear warheads from strategic 
warheads; an exchange of data could involve divulging information about 
sensitive nuclear weapon facilities; and such an exchange would 
probably involve Restricted Data or Formerly Restricted Data, which 
would require negotiation of an Agreement for Cooperation under the 
Atomic Energy Act.

    Question 10. What effect would the imposition of unilateral treaty 
withdrawal restrictions have on U.S. strategic flexibility?

    Answer. In general, we believe that it would not be in the U.S. 
interest to impose unilateral withdrawal restrictions that go beyond 
negotiated treaty language in arms control agreements. In particular, 
if you are referring to the Moscow Treaty, that Treaty contains a 
provision allowing each Party, in exercising its national sovereignty, 
to withdraw upon three months written notice to the other Party. 
Neither country can predict what security challenges may arise within 
the next decade. The United States will need to maintain the 
flexibility to respond to any potential challenges. For this reason, 
the withdrawal provision was deliberately fashioned to allow greater 
flexibility for each Party to respond in a timely manner to unforeseen 
circumstances, whether they are caused by technical problems in the 
stockpile, the emergence of new threats, or any other significant 
changes in the international environment. This withdrawal provision 
also reflects our much-improved strategic relationship with Russia, 
where a decision to withdraw likely would be prompted by causes 
unrelated either to the Treaty or to our bilateral relationship. For 
these reasons, it would not be in the U.S. interest to restrict 
unilaterally the flexibility provided by the Moscow Treaty's withdrawal 
provision.

                                 ______
                                 

     Responses of Lisa Bronson, Deputy Under Secretary of Defense, 
  Technology Security Policy and Counterproliferation, to Additional 
       Questions for the Record Submitted by Senator Jesse Helms

                         TAXATION OF ASSISTANCE

    Question. What is the current state of agreement between the United 
States and the Russian Federation on the issue of taxation and 
assistance? Will this issue be resolved prior to the introduction of 
additional assistance? To what extent do prior commitments from the 
national and local Russian authorities remain unsatisfied?

    Answer. The CTR Program is implemented pursuant to a government-to-
government umbrella agreement with the Russian Federation (RF). This 
agreement provides a comprehensive legal framework for CTR activities 
and includes exemption of CTR activities from all taxes and similar 
charges. The RF indicates that it must submit the umbrella agreement to 
the Duma for ratification, but has not done so, to date. Nevertheless, 
the RF has agreed to provisional application of the agreement to CTR 
assistance until it is ratified. Consequently, DoD has experienced few 
significant problems regarding RF attempts to tax CTR assistance. All 
American firms involved in CTR projects are not paying Value Added Tax 
(VAT), customs fees, or other taxes. DoD has experienced some problems 
with local tax collectors that are unaware of, or ignore, CTR's tax-
free status, but these typically have been resolved quickly by 
providing necessary documentation to local authorities or involving RF 
officials.

                   PREVENTING DIVERSION OF ASSISTANCE

    Question. What safeguards have been developed to ensure the 
assistance provided through DoD is not subject to diversion? What have 
been the results of the audits and analysis to date?

    Answer. DoD's Cooperative Threat Reduction (CTR) program has 
established a layered system to reduce the risk of diversion of U.S. 
assistance. First, the CTR Program is implemented through a series of 
government-to-government umbrella agreements. These agreements provide 
a comprehensive legal framework for CTR activities, including the 
following:

   Exemption of CTR activities from all taxes and similar 
        charges,
   Immunity for participating U.S. personnel from foreign 
        criminal jurisdiction,
   Audit and examination rights for U.S. assistance,
   Waiver of all liability claims by recipient governments,
   Assumption of all liabilities by host governments for third-
        party claims,
   Application of U.S. contracting rules,
   Imposition of various other obligations including the duty 
        to not transfer any CTR assistance without U.S. permission.

