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THE DEPARTMENT OF DEFENSE AND 

THE FISCAL YEAR 2014 BUDGET 

HEARING 

BEFORE THE

COMMITTEE ON THE BUDGET 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED THIRTEENTH CONGRESS 

FIRST SESSION 

HEARING HELD IN WASHINGTON, DC, JUNE 12, 2013 

Serial No. 113–6 

Printed for the use of the Committee on the Budget 

( 

Available on the Internet: 

www.gpo.gov/fdsys/browse/committee.action?chamber=house&committee=budget 
(II) 

COMMITTEE ON THE BUDGET 

PAUL RYAN, Wisconsin, Chairman 

TOM PRICE, Georgia 

SCOTT GARRETT, New Jersey 

JOHN CAMPBELL, California 

KEN CALVERT, California 

TOM COLE, Oklahoma 

TOM MCCLINTOCK, California 

JAMES LANKFORD, Oklahoma 

DIANE BLACK, Tennessee 

REID J. RIBBLE, Wisconsin 

BILL FLORES, Texas 

TODD ROKITA, Indiana 

ROB WOODALL, Georgia 

MARSHA BLACKBURN, Tennessee 

ALAN NUNNELEE, Mississippi 

E. SCOTT RIGELL, Virginia 

VICKY HARTZLER, Missouri 

JACKIE WALORSKI, Indiana 

LUKE MESSER, Indiana 

TOM RICE, South Carolina 

ROGER WILLIAMS, Texas 

SEAN P. DUFFY, Wisconsin 

CHRIS VAN HOLLEN, Maryland, 

Ranking Minority Member 

ALLYSON Y. SCHWARTZ, Pennsylvania 

JOHN A. YARMUTH, Kentucky 

BILL PASCRELL, JR., New Jersey 

TIM RYAN, Ohio 

GWEN MOORE, Wisconsin 

KATHY CASTOR, Florida 

JIM MCDERMOTT, Washington 

BARBARA LEE, California 

DAVID N. CICILLINE, Rhode Island 

HAKEEM S. JEFFRIES, New York 

MARK POCAN, Wisconsin 

MICHELLE LUJAN GRISHAM, New Mexico 

JARED HUFFMAN, California 

TONY CA ́ RDENAS, California 

EARL BLUMENAUER, Oregon 

KURT SCHRADER, Oregon 

PROFESSIONAL STAFF

AUSTIN SMYTHE, Staff Director 

THOMAS S. KAHN, Minority Staff Director 
(III) 

C O N T E N T S 

Page 

Hearing held in Washington, DC, June 12, 2013 ................................................. 1 

Hon. Paul Ryan, Chairman, Committee on the Budget ................................ 1 

Prepared statement of ............................................................................... 2 

Questions submitted for the record ......................................................... 49 

Hon. Chris Van Hollen, ranking member, Committee on the Budget ......... 3 

Prepared statement of ............................................................................... 4 

Hon. Chuck Hagel, Secretary, U.S. Department of Defense ......................... 5 

Prepared statement of ............................................................................... 8 

Response to questions submitted for the record ..................................... 52 

GEN Martin E. Dempsey, USA, Chairman, Joint Chiefs of Staff ................ 16 

Prepared statement of ............................................................................... 17 

Response to questions submitted for the record ..................................... 61 

Questions submitted for the record from: 

Hon. James Lankford, a Representative in Congress from the State 

of Oklahoma ........................................................................................... 49 

Hon. Bill Flores, a Representative in Congress from the State of 

Texas ....................................................................................................... 49 

Hon. Luke Messer, a Representative in Congress from the State 

of Indiana ............................................................................................... 51 

(1) 

THE DEPARTMENT OF DEFENSE AND 

THE FISCAL YEAR 2014 BUDGET 

WEDNESDAY, JUNE 12, 2013 

HOUSE OF REPRESENTATIVES, 

COMMITTEE ON THE BUDGET, 

Washington, DC. 

The Committee met, pursuant to call, at 1:00 p.m., in room 210, 

Cannon House Office Building, Hon. Paul Ryan, [Chairman of the 

Committee] presiding. 

Present: Representatives Ryan, Price, Calvert, McClintock, 

Lankford, Ribble, Rokita, Woodall, Blackburn, Nunnelee, Rigell, 

Hartzler, Walorski, Messer, Williams, Van Hollen, Schwartz, Yarmuth, Pascrell, Ryan of Ohio, Castor, McDermott, Lee, Cicilline, 

Jeffries, Pocan, Lujan Grisham, Huffman, Blumenauer, Schrader 

Chairman RYAN. The Committee will come to order. Welcome, everybody. I want to start on time, or as close to on time as we can 

because we have a busy day. Number one, we have got votes that 

are going to hit about 2:30, 2:45. The Secretary and the General 

have to be down at the White House by 3:00, so I am going to, with 

consultation from the Ranking Member, knock our question time 

for each member, including ourselves, down to three minutes each 

so that everybody gets a chance to ask a question, and we can get 

this done in time for the pending votes on the floor and in time for 

their meeting at the White House. 

With that, I want to start by thanking our distinguished witnesses: Secretary Hagel, General Dempsey, and Secretary Hale. 

Each of you served our country, both in military and government, 

and we thank you for your service. The first duty of government 

is to keep us safe, and to keep us safe, our strategy ought to drive 

our budget. But under this Administration, our fear is that the 

budget is driving the strategies. It is the opposite. 

Last year, Secretary Panetta made a budget request, he came 

here to testify on it, that he said was the minimum necessary to 

execute the president’s strategy. He said that there was, quote, ‘‘little room for cuts if we wanted our troops to fulfill our mission.’’ 

This year’s budget request covers the same mission, but over the 

next 10 years, it is about $120 billion lower than last year’s request. So far, there has been no explanation for this number. Have 

we changed our strategy? 

Now, the Department of Defense is not immune to waste. There 

is room for improvement, clearly. Every agency must use taxpayer 

dollars wisely, especially the Department of Defense because it has 

a very large budget. 
2 

Secretary Hagel announced the strategic choices that management reviewed to develop a new strategy for a smaller budget, but 

a cheaper strategy is not necessarily a better one. The Defense 

Business Board has suggested a number of ways to improve the 

Department, and I want to commend their hard work. I think it is 

excellent work, and I encourage you to act on their recommendations. 

That said, national security is our nation’s top security, it is our 

top priority. Defense has born have the burden of deficit reduction, 

and the president wants to cut even more. This year, the House 

budget provides the same amount of Defense spending that the 

president requested last year, yet the president seems to be opposing our proposal. The president is holding Defense hostage for 

higher taxes and more spending, in our opinion. 

These days, every part of government needs to be more efficient, 

but even as we try to cut the fat, we have to make sure that we 

do not cut the bone. We must make sure our troops overseas have 

what they need to complete their mission. We owe a debt of gratitude to our military and their families who continue to make sacrifices for our country for the freedoms that we cherish. They are 

there fighting for us right now while we speak, so we have to get 

this right. I look forward to hearing your thoughts on the challenges we face and the resources that we need to meet them. 

With that, I would like to yield to the Ranking Member, Mr. Van 

Hollen. 

[The prepared statement of Paul Ryan follows:] 

PREPARED STATEMENT OF HON. PAUL RYAN, CHAIRMAN, COMMITTEE ON THE BUDGET

Welcome, everybody. I want to start by thanking our distinguished witnesses: Secretary Hagel, General Dempsey, and Secretary Hale. Each of you has served our 

country—both in the military and in government. And we thank you for your service. 

The first duty of government is to keep us safe. And to keep us safe, our strategy 

should drive our budget. But under this administration, the budget is driving the 

strategy. 

Last year, Secretary Panetta made a budget request he said was the minimum 

necessary to execute the President’s strategy. He said there was ‘‘little room’’ for 

cuts if we wanted our troops to fulfill their mission. 

This year’s budget request covers the same mission. But over the next ten years, it’s about $120 billion lower than last year’s request. And so far, there’s been no 

explanation. Have we changed our strategy? 

Now, the Defense department isn’t immune to waste. There’s room for improvement. Every agency must use taxpayer dollars wisely—especially the Defense department. 

Secretary Hagel has announced the Strategic Choices and Management Review to 

develop a new strategy for a smaller budget. But a cheaper strategy isn’t necessarily 

a better one. The Defense Business Board has suggested a number of ways to improve the department. I want to commend their hard work—and encourage you to 

act on their recommendations. 

That said, national security is a priority. Defense has borne half the burden of 

deficit reduction. And the President wants to cut even more. This year, the House 

budget provides the same amount of defense funding the President requested last 

year. Yet the President opposes our proposal. The President is holding the defense 

budget hostage for higher taxes and more spending. 

These days, every part of government needs to be more efficient. But even as we 

try to cut the fat, we have to be sure not to cut bone. We must make sure our troops 

overseas have what they need to complete their mission. We all owe a debt of gratitude to our military and their families, who continue to make sacrifices for our country and the freedoms we cherish. 

So I look forward to hearing your thoughts on the challenges we face—and the 

resources we need to meet them. 
3 

Mr. VAN HOLLEN. Thank you, Mr. Chairman. I want to join 

Chairman Ryan in welcoming all our witnesses. Secretary Hagel, 

General Dempsey, Secretary Hale, thank you for your dedicated 

service to our nation. I also want to convey our gratitude to the 

men and women in the Armed Forces for the sacrifices they make 

every day for our country. 

This week, the House of Representatives will be debating and 

voting on the National Defense Authorization Act. That will provide an opportunity to provide the resources we need for our Armed 

Forces. It will also be a chance to address some of the other significant challenges that must be confronted, like the mechanisms for 

confronting cases of sexual abuse in the military. 

Here in the Budget Committee, we can help honor the sacrifices 

of the men and women in the Armed Forces by allocating the topline resources they need to accomplish their mission, and by making sure we have a budget plan that ensures that America remains 

economically strong and the land of opportunity for their children 

and grandchildren. The choices we make in our federal budget 

should reflect those goals. We should make choices that ensure that 

our military remains second to none, and make investments in education, scientific research, and the infrastructure necessary to help 

power our economy, sharpen our competitive edge, and create new 

opportunities. The very deep and very rapid cuts imposed by the 

sequester place all of these objectives at risk. 

You have both spoken very plainly about the negative impact on 

military readiness. There are obviously other major negative impacts on the Defense side of the equation. The nonpartisan Congressional Budget Office, which serves as the independent referee 

here, has said that deep immediate cuts from the sequester will 

also reduce our economic growth this year by a full one-third, 

which translates into 750,000 fewer American jobs this year. I have 

a letter from a major biotech company in my district that talks 

about the hiring freeze they imposed because of the cuts to NIH 

grants. These are self-inflicted wounds to our military, to our kids’ 

education, to our economy. 

Now, the president and House and Senate Democrats have proposed budgets that would replace that sequester overall. Unfortunately, here in the House, we have not even had an opportunity to 

vote on that proposal. The good news is the House Republican 

budget on Defense provides the same level of funding, approximately, as the president’s budget and the House and Senate Democrats. The bad news is the way they make up for that is by absolutely gutting the other parts of discretionary spending. So, for example, the part of the budget that funds our education and research at NIH would be cut by approximately 20 percent below 

2013 sequester levels. The president has been absolutely right to 

make it clear that he will not support appropriations bills that 

have those lopsided priorities. 

Finally, Mr. Chairman, I would say, given the large differences 

between the House and Senate budgets, you would think our Republican colleagues would want to get together now to resolve 

those differences by going to conference. We heard for three years 

about the fact the Senate did not have a budget. They have now 
4 

had a budget for 81 days. We are now 58 days past the statutory 

deadline for a conference committee being met. 

Speaker Boehner unfortunately continues to block the creation of 

a budget conference. I do not know what happened to ‘‘No Budget, 

No Pay,’’ but I hope that this hearing and the testimony that is 

given will provide motivation for us to get going and doing our job 

now, go to conference, remove the uncertainty, and deal with these 

issues in a transparent way where we actually make the compromises necessary to move our country forward. Thank you, Mr. 

Chairman. 

[The prepared statement of Chris Van Hollen follows:] 

PREPARED STATEMENT OF HON. CHRIS VAN HOLLEN, RANKING MEMBER, 

COMMITTEE ON THE BUDGET

I want to join Chairman Ryan in welcoming our witnesses. Secretary Hagel, General Dempsey, and Under Secretary Hale, thank you for your dedicated service to 

our nation. I also want to convey our gratitude to the men and women in the Armed 

Forces for the sacrifices they make for the rest of us and for our country. 

This week the House will be debating and voting on the National Defense Authorization Act. That will provide an opportunity to provide the resources we need for 

our Armed Forces. It will also be a chance to address some of the significant challenges that must be confronted—like the mechanisms for confronting cases of sexual 

abuse in the military. And it will provide a chance to examine the huge growth in 

the number of contractors used by the Defense Department and other security related federal agencies—a fact that has been highlighted by the recent leaks by a 

contractor to the National Security Agency. 

Here in the Budget Committee we can help honor the sacrifices of the men and 

women in the Armed Forces by allocating the top-line resources they need to accomplish their mission, and by making sure we have a budget plan that ensures that 

America remains economically strong and the land of opportunity for their children 

and grandchildren. 

The choices we make in our federal budget should reflect those goals. We should 

make budget choices that ensure that our military remains second to none, and 

make the investments in education, scientific research, and infrastructure necessary 

to help power our economy, sharpen our competitive edge, and create new opportunities. 

The very deep and very rapid cuts imposed by the sequester place these objectives 

at risk. You have both spoken plainly about the corrosive effects these cuts have 

on our military readiness. I also find it shameful that, in this great country of ours, 

the children of our service men and women stationed on military bases like Fort 

Bragg will lose five days of school this fall while their teachers are furloughed because this Congress cannot get its act together. 

The non-partisan Congressional Budget Office (CBO), which serves as the independent referee around here, has said that the deep, immediate cuts from the sequester will also reduce economic growth this year by one-third—which translates 

into 750,000 fewer jobs in this calendar year alone. I have a letter from a major 

bio-tech firm that provides one small example of that drag on the economy—they 

have imposed a hiring freeze because of the cuts in medical research at the National 

Institutes of Health. 

These are self-inflicted wounds to our military, to our kids’ education, to our economy. The President, and the House and Senate Democrats, have all proposed budgets that would replace these deep, immediate cuts with a balanced approach that 

makes the necessary investments in our military and our economic growth, while 

reducing our long-term deficit with targeted cuts to spending and tax expenditures 

over a period of time. Here in the House, on seven occasions I have asked for a vote 

on a specific plan to replace the sequester through such a balanced approach. Unfortunately, we have not even been allowed a single vote on that plan in the people’s 

House. 

Our Republican colleagues continue to reject that approach because they oppose 

any plan to replace the sequester, or to reduce the deficit, that includes any new 

revenue from closing tax breaks for the wealthy. Even though, I would point out, 

the CBO recently issued a report showing that 17 percent of the biggest tax breaks 

go to those with the top 1 percent of income. 
5 

The good news in the House Republican budget is that—like the Democratic proposals—it would eliminate the very steep and immediate cuts to defense in FY 2014. 

The bad news is that they do it by cutting even more deeply into vital investments 

in our kids’ education and in the investments in innovation and technology that help 

grow our economy. In fact, the Republican budgets would cut the part of the budget 

that funds education and vital medical research by 19 percent below the sequester. 

And despite claims to want to strengthen our embassy security in the aftermath of 

tragedies like Benghazi, the Republican budget slashes State Department operations by over 15 percent below sequester. The White House has rightly stated that 

the President would veto any such lopsided approach. 

Given the big differences between the House and Senate budgets, you would think 

that our Republican colleagues would be eager to go to a budget conference to work 

out the differences in a transparent manner. After all, for years they displayed 

charts showing how many days it had been since the Senate had passed a budget. 

Well, the Senate passed a budget 81 days ago. It has now been 58 days since the 

statutory deadline for Congress to reach a budget conference. Yet Speaker Boehner 

refuses to appoint budget conferees, while the Senate Democrats have been blocked 

12 times from getting Republicans to go to a budget conference. Whatever happened 

to ‘no budget, no pay’? Even Senator McCain has said that Republican refusal to 

go to a budget conference is ‘insane’ and ‘incomprehensible.’ He is not alone. 

Meanwhile, the sequester continues to eat away at our military readiness, at critical investments, and at economic growth. I hope today’s hearing will inspire our 

colleagues to get serious about starting to tackle these big issues now. I don’t know 

what we are waiting for. 

Chairman RYAN. Thank you. Thank you. And I expected similar 

comments like that, and I will say our goal is to get a budget 

agreement at the end of the day, and the decisions we are making 

are to try and maximize the likelihood of an outcome that is successful. 

Mr. VAN HOLLEN. Well, today, for the 13th time, Senate Democrats asked to go to conference, and they have been blocked by Republican Senators. 

Chairman RYAN. Thank you. All right. Remember, 3:00. Secretary Hagel, the microphone is yours, then will be followed by 

General Dempsey. 

STATEMENT OF HON. CHARLES T. HAGEL, SECRETARY, 

U.S. DEPARTMENT OF DEFENSE 

Secretary HAGEL. Mr. Chairman, thank you, and Ranking Member Van Hollen, thank you, and to the distinguished members of 

this committee, thank you. I note that my friend and predecessor, 

the former chairman of this body, hangs proudly on your wall and 

is carefully monitoring my testimony, so I shall do all I can not to 

embarrass him, and I would say, as you all know, and some served 

with Leon Panetta, he continues to contribute a remarkable public 

servant. So thank you for this opportunity. 

As you have both noted, we are here today to talk about the 

president’s 2014 budget, and I would begin with first thanking this 

committee and each of you for your support of our men and women 

in uniform, their families, and our civilian workforce, all who are 

associated with the Department of Defense and our national security. Thank you. 

The president has requested $526.6 billion for the Department of 

Defense’s Fiscal Year 2014 base budget, and 79.4 billion for overseas contingency operations. Mr. Chairman, my written statement, 

as you have probably noted, contains significant details on both 

budget requests. But this afternoon, allow me to very briefly focus 

on three general areas before I take your questions. First, the continued budget challenges facing the Department in Fiscal Year 
6 

2013 as a result of sequestration; second, the Department’s Fiscal 

Year 2014 budget request; and third, how the Department is preparing for future budget uncertainty and the prospects of further 

reduced resources. 

As you all know, the Department has been forced to implement 

deep, steep, and abrupt cuts in the current fiscal year because of 

sequestration. According to the latest guidance from the Office of 

Management and Budget, the Department must cut $37 billion in 

spending through the remainder of this fiscal year. With our internal decision to shift the impact of sequestration away from those 

serving in harm’s way and our force readiness, the cuts now fall 

heavily on DoD’s accounts that train and equip those who will deploy in the future. The Department is also experiencing higher 

wartime costs than expected. As a result of these factors, the Department is facing a shortfall of more than $30 billion in our operation and maintenance budget for Fiscal Year 2013. 

To deal with this shortfall, the Department has cut back sharply 

on facilities maintenance, instituted hiring freezes, cut overhead 

spending, reduced important but lower priority programs, directed 

furloughs of nearly 700,000 civilian employees, and submitted a 

$9.6 billion reprogramming request to Congress. Given the scale of 

this shortfall, the reprogramming and other steps we have taken 

to cut nonessential spending are not enough. While we have protected spending to sustain the war effort and defend America’s 

vital strategic interests, the Department’s day-to-day activities will 

be significantly disrupted for the remainder of this fiscal year. 

Each of the military services has begun to significantly reduce 

training and maintenance of non-deployed operating forces. For example, the Army has stopped rotations at its key combat training 

centers for all but deploying units. More than a dozen combatcoded Air Force squadrons either already have or will soon stop flying, and the Navy has curtailed all deployments. 

To avoid even more significant reductions to military readiness, 

I directed furloughs of up to 11 days for most of the Department’s 

800,000 civilian personnel. I made this decision very reluctantly. I 

made it very reluctantly because I recognize the significant hardship this places on our civilian personnel and their families. But 

the current budget environment is requiring difficult decisions and 

difficult options to deal with. 

The president’s Fiscal Year 2014 budget continues to implement 

the $487 billion in spending reductions over 10 years, agreed to, as 

this body knows, in the Budget Control Act of 2011. If the sequester-related provisions of the Budget Control Act are not changed, 

the Fiscal Year 2014 funding for national defense programs will be 

subject to an additional $52 billion reduction in DoD funding, and, 

if there are no changes, continued sequestration will result in 

roughly $500 billion in additional reductions to Defense spending 

over the next 10 years. 

The president’s Fiscal Year 2014 budget replaces sequestration, 

and gives the Department the time and flexibility to plan and to 

implement spending reductions wisely and responsively. In particular, this budget enables the Department to support troops still 

at war in Afghanistan as we transition out of Afghanistan, protect 

readiness, modernize the military’s aging weapons inventory in 
7 

keeping with the president’s Strategic Guidance, and sustain the 

high quality of the all-volunteer force. This budget also continues 

the Department’s approach over the last couple of years of targeting growing costs in areas of support, overhead acquisition, and 

pay and benefits. 

Over the next five years, DoD has identified $34 billion in new 

savings across these categories. This includes weapons programs, 

restructuring and terminations that achieve $8.2 billion in savings, 

slowdowns in military construction, and reductions in other lowpriority programs. Our military compensation package preserves 

DoD’s world-class pay and benefits while putting our military on a 

more sustainable path for the future. It includes changes to the 

TRICARE program to bring the beneficiaries’ cost share closer to 

the levels envisioned when the program was implemented. 

The Department of Defense also must be able to eliminate excess 

infrastructure. The president’s Fiscal Year 2014 budget requests 

authorization for one round of base realignment closure. BRAC, as 

we all know, is an imperfect process, and there are upfront costs, 

but in the long term, there are significant savings. The previous 

rounds of BRAC are saving $12 billion annually. We cannot justify 

funding unnecessary infrastructure when we are reducing our 

forestructure. 

Since 2003, DoD has divested more than 100 foreign bases and 

operations, and we are on schedule to close or consolidate over 20 

more overseas operations. Although there are clearly opportunities 

to achieve significant savings by improving efficiency, consolidations, and reducing overhead, the scale of the current spending reductions will also require cuts and changes to military operations. 

The fiscal 2014 budget request seeks to further align budget programs with the president’s Defense Strategic Guidance while continuing to reduce the size of the ground forces and retire aging aircraft and ships. This budget invests in key elements of our defense 

strategy including implementing a rebalance to the Asia Pacific region, maintaining a safe, secure, and effective nuclear stockpile, increasing investment in cyber capabilities, and sustaining the 

growth of Special Operations forces. Finally, this budget seeks to 

preserve a combat-ready force, and sustain the high quality all-voluntary force. 

Now, let me just very briefly note what the chairman had mentioned in his opening remarks about a strategic choices management review that I directed three months ago. The Fiscal Year 

2014 budget reflects DoD’s best efforts to match ends, ways, and 

means, and this is during a period of intense fiscal uncertainty. It 

is obvious that significant changes to the Department’s top-line 

spending would require changes to this budget plan. 

Consequently, I directed a strategic choices management review 

in order to assess the potential impact of further reductions, and 

plan for those continued reductions. I have received the initial internal results of the review, and I am now reviewing all the documents. This Defense Department will continue to find new ways to 

operate more affordably, efficiently, and effectively. However, as I 

have stated, continued cuts on the scale and the timeline of sequestration will require significant reductions in core military capabilities and the scope of our activities around the world. The presi-
8 

dent’s Fiscal Year 2014 budget sustains our military strength in an 

environment of constrained resources, giving DoD the time and the 

flexibility to make the necessary reductions and adjustments over 

a 10-year timeframe. 

Hard choices will have to be made over the next few years. In 

the past, many modest reforms to personnel and benefits, along 

with efforts to reduce infrastructure and restructure acquisition 

programs, were met with fierce political resistance, and they were 

never implemented. As you all know, we are now in a different fiscal environment. New realities are forcing us to more fully confront 

these tough and painful choices, and to make the reforms necessary 

to put this Department on a path to sustain our military strength 

for the 21st century and meet new complicated threats; we must 

do better. 

This will require the continued partnership and assistance of this 

Committee and the Congress. Before I take questions, I would ask 

if it is okay, Mr. Chairman, if General Dempsey present his statement as well. 

[The prepared statement of Secretary Hagel follows:] 

PREPARED STATEMENT OF HON. CHUCK HAGEL, SECRETARY, 

U.S. DEPARTMENT OF DEFENSE

Chairman Ryan, Ranking Member Van Hollen, members of the committee, thank 

you for this opportunity to discuss the President’s Fiscal Year 2014 budget request 

for the Department of Defense. 

Allow me to express my appreciation to this committee for its continued support 

of our men and women in uniform and our civilian workforce. They are doing tremendous work and making great sacrifices, along with their families, as they have 

for the more than 11 years our nation has been at war. Whether fighting in Afghanistan, patrolling the world’s sea lanes, standing vigilant on the Korean peninsula, 

supplying our troops around the world, or supporting civil authorities when natural 

disasters strike, they are advancing America’s interests at home and abroad. Their 

dedication and professionalism are the foundation of our military strength. 

As we discuss numbers, budgets, and strategic priorities, we will not lose sight 

of these men and women serving across the globe. As you all know, their well-being 

depends on the decisions we make here in Washington. 

FISCAL AND STRATEGIC CONTEXT

Today, the Department of Defense faces the significant challenge of conducting 

long-term planning and budgeting at a time of considerable uncertainty both in 

terms of the security challenges we face around the world and the levels of defense 

spending we can expect here at home. 

Even as the military emerges—and recovers—from more than a decade of sustained conflict in Iraq and Afghanistan, it confronts an array of complex threats of 

varying vintage and degrees of risk to the United States, to include: 

• the persistence of violent extremism throughout weak states and ungoverned 

spaces in the Middle East and North Africa; 

• the proliferation of dangerous weapons and materials; 

• the rise of new powers competing for influence; 

• the risk of regional conflicts which could draw in the United States; 

• faceless, nameless, silent and destructive cyberattacks. 

Meanwhile, the frenetic pace of technological change and the spread of advanced 

military technology to state and non-state actors pose an increasing challenge to 

America’s military. 

This is the strategic environment facing the Department of Defense as it enters 

a third year of flat or declining budgets. The onset of these resource constraints has 

already led to significant and ongoing belt-tightening in military modernization, 

force structure, personnel costs, and overhead expenditures. It has also given us an 

opportunity to reshape the military and reform defense institutions to better reflect 

21st century realities, as I outlined in a speech in April at the National Defense 

University. 
9 

The process began under the leadership of Secretary Gates, who canceled or curtailed more than 30 modernization programs and trimmed overhead costs within the 

military services and across the defense enterprise. These efforts reduced the Department’s topline by $78 billion over a five year period, as detailed in the Department’s FY 2012 budget plan. 

The realignment continued under Secretary Panetta, who worked closely with the 

President and the Joint Chiefs of Staff to craft new defense strategic guidance and 

a FY 2013 defense budget plan which reduced the Department’s topline by $487 billion over the course of a decade. Even while restructuring the force to become smaller and leaner and once again targeting overhead savings, this budget made important investments in the new strategy—including rebalancing to Asia and increasing 

funding for critical capabilities such as cyber, special operations, global mobility, 

and unmanned systems. 

The President’s request of $526.6 billion for the Department of Defense’s base 

budget for FY 2014 continues to implement the President’s Defense Strategic Guidance and enhances the Department’s efforts at institutional reform. Most critically, 

it sustains the quality of the all-volunteer force and the care we provide our service 

members and their families, which underpins everything we do as an organization. 

The accompanying OCO request for $79.4 billion provides the resources to continue 

the responsible drawdown in Afghanistan and restore equipment damaged or worn 

out by more than a decade of war. 

DoD’s base-budget request for FY 2014 does not reflect the effects of sequester 

cuts that would occur if the Budget Control Act (BCA) is not changed. However, the 

President’s Budget includes balanced deficit reduction proposals that are more than 

sufficient to allow Congress to meet BCA goals and then repeal sequester-related 

reductions. 

CHALLENGES IN FY 2013

Before discussing the particulars of this budget request, however, allow me to address the profound budget problems facing the Department in FY 2013 and beyond 

as a result of sequester—because they have significantly disrupted operations for 

the current fiscal year and greatly complicated efforts to plan for the future. The 

Congress and the Department of Defense have a responsibility to find answers to 

these problems together—because we have a shared responsibility to protect our national security. DoD is going to need the help of Congress to manage through this 

uncertainty. 

The FY 2013 DoD Appropriations bill enacted by the Congress in March addressed many urgent problems by allocating DoD funding more closely in line with 

the President’s budget request, giving the Department authorities to start new programs, and allowing us to proceed with important military construction projects. 

Nonetheless, the bill still left in place the deep and abrupt cuts associated with sequester—some $37 billion in spending reductions. With military pay and benefits 

exempt from the sequester, and our internal decision to shift the impact of sequestration away from those serving in harm’s way, the cuts fall heavily on DoD’s operations, maintenance and modernization accounts that we use to train and equip 

those who will deploy in the future. 

Furthermore, the military is experiencing higher wartime operating tempos, and 

higher transportation costs than expected when the budget request was formulated 

more than a year ago. As a result of all these factors, the Department is now facing 

a shortfall of more than $30 billion in our operation and maintenance (O&M) budget 

for FY 2013. 

The Department has been doing everything possible to reduce this shortfall while 

ensuring we can defend the nation, sustain wartime operations, and preserve DoD’s 

most critical asset—our world-class civilian and military personnel. To that end, we 

have cut back sharply on facilities maintenance, instituted a hiring freeze, cut overhead and all non-essential spending, reduced many other important but lower-priority programs, and worked to shift funds from investment to O&M accounts. 

Still, these steps have not been enough to close the shortfall. While we have protected spending to sustain the war effort and defend America’s vital strategic interests, the Department’s day-to-day activities will be significantly disrupted for the remainder of the fiscal year. Each of the military services has begun to significantly 

reduce training and maintenance of non-deployed operating forces—steps that are 

having effects on military readiness. 

Specifically: 

• The Army has stopped rotations at its key combat training centers for all but 

deploying units. By the end of the year, this and other training cutbacks will leave 

most non-deployed Army units at unacceptable readiness levels. 
10 

• The Air Force has or will soon stop all flying at more than a dozen combat 

coded squadrons. These units will soon no longer be ready to fight on short notice. 

• The Navy has curtailed deployments, including the decision not to send a second carrier strike group to the Gulf. 

We have also recently submitted a $9.6 billion reprogramming request to Congress. Most of this reprogramming seeks permission to move unneeded military personnel funding, and non-executable or lower priority investment funding, into our 

O&M accounts that are experiencing the largest budget shortfalls. 

To avoid even more significant reductions to military readiness, and after extensive review of all options with the DoD’s senior military and civilian leadership on 

how we address this budget crisis, I have decided to direct furloughs of up to 11 

days for nearly 700,000 of the Department’s civilian personnel. I have made this decision very reluctantly, because I know that the furloughs will adversely impact 

DoD operations. I also recognize the significant hardship this places on our civilian 

personnel across the country and their families. But the current budget is requiring 

difficult decisions and options. 

After required notifications, we will begin the furlough period on July 8 at the 

rate of one furlough day per week for most personnel. We plan to continue these 

furloughs through the end of the current fiscal year. If our budgetary situation permits us to end furloughs early, I would strongly prefer to do so. That is a decision 

I will make later in the year. 

FY 2014 BUDGET REQUEST

Let me turn now to FY 2014. If the sequester-related provisions of the Budget 

Control Act of 2011 are not changed, FY 2014 funding for national defense programs 

will be subject to a steeply reduced cap, which would cut DoD funding by roughly 

$52 billion further. And, if there is no action by the Congress, roughly $500 billion 

in reductions to defense spending would be required over the next ten years covered 

by the BCA. 

As an alternative, the President’s budget proposes some $150 billion in additional 

defense savings (measured in terms of budget authority) over the next decade when 

compared with the budget plan submitted last year. These cuts are part of a balanced package of deficit reduction. Unlike sequester, these cuts largely occur in the 

years beyond FY 2018—which gives the Department time to plan and implement 

the reductions wisely, and responsibly, anchored by the President’s defense strategic 

guidance. 

The President’s FY 2014 request reflects these changes. It continues to balance 

the compelling demands of supporting troops still at war in Afghanistan, protecting 

readiness, modernizing the military’s aging weapons inventory in keeping with the 

president’s strategic guidance, and sustaining the quality of the all-volunteer force. 

The requested funding of $79.4 billion for FY 2014 OCO provides funds to continue the responsible drawdown in Afghanistan and is lower than the roughly $89 

billion enacted for FY 2013. The top-line budget request of $526.6 billion for basebudget funding FY 2014 is essentially flat compared to the President’s request for 

FY 2013, and roughly in line with what both the House and Senate have passed 

in their FY 2014 budget resolutions. 

The following are the major components of the $526.6 billion base budget request 

for FY 2014: 

• Military pay and benefits (including TRICARE and retirement costs)—$170.2 

billion (32% of the total base budget); 

• Operating costs (including $77.3 billion for civilian pay)—$180.1 billion (34%); 

• Acquisitions and other investments (Procurement, research, development, test 

and evaluation, and new facilities construction)—$176.3 billion (33%) 

The base budget presented today, at its most basic level, consists of a series of 

choices that reinforce each of the following complementary goals: 

• making more disciplined use of defense resources; 

• implementing the President’s defense strategic guidance; 

• seeking to sustain the readiness and quality of the all-volunteer force; 

• supporting troops deployed and fighting in Afghanistan. 

As I discuss each of these goals, I must note that, unfortunately, many of the reductions we are being forced to make in FY 2013 as a result of sequester run directly counter to the FY 2014 goals. 

1. MAKING MORE DISCIPLINED USE OF DEFENSE RESOURCES

In developing the FY 2014 budget, the Department identified about $34 billion in 

savings over the current Future Years Defense Program (FYDP), which covers FY 
11 

2014 to FY 2018. These savings were used to help pay the costs of implementing 

the new defense strategy and to accommodate budget reductions. 

These efforts continue the Department’s approach of the last several years to first 

target growing costs in areas of support, overhead, acquisition, and pay and benefits, before cutting military capabilities and force structure. 

Reducing Support Costs 

In order to maintain balance and readiness, the Department of Defense must be 

able to eliminate excess infrastructure. Therefore, the President’s FY 2014 budget 

requests authorization for one round of Base Realignment and Closure (BRAC) in 

2015. While the commission would meet in 2015, the actual closing of any bases 

would involve a multiyear process that would not begin until 2016. 

BRAC is a comprehensive and fair tool that allows communities a role in re-use 

decisions for the property and provides redevelopment assistance. BRAC is an imperfect process, and there are up-front costs for BRAC, and this FYDP adds $2.4 

billion to pay them, but in the long-term there are significant savings. The previous 

five rounds of BRAC are now saving a total of $12 billion annually. 

We cannot justify funding unnecessary infrastructure when we are reducing force 

structure. Since 2003, DoD has divested more than 100 foreign bases and operations 

and we are on schedule to close or consolidate over 20 more overseas operations. 

We are also taking other important steps to cut back on support costs. We have 

begun a study of our Military Treatment Facilities, including many hospitals and 

clinics that are currently underutilized. By the end of this year we will have a plan 

in place that suggests how to reduce that underutilization while still providing highquality medical care. This restructuring, coupled with a BRAC round and other 

changes, would permit us to plan on a cut in our civilian workforce that will comply 

with Congressional direction. 