    Second, DoD has concluded implementing agreements for all program 
areas with a designated executive agent from recipient countries. For 
example, DoD concluded the Nuclear Weapons Storage Security 
Implementing Agreement with the Russian Ministry of Defense (MOD). 
Implementing agreements link assistance activities to the protections 
of the umbrella agreement, establish a limit for the amount of funding 
involved, and establish arrangements for audits and examinations of 
materials, goods and services. DoD has concluded implementing 
agreements that define the types and levels of CTR activity with 
counterpart ministries and agencies in the former Soviet Union (FSU) 
states.
    Third, DoD conducts audits and examinations (A&Es) as a key means 
to ensure CTR assistance is used for the intended purpose and not 
diverted. The USG has established the right to examine the use of any 
material, training, or other services provided through the CTR program 
pursuant to umbrella and implementing agreements with each recipient 
state. From 1993 to October 2002, DoD conducted a total of 126 A&Es in 
Russia, Ukraine, Kazakhstan, Belarus, and Georgia. In FY 2002, DoD 
conducted a total of 14 A&Es.
    Fourth, DoD accomplishes CTR projects in accordance with U.S. 
contracting laws and regulations, including the Federal Acquisition 
Regulations (FAR) to ensure proper use of CTR assistance in the FSU. 
Implementation of the FAR is a non-negotiable item in contract 
negotiations with U.S., FSU and other contractors. Application of the 
FAR ensures that DoD is minimizing costs using an objective metric and 
provides assurances that the program is executed properly and diversion 
is prevented. In addition, the following principles have proven 
important to providing CTR assistance in the FSU:

   A rigorous and detailed discussion of the requirements as 
        necessary before work is contracted, including site access to 
        ascertain the scope of the problem and possible solutions.
   An independent U.S. Government (USG) cost estimate before 
        beginning procurement.
   A prohibition against transferring any assistance to other 
        entities without written U.S. Government approval.
   Contracts must comply with the Competition in Contracting 
        Act. FSU private companies may be contracted for work, but only 
        for work performed under a firm fixed price contract.
   U.S. project managers must be allowed to monitor closely and 
        regularly the cost, schedule, and performance of the contractor 
        and the project to ensure that the contract is finished on time 
        and at cost.
   U.S. project managers must be able to monitor any work 
        promised by the recipient that is integral to the project 
        success (e.g., infrastructure needed to support a CTR 
        constructed demilitarization site).
   No work is paid for unless it is inspected and accepted by a 
        USG representative. Payment to recipient country contractors or 
        subcontractors is made only after work is completed.
   Only accepted Western financial accounting methods may be 
        used for non-fixed price contracts.
   U.S. project managers must be able to monitor the payments 
        from the USG to the bank selected by the contractor.
   U.S. project managers must be able to meet regularly with 
        CTR contractors (both U.S. and foreign) to review their work, 
        and discuss their banking arrangements and financial 
        situations.

    DoD program management teams travel extensively in the FSU to 
oversee CTR project implementation (140 trips during FY 2002). These 
trips provided an opportunity to develop requirements, negotiate 
contracts, agreements and arrangements, monitor contractor performance, 
resolve program concerns and assess whether CTR-provided services, 
materials, and equipment were used for their intended purpose. These 
trips were in addition to project visits by U.S. embassy officers and 
on-site project management support by USG teams and U.S. contractors 
who reside in country and report frequently to DoD program managers. 
Additionally, CTR Logistics Support (CLS) personnel visits to perform 
preventive and corrective maintenance on CTR provided equipment help 
ensure equipment is used properly. Additionally, CLS contractors train 
recipient-country personnel to provide assurance that the equipment is 
properly used.
    Fifth, the CTR Program uses National Technical Means as a 
supplemental method to enhance CTR's confidence that assistance is 
being used as intended.
    Six, DoD is holding semi-annual reviews with RF executive agents to 
develop a Joint Requirements and Implementation Plan to define agreed 
requirements, assumptions, risks, and risk mitigation, and 
responsibilities of each party for CTR projects. The U.S. meets with 
the other recipient countries on an as needed basis.
    To date, DoD's implementation of the above activities has 
identified no confirmed diversion of CTR assistance by recipient 
governments. While not a diversion of assistance, the RF was discovered 
to be using heptyl fuel from dismantled ballistic missiles in 
commercial space launches rather than storing it for disposal by a $90 
million facility built by CTR due to open in summer 2002. DoD took 
immediate action to prevent future such occurrences: instituted semi-
annual reviews with Russian executive agents; developed implementing 
agreement amendments to replace Russian good faith obligations with 
legal commitments; and has developed the Joint Requirements and 
Implementation Plans describing assumptions, risk assessments, risk 
mitigation and proposed responsibilities for each CTR project.