We are also continuing our successful efforts to hold down military health system 

costs. Due primarily to changes in payments to health care providers, our projected 

costs for FY 2014 are about four percent lower than those costs in FY 2012, a significant turnaround compared to health care trends over the past decade. But costs 

will soon start to grow again. Therefore, we continue efforts to slow the growth of 

medical care costs through actions such as re-phasing military construction, making 

full use of past changes in provider costs, taking advantage of the slowing of growth 

in medical costs in the private sector, and modest changes in user fees and co-pays. 

Another important initiative is our effort to improve the Department’s financial 

management and achieve auditable financial statements. We need auditable statements, both to improve the quality of our financial information and to reassure the 

public, and the Congress, that we are good stewards of public funds. We have a focused plan and are making progress. Our next goal is audit-ready budget statements by September 2014. We are working hard to achieve this goal, though the 

current budget turmoil is hampering our efforts significantly. I strongly support this 

initiative and will do everything I can to fulfill this commitment. 

These and many other changes led to total savings of about $34 billion in FY 

2014-2018, including $5.5 billion in FY 2014. However, we are concerned that these 

savings from more disciplined use of resources could be eroded by sequester, as we 

are forced to make inefficient choices that drive up costs. Today, for example, we 

are being forced to engage in shorter and less efficient contracts and cuts in unit 

buy sizes that will increase the unit costs of weapons. 

Restructuring and Terminations of Weapons Programs 

In this budget, the Department has shifted priorities within its modernization 

portfolios and achieved $8.2 billion in savings from weapons program terminations 

and restructuring. For example, by revising the acquisition strategy for the Army’s 

Ground Combat Vehicle (GCV) program, the Department will save over $2 billion 

in development costs. In other cases the Department proposes evolutionary approaches to develop new capabilities instead of relying on leap-ahead gains in technology. 

For example, the Department: 

• Realigned investment funding and restructured the SM-3 IIB interceptor—a 

high-risk, high-cost system—to improve the capabilities of existing missile defense 

systems, resulting in savings of about $2.1 billion during the Future Year Defense 

Program (FYDP); 

• Cancelled the Precision Tracking Space Satellite system—another high-risk 

project—saving $1.9 billion during the FYDP; the Department invested a portion of 

these savings in technology upgrades to existing ground-based radars and sensors. 
12 

To lessen the potential impact on local communities from the reductions in defense procurement, the Department is requesting an additional $36 million in support of the Defense Industry Adjustment program. 

The Department is continuing to take steps to tighten the contract terms and reduce risk in our largest acquisition program, the F-35 Joint Strike Fighter. The FY 

2014 budget request includes $8.4 billion for the Joint Strike Fighter. 

Military Pay and Benefits 

The costs of military pay and benefits are another significant driver of spending 

growth that must be addressed in the current fiscal environment. In this budget, 

the Department is submitting a new package of military compensation proposals 

that take into consideration Congressional concerns associated with those from FY 

2013. These changes save about $1.4 billion in FY 2014 and a total of $12.8 billion 

in FY 2014-2018 

This package includes a modest slowing of the growth of military pay by implementing a one percent pay raise for service members in 2014. The Department is 

also seeking additional changes to the TRICARE program in the FY 2014 budget 

to bring the beneficiary’s cost share closer to the levels envisioned when the program was implemented—particularly for working age retirees. Today military retirees contribute less than 11 percent of their total health care costs, compared to an 

average of 27 percent when TRICARE was first fully implemented in 1996. 

The proposed TRICARE changes include: 

• For retirees, increases in TRICARE Prime enrollment fees, instituting an enrollment fee for TRICARE Standard/Extra, and increasing Standard/Extra deductibles. 

• Implementation of an enrollment fee for new TRICARE-for-Life beneficiaries, 

while grandfathering in those who are Medicare-eligible at enactment. 

• Increases in pharmacy co-pays and, where appropriate, mandatory use of mail 

order delivery of pharmaceuticals. 

• Indexing of fees, deductibles, co-pays and the catastrophic cap to the growth in 

the annual retiree cost-of-living adjustment. 

Survivors of military members who died on active duty or medically retired members would be excluded from all TRICARE increases. Even after the proposed 

changes in fees, TRICARE will remain a generous benefit—as it should be. 

These adjustments to pay and benefits were among the most carefully considered 

and difficult choices in the budget. They were made with the strong support of the 

Joint Chiefs of Staff and Senior Enlisted Leadership, in recognition that in order 

to sustain these benefits over the long term without dramatically reducing the size 

or readiness of the force, these rising costs need to be brought under control. 

2. IMPLEMENTING AND DEEPENING OUR COMMITMENT TO THE PRESIDENT’S DEFENSE

STRATEGIC GUIDANCE

Spending reductions on the scale of the current drawdown cannot be implemented 

through improving efficiency and reducing overhead alone. Cuts and changes to capabilities—force structure and modernization programs—will also be required. The 

strategic guidance issued in January 2012 set the priorities and parameters that informed those choices, and the FY 2014 budget submission further implements and 

deepens program alignment to this strategic guidance. 

The new strategy calls for a smaller and leaner force. Last year we proposed reductions of about 100,000 in military end strength between FY 2012 and FY 2017. 

Most of those reductions occur in the ground forces and are consistent with a decision not to size U.S. ground forces to accomplish prolonged stability operations, 

while maintaining adequate capability should such activities again be required. By 

the end of FY 2014 we will have completed almost two thirds of the drawdown of 

our ground forces, and the drawdown should be fully complete by FY 2017. 

Last year DoD submitted proposals for changes in Air Force and Navy force structure; some were rejected by Congress. We continue to believe, however, that these 

reductions are consistent with our defense strategy and the need to hold down costs. 

Therefore, DoD is resubmitting several proposals from its FY 2013 budget submission that were not supported by Congress, including the retirement of seven Aegis 

cruisers and two amphibious ships at the end of FY 2014 when funds appropriated 

for their operation run out. Despite the growing importance of the Asia-Pacific—a 

mostly maritime theater—the high costs of maintaining these older ships relative 

to their capabilities argues strongly for their retirement. 

The FY 2014 budget continues implementation of the Air Force total force proposal included in the FY 2013 National Defense Authorization Act. In response to 

state and congressional concerns about proposed reductions to the Air National 

Guard that DoD made in the original FY 2013 budget, the Department added back 
13 

44 aircraft to the Guard, 30 aircraft to the Air Force Reserve, and is taking away 

31 aircraft from the active Air Force. 

These shifts were forced primarily by political realities, not strategy or analysis. 

While this active-reserve compromise allows the Air Force to move forward with 

prior year retirements and transfers, and approved mission changes for many reserve units, it does require the Department to retain excess aircraft capacity. The 

Department’s position continues to be that retaining excess air capacity in the reserve component is an unnecessary expenditure of government funds that detracts 

from more pressing military priorities outlined in the defense strategic guidance. 

Increased emphasis on the Asia-Pacific and Middle East represents another key 

tenet of the new defense strategic guidance. This budget continues to put a premium 

on rapidly deployable, self-sustaining forces—such as submarines, long-range bombers, and carrier strike groups—that can project power over great distance and carry 

out a variety of missions. 

This new strategy not only recognizes the changing character of the conflicts in 

which the U.S. must prevail, but also leverages new concepts of operation enabled 

by advances in space, cyberspace, special operations, global mobility, precisionstrike, missile defense, and other capabilities. 

3. SEEKING TO SUSTAIN THE READINESS AND QUALITY OF THE ALL-VOLUNTEER FORCE

The high-quality of our all-volunteer force continues to be the foundation of our 

military strength. This budget seeks to ensure that our troops receive the training 

and equipment they need for military readiness, and the world-class support programs they and their families have earned. However, as in other areas of the budget, the steep and abrupt cuts caused by the FY 2013 sequester has harmed these 

programs. The remainder of this discussion outlines the goals of the FY 2014 budget, but they would be significantly impacted if sequester-level cuts persist. 

Readiness Investments 

Even in the face of flat and declining defense toplines, this budget seeks to press 

ahead with the transition from a counterinsurgency-focused force to a force ready 

and capable of operating across a full range of operations across the globe. The service budgets all fund initiatives that seek to return to full-spectrum training and 

preparation for missions beyond current operations in Afghanistan. 

The Department continues its work to understand and quantify readiness activities as we seek to maximize our preparedness for real-world missions. We do not 

yet know the costs of fixing the readiness of the force following the six months of 

sequester cuts to training in this fiscal year. Therefore these costs are not included 

in the FY 2014 budget. 

Family Support Programs 

The Department’s budget submission makes clear that people are central to everything we do. While sequester cuts would unfortunately counter many of these initiatives, especially for our civilian workforce, the initiatives remain important statements of the intent in this budget. 

The Department continues to support key programs in FY 2014 that support service members and their families, spending $8.5 billion on initiatives that include: 

• Transition Assistance and Veteran’s Employment Assurance—the Department 

continues to support the Transition Assistance Program (TAP) to ensure every service member receives training, education, and credentials needed to successfully transition to the civilian workforce. 

• Family Readiness—the Department continues to ensure that family support is 

a high priority by redesigning and boosting family support in a number of ways. 

The Department is also providing support to our people with a number of other 

important initiatives, including: 

• Behavioral Health—the Department maintains funding for psychological health 

programs and expands those programs that are most effective, such as Embedded 

Behavioral Health, to provide improved access to care, improved continuity of care, 

and enhanced behavioral health provider communication. 

• Suicide Prevention—the Department continues to implement recommendations 

from the Suicide Prevention Task Force and act on other findings from think tanks, 

the National Action Alliance’s National Suicide Prevention Strategy, and DoD and 

Department of Veteran’s Affairs (VA) Integrated Mental Health Strategy (IMHS). 

Another area of focus has been Sexual Assault Prevention and Response. I have 

no tolerance for sexual assault in the military. This is a terrible scourge in our military and it must end. It will end. We will fix it. I have directed a number of initiatives to advance DoD’s efforts to prevent and respond to the crime of sexual assault, 

along five lines of effort: 
14 

Accountability 

• I directed DoD’s Acting General Counsel to propose to the Congress changes to 

Article 60 of the Uniform Code of Military Justice (UCMJ) that would eliminate the 

ability of a convening authority to change findings in courts-martial, except for certain minor offenses. These changes would also require the convening authority to 

explain in writing any changes made to court-martial sentences, as well as any 

changes to findings involving minor offenses. These changes, if enacted, would help 

ensure that our military justice system works fairly, ensures due process, and is accountable. 

• I have also directed the Service Chiefs to develop methods to evaluate military 

commanders’ performance in establishing command climates of dignity and respect 

and in incorporating sexual assault prevention and victim care principles in their 

commands. This includes providing commanders the results of their subordinate’s 

annual command climate surveys in order to enhance accountability and improve 

insight in command climate at every level of the chain of command. 

• I have named a set of highly respected and experienced experts to serve on a 

panel called for in the National Defense Authorization Act for FY 2013. The panel 

will conduct an independent review and assessment of DOD’s systems used to investigate, prosecute and adjudicate crimes involving adult sexual assault and related 

offenses. It will convene its first meeting no later than July 1st. I have spoken to 

the panel and asked it to accelerate its work and provide a final recommendation 

within 12 months. 

Prevention 

• I have directed the complete and thorough review of credentials and qualifications for DoD’s sexual assault victim advocates, coordinators, and recruiters. 

• I have directed DoD to improve the effectiveness of Sexual Assault Prevention 

and Response (SAPR) programs in recruiting organizations. 

• I have directed DoD component heads to direct comprehensive and regular visual inspections of all DoD workplaces to include military academies to ensure that 

our facilities promote an environment of dignity and respect for all members and 

are free from materials that create a degrading or offensive work environment. 

Investigation 

• Consistent with the FY 2012 and FY 2013 National Defense Authorization Acts, 

DoD has established new policies to retain restricted and unrestricted reports for 

50 years, and is developing policy for Special Victim Capability, which includes 

standards and training for prosecutors and investigators. 

Advocacy 

• DoD has implemented a sexual assault crisis intervention line, the DoD Safe 

Helpline, to give victims 24/7 global access to crisis support staff, implemented an 

expedited transfer policy for victims requesting transfer to a new unit, and expanded emergency care and services to DoD civilians stationed abroad. 

• I have directed the Service Secretaries to implement methods to improve victim 

treatment by their peers, coworkers, and chains of command. Direct victim input 

will also be incorporated into these methods. 

Assessment 

• DoD has added sexual assault questions to DoD Command Climate Surveys and 

implemented policy to conduct assessments within 120 days for new commanders 

and annually thereafter, consistent with the FY 13 NDAA. 

• I have begun holding a weekly review and progress meeting on DoD’s various 

sexual assault directives to ensure that they are bringing about real change. 

I receive weekly updates on the Department’s prevention efforts in regularly 

scheduled weekly meetings. I also have an individual on my personal staff that I 

have tasked to oversee all of these directives and Department-wide efforts. 

Everyone in this department at every level of command will continue to work together every day to establish an environment of dignity and respect, where sexual 

assault is not tolerated, condoned or ignored, where there is clear accountability 

placed on all leaders at every level. The leadership of this department has no higher 

priority than the safety and welfare of our men and women in uniform, and that 

includes ensuring they are free from the threat of sexual harassment and sexual assault. I will continue as Secretary of Defense to prioritize the Department’s efforts 

to turn this problem around. 
15 

4. SUPPORTING TROOPS DEPLOYED AND FIGHTING OVERSEAS

The amendment to the FY 2014 President’s budget includes $79.4 billion for Overseas Contingency Operations (OCO). Military operations in Afghanistan comprise a 

significant portion of the OCO request. Over the course of the year, American forces 

in Afghanistan are moving into a support role as Afghan forces take the lead. By 

February 2014, half of our troops there will have returned home, and by December 

2014, United States’ combat operations in Afghanistan will have ended. Still, the 

United States will maintain a commitment to Afghanistan’s sovereignty and security, and we will continue to equip, train, advise, and assist the Afghan National 

Forces; support economic development and governance efforts; and pursue al Qaeda 

and its affiliated groups. 

Of the total OCO request, $78.1 billion is for activities in support of Operation 

Enduring Freedom (OEF) and $1.3 billion is for finalizing transition activities in 

Iraq. 

THE WAY AHEAD: STRATEGIC CHOICES AND MANAGEMENT REVIEW

The FY 2014 budget is a reflection of DoD’s best efforts to match ends, ways, and 

means during a period of intense fiscal uncertainty. It is a balanced plan that would 

address some of the Department’s structural costs and internal budget imbalances 

while implementing the President’s defense strategic guidance and keeping faith 

with our men and women in uniform and their families. 

It is obvious that significant changes to the Department’s top-line spending would 

require changes to this budget plan. The Department must be prepared for any additional reductions to the defense budget that might result from Congress and the 

Administration agreeing on a deficit reduction plan, and it must be prepared in the 

event that sequester-level cuts persist for another year or over the long-term. 

Consequently, earlier this year I directed a Strategic Choices and Management 

Review (SCMR) in order to assess the potential impact of further reductions up to 

the level of full sequester. The purpose of the SCMR is to re-assess the basic assumptions that drive the Department’s investment and force structure decisions and 

to search for additional management efficiencies. 

It is designed to help understand the challenges, articulate the risks, and look for 

opportunities for reform and efficiencies presented by resource constraints. Everything is on the table during this review—roles and missions, planning, business 

practices, force structure, personnel and compensation, acquisition and modernization investments, how we operate, and how we measure and maintain readiness. 

I have received the initial internal results of the SCMR and am reviewing them 

now. The results will inform our planning for FY 2014 as well as our FY 2015 budget request, and will they be the foundation for the Quadrennial Defense Review due 

to Congress in February 2014. 

It is already clear to me that achieving significant additional budget savings without unacceptable risk to national security will require not just tweaking or chipping 

away at existing structures and practices but, if necessary, fashioning entirely new 

ones that better reflect 21st century realities. And that will require the partnership 

of Congress. 

The FY 2014 budget and the ones before it have made hard choices. In many 

cases, modest reforms to personnel and benefits, along with efforts to reduce infrastructure and restructure acquisition programs, met fierce political resistance and 

were not implemented. 

We are now in a different fiscal environment dealing with new realities that will 

force us to more fully confront these tough and painful choices, and to make the 

reforms we need to put this Department on a path to sustain our military strength 

for the 21st century. But in order to do that we will need flexibility, time, and some 

budget certainty. 

We will also need to fund the military capabilities that are necessary for the complex security threats of the 21st century. I believe the President’s budget does that. 

With the partnership of Congress, the Defense Department can continue to find new 

ways to operate more affordably, efficiently, and effectively. However, multiple reviews and analyses show that additional major cuts—especially those on the scale 

and timeline of sequestration—would require dramatic reductions in core military 

capabilities or the scope of our activities around the world. 

As the executive and legislative branches of government, we have a shared responsibility to ensure that we protect national security and America’s strategic interests. Doing so requires that we make every decision on the basis of enduring national interests and make sure every policy is worthy of the service and sacrifice 

of our service members and their families. 
16 

Chairman RYAN. Absolutely. General Dempsey. 

Secretary HAGEL. Thank you. 

STATEMENT OF GEN MARTIN E. DEMPSEY, CHAIRMAN, 

JOINT CHIEFS OF STAFF 

General DEMPSEY. Thank you, Chairman Ryan, Ranking Member 

Van Hollen, distinguished members of the Committee. Thanks for 

the opportunity to come before you today and discuss the fiscal 

year 2014 budget. This hearing comes at a time of extraordinary 

uncertainty, as Secretary of Defense mentioned. Risks to our nation’s security are increasing, but the resources for and the readiness of our force is decreasing. The will to win of our service men 

and women remains undaunted, but the means to prepare to win 

are more uncertain every day. 

This budget was purpose-built to keep our nation immune from 

coercion. It is a responsible investment in an unrivaled joint force 

that is ready with options for that dangerous and uncertain future. 

It supports our forward-deployed operations, upholds funding for 

emerging capabilities such as cyber, and it resources the conventional and nuclear forces that have proven so essential and effective to our defense. 