                         AUDITS OF SUBCONTRACTS

    Question. Have audits been conducted to ensure that funds provided 
through DoD were appiopriately expended down to the second and third 
tier of subcontracts in the Russian Federation?

    Answer. CTR contracts are subdivided into firm fixed price (FFP) 
and cost contracts. FFP contracts are not audited. The work and price 
is agreed to prior to signing the FFP contract, and payment occurs only 
after the work is complete and inspected by a U.S. Government 
representative, in accordance with the Federal Acquisition Regulations 
(FAR). CTR only uses firm fixed price contracts when dealing with 
former Soviet Union (FSU) companies.
    A cost contract is often used with American or Western firms. These 
contracts are moritored by an U.S. Government team and audited by the 
Defense Contract Audit Agency (DCAA), in accordance with the FAR. DCAA 
audits the prime contractor and often audits subcontractors down to the 
third tier. DCAA's decision to audit at this level is based on the 
dollar value of the contract, the service or material involved, the 
contract type, and other factors. DCAA may also audit to this level if 
the contracting office specifically requests it. The American and 
Western firms working on cost contracts often use FSU subcontractors, 
but the U.S. firms employ firm fixed price subcontracts with the FSU 
firms.
    As a result, U.S. or Western subcontractors may be audited on cost 
contracts. However, FSU firms are not audited by DCAA because FSU 
contractors only work on firm fixed price contracts.

                            EQUIPMENT TITLE

    Question. In what government or entity does title reside for those 
items of equipment that have been provided under previous or current 
CTR assistance?

    Answer. DoD provides the vast majority of CTR assistance by service 
under a contract. For example, a contractor constructs a facility to 
eliminate ballistic missiles. In other cases, DoD provides equipment or 
materials to a former Soviet Union (FSU) state for a CTR project to 
eliminate or secure weapons of mass destruction, delivery systems or 
infrastructure.
    In the end, the completed facility or equipment is transferred to 
the recipient state's executive agent. The ``title'' document is called 
a Transfer of Custody (TOC) document. The TOC is issued in accordance 
with the umbrella agreement, which controls equipment retransfer and 
restricts use of equipment for its intended purpose. For example, 
Article VI or the CTR umbrella agreement states:

          Unless written consent of the United States of America has 
        first been obtained, the Russian federation shall not transfer 
        title to, or possession of, any material, training or services 
        provided to pursuant to this Agreement to an entity, other than 
        an officer, employee, or agent of a Party to this Agreement and 
        shall not permit the use of such material, training, or 
        services for purposes other than those for which it has been 
        provided.

    DoD monitors compliance with these terms through audits and 
examinations, National Technical Means and routine logistics service of 
equipment or facilities that have been transferred.

                          RUSSIAN OBLIGATIONS

    Question. Has the Russian Federation, nationally and locally, 
enacted all legislation and issued all legal authorities necessary to 
fulfill Russian obligations under bilateral assistance programs 
administered by DoD? What remains to be done? What steps are beirg 
taken by the U.S. Government to ensure that these steps are taken prior 
to the provision of additional assistance?

    Answer. The record is somewhat mixed. DoD implements the CTR 
Program pursuant to a government-to-government umbrella agreement 
concluded with the Russian Federation (RF). In the late nineties, the 
RF concluded that it must submit the umbrella agreement to the Duma for 
ratification, but has not done so, to date. Nevertheless, the RF has 
agreed to provisional application of the agreement until it is ratified 
by the Duma. Consequently, the RF has continued to comply with the 
umbrella agreement regarding the provision of USG assistance 
thereunder. We understand from the Ministry of Foreign Affiirs that the 
RF will submit the CTR umbrella agreement for ratification in the near 
future.
    For several years, DoD was unable to provide comprehensive security 
upgrades to Russian nuclear weapons storage sites through the CTR 
program due to RF legal constraints on non-Russian access to these 
sites. In spring 2002, the Russian Prime Minister reportedly issued a 
directive allowing U.S. Government personnel limited access to its 
nuclear weapons storage sites in order to monitor installation of 
security systems. DoD is currently negotiating with the Russian MOD to 
conclude the necessary protocols and arrangements to provide the site 
access necessary for implementation of CTR projects and protection for 
Russian sensitive information. DoD provided a revised version of these 
documents to MOD in mid-December. We anticipate resolving minor 
differences with MOD in the near future on these documents, so that we 
can proceed with initial security enhancement projects at agreed sites.
    On a few occasions, the RF has experienced difficulty in securing 
land allocation for CTR projects due to local/regional opposition and 
political maneuvering. This delayed initiation of the Chemical Weapons 
Destruction Facility project, but was eventually resolved and land 
allocated in 1998. In 1997, local opposition precluded construction of 
a facility at Perm to eliminate solid rocket motors from Russian 
ballistic missiles destroyed through CTR projects. Subsequently, the RF 
identified Votkinsk as the site for construction of this facility. To 
date, the RF has been unable to secure from local authorities the 
necessary land allocation and permits for construction of this 
facility. Consequently, DoD has held up awarding the ``Phase II'' 
contract (initial construction and long lead equipment procurement) 
pending satisfactory resolution of this issue.

         INFORMATION EXCHANGE ON NON-STRATEGIC NUCLEAR WEAPONS

    Question. Describe previous efforts to conduct an information 
exchange with the Russian Federation regarding non-strategic nuclear 
weapons. What impediments remain to a full and meaningful exchange of 
information?

    Answer. While the Moscow Treaty focuses on reductions in strategic 
nuclear warheads, we have made clear to Russia our interest in non-
strategic nuclear weapons (NSNW), and in particular, in greater 
transparency regarding those weapons.
    In the early 1990s, the United States and Russia both announced 
significant reductions in their non-strategic nuclear weapons without 
the need for a formal arms control agreement. While the U.S. has made 
such reductions, we have a great deal of uncertainty regarding the 
status of Russia's non-strategic nuclear weapons.
    We are concerned about the large number of Russian non-strategic 
nuclear weapons and Russia's nuclear warhead production capability. We 
believe that the best way to address these concerns is through 
expanding mutual transparency.
    Both Secretary Rumsfeld and Secretary Powell have raised these 
concerns with their Russian counterparts. We put them on notice that we 
intend to address these issues bilaterally. We plan to pursue 
transparency discussions on NSNW as a priority matter in the 
Consultative Group for Strategic Security (CGSS).
    Many aspects of the issue of tactical nuclear weapons also involve 
our NATO allies and our Alliance commitments, so it is an Alliance 
matter in addition to a bilateral issue with Russia.
    In the past, the U.S. has proposed comprehensive stockpile data 
exchanges. Russia thus far has shown little interest in this concept. 
Even so, depending upon the detail and nature of information that may 
be exchanged regarding future reductions of non-strategic weapons, 
Restricted Data or Formerly Restricted Data may be involved. In such an 
instance, the exchange of data would require completion beforehand of 
an Agreement for Cooperation under the Atomic Energy Act of 1954, as 
amended.

                     TREATY WITHDRAWAL RESTRICTIONS

    Question. What effect would the imposition of unilateral treaty 
withdrawal restrictions have on U.S. strategic flexibility?

    Answer. In general, we believe that it would not be in the U.S. 
interest to impose unilateral withdrawal restrictions that go beyond 
negotiated treaty language in arms control agreements. In particular, 
if you are referring to the Moscow Treaty, that Treaty contains a 
provision allowing each Party, in exercising its national sovereignty, 
to withdraw upon three months written notice to the other Party. 
Neither country can predict what security challenges may arise within 
the next decade. The United States will need to maintain the 
flexibility to respond to any potential challenges. For this reason, 
the withdrawal provision was deliberately fashioned to allow greater 
flexibility for each Party to respond in a timely manner to unforeseen 
circumstances, whether they are caused by technical problems in the 
stockpile, the emergence of new threats, or any other significant 
changes in the international environment. This withdrawal provision 
also reflects our much-improved strategic relationship with Russia, 
where a decision to withdraw likely would be prompted by causes 
unrelated either to the Treaty or to our bilateral relationship. For 
these reasons, it would not be in the U.S. interest to restrict 
unilaterally the flexibility provided by the Moscow Treaty's withdrawal 
provision.

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