Most importantly, it protects our real decisive edge, which is our 

people. It treats being the best-led, best-trained, and best-equipped 

military as the non-negotiable imperative. It also makes sure our 

wounded warriors and their families receive world-class care, family and medical services that are worthy of their service to the nation. 

Now, there are some things that this budget does not do. It does 

not reflect full sequestration. Rather, it imposes less reduction and 

gives us more time to implement new reductions. The consequences 

of full sequestration and its attended risks to our national security 

will gain clarity in the weeks ahead due to the Secretary of Defense’s strategic choices management review. As you know, the 

Senate has actually asked us—tasked us to provide our assessment 

on the impact to the joint force by 1 July. 

Nor does this budget account for the costs of restoring lost readiness. We do not yet know the full cost to recover from the readiness 

shortfalls that we have imposed this year. As expected, we continue 

to curtail or cancel training and exercises across all services for 

units that are not about to deploy, and as a result, we are less everyday for an unforeseen crisis or for an unpredictable contingency 

operation. In effect, we are foreclosing on options. 

It is also more expensive to become ready than it is to stay 

ready. This means that the cost to recover our lost readiness will 

inevitably compete with the cost that we anticipate in building the 

joint force we need in 2020. As our military power potentially becomes less sustainable, it becomes less credible. We risk breaking 

commitments and losing the confidence of partners and allies of the 

defense industrial base, and, more importantly, of our men and 

women in uniform and their families. 

Now, that outcome is not inevitable. Working together, we can 

and must uphold the readiness and the health of the force at an 

affordable cost. To do that, as we have discussed in the past, we 

need three things. We need the certainty of a predictable funding 
17 

stream, that is to say, a reliable top-line. We also need the time 

to implement tradeoffs, tradeoffs in forestructure, modernization, 

compensation, and readiness, and we need the full flexibility to 

keep the force in balance. 

We simply cannot afford to postpone essential reforms to compensation, health care, and to the institution at large. These should 

be allowed to grow more gradually, and, in some cases, to shrink. 

We should stop pouring money into excess facilities and unwanted 

weapons systems, and real institutional reform is the only way to 

avoid repeating the mistakes of past drawdowns; and we do have 

experience in past drawdowns, and we do know where the mistakes 

await us. 

We have an opportunity and an obligation with this and any future budget to restore confidence. We have it within ourselves to 

stay strong as a global leader and a reliable partner. Thank you 

to members of this Committee for all you have done for our men 

and women in uniform in the past, and I look forward to taking 

your questions. 

[The prepared statement of General Dempsey follows:] 

PREPARED STATEMENT OF GEN MARTIN E. DEMPSEY, USA, 

CHAIRMAN, JOINT CHIEFS OF STAFF

I. INTRODUCTION

Chairman Ryan, Ranking Member Van Hollen, and distinguished Committee 

Members, it is my privilege to update you on the state of the US Armed Forces and 

to comment on the President’s budget proposal for fiscal year (FY) 2014. 

This year’s posture testimony comes in the context of extraordinary uncertainty. 

Our Nation is going through an historic fiscal correction to restore the economic 

foundation of our power. As resources decline, risks to our national security interests rise. A more competitive security environment compounds these risks, increasing the probability and consequences of aggression. 

This context calls out for our leadership. We can and must find it within ourselves 

to stay strong as a global leader and reliable partner. We must restore lost readiness and continue to make responsible investments in our Nation’s defense. 

II. STRATEGIC DIRECTION TO THE JOINT FORCE

A year ago, I established four priorities to help guide our Joint Force through this 

period of uncertainty. Our way forward must be rooted in a renewed commitment 

to the Profession of Arms. This means preserving an uncommon profession that is 

without equal in both its competence and its character. Along the way, we must 

keep faith with our Military Family. This means honoring the commitments we 

have made to our service members and their families. They deserve the future they 

sacrificed so much to secure. 

These two priorities serve as a source of strength for the Joint Force as we 

achieve our national objectives in current conflicts. This means achieving our campaign objectives in Afghanistan while confronting aggression toward America and 

its allies in all its forms, wherever and whenever it arises. It also means helping 

to secure the flow of commerce in the global commons, building the capacity of our 

partners, providing humanitarian assistance, and maintaining a credible nuclear deterrent. 

These three priorities enable us to understand and develop the Joint Force of 

2020. Our ability to build the force we will need tomorrow depends on the decisions 

we make today. This is a defining period in a defining year. Ensuring our future 

military is unrivaled and sustainable requires the right mix between current capacity and new capabilities. We must recapitalize current equipment where possible 

and modernize capabilities that preserve our decisive advantages. 

III. JOINT FORCE OPERATIONS

One thing has been certain over the last year—the Joint Force stood strong and 

responded to the Nation’s call. After more than a decade of continual deployments 
18 

and tough fighting, I remain humbled by the resilience and determination of our 

warriors. 

In the past year, our service men and women have simultaneously fought, 

transitioned, and redeployed from Afghanistan. Never before have we retrograded 

so much combat power and equipment while continuing combat operations. Our 

forces performed superbly, transitioning to Afghan security lead in areas comprising 

over 85% of the population. In the process, we redeployed over 30,000 US troops, 

closed over 600 bases, and preserved Coalition cohesion. We were challenged by ‘‘insider attacks,’’ but responded the way professional militaries do. We assessed and 

adapted. We reaffirmed our partnerships and moved forward jointly with more 

stringent force protection and vetting procedures. 

Transition continues. In the weeks ahead, the Afghanistan National Security 

Forces will assume operational lead across all of Afghanistan. This milestone represents an important achievement on the Lisbon roadmap, reaffirmed at the Chicago Summit in 2012. At the same time, the International Security Assistance Force 

will transition primarily to training and advising. We are also working with NATO 

and the Afghan government on options for an enduring presence beyond 2014 to reinforce Afghan security and maintain pressure on transnational terrorists. 

When I testified last year, the effects of the November 2011 border incident with 

Pakistan were still fresh, and tensions were as high as any time since the Osama 

bin Laden raid. Measured, but steady civilian-military engagement with Pakistani 

leadership led to the reopening of the Ground Lines of Communication in July 2012. 

We are gradually rebuilding our relationship as reflected in the recent signing of 

a tripartite border document to standardize complementary cross-border operations—and will continue to do so with Pakistan’s new leadership following its historic election last month. 

The Joint Force has been vigilant well beyond South Asia and around the world. 

We continue to help deter aggression and counter the increasingly bold provocations 

from North Korea and Iran. We are supporting Syria’s neighbors in their efforts to 

contain spillover violence while providing assistance to help with refugees. And, we 

are ready with options if military force is called for—and can be used effectively— 

to secure US national interests in Syria without making the situation worse. 

Along with our interagency partners, we are also postured to detect, deter, and 

defeat cyber-attacks against government and critical infrastructure targets. We are 

part of interagency and multinational efforts to counter transnational crime. And, 

we remain relentless in our pursuit of al-Qa’ida and other violent extremist organizations, directly and through our partners. This includes al-Qa’ida-Arabian Peninsula (AQAP) in Yemen and, working with French and African partners, al-Qa’ida 

in the Islamic Magreb (AQIM). 

Finally, in the context of a ‘‘new normal’’—where the diffusion of power fuels insecurity and unrest—we continue to support reform across the Middle East and North 

Africa through military-to-military exercises, exchanges, and security assistance. We 

are also adjusting global force posture to reflect these risks in the context of our 

rebalance to the Asia-Pacific region. 

IV. OUR JOINT FORCE TODAY

We have an experienced, combat-tested force. Never has our nation sustained 

such a lengthy period of war solely through the service of an All-Volunteer military, 

which proudly celebrates its 40-year anniversary July 1st, 2013. Our warriors’ will 

to win is undaunted, but the means to prepare to win are becoming uncertain. Military readiness is at risk due to the convergence of several budget factors. These 

same factors compound risk to the wellness of the Joint Force and our Military 

Family. As I testified in April, we need the help of our elected leaders to gain budget certainty, time, and flexibility. 

Few have borne more of war’s burden than our Military Family. For twelve relentless years, our service men and women have answered our Nation’s call with 

unsurpassed courage and skill. Many have fallen or been grievously wounded in the 

service of our Country. We honor them most by caring for their families and for 

those who have come home with wounds seen and unseen. 

We are unfailing in our praise for the sacrifices of our warriors in battle. 

But for so many of our veterans, returning home is a new type of frontline in their 

struggle. We cannot cut corners on their healthcare. We must continue to invest in 

world-class treatments for mental health issues, traumatic brain injury, and combat 

stress. Stigma and barriers to seeking mental health services must be reduced. 

Suicide is a tragic consequence for far too many. As a Nation, we have a shared 

responsibility to address this urgent issue with the same devotion we have shown 

to protecting the lives of our forces while in combat. The Department is working 
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closely with our interagency partners and the White House to increase our understanding of the factors leading to suicide and how to best leverage care networks 

to keep our Veterans alive. 

The risks inherent to military service must not include the risk of sexual assault. 

We cannot allow sexual assault to undermine the cohesion, discipline, and trust that 

gives us strength. Therefore, working closely with the Secretary of Defense and Congress, we are examining the best ways to leverage additional education, training, 

and the Uniform Code of Military Justice. We are exploring every option, and we 

are open to every idea, that will help eliminate this crime from our ranks. As I testified last week, we are acting swiftly and deliberately to accelerate institutional 

change—to better protect victims, to prevent and respond to predatory and high-risk 

behaviors, and to ensure a professional work environment while at the same time 

preserving the right of the accused. We will not shrink from our legal and moral 

obligations to treat each other with dignity and respect. 

Future success relies on opening our ranks to all of America’s talent. The Joint 

Chiefs and I have supported the expansion of service opportunities for women. This 

decision better aligns our policies with our experience in war, and it serves to 

strengthen the Joint Force. Consistent with the law, we also extended some benefits 

to the same-sex domestic partners of service members. We are implementing both 

initiatives deliberately across all Services to ensure we uphold essential standards, 

guard against potential risks, and avoid creating new inequities for other members 

of the Joint Force. 

Keeping faith with our Military Family will take a mutual commitment from fellow veterans and a grateful Nation. The next few years will define how we, as a 

Nation, view the 9/11 generation of veterans. America’s future All-Volunteer force 

is watching. They are also watching as we inflict risk on ourselves. With $487 billion in 

planned reductions already reflected in the Department’s FY 2013 budget, sequestration’s additional cuts jeopardize readiness not only this year, but also for many 

years to come. We cannot fail to resource the war we are still fighting. At the same 

time, we cannot compromise on readiness in the face of an uncertain and dangerous 

future. Our Joint Force must begin to reconnect with family while resetting and refitting war-torn equipment. It must retrain on the full-spectrum skills that have atrophied while developing new skills required for emerging threats. There are no 

shortcuts to a strong national defense. 

When budget uncertainty is combined with the mechanism and magnitude of sequestration, the consequences lead to a security gap—vulnerability against future 

threats to our national security interests. And, as our military power becomes less 

sustainable, it becomes less credible. We risk breaking commitments to our partners 

and allies, our defense industrial base, and our men and women in uniform and 

their families. 

This outcome is not inevitable. We can maintain the readiness and health of the 

force at an affordable cost, although this gets increasingly harder to do as uncertainty persists. But, we need help from our elected leaders to keep the force in balance and avert the strategic errors of past drawdowns. To this end, the Joint Chiefs 

and I continue to request your support for certainty, time, and flexibility. 

Most importantly, we need long-term budget certainty—a steady, predictable 

funding stream. While the passage of the FY 2013 Appropriations Act provided relief from the Continuing Resolution, uncertainty over the FY 2014 topline budget 

and the full effects of FY 2013 sequestration remains. Last month, we submitted 

an amendment to the FY 2014 President’s budget that includes $79.4 billion for 

overseas contingency operations (OCO) to support Operation ENDURING FREEDOM—mostly in Afghanistan—as well as finalizing the transition in Iraq. We also 

submitted a reprogramming request designed to offset our most critical FY 2013 

shortfalls, especially in wartime funding. We appreciate your expedited review and 

support of both requests, which will bring important near-term budget certainty and 

help reduce our most urgent OCO shortfalls. 

Additionally, we need the time to deliberately evaluate trade-offs in force structure, modernization, compensation, and readiness to keep the Force in balance. We 

do not yet know the full FY 2013 impact in these areas as we make key decisions 

about FY 2014 and beyond. Finally, we continue to seek the full flexibility to keep 

the force in balance. Budget reductions of this magnitude require more than just 

transfer authority and follow-on reprogramming authority. Everything must be on 

the table—military and civilian force reductions; basing and facilities; pay and compensation; and the mix among active, Reserve, and National Guard units. 

There are no easy solutions, and no way to avoid sacrifices and risks as we work 

together to make the hard choices. But, the FY 2014 budget proposal helps us rebalance and strengthen readiness through these hard but necessary choices. It enables 
20 

us to lower manpower costs, reduce unneeded infrastructure, and shed ineffective 

acquisition programs while maintaining support for the responsible drawdown of 

our military presence in Afghanistan. It provides an equitable and practical 2014 

military pay raise of one-percent while protecting important education, counseling, 

and wounded warrior programs. Proposed infrastructure reductions include a request for BRAC authorization in FY 2015, although any closures would take multiple years and not begin until 2016. We simply cannot afford to keep infrastructure 

and weapons we do not need without getting the reforms we do need. 

V. A JOINT FORCE FOR 2020

The budget decisions we are making now will indicate whether we view our future 

Joint Force as an investment or an expense. 

America is unmatched in its ability to employ power in defense of national interests, but we have little margin for error. An unforeseen crisis, or a contingency operation, could generate requirements that exceed the capacity of our immediately 

available forces. We are able to deter threats, assure partners, and defeat adversaries when we do so from a position of strength. 

We remain strong—and our Nation is secure—because we treat being the best led, 

trained, and equipped force as a non-negotiable imperative. 

The secret to sustaining our strength with this or any future budget is simple— 

preserve investment in readiness, prioritize investment in people, and protect investment in decisive capabilities. Now, several months since the Joint Chiefs expressed deep concern about a readiness crisis, we continue to curtail or cancel training and exercises across all Services for units not about to deploy. The costs of recovering lost readiness are going up by the day. Inevitably, recovery in the years 

to come will compete with the costs of building Joint Force 2020. 

It is our people that make us the most capable military in the world. They are 

our best hedge against threats to our homeland and interests abroad. 

By 2020, we will require even greater technical talent in our ranks. But, developing technological skill must occur in concert with leader and character development. We must resist the temptation to scale back on education, including languages and cultural knowledge. Military service must continue to be our Nation’s 

preeminent leadership experience. It is more important than ever to get the most 

from the potential and performance of every service member. 

Investing in people is not just about their development and readiness. It is also 

about the commitment we make to their families. Unsustainable costs and smaller 

budgets mean we must examine every warrior and family support program to make 

sure we are getting the best return on our investment. 

We need to reform pay and compensation to reduce costs while making sure we 

recruit and retain the best America has to offer. We must also balance our commitment to provide quality, accessible health care with better management and essential reform to get escalating costs under control. The FY 2014 budget would help 

control rising health care costs by initiating a restructuring of medical facilities to 

make them more efficient, without sacrificing quality or continuity of care, and by 

proposing fee adjustments that exempt disabled retirees, survivors of service members who died on active duty, and their family members. The Department of Defense 

is also working with Veterans Affairs to find efficiencies across health care systems. 

As we work to get the people right, we must also sustain our investment in decisive capabilities. The FY 2014 budget continues to fund long-term capabilities that 

sustain our edge against resourceful and innovative enemies, while maintaining 

critical investments in science and technology, and research and development programs. 

Emerging capabilities, once on the margins, must move to the forefront and be 

fully integrated with our general purpose forces. Special Operations Forces, for example, have played an increasingly consequential role over the past ten years. We 

have expanded their ranks considerably during this timeframe, and now we must 

continue to improve the quality of their personnel and capabilities. 

Closely linked are our intelligence, surveillance, and reconnaissance capabilities— 

from sensors to analysts. We will continue to rely on proven systems designed for 

the low threat environments of Iraq and Afghanistan. At the same time, we must 

also develop and field sensors designed to penetrate and survive in high-threat 

areas. They will expand our ability to access and assess hard-to-reach targets. 

This budget also sustains our investment in cyber, in part by expanding the cyber 

forces led by the U.S. Cyber Command. Despite significant investment and progress 

in the past year, the threat continues to outpace us, placing the Nation at risk. The 

FY 2014 budget increases funding for cyber security information sharing, but we 

need legislation to allow the private sector and U.S. interagency to share real-time 
21 

cyber threat information—within a framework of privacy and civil liberty safeguards. In parallel, we must establish and adopt standards for protecting critical infrastructure. 

The development and integration of these emerging capabilities will by no means 

amount to all that is new in Joint Force 2020. They must be integrated with our 

foundational and impressive conventional force capabilities. The FY 2014 budget 

protects several areas where reinvestment in existing systems—such as the C-130, 

F-16, and the Army’s Stryker combat vehicle—sustains our competitive advantage. 

All are backed by our asymmetric advantages in long-range strike, global mobility, 

logistics, space, and undersea warfare. And, they must be connected with a secure, 

mobile, and collaborative command and control network. 

This combination of increasingly powerful network capabilities and agile units at 

the tactical edge is a powerful complement to leadership at every echelon. It provides the basis to project both discrete and overwhelming power across multiple domains. It gives policymakers and commanders alike a greater degree of flexibility 

in how they pursue objectives. 

As we set priorities and implement reductions, we must rely more on—and invest 

more in—our other instruments of national power to help underwrite global security. Fewer defense dollars only adds to the importance of relationships among defense, diplomacy, and development. When the political and economic foundations of 

our bilateral relationships are under stress, our military-to-military ties can serve 

as a model of professionalism and restraint for foreign militaries, and often help 

provide a channel for continued dialogue. Advancing American interests not only requires integration across all instruments of national power, but it also requires that 

our international partners accept a greater share of the risk and responsibility. 

Some are more ready and willing to do that than others. 

VI. CONCLUSION

Although I am confident the Joint Force today can marshal resources for any specific contingency, our goal is to be able to offer military options that restore and 

maintain readiness while putting US national security on a sustainable path to 

2020 and beyond. To do this, we must recruit and retain the most talented people. 

We must invest in their competence and character so they can leverage emerging 

and existing capabilities in our defense. It is an investment our predecessors made 

in decades past. We must do the same. 

Our consistent first line of defense has been and always will be our people. They 

are our greatest strength. We will rely on our war-tested leaders to think and innovate as we navigate the challenges and opportunities that lie ahead. We need to 

seize the moment to think differently and to be different. But, we cannot do it alone. 

We need the help of our elected officials to give us the certainty, time, and flexibility 

to make change. Otherwise, the cuts that have already diminished our readiness 

will only get deeper, and the risks we will have to accept in the years to come will 

only increase. 

We can and must stay strong in the face of declining budgets and rising risk. We 

must have the courage to make the difficult choices about our investments, about 

our people, and about our way of war. The Secretary’s Strategic Choices and Management Review (SCMR) is helping to identify options and opportunities as we move 

forward in partnership with Congress. 

We have been down this road before. We can lead through this uncertainty and 

manage the transition to a more secure and prosperous future. I know your Nation’s 

military leaders are ready—as is every single Soldier, Sailor, Airman, Marine, and 

Coastguardsman—to give their last breath to defend America and her allies. 

Please accept my thanks to this Committee and Congress for all you have done 

to support our men and women in uniform. Together, we serve our Nation. 

Chairman RYAN. Okay. Since we are keeping all of ourselves at 

three minutes, I will try and be as quick as I can here. Secretary 

Hagel, last week, the House passed the MILCON, the Military 

Construction Appropriations bill, by a vote of 421 to four. The Administration then released a statement of administration policy 

saying that, quote, ‘‘Unless this bill passes the Congress in the context of an overall budget framework, meaning one that supports 

the president’s plan to increase non-Defense discretionary spending, the president’s senior advisors would recommend a veto,’’ unquote. 
22 

We are meeting the number that was requested by the Administration. Are you among the senior advisors recommending a veto 

on that bill? And then the second follow-up is, today, the House is 

marking up the DoD appropriations bill again, basically meeting 

the Administration’s number. Are you going to recommend a veto 

of that as well? 

Secretary HAGEL. First, Mr. Chairman, I have not been asked for 

my opinion on whether the president should veto the bill or not. 

My, as you know, responsibility is this department, and that is 

where I stay focused. If I am asked for my thoughts on the overall 

budget, then I will give them to him, but I have not been asked 

for those. 

Chairman RYAN. But if Congress passes appropriation bills hitting the numbers you are asking for, it is a good idea that they 

would be signed into law, would you not agree? 

Secretary HAGEL. Well, the numbers that we have been asked for 

the Congress to give us, as you have noted, are our budget. But the 

president has to make a decision on the entire framework of the 

total budget. 

Chairman RYAN. One more, or two more, actually. 1:22 left. 

Okay, in April 2011, I recall the president putting out a speech 

where he mentioned the number that he was going to hit, 487, for 

the Pentagon. Then in January 2012, Secretary Panetta announced 

the strategy review to comport to that number. This year, the 

budget says we are going to go $120 billion lower than the number 

that General Dempsey and Secretary Panetta came here and testified for, and now, you are engaging the strategic choices and management review. 

It seems to me that we have got here a budget-driven strategy, 

not a strategy-driven budget. I do not know how one can conclude 

other than that. That is point number one. 

Point number two, do you have any reactions you can give us 

with respect to any of the findings that you have had from this review? What are the new things that you can do without jeopardizing this mission to meet that 120 number you have put out there 

that does not contradict what last year General Dempsey and Secretary Panetta said was the bottom line, bargain basement, lowest 

number we could get to? 

Secretary HAGEL. First, I have just testified, and have been testifying to this fact the last two months, that I support the president’s 

Fiscal Year 2014 budget, as do all the senior uniform military leaders in the Department of Defense. We support that budget because 

we believe that the national security interests of this country can 

be fulfilled with that budget. 

The strategic choices management review was not about the 

2014 budget or reviewing that budget. That review was done based 

on sequestration, the reality of the numbers that we are dealing 

with as I have just noted and this committee knows; not hope, not 

possibilities, not budgets, not theory but reality, law, and what is 

the prospect, the possibility of sequestration continuing. Of course, 

as I have said, that will affect our strategic interests; that will affect operations. So what that review was about, not questioning the 

president’s budget, but was to prepare, if we must, the Pentagon 

to deal with this new reality of sequestration and these numbers. 
23 

Chairman RYAN. There is no justification of 120. It is a review 

of what might come to pass if these things occur. 

Secretary HAGEL. That is right, because we cannot turn this big 

ship around in a month or two, as you know. 

Chairman RYAN. Well, since I am going to be enforcing the time 

limits, I better live by them. I will probably follow up, I have got 

some Afghanistan questions I wanted to ask you in writing about 

metrics in violence, but, Mr. Van Hollen. 

Mr. VAN HOLLEN. Thank you, Mr. Chairman. Thank all of you 

for your testimonies. As a member of Congress who was one of the 

426 who voted for the Military Construction and Veterans Appropriations bill, I fully support the president’s or the White House 

recommendation to veto a legislation if it is in the context of adopting the House Republican budget because this chart shows exactly 

what the House Republican budget would do. 

If you see the green-shaded items, the top one is Defense, the 

other are other security-related parts of the budget, they would increase those parts of the budget relative to the middle line, which 

is the 2013 sequester. How did they do that in their budget? By 

cutting things dramatically in other parts of the budget. So, that 

last bar, that is the funding for our kids’ education, research at National Institutes of Health; they would cut that almost 20 percent 

below the sequester. 

So what the president is saying is, ‘‘I want a budget plan and appropriation bills that meet all our needs.’’ Yes, the Defense Appropriations bill and the president’s is actually a little higher than the 

Defense bill coming out of the House. But he also understands we 

need to meet other important parts of our national requirements. 

And interestingly, the way to resolve this issue, Mr. Secretary, is 

for us to go to conference so we can resolve these, come to a negotiated settlement, which is why even Senator McCain has said that 

the refusal of our Republican colleagues to go to conference is, 
24 

quote, ‘‘insane,’’ and, quote, ‘‘incomprehensible.’’ And he is not 

alone. I know a lot of our colleagues here wonder why, after all 

these years of complaining the Senate did not have a budget, that 

they refuse to go conference. 

So if we went to conference, we could actually resolve some of 

these issues, and then we could come together on a common plan 

for the country that funds our security requirements and funds our 

kids’ education. And so I would suggest that we get on with that 

right away. Let us go to conference. 

I have a question about OCO because as I look at even the fiscal 

year 2014 OCO request, I actually see some items in there that I 

think are more associated with sort of peacetime defense than wartime defense. For example, there is some peacetime flying costs, as 

was testified to by the Chief of the Air Force, General Welsh. So 

I understand how the desire, as we reduce our footprint in Afghanistan, to try to provide flexibility, but we should not be doing that 

by putting in the OCO account things that really should be in the 

base account. 

My question relates to the OCO request from all of you, and from 

the president of the United States, the commander-in-chief, and he 

has put forward a request in his budget; the House Republican 

budget exceeds that president’s request by $5 billion. And my question to you is, does the Administration’s request reflect what you 

believe is necessary for our overseas wartime operations and for 

OCO account operations? 

Secretary HAGEL. Well, what I believe, in consultation with our 

military leaders, that the budget that we presented, the president’s 

budget, $526 billion baseline, $79 billion OCO, is the sufficient 

budget to carry out our strategic interests, and that is the budget 

that we have been testifying to, we have been explaining, we have 

been going into great detail as to why we believe what we believe. 

Mr. VAN HOLLEN. General Dempsey, if I could just, on the 

record, does the OCO request that was made, in your judgment, 

satisfy our military requirements for OCO? 

General DEMPSEY. Yes, it does, but this year’s request proved inadequate to the task. I mean, we have to have some understanding 

of trying to predict the future two years out. But yes. 

Mr. VAN HOLLEN. But just to, your 2014 request, in your best 

judgment, reflects the needs? 

General DEMPSEY. Yes. 

Chairman RYAN. And as you know, the president’s budget came 

three months late, so we had to put our own number up with their 

guidance. Mr. Price. 

Mr. PRICE. Thank you. Before that chart goes down, I would just 

point out to the members that those bottom four bars, all of them, 

all of them, are significantly higher domestic discretionary spending than they were ’06/’08 level, so we have got a ways to go. 

I got a lot of questions. Mr. Secretary, I want to welcome and the 

General, and I hope I get to some numbers, but I want to talk very 

briefly about the issue of Syria. I would suggest to you that our 

whole strategy of leading from behind is not working there. The 

Russians continue to support President Assad, and Russia has reiterated its intent to provide an S-300 air defense system to Syria. 

What would the U.S. do if Russia provides the S-300 to Syria? 
25 

Secretary HAGEL. Congressman, the president has asked the Department of Defense, be prepared for all options and contingencies 

that he may choose. 

Mr. PRICE. So what is our plan to mitigate that threat? 

Secretary HAGEL. Well, we have contingency plans and options 

that I do not want to discuss in an open hearing, but the efforts 

that are ongoing to try to stop the violence and contain it from not 

allowing it to get into a regional conflict, which it is already spilling over into the borders, as you know, of Israel and Jordan and 

Iraq, and working with the Russians, working with others, working 

with our allies. I was in Belgium last week, met with NATO ministers of defense, with the British, with the French, worked with 

our partners on this. 

Mr. PRICE. We just want to encourage you, Mr. Secretary, to 

make certain that we are mitigating the threat to Israel significantly, and I want to move on because I have got a short amount 

of time. 

Secretary HAGEL. And we are, by the way. 

Mr. PRICE. The Senate Democratic budget that has been touted 

here, and we are interested in going to conference; we need to set 

some parameters before we get there. Otherwise, it is just a freefor-all that does not accomplish anything. But the Senate Democratic budget provides no funding, no funding, for OCO or GWAT 

after Fiscal Year 2015. Do you anticipate that there are going to 

be any U.S. troops in Afghanistan after 2015? 

Secretary HAGEL. Well, the president has made it very clear that 

we are transitioning out of a lead combat role in Afghanistan to a 

post-2014 role. But we will have presence in Afghanistan. He has 

said that. That is his policy. 

Mr. PRICE. So the fact of the matter is the Senate Democratic 

budget does not take into account the president’s own policy as it 

relates to Afghanistan. 

Secretary HAGEL. I do not speak for the Senate Democrats. 

Mr. PRICE. But if they do not have any money, then there is no 

money to support the troops that the president proposes to be 

there. 

Secretary HAGEL. We have not submitted a budget request for 

2015, we will, or any other years, we have not requested funding. 

Mr. PRICE. The GAO provided information that states that the 

assessment by the Department of Defense on the appropriate mix 

of military and civilian personnel has yet to be done adequately. 

Are you planning on moving forward with that review and recommendation? 

Secretary HAGEL. What review are you referring to? 

Mr. PRICE. The GAO, Government Accountability Office. 

Secretary HAGEL. But I am not certain what you mean by the 

adequate mix of civilians and military personnel. 

Mr. PRICE. Their contention is that there has not been an accurate assessment of the appropriate mix of military and civilian personnel capabilities in your strategic workforce plan. Is that going 

to be included? 

Secretary HAGEL. Well, we assess that all the time. The review 

of mix and balance, and it is skills, it is people who understand the 
26 

jobs; there is always that factor that plays out in everything we do 

to carry out all of our strategic interests and our operations. 

Mr. PRICE. Thank you. Thank you, Mr. Chairman. 

Chairman RYAN. Mr. Yarmuth. 

Mr. YARMUTH. Thank you, Mr. Chairman. Mr. Secretary, General 

Dempsey, welcome. Thank you for your testimony. I think many of 

us would agree that sequestration is a terrible policy, and that we 

are all suffering, to a certain extent, the consequences of that. 

I would like to talk about briefly one thing that has come to my 

attention very recently, which I am sure is of interest to you. And 

I visited, a couple weeks ago, the Neural Science Center at the 

University of Louisville, where they are doing some incredible research into spinal injuries, and met a young guy named Rob Summers who was paralyzed in a 2006 accident, paralyzed from the 

neck down, could move one finger. Now, after going through the 

program, that they have developed at the University, he has full 

mobility above his waist; he can move his toes, his ankles, his 

knees, his hips; has sensation throughout his legs; and, actually, 

has taken steps by himself. 

The researchers in charge of that project are very, very concerned because of cuts at NIH due to sequestration; they have already had to lay off some researchers. They have had to cut back 

in certain areas. And they are very much concerned about the impact on this program, which obviously could have incredible benefits for our wounded warriors who have sacrificed so much. So I am 

very concerned, also as the Ranking Member, that we need to do 

more to create a balanced approach, go to conference, and accommodate many of these priorities that we have. 

In my area, because of sequestration, more than 8,000 civilian 

Defense Department employees have received furlough notices, 725 

National Guard military technicians as well. Obviously, a great impact on their families and on the regional economy. Our civilian 

DoD and National Guard employees are going to have to have to 

sacrifice even more if the sequester is not replaced. Should they be 

preparing for nine more years of furloughs? 

Secretary HAGEL. Two answers to your two questions. First, on 

the facility, and the reference you made to traumatic brain injuries 

and the research that is going on in the programs, our budget for 

2014 protects all of those programs, Wounded Warriors. In fact, 

General Dempsey and I, this morning, both spoke at a traumatic 

brain injury conference that is being hosted at DoD. So we are fully 

committed to those programs and the funding of those programs. 

We are committed because it is the right thing to do, and we owe 

it to these men and women and their families. 

Second, we will continue to carry out all the programs and efforts 

that you have just talked about. 

Mr. YARMUTH. Thank you. I will yield the remaining 15 seconds 

to the Ranking Member. 

Mr. VAN HOLLEN. Thank you, my colleague. If I could just show 

you this chart in response to Mr. Price’s statement. What this 

shows: the green bars are the growth in non-security discretionary 

spending since 2001. As you can see, much slower than the red 

bars, which is the growth in security spending, including Defense. 

And I would emphasize that the red bars do not include the costs 
27 

of the war. Those do not include OCO accounts. So this gets back 

to the earlier conversation we were having about making sure we 

meet all our priorities in this country. I would also point out that 

this was the 13th day that the Senate Democrats have tried to go 

to conference on the budget, so—— 

Mr. YARMUTH. And it is a real dollar, not a nominal number. 

Mr. VAN HOLLEN [continuing]. These are, yeah, these are real 

dollars. So these are constant dollars, real. 

Chairman RYAN. Mr. Lankford. 

Mr. LANKFORD. Thank you. And gentlemen, thank you for being 

here. I know, Secretary Hagel, in your testimony you mentioned 

that a budgetary situation permits us to end the furloughs early. 

You would strongly prefer to do so. Obviously, all of us would as 

well. There are a lot of families that are affected that had nothing 

to do with this, and I know you all are working hard to be able 

to resolve some of this. What I want to ask is, what are some of 

those factors that you are looking for to be able to deal with the 

maximum of 11 days that are left for civilians, to be able to resolve 

that? Have you made additional requests? And what are we doing 

to try to resolve that at this point? 

Secretary HAGEL. Well, we continue, and I may ask the comptroller to respond here very briefly to any specific programs, but let 

me answer your question this way: we continue to look for ways, 

as I noted in my statement, as we cut nonessential services, 

overheads, consolidations, continue to try to find savings. These are 

big numbers, though, that we are talking about. 

Mr. LANKFORD. Have you looked at unobligated balances? 

Secretary HAGEL. We are looking at everything. That was part 

of the strategic review, by the way. And we do not know what is 

going to happen in the next three and a half months. That is part 

of the uncertainty we are living with. So what the comptroller has 

got to do is he has got to deal with, the only reality we have right 
28 

now is the sequestration is going to continue to be the law of the 

land, and we are going to have to comply with it. So if we can find 

ways, if that shifts in some way, then we will obviously put the 

focus on pulling those furloughs down, if we can. 

Mr. LANKFORD. Will there be additional requests back to the Appropriations Committee for reprogramming authority? In the days 

ahead, would you expect that at this point? 

Secretary HAGEL. Well, I will give a general answer, and then I 

will let comptroller. First, we really need your help on getting this 

current $9.6 billion reprogramming accomplished because it gives 

us some flexibility, and flexibility is key here. Bob, do you want to 

add anything? 

Secretary HALE. Yes, I anticipate that if we lose any sources in 

this current reprogramming, we will, if we have time, go back and 

ask for additional reprogramming. And just to add briefly, one of 

the major items is just how much the war costs in the next three 

months, and there is still some uncertainty. If we can find a way 

to minimize those, I think we will have a better chance of ending 

furloughs early, and I certainly hope to. 

Mr. LANKFORD. Terrific. I would also request of you, as much as 

possible, and I know it is not all possible especially with the speed 

of what is happening, allow local bases and posts to be able to 

make decisions about how that is implemented, rather than any 

top-down model that comes to them. But a lot of those local leadership, and the people and the civilians that are working there to 

find the efficiencies. 

I want to ask one question as well. Last year, Secretary Panetta, 

when he was here, we talked about the reductions plan. Over the 

next five years, there is 120,000 uniformed personnel reduction, 

but there was only a 15,000 reduction over the next five years in 

the civilian workforce. I asked Secretary Panetta, and actually Secretary Hale is the one who responded to this one at that point, 

said, ‘‘Why the discrepancy in the two numbers?’’ And the question 

was, ‘‘There was not enough time.’’ And expected, by the time we 

got to this year, there would be a response of what we are looking 

at as a recommendation of reductions in civilian workforce over the 

next five years. Where does that stand at this point? 

Secretary HAGEL. Well, obviously, I am going to let Secretary 

Hale respond to what he said, but go back very quickly to flexibility 

given to the managers and the people in charge of the bases. We 

are giving them as much flexibility as we can give them with some 

guidance from the top for the very reasons you mentioned. 

Secretary HALE. We have about a 5 percent reduction of civilian 

employees built into this five-year plan. It is heavily dependent on 

BRAC because that is where those civilians work. And if we cannot 

close any of the bases, we will not be able to make those reductions. But if you give us authority to do it, then we will be able 

to achieve the reduction. 

Mr. PASCRELL. So the assumption would be that bases would be 

closed within the next five years that would achieve that? 

Secretary HALE. By the fifth year, fourth and fifth year out, yes, 

we would have begun to achieve some of the civilian reduction. The 

base might not be closed, but we would be drawing down the civil-
29 

ians. And we are depending critically on it in order to achieve those 

reductions. 

Mr. VAN HOLLEN. Thank you. Mr. Pascrell. 

Mr. PASCRELL. Mr. Secretary, thank you for your service to your 

country. Let us get to the crux of the issue that Mr. Yarmuth has 

touched upon. Having been co-chair of the traumatic brain injury 

caucus for the last 14 years, I am very, very concerned about how 

DoD, before you got there, handled the situation with one out of 

five veterans of Operation Enduring Freedom and Operation Iraqi 

Freedom estimated to experience a possible traumatic brain injury 

that Congress has done, I believe, a yeoman’s task in educating the 

DoD. We have continued, on a bipartisan basis, to emphasize the 

importance of this issue, and we have made funds available for the 

identification and treatment of brain injuries in our soldiers. 

In 2007, the Congress gave the Department of Defense $900 million to increase access, treatment, and research for traumatic brain 

injury and post-traumatic stress disorder. In 2008, my colleagues 

and I put in place protections for the troops in the fiscal year 2008 

National Defense Authorization bill requiring cognitive screenings 

of soldiers pre-deployed and post-deployed. We do that for football 

players going on the field in high schools, and soccer players, and 

tennis players, and we did not do it for our troops. We said we were 

going to do it by an act of Congress. 

Evidence seems to point to the fact that this law has yet to be 

fulfilled, as members of the Armed Forces still have not been consistently given a post-deployment cognitive screening in order to 

identify any possible brain injury. What are you doing to ensure 

that service members are receiving consistent pre- and post-deployment cognitive screening as Congress has required by law? 

Secretary HAGEL. Congressman, I can tell you I have been at the 

DoD a little more than three months now, and this is as high a priority as we have. We have a lot of high priorities: getting this sexual assault scourge dealt with, an entire inventory. This one, 

though, is as high up as we have. And I have instructed all of our 

leaders, all of our people, all of our programs to make this a priority. We are doing that, we are committed to do it. I know we have 

not done it all. I know we are behind. I know we need to do more. 

But you have my assurance and my commitment that this will continue to be done. 

General DEMPSEY. If I could add, Congressman, I have deployed 

three times, and in the units under my command, there has been 

a full accounting for that legislation, meaning we are screening pre 

and post. Now I will go back and answer your question more fully 

for the record, but we have done other things with the money you 

have given us. We have hired 12,000 health care professionals. We 

have been directed to go back and rescreen cases that were previously closed, and we are about, on average, about 90 percent complete with that effort. So I think we are doing better than you have 

just reported, but let me prove it. 

Mr. PASCRELL. Thank you, I yield back. 

Chairman RYAN. Mr. Ribble. 

Mr. RIBBLE. Thank you, Mr. Chairman. Thank you, Secretary 

Hagel. I am over here. The requirement for the Defense Department to produce auditable financial statements was legislated over 
30 

20 years ago. We are now hearing we are not going to get an audited statement until 2017. If you and the Department cannot tell 

us how you are spending money, how do we accurately budget and 

appropriate money? 

Secretary HAGEL. Your question is an absolutely legitimate question. I am going to ask the comptroller to respond specifically, but 

let me first say this. For the reasons you just noted and others, the 

accountability of our spending, and of our programs, and of our 

management is essential to everything we do. It is essential to any 

institution. And we are making progress on this. We are fulfilling 

the mandates of Congress. We are not there yet. I am going to ask 

Hale to go into more of the specifics on to what will be available 

in 2014 on statements, and then what is auditable by 2017. 

Last point I would make on this, and I do not know if the comptroller will say this, but this is another consequence, and I do not 

blame sequestration for this, but the comptroller’s office and all our 

financial people inside of DoD, all across the globe where we have 

facilities, are spending a huge amount of their time on sequestration, on reprogramming, on going back and reviewing everything. 

Now, this is not an excuse for not having auditable statements. 

Mr. RIBBLE. Now they had 19 years prior to that. 

Secretary HAGEL. No, I am saying it is not an excuse. But the 

priority has not always been there. I know Secretary Panetta put 

a priority on it; obviously he knows something about these kinds 

of things. He was absolutely committed to it, as I am. Now let me, 

if I can, Congressman ask the comptroller to get a little more specific. 

Secretary HALE. We do know where we are spending the money. 

We do 150 million accounting transactions a year. If 1 percent of 

them were wrong, a million and a half would be wrong. We would 

have massive mispayments that just are not occurring. What we 

cannot do is document it, and sometimes our business practices are 

not tight enough to survive audit. We have got to fix that, and we 

are doing it on an interim basis. We are not waiting for 2017; by 

2014, and I think we will make this, we are going to have auditready statements for the budget, which is the key part of most concern to you. So we have been pressing hard. I have worked this 

personally, it is important to me, we owe it to you, and we will do 

our darndest to get there. But getting rid of sequestration would 

help a lot, and so, thank you, Mr. Secretary, for that point. 

Mr. RIBBLE. Thank you for that. General Dempsey, just one 

quick question: Will you achieve your campaign objectives in Afghanistan by the end of 2014? 

General DEMPSEY. Yes. 

Mr. RIBBLE. Thank you, and I yield back. 

Chairman RYAN. All right, Ms. Castor. 

Ms. CASTOR. Thank you, Mr. Chairman, and welcome, gentleman. Thank you for your outstanding service to the country. Let 

me start by saying the Defense Department and the services are 

giving greater attention to the problem of sexual assault in the 

military, and hopefully taking greater action to address the problem, and I thank you for that. But after decades of many assurances, and after a couple of years where we have seen a 37 percent 

increase in the number of sexual assaults, now 26,000 cases over 
31 

the past two years, it is time to change this status quo, and empower the prosecutors to do some things, some innovative things, 

that are different than the current change of command. 

I will leave it at that because this is a hearing on the impact of 

having no budget, and the sequester on our national defense. And 

there has been a national dialogue, I think, on the harm the sequester is causing to jobs and the economy, medical research and 

innovation, Head Start, our ability to invest in infrastructure in 

this country, but I do not think we have had that same dialogue 

on the impact of the sequester on our national security. I certainly 

hear it at home from the folks at U.S. Central Command, and Special Operations Command, and MacDill Air Force Base, and we do 

not like the fact that civilians are going to be furloughed because 

of some arbitrary budget policy. But there are some challenges 

here. 

Now without a budget, our Republican friends who complained 

for many years that the Senate would not pass the budget now will 

not go to negotiate a budget. It has been 81 days since a budget 

was passed, and they will not proceed to conference. And that is 

going to cause great problem and angst over the coming days, and 

months, and years. 

The other problem is many of my Republican friends want the 

sequester; they want the cuts across the board, and they have rejected the Democratic replacements for the sequester. So this is 

going to have serious consequences. I want you to now drill down 

and be specific, and focus on Special Operations, in particular, because the threats to our national security have evolved over the 

past decades. We are not as involved in conventional warfare; the 

threats are unconventional. In the past, the former commander, 

Admiral Olson, said, ‘‘We are focused on quality in special ops.’’ 

And now commander, Admiral McRaven, said, ‘‘We want to grow 

the force.’’ And you have said, General, ‘‘We need to grow special 

operations, and personnel, and our capabilities.’’ But what is the 

sequester going to do to our ability to invest in Special Operations 

forces and confront the unconventional threats facing our country? 

General DEMPSEY. Yeah, I think could, first of all, Congressman, 

thanks for the support you give to MacDill. I spent two great years 

there myself commanding CENTCOM, and we always felt very 

much at home in that community. So thanks for that. 

The effort we have got to look at the impact of sequestration will 

present some very stark and uncomfortable choices, some of which 

can be mitigated by flexibility. Meaning if we can get about a third 

of what we need, however that much turns out to be, whether it 

is full sequestration or something less, if we can get about a third 

or 30 percent of it out of institutional reform and compensation 

health care changes, then we can have an impact on the force, the 

combat power of the force; that is probably manageable. If we cannot, then it will not be manageable. You will find that we will have 

to make some choices that will put us at a disadvantage, and we 

have not been at a disadvantage in a very long time as the United 

States Armed Forces. 

Special Forces is one of the three areas that in last year’s budget 

and in this year’s budget, we have advantaged. Advantaged, meaning we have not taken the reductions that we have in other parts 
32 

of the force, the conventional force. But if we got to full sequestrations, if this becomes an annual effort, at some point we will have 

to slow the growth of Special Forces. 

Chairman RYAN. Thank you. Mr. Rokita. Mr. Rokita, will you 

yield me five seconds? 

Mr. ROKITA. I yield to the Chair. 

Chairman RYAN. Let me remind the committee that this Committee marked up and passed the Sequester Replacement Act. It 

passed on the floor two times last year. Cuts in other areas of government to prevent the sequester from taking place this year. Our 

budget does the same. The sequester was requested by the president in the Budget Control Act negotiations and is now law. Mr. 

Rokita. 

Mr. ROKITA. I thank the Chair, I thank the Secretaries and the 

General for being here today. A question about military staff sizes 

to the General: By the end of March 2010, I have that 1.4 million 

service members on active duty were being led by 950 generals and 

flags. That is one for about every 1,500 troops. And from 2000 to 

2010, the number of general flags, officers, increased 8 percent, 

while active duty and strength only grew 3 percent. Why the discrepancy? Why are your flags and generals growing so much faster 

than your men? 

General DEMPSEY. Well, two things. First of all, we grew the 

number of flags in response to requirements. So when you stand 

up an architecture of command and control interact in Afghanistan, 

it was stood up external to, or in addition to, the existing structure. 

Mr. ROKITA. So we could expect the number to go back down? 

General DEMPSEY. Yeah. If you are asking me, do I think we 

need to reduce the number of generals and flag officers, the answer 

is yes. 

Mr. ROKITA. Okay, thank you. Also, I will go to the Secretary 

please, Defense News, the magazine, recently said that U.S. military commands grew by 15 percent from 2010 to 2012. And your 

predecessor said we need to reduce those numbers. And, in fact, 

OSD and the Joint Staff, for example, grew by 1,300 people in 2010 

to 4,200 people in 2012, a 230 percent increase. Can you explain 

that, when your predecessor said it should be going down? 

Secretary HAGEL. Well, I will ask the Chairman to respond, as 

well. But my response is this: Those numbers are going to come 

down. In fact, one of the things that we took a very hard look at 

during the review in the last three months was this issue. And so 

those numbers will come down in every category, and that will be 

one of the products of the review that we have just completed and 

we are looking at now. 

Mr. ROKITA. So when would you expect the decrease? 

Secretary HAGEL. Well, we will be making those decisions here 

this year. 

Chairman RYAN. General? 

General DEMPSEY. Yeah, the Joint Staff grew because of the disestablishment of joint forces command, then the absorption of some 

of the manpower in Suffolk under the flag of the Joint Staff. But 

the Secretary has given us some pretty clear marching orders that 

if we are going to reduce the force, we are going to start at the top. 

Mr. ROKITA. Okay. And by when? 
33 

General DEMPSEY. I will defer to the Secretary of Defense. 

Mr. ROKITA. Okay. And you said they were going to make a decision soon. 

General DEMPSEY. What I said was, ‘‘We will be making those 

decisions this year.’’ 

Mr. ROKITA. Okay. 

Chairman RYAN. Thank you. Mr. McDermott. 

Mr. MCDERMOTT. Secretary Hagel, General Dempsey, I was a 

Vietnam-era serviceman. I was a psychiatrist who dealt with people coming back from the war. And I would ask the unanimous 

that be entered into the record, an op-ed by General Eikenberry 

and David Kennedy; they assert that the American public and the 

military are drifting apart at this time. 

Chairman RYAN. Without objection. 

Mr. MCDERMOTT. And my concern is, you go down to my office, 

you will see the faces of all the people who have died from the state 

of Washington on the wall. You walk around these buildings, there 

is only about four or five places where that happens, because it is 

easy to forget who has been over there, who is fighting since we 

went to the volunteer Army. And we have, at the same time, had 

increases of suicides, and all kinds of things on military bases and 

in the veteran community afterward, with TBI and with PTSD. We 

did not see TBI in Vietnam because nobody survived. If they went 

through something like that, they died. But now we are able to 

keep them alive, and we have a whole new cadre of problems. 

And I wonder, as you look at the budget that you are looking at 

now, how you think we could do a better job in not only sending 

people prepared to go to war, but also to return. I mean, people 

sent to Iraq did not where they were going. They had no background whatsoever in the population they were going into. They 

were just thrown in there, just like those recruits were in the Vietnam War. And then when we bring them back into our society, we 

have been very bad at getting them jobs and housing, all the things 

that somebody would think if you had served the country, the country would reward you with when you came home. When they came 

home from the Second World War, we handed them free college 

education. That is where the greatest generation came from, was 

that class of 1949 had all been educated because we said, ‘‘Our vets 

are coming home; here is an education.’’ We do not do that anymore. 

And what I am looking at is wondering about your own thinking, 

both of you, in terms of the larger problem of keeping the American 

public involved in the issue of going to war. 

Secretary HAGEL. Congressman, thank you. This obviously, as 

you have known, and over the years done, could take days and 

days, and weeks and weeks to respond. But, in the interest of time 

I will give you this response. So many pieces to what you just 

noted. I think we have done a far, far better job as a society, as 

a country, of being able to delineate the war from the warrior as 

these young men and women come back, assimilate back into society, all the things that are required in order for that successful 

transition. Imperfect, front page of USA Today is about, you may 

have seen it, the story of a young man who cannot get a job. The 
34 

country has failed him. He went and served. I mean, we know 

those stories. We are not doing enough, I get that. We will do more. 

But compared to when I flew into Travis Air Force Base on December 4, 1968, after a year in Vietnam in ’68, 48 hours later, you 

were out on the street. You had a Class A uniform. You had travel 

money home and some expense money, and that was it. That was 

it. So we have come a long way. One of the big differences is, and 

I will stop here, and I used to give speeches on the Senate floor 

about this during the peak of the Iraq War and the Afghanistan 

War. The disconnect, which you just said, 1 percent of our population in this society pays the price. They make all the sacrifices, 

they bear all the burden, they do all the dying. And I am a supporter of the all-volunteer service, by the way. I do not think we 

could ever go back, nor do we want to, for a lot of reasons. It is 

the most professional Armed Forces ever. They are better trained, 

better led, better equipped. 

But here is the point: How do you integrate that in a better way 

so there is more appreciation, more understanding? I think the people of this country, though, do very much appreciate the service of 

our men and women. We need to do more. 

Chairman RYAN. Thank you. Ms. Walorski. 

Mrs. WALORSKI. Thank you, Mr. Chairman. Mr. Secretary, good 

to see you again. Thank you for your leadership role on this issue 

with sexual abuse in the military, and for your support. And also 

to you, General Dempsey, great to see you. So, you know, I sit on 

the Armed Services Committee, which is where I saw you folks 

last. And I have worked hard in my role on Armed Services to provide a workable replacement to sequestration. We have talked 

about it as a committee. We have proposed bills as well. I am concerned that the president’s 2014 budget seriously underestimates 

and underfunds costs in certain areas, and then makes trade-offs 

in other areas. For example, I do not believe we should be shutting 

down bases, considering shutting down bases, or paying for spending on the backs of our military members. 

But the question I have is, the DoD budget has already sustained 

significant funding cuts, and faces potential additional cuts in the 

future. So at what point do these cuts endanger our national security? And it is a question to either of you. And then my second 

question is, is there a particular funding amount or percentage cut 

that you believe to be a red line when it comes to this issue of national security? Thank you. 

General DEMPSEY. I will start, and then the Secretary will take 

the bulk of the question. But in terms of, can we identify a point 

at which we put the security strategy at risk? Yeah, I think we will 

be. I think we will be able to identify that point through the results 

of the SecDef’s SCMR, Strategic Choices Management Review. 

One thing I would point out: when we did the future year defense plan for 2014, when we did it three years ago, four years ago, 

the top line was going to be $598 billion. This year, $526 billion. 

If we go to full sequestration, it will be $474 billion. This is not the 

deepest cut in our history. It is the steepest by a wide margin, and 

that is what makes it so difficult. 

Secretary HAGEL. I would add just a couple of things. One of the 

points that the Chairman made to answer your question in his 
35 

opening statement, he said something to the effect that one of the 

effects of sequestration and what we are going through, and may 

well continue to go through for some years, I think he said, ‘‘It is 

going to be more costly to recover lost readiness.’’ Now that is a factor here that often gets lost or never gets any attention. And that 

is a big part of, I think, your question, the answer to your question, 

when you say, ‘‘Well, at what point do we know?’’ 

Mrs. WALORSKI. Do we, Mr. Secretary, do we have a funding 

amount? Is there a red line for when we get to that point that we, 

as congressional members here, and also the American people that 

are vested in our military, is there a red line to say, ‘‘When we get 

to this point, our national security is in trouble?’’ 

Secretary HAGEL. Well, this is not just a numbers business, as 

you know. Again, I go back to the review. I have asked, in this review, all the different scenarios: at $150 billion over the next 10 

years, $250 billion reduction over the next 10 years, or the $500 

billion over the next 10 years, which is now law, as the Chairman 

reminded us. And sure, it is going to cut into our readiness. Sure, 

it is going to cut into our operations. I noted that in my testimony, 

as did the Chairman. There is no question about it. It is doing it 

right now. When you go through the inventory of things that we 

are having to do now, the chiefs of all the services, cut training, 

essentially eliminate training, deployments, stand down squadrons. 

Now, what we are doing is we are putting everything forward to 

protect our current readiness requirements, our strategic needs 

now. But there is going to be a cost that is coming in right behind 

that. 

Chairman RYAN. Thank you. Mr. Cicilline. 

Mr. CICILLINE. I thank you, Mr. Chairman. And thank you, General and Mr. Secretary, for being here, and, of course, for your service to our country. I think the uncertainty of us not having a budget adds to the difficulties that we are facing in dealing with the 

very serious financial challenges in our country. And I think the 

only way that we can ensure that we meet our solemn obligation 

to our men and women in uniform, to ensure that they have access 

to all the things they need, not only to complete the mission, but 

all the things that they need when they return is to be sure we 

have a budget. And the priorities warrant a thoughtful and careful 

budget process, not a budget process fraught with needless uncertainty and partisanship. 

And I hope your testimony today will inspire further engagement 

in the Congress to develop a serious set of solutions for our nation’s 

fiscal challenges, and, most importantly, motivate our Republican 

leaders to appoint conferees so that we can really get to the work 

of completing this budget process. For some reason, although there 

is been a lot of clamor about the importance of a budget and adopting a budget, there seems to be no interest, at least from the Republican House leadership, to actually appoint conferees, which is 

necessary to complete that process. And I thank you for furnishing 

us with the kind of uncertainty and examples of the uncertainty 

that come from not having a budget. And I hope it will inspire 

them to do that. 

I think it is particularly important, when you look at what Mr. 

Van Hollen identified in the beginning of this, that there is an ef-
36 

fort here by going through appropriations in defense, military construction, and homeland security that will essentially result in 

very, very substantial additional cuts in non-discretionary spending 

and non-defense spending above and beyond the cuts of sequestration, which will have, obviously, very serious impacts. 

But I just want to ask you to spend a few moments here, if you 

would, to address the Department’s investment in programs that 

can help realize sustainable budgetary savings while approving efficiencies, accountability, and readiness. For more than a decade, 

the Department and Congress have collaborated on efforts to implement item-unique identification strategies. This technology, as 

you know, allow for permanent marking of equipment with unique 

identifications to ensure the efficient management and a real accounting of the resources the Department possesses. And we have 

a great company in my district, A2B Tracking in Portsmouth, 

Rhode Island, has really been a leader in this work. But a Department logistics item-unique identification taskforce in March of 2011 

estimated that full implementation of this policy could result in 

savings between $3 billion and $5 billion every year, beginning in 

2017. 

But there has been some, I think, difficulties with implementation of this. So I would like to know where that stands, whether 

the sequestration cuts will adversely impact this implementation 

which has the potential to produce real savings, improve efficiencies, bring greater accountability and transparency to the Department. 

Secretary HAGEL. Congressman, I am going to respond generally, 

and then very quickly ask for the comptroller’s specific comment on 

this. One of the things that we are focused on, have to be focused 

on, is accomplishing the objective that you just noted. We have to; 

we do not have any choice. We should be doing it anyway, whether 

sequestration or not, for the reasons everyone understands. We are 

doing it. Let me get the comptroller to be more specific about your 

question. 

Secretary HALE. Well, I am afraid the comptroller’s going to have 

to go do some research to be more specific. I am not real familiar, 

but we will get back to you. Let me just add though, we have done 

a lot of things, some small, TRANSCOM, shipping on 40-foot containers rather than 20, that has saved us some money; grouping together cellphone contracts in the Navy, to bigger items, terminating more than 30 weapon systems that we felt were of lower 

priority in past efforts to reduce our costs. And we are going to do 

it again, as the Secretary has directed. And we are all committed 

to it. 

Mr. CICILLINE. Thank you. 

Chairman RYAN. Thank you. Mr. Nunnelee. 

Mr. NUNNELEE. Thank you, Mr. Chairman. Thank you, Mr. Secretary, for being here. General. I recently had the privilege to meet 

with a group of Mississippians that came up for an honor flight, 

World War II veterans. I met them at the World War II memorial; 

it was a very emotional experience. And one of the takeaways I had 

from that, here is a group of men, and there were actually a couple 

of women World War II veterans in the group, it is a group of men 

and women that were part of the greatest mobilization to defend 
37 

freedom in the history of the world. And while they went to place 

they had never heard of, their families were back home doing two 

things: building the tools necessary for the war effort, and also buying bonds necessary to fund the war effort. 

One of the things that keeps me awake at night is the fear that 

if we were to have a repeat of that, that we could not afford to put 

together that kind of mobilization, because we could not afford it. 

And I do not think my fears are alone. The former chairman of the 

Joint Chiefs of Staff said the greatest threat to our national security is our debt. And we are going to be bumping up on a debt ceiling that is statutory, but our real debt ceiling occurs when creditors will no longer be willing to lend us money at interest rates we 

can afford. Are my concerns justified? And is our ability to defend 

freedom limited by our ability to fund it? 

Secretary HAGEL. I think the quick answer is yes. I think Admiral Mullins’ comments, and I recall when he said them, I agree 

with. A nation’s economic strength is the underpinning of all their 

liberties and preservation of security. And you cannot disconnect 

the two, as you know. 

Mr. NUNNELEE. All right. And then maybe a final question: How 

do you go about planning for the uncertainty and the difficulty of 

a reduced budget? We have just passed, out of Appropriations, the 

defense markup on defense. Previously, you had a request for 

equipment, helicopters, airplanes, tanks, et cetera, and that has 

been diminished. What process do you use to make those decisions 

and plan? 

Secretary HAGEL. You mean reducing those efforts? 

Mr. NUNNELEE. Yes. 

Secretary HAGEL. Well, it is a long process, but the services have 

their budgets. We have the component overseas, the services on accountability, responsibility for managing the Pentagon. That is the 

larger office of the Office of Secretary of Defense. It is five undersecretaries; the comptroller is one of them. Another one that is key 

to this is the undersecretary for acquisitions. And then in consultation with the chairman and the chiefs of the services, with input 

from the nine combatant commanders, I mean, it works through 

that. Then the budget, obviously, is an underpinning dynamic of 

this because if you do not have the money, you are not going to be 

able to buy the weapons. 

Mr. NUNNELEE. Thank you. 

General DEMPSEY. Could I, really briefly, sir? 

Mr. NUNNELEE. Okay. 

General DEMPSEY. We have three responsibilities as a military: 

deter enemies, assure our allies, and then defeat if deterrence fails. 

And as we map the force we have to those three responsibilities, 

it allows us to see how big we think it needs to be. 

Chairman RYAN. Thank you. Mr. Jeffries. And again, I ask members not to ask their questions near the end of their three-minute 

time so that we can try to get the answers to comport within that 

time as well so everybody else can get a chance. Mr. Jeffries. 

Mr. JEFFRIES. Thank you, Mr. Chairman. Thank you to the witnesses for your testimony, your presence here today, as well as, of 

course, your great service to this country. Am I correct in my understanding that if you look at the United States’s military spend-
38 

ing, and then you compare that to the military spending of the next 

10 highest spending countries from a defense perspective, that the 

United States, from a budgetary standpoint, exceeds the spending 

of those 10 countries that fall behind us? 

Secretary HAGEL. The military budgets? Defense budgets? 

Mr. JEFFRIES. Yes. 

Secretary HAGEL. I think that is right. I think that is correct. 

Secretary HALE. I suppose it might be 13, but you are right. The 

gist of it is correct. 

Mr. JEFFRIES. So certainly a national security is of tremendous 

concern. It is a top priority, I think, for all of us on both sides of 

the aisle. But it will be useful for me if either the General or you, 

Secretary Hagel, could provide some context for why that level of 

spending is necessary in terms of the threats that we need to be 

prepared to guard against relative to what other countries, including in that list China, and Russia, and others do combined. 

Secretary HAGEL. Let me make a general comment, and then I 

know Chairman Dempsey wants to answer this as well. Well, first, 

you have to analyze the national security strategic interests of your 

country. What does it take to assure that those interests are protected, starting with the homeland of your country? I mean, that 

is, as the General said, that is the first priority of any nation’s defense structure, is the security of their country. Then you build out 

from there. What does it require? I do not need to go much beyond 

pick up a newspaper today, and you go down through The New 

York Times, The Washington Post, Wall Street Journal, and the inventory of problems in the world that are threats to us. They come 

different ways. They come from cyber; they come from nuclear 

threats; they come from terrorism; they come from conventional 

forces; they come from economic threats. And so you assess what 

your requirements are to defend your country. And then, based on 

that assessment, then you flesh what the requirements are going 

to be and the resources in order to defend your country. General? 

General DEMPSEY. It is a great question. It is the question we 

are asking ourselves in this choices review, is what do we want to 

be able to accomplish? And at what level of effort, what capability 

and how much of it so it can rotate? 

Our force is generally present in places like Korea and Europe. 

It is rotational, and then we keep a capacity for readiness at home 

as a hedge against future uncertainty. We have global responsibilities, and we want to provide the president, the commander-inchief, with options. I mean, you could convince yourself, ‘‘Well, really all you need is about 25 nukes. And if anybody tries to interfere 

with your interests, we will just nuke them.’’ But that is not who 

we are. So we need options along a spectrum of conflict. But this 

is a much longer question to be answered. 

Mr. JEFFRIES. Thank you. 

Chairman RYAN. Ms. Hartzler. 

Mrs. HARTZLER. Thank you, Mr. Chairman, and thank you, Mr. 

Secretary, and General, it is great to have this conversation with 

you. And I certainly am a big supporter of our national defense. Believe me, there is only a few things we should be doing here in 

Congress, and one of them is to provide for the common defense. 

And I, like you, have been very concerned with the cuts to the de-
39 

fense over the years, especially with the impact of sequestration. 

Certainly, in my district, representing Whiteman Air Force Base 

and Fort Leonard Wood, yeah, that is very concerning to us with 

the layoffs of civilians, as well as the reduced flying training hours, 

and the other issues we have been talking about, lack of modernization and reset. 

But, having said that, I wanted to visit with you today about a 

report that Senator Coburn has put out. I just wondered if you had 

seen this. And this is on wasteful spending in the Department of 

Defense. And this is very concerning to me because I believe it undermines my efforts and a lot of our colleagues’ efforts here to advocate for more defense spending when they have identified $67.9 

billion in what they think is wasteful spending. That could certainly be put better towards helping advance the new long range 

strike-bomber, or getting, you know, more weapons to our soldiers. 

Some of the things they have identified is that the Navy recently 

funded research concerning the behavior of fish to teach us about 

democracy, and developed an app for the iPhone on how to pick the 

best time to take a coffee break. The Air Force Office of Scientific 

Research funded a study examining how to make it easier to 

produce silk from wild cocoons in Africa and South America. And 

there was this study that was done by that same office to try to 

determine the color of a dinosaur, the first, perhaps, bird that flew. 

And I just wondered, what are you doing to address the examples 

of ways, I believe there was a video produced called, ‘‘The Grill Sergeants,’’ where you did barbecue grilling by the drill sergeants. It 

is very frustrating to me that this is going on at the same time we 

are trying to advocate for more defense dollars. So have you seen 

the report, and if so, what are you doing to address the waste? 

General DEMPSEY. Well, I have not seen the report. And I have 

never appeared before any body of Congress and argued that we 

could not find a way to be good stewards of the nation’s resources. 

We will look for the report. I will be interested to see whether we 

put it in there or somebody else put it in there when it became part 

of the bill. 

Secretary HALE. I am familiar with the report. Let me say, I am 

not going to defend some of those. Sometimes you get into the details, and these do not sound quite as bad as Senator Coburn described it, but I think there is room for paring of waste. I will say 

it was $69 billion, I think, over 10 years; about two-thirds of it was 

cuts in civilian personnel, and he did not really identify how to do 

that. As I have told you before, one way to do it is to let us close 

bases and get rid of the civilians we do not need. You may notice 

a theme. And so if we are going to make some of these big changes 

that were suggested in there, we are going to need your help. 

Chairman RYAN. Mr. Pocan. 

Mr. POCAN. Thank you. And thank you, gentleman, thank you for 

being here and for your service. Let me ask two questions, different 

questions. Let’s put them both out there to save a little time. General, one of the comments you made in your presentation that really concerned me, especially when we are talking about the sequester and the effects of sequester, the fact that our House leadership 

refuses to appoint conferees. So, once again, you know, we may not 

have a budget for this country, a road map. The words you used 
40 

were, ‘‘We are less ready every day.’’ And that should concern every 

single person about preparation, some of the things you are having 

to scale back. Could you just talk a little more about what that 

means with the current sequester, and what that could mean down 

the road if the sequester continues? 

And then the second question, Secretary, for you. I am concerned, and perhaps, I could say, skeptical of the drone program. 

I know the president has now assigned some guidelines that the 

Department of Defense is going to be more involved. I was just 

hoping you could address a little bit what role you are playing in 

the development and implementation of those plans, specifically to 

ensure that there could be zero civilians who are involved, as well 

as what oversight Congress might have in that. 

General DEMPSEY. Readiness is the most challenging thing to articulate. Most of what we do has some constituency in Congress 

and Washington D.C., weapons systems, bases, people. Readiness 

is the hardest one to articulate because there is no huge constituency for it. You only know you need it when you need it. 

Let me use a basketball analogy. Right now, about a third of the 

force is training at the individual level. They are not training as 

big units. And so if it were a basketball team, we are doing individual drills, but we are not scrimmaging. And when you do not 

scrimmage before you go into the game, it generally does not have 

a very good outcome. And so I am uncomfortable that we are cancelling rotations to our training centers, which is where we do our 

scrimmages. And that is all services. 

Secretary HAGEL. Just very briefly on your question regarding 

drones, I support strongly the president’s policy and the speech he 

gave. And much of that was about more transparency and oversight. We do have oversight now, the Congress does and the intelligence committees. What we do, in every way, is legal. Drones are 

a very key factor in our security inventory. It is always a responsible use, wise use. Factoring in one of your examples, civilian casualties, collateral damage, is this the right thing to do, laws, relationships with other countries. 

So I think what the president did here, and I was co-chairman 

of the president’s Intelligence Advisory Board the last four years, 

and it is something we recommended to him often, is a little more 

transparency. But the two titles of authority that are used, he specifically mentioned Title 10, which is the authority that is in our 

Constitution, in our law, as you know under DoD, and then Title 

50, which is covert action, which usually the CIA or intelligence; 

both are necessary for the security of this country. 

Chairman RYAN. Thank you. Mr. Rigell. 

Mr. RIGELL. Thank you, Mr. Chairman, and Secretary Hagel, 

thank you for your service, General Dempsey and Secretary Hale. 

Secretary Hale, I would like to really direct this question to you. 

If there is universal agreement on anything, it is that sequestration is unwise. And we, as Americans, can do better than that. And 

it seems like there are two principal drivers to it. One is the topline funding, of course. And then the other part of it that creates 

so much inefficiency is this, you know, the cuts are universally applied. Now the top-line part is a high hurdle; I am not going to try 
41 

to get into that right now. But on how they are uniformly applied, 

I would like to delve into that just a bit. 

I know you have got over $9 billion reprogram in the works, 

right? As we were marking up the NDAA the other night, actually, 

the other morning, ended up around 2:00 a.m. in the morning, one 

of my colleagues introduced an amendment that would give DoD 

about $20 billion of running room on that. I would like to hear your 

views on that. I voted no, to be clear here, because it did not seem 

like that much discretion without congressional oversight was wise 

or prudent. But I was intrigued by the idea, and in this time remaining, please if you would expand on that, please. 

Secretary HALE. I would like to see you take the limits off entirely, and here is why. You would still have full oversight. Every 

time we do a reprogram, it has to be submitted to all the committees who can only do it if every committee approves. I have never 

understood why you need a separate limit on the amount, especially in the environment as uncertain as this one. But if you will 

not do that, I would certainly prefer, it is around now $7.5 billion, 

something significantly higher. I will say again, I think you would 

have the oversight you need, and full oversight, even without 

transfer authority limits. 

Mr. RIGELL. Well, is the reprogram that is in the works now, 

does that reflect the full source of consternation within DoD, or is 

there more that you are looking at right now that you are going 

to need to come back to us on and work through? 

Secretary HALE. We are just about at the legal transfer authority, only $200 million short of it in that reprogram. So we do not 

have any more flexibility. But yes, we have some remaining problems, particularly in the Army, of local [spelled phonetically] shortfalls, that we are working actively right now. We are not going to 

be able to do it through reprogramming, unfortunately. 

Mr. RIGELL. Well, I have got just maybe 40 seconds or so left, but 

Mr. Secretary, I would be open, and I do not speak for my colleagues, of course, but for a wiser path of saying if we are expecting to be under sequestration or sequestration-type levels for the 

foreseeable future, and I am trying to avert that, I would be open 

to any type of wise alternative that would give you more running 

room. 

Secretary HAGEL. Thank you, Congressman. Flexibility is, as we 

have said throughout this hearing, absolutely key. And your point 

about more running room is part of that flexibility. We are going 

to most likely need that, depending on what happens here. But if 

this plays out the way it appears it is going to play out, at least 

for the remainder of fiscal year 2013, then we are going to have 

to continue to make these tough choices, and we are going to need 

more flexibility. 

Secretary HALE. Thank you. Mr. Blumenauer. 

Mr. BLUMENAUER. Thank you, Mr. Chairman. Secretary Hagel, it 

is a pleasure to have you here. We are excited that somebody with 

your background in business, in government, in the military, is in 

the position you are to make these tough choices. And I really appreciate, General Dempsey and Undersecretary Hale, what you 

have said. You are coming to Capitol Hill, for instance, urging 

health care reform and base closures. Congress has never met a 
42 

base that it wants to close, which is why we have a Base Closer 

Commission, because we want to have it both ways, you know. You 

know, you look at savings with PXs, and people go ballistic, and 

you get stuffed back where you are dealing with readiness issues. 

And I appreciate your patience. 

I would request, in a written form at some point, a little analysis 

on nuclear weapons. It is mind-boggling to me that we are looking 

at upwards of three-quarters of a trillion dollars over the next 10 

years that the Administration was forced to deal with some upgrades. And we have far more than we need, and we are spending 

a miniscule amount, less than 1 percent, decommissioning. And I 

would really love an explanation for why we have to have this level 

of expenditure when you are talking about major other initiatives 

that are before us. 

But the question I would put to you, Mr. Secretary, now, for perhaps a reaction, deals with environmental stewardship of the Department of Defense. I have been impressed with the progress that 

has been made for a sustainable military. I have been impressed 

with the recent guidance in terms of facilities. That is really terrific, and I hope it can be put into effect. But there is also the element, the Department of Defense is the largest generator of superfund sites in America. There are 10 other members of the Committee who have superfund sites in their district that have yet to 

be cleaned up. I am dealing with one in the Willamette River in 

Portland, Oregon that was a staging area for the Navy for three 

wars, and there is serious pollution that is, in part, the responsibility of the federal government. 

And I would like to know what we can look forward to. I know 

it is tough times and I am willing to go the extra mile with you 

on things that you have requested, and maybe a few that you have 

not. But I hope that we are not backing away from the responsibility of the Department of Defense for pollution that is across the 

country in every state, and many of them in our districts. 

Secretary HAGEL. I can assure you the Department of Defense is 

not going to back away. We have not backed away. We will continue to fulfill the commitments we have made, and those commitments are based on our obligations and responsibilities, you are exactly right. As you know, the superfund sites, I think, is administered out of the EPA. We fund part of that; part of that, a good 

part of that, is due to us, the DoD, over the years. It goes back preWorld War II. I mean, I do not have to tell you. So we will continue 

to make those funds available, continue to work with the superfund 

administrators. Specifically, if you have something, let us know, we 

will respond. 

Chairman RYAN. Thank you. Ms. Blackburn. 

Mr. BLUMENAUER. Thank you, Mr. Chairman. 

Mrs. BLACKBURN. Thank you, Mr. Chairman. And thank you all 

for being here with us. I represent Tennessee’s Seventh District; 

Fort Campbell is in that district. And, of course, we have the wonderful 101st, the 160th, and the Fifth Division. And when I am on 

post and when I am talking with many of our men and women in 

uniform, a couple of different things come up. They all have to do 

with readiness, and I appreciate your comments about loss readiness. And I think one of the lessons we learned through the ’90s 
43 

is when you do these drawdowns, and not carefully, there are consequences to pay. 

But looking at Europe, and this is one of the things that people 

are talking about now in my district, they are looking at the 

forestructure that we have there in Europe, and they are concerned 

this may go away. So I want to talk with you about, and just have 

you, Mr. Secretary, I have told them if I ever got a chance to ask 

you, I would ask you, so here we go. What purpose does this serve, 

to have that permanent force there? And what is it there for? Is 

it there to counter Russia? Is it there to make it better, easier to 

serve as a launch point to get to other parts of the world? If we 

had another Benghazi-style crisis somewhere North Africa, or 

Israel, or the Middle East, how would we handle it if we did not 

have a place like Europe to go from? How badly would it impair 

a commander’s options, or degrade his ability to respond if we did 

not have it? And, you know, just talk to me about Europe for about 

a minute. And I have got one other comment to add once you do, 

so—— 

Secretary HAGEL. Well, I will be very brief, and I am going to ask 

the General to respond, too, because this has been his whole life. 

Just very briefly, I think you listed a number of reasons why we 

need forward-deployed forces. It is force projection, of course; that 

is the whole point of the rebalancing Asian Pacific. It is time, it is 

schedules, it is options. Benghazi, a good example, the Congress 

continues to ask a lot of questions about what happened in 

Benghazi. Why were we not there? Could we have been there? 

What was the time? It is clearly in our national security interests 

to have that forward-deployed option because if you do not have it, 

then the only option you have is you bring them out of the United 

States. And you cannot respond. The world is too hair-triggered; it 

is too fast; it is changed. We do not have any options. And so things 

happen like that. So I think your list of questions actually was a 

list of answers as well. 

General DEMPSEY. I have nothing to add. 

Secretary HAGEL. That is the first time the General has ever said 

he had nothing to add. 

Mrs. BLACKBURN. Well, and I will just say the Flying Hours Program, I have worked with the Committee to add in the funds to 

continue that. I was very concerned about the loss of 500 aviators, 

and I would just ask you all to work with Army to be certain that 

that program continues in 2014. 

Secretary HAGEL. Thank you. 

Mr. VAN HOLLEN. Thank you. Ms. Lee. 

Ms. LEE. Thank you very much. Thank you, Secretary Hagel, 

General Dempsey, and Undersecretary Hale for your leadership 

and for being here today. I wanted to ask a couple questions, one 

relating to the end of the war in Afghanistan. We know that the 

timetable now is 2014, but what do you see or foresee as future involvement after 2014? And as it relates to military personnel and 

contractors, and what do you see Congress’ role in that effort, in 

terms of our responsibility to authorize or to appropriate? 

Secondly, I was glad to hear the answer about audit the Pentagon. For years, I have been working on issues around waste, 

fraud, and abuse, and what I learned was that the Pentagon has 
44 

missed all these deadlines as it relates to the audit. And so I am 

going to ask, I hope it is not too redundant, but have you projected 

any savings from this audit that hopefully will be completed pretty 

soon? 

And finally, just a little bit about the Overseas Contingency Operations Fund, that really has exploded beyond any reasonable 

measure of what a contingency fund should be. I think now you are 

asking, what, for $5 billion above the request that the House 

Armed Services Committee has provided? And so why are we not 

projecting major savings from ending the war in Afghanistan if, in 

fact, this contingency fund continues to explode? 

Secretary HAGEL. Congresswoman, I will try to be very brief because I know we have all got time issues here. I will start with 

OCO. That $5 billion additional, that did not come from our request. That was a congressional addition to what we requested, $79 

billion. That represents $10 billion less than what the request was 

last year. I was in the Senate for most of the Iraq-Afghanistan 

War. And we financed those two wars almost entirely, all the time, 

to emergency supplementals. That is where, really, it came from. 

And now, we are going to be bringing that back down for the very 

reasons you know and others. 

In addition to that, however, why do you still need it if you are 

coming out? Then I will get to your post-2014 question. We have 

still got over 60,000 troops there; we are bringing out a couple 

thousand a month to get down to 34,000 troops by, I think, February of next year. A huge amount of equipment that we have got 

to get out, we have got to do something with that equipment as we 

consolidate bases. All these are huge costs to us. It is not as easy 

as getting out as we did in Iraq when you just come right down 

to the desert, load everything up on the ships. This is a whole different ballgame. So those are additional costs. 

What do I see after 2014? The president has laid out that we will 

have a trained assistant advise mission after that. We will have a 

presence there. 

Chairman RYAN. Thank you. Mr. Williams. 

Mr. WILLIAMS. Yes, I want to thank all of you for being here. I 

appreciate your patriotism. My question is being directed to you, 

Mr. Secretary. Fort Hood is in my district, and they are doing a 

fantastic job. A lot of people in my district ask, do you think that 

America should be the number one superpower in the world? 

Secretary HAGEL. I believe, and I always have, that America 

must maintain its superiority in every way to maintain our national security. 

Mr. WILLIAMS. Do you feel that our enemy is fierce today? 

Secretary HAGEL. Our enemy is very fierce today. 

Mr. WILLIAMS. Do you think our friends trust us? 

Secretary HAGEL. I think we have partners, we have allies, we 

have relationships that are all built around common interests. That 

is not new; that is the history of the world. And those common interests that forge those relationships, the era of coalitions of common interests came after World War II when we built all those coalitions, NATO, so on and so on. And we will need them even more 

so in the 21st century. 
45 

Mr. WILLIAMS. We have talked a little bit about the president’s 

budget, that you are aware that it came to us very late in this 

cycle. 

Secretary HAGEL. Yes. 

Mr. WILLIAMS. And are you also aware that sequestration, which 

we talk about all the time, was the idea of President Obama? 

Secretary HAGEL. Well, I am going not going to get into the politics of whose idea it was. 

Mr. WILLIAMS. I just want to make sure you are aware. I want 

to make sure you are aware of that. 

Secretary HAGEL. I have got a responsibility to run the Pentagon, 

not to get involved in politics. 

Mr. WILLIAMS. All right. Okay. I just want to make sure you are 

aware of that. And I also would ask you, it is been widely reported 

that some DoD components had identified sufficient spending cuts 

such that they would not have needed to furlough their civilian 

workforce during that 11 days. I know you have got reports in the 

Navy and Air Force that gave you some other options. My question 

is why did you choose to go to the wide furloughs rather than implement cuts to activities that you had been advised on that you 

could have gone another way, thus creating pain with the public 

and creating, really, havoc with some of the communities? 

Secretary HAGEL. Well, if you were here for my opening statement, I noted that decision and why, but I will repeat it. We have 

looked at every possible area we can cut, and I listed some of them, 

and we can give you an entire list of them. I would be very happy 

to do that. I got to the point where, we started with the possibility 

of 22 days of furloughing. The decision I made was finally 11. It 

was the last thing we wanted to do. This was in coordination with 

all our commanders, all our senior leaders, because I could not take 

the readiness issue down any further than where it was. We would 

have to cut more into our readiness and our force protection of our 

people, and I could not do that. 

Mr. WILLIAMS. Okay. Last question, I have never been able to 

understand, why do we compare ourselves to other countries as far 

as amount of missiles, you name it? Why do we compare ourselves 

to them? Why do we not set the standard? If we are going to be 

the superpower in the world, why do we want to come to their 

level? Why do we not just want to be America? 

Secretary HAGEL. Well, I am not sure what you mean. 

Mr. WILLIAMS. Well, we talk about bringing missiles down to a 

certain level, doing this, we are worried about a budget of another 

country; I do not see how that plays into our defense. 

Chairman RYAN. We will have to leave it at that just because the 

votes on the floor, 11-54 left. Mr. Huffman. 

Mr. HUFFMAN. Thank you to all the witnesses. I will be quick. 

Secretary Hagel, I was a big fan of your work in the Senate, your 

bipartisan work on nonproliferation, and continuing into your time 

when you were out of office working on sensible ways to right-size 

our nuclear arsenal to address 21st century needs instead of Cold 

War and bloated nuclear arsenal. So that is the big-picture question I want to ask you about. In the post-Cold War era, at a time 

when we are struggling to address our long-term debt and deficits, 

we still have a huge nuclear arsenal, even with the progress we 
46 

have made in the START treaty numbers, 1,550 deployed nuclear 

weapons. Some estimate as much as $52 billion a year to maintain 

that arsenal, and we will be being asked to pay for modernization 

of it all. 

In light of all of that, can we afford this type of a nuclear arsenal 

in this day and age, and do we need it? Or can we move back towards something more like the great report that you did in May 

of 2012 with Global Zero where you envisioned a nuclear arsenal 

closer to 900 total weapons deployed in a very different way? 

Secretary HAGEL. Well, I think it is been the goal of every president of the Unites States since the advent of nuclear weapons. Recognizing every president has realized, as I have, and I think most 

Americans, that the nuclear deterrence has been as important a 

part of keeping our freedoms as anyone thinks since World War II. 

Ronald Reagan, if you remember in, I think it was 1986, turned to 

Gorbachev, and said, ‘‘Let’s get rid of all the nuclear weapons.’’ And 

I recall that vividly. And a lot of people gulped, ‘‘Is he crazy?’’ 

Every reduction in our nuclear armament has come as a result of 

a treaty, in a commiserate reciprocal reduction. You ask yourself, 

well, how many missiles and how many nuclear warheads do you 

need to defend yourself? How many times do you have to blow up 

the world? 

I mean, I believe strongly in a strong nuclear deterrence, strongly. And I also believe that Ronald Reagan and every president we 

have had, Democrat or Republican, asked the right questions. This 

president is asking the right questions. Your numbers that you 

mentioned was a result of a treaty with the Russians, I think in 

2010, that Congress approved, the Senate, with the president. I 

think that makes sense. If we can find ways to reduce the threat 

to mankind but still protect ourselves, is that not what we should 

be doing? 

Mr. HUFFMAN. Thank you. 

Chairman RYAN. Thank you. Let’s leave it at that. Mr. Calvert. 

Mr. CALVERT. Thank you for your service. I am going to submit 

a couple questions for the record, but I just want to get a couple 

of points in real quickly. When it comes to BRAC, I think you probably know, even though we are discussing BRAC, there is probably 

not a stomach for voting for it. And I would hope we can work together to maybe closely more define what a BRAC process is. I 

think, too, we may need to add the National Laboratories and 

NASA centers to it also. If we are going to do it, let’s just do it all. 

One thing, to be specific, electronic health records. We asked the 

Department of Defense some time ago to get that done. It would 

create efficiencies and save a lot of money. You know, Kaiser in 

California, has gone to digitized health records a long time ago. 

And we asked, it is been God knows how many years now, five 

years ago. What is the hold up? 

Secretary HAGEL. Well, first, DoD and VA will be interoperable 

by the end of this year in the transferring of all of our paper back 

and forth. This is a long story. As you know, five years’ worth and 

a lot of money’s worth, but let me, in the interest of time, just hit 

a couple of important points. The seamless interoperable of those 

two systems, they do not have to be the same systems, just interoperable. As long as they are talking to each other, and we can ac-
47 

complish getting paper records out of DoD over to VA, over to their 

claims, and that is being done, it will be done. That is one part of 

it. 

The backlog at the VA is not a DoD-result problem. About 4 percent of that backlog is our piece. And that is mainly because Secretary Shinseki made a decision, which I think he was right, a couple of years ago to start including all the Vietnam veterans and everybody prior to Iraq and Afghanistan, and the veterans that were 

produced the most two wars, we had electronic records. 

When I was in Vietnam, I mean, you have got maybe your folder. 

It is all paper records, so they have been flooded with this stuff. 

We have been working very closely with them. A lot of glitches, a 

lot of issues, absolutely. But I have got to be responsible for the 

modernization of our systems for DoD. That is not mutually exclusive from the VA. We work very closely. I just offered more manpower. We have people over in the VA, and we have got them all 

over. And the VA just accepted seven more of our people, which I 

am glad they have done. So, yes, a lot of issues, a lot of problems, 

but we are getting there, and we will get there. 

Mr. CALVERT. Thank you. 

Chairman RYAN. Thank you. Ms. Lujan Grisham. 

Ms. LUJAN GRISHAM. Thank you, Mr. Chairman. Thank you very 

much for being here today, Mr. Secretary and General. I appreciate 

that, too. And I was not playing on talking about this, and I will 

be brief, but I want to echo what my colleague just talked about, 

and I appreciate your response on veterans’ issues, the backlog, 

and electronic medical records. And with all the different proprietary records in the private sector, it is clear that having a single 

system is not going to work, that we have to find utility programs 

that will make them all interoperable. And I just had a veterans’ 

forums, and I will tell you that every single complaint was having 

access and following their record trail, and making sure that they 

are getting adequate and quality care, and that that is seamless. 

So I appreciate that, and appreciate your diligence. 

I quickly want to go to contracting, and I want to have you just 

talk to me a little bit about the impact sequestration is having on 

defense contractors, and their ability to stay staffed and meet any 

of these demands. I have got negative job growth in significant defense contracting in my district. I represent Albuquerque in New 

Mexico, and it is a real challenge. 

Secretary HAGEL. Well, again, within the limits of our time here, 

contractors are going to be and are being severely cut employees. 

Just as we are having to take a hit with our civilian workforce, 

there is no way around it. I mean, when you are putting off contracts and forcing them out into the future, and because you have 

less resources you cannot go forward with making commitments. 

Ms. LUJAN GRISHAM. Are you concerned about their ability to 

have capacity when you do need them as a result of this? 

Secretary HAGEL. Absolutely. Of course. The chairman talked 

about that, and we all know that. 

Ms. LUJAN GRISHAM. And to also meet your goals for disadvantaged groups such as veterans and women, and to make sure that 

you are meeting those goals that you set aside to encourage that 

entrepreneurship and those kinds of relationships? 
48 

Secretary HAGEL. It is all affected. 

Ms. LUJAN GRISHAM. Any suggestions that you have in the interim, since the power rests here, about what we do in a district 

like mine to sure up these relationships and these private businesses? 

Secretary HAGEL. My suggestion is, as the chairman, and the 

ranking, and all the members of Congress know, is if we could get 

some clarity, some certainty, some flexibility on a budget. 

Ms. LUJAN GRISHAM. You have my support to that. 

Secretary HAGEL. Thank you. 

Ms. LUJAN GRISHAM. And thank you very much. 

Chairman RYAN. Last but not least, Mr. McClintock. 

Mr. MCCLINTOCK. Thank you, Mr. Chairman. My constituents 

had one question; they would want me to direct it to you, General 

Dempsey. And it involves the rules of engagement that have placed 

our young men and women under the most unprecedented constraints, I think, in the history of a battlefield. The point was 

brought home to me at a veterans’ lunch a couple of years ago in 

Nevada City where I was talking to a young man who just returned from Iraq, as well as a veteran of Patton’s Third Army. And 

I asked the young man about the rules of engagement, and the look 

of relief crossed his face, like, ‘‘Thank God somebody is asking.’’ He 

says, ‘‘They are terrible; they will not let us fight back. If we are 

shot at, we have to identify ourselves, and first yell at them to stop 

shooting at us. If it is at night, we have to shine a light at them. 

If the fire is coming from anywhere in the vicinity of a village, we 

are not allowed to return fire. We are not allowed to pursue insurgents into a mosque.’’ He says, ‘‘I had a buddy who did that. The 

insurgents were released; my buddy was demoted for breaking the 

rules of engagement.’’ 

I turned to the veteran and I said, ‘‘Well, what were the rules 

of engagement in Patton’s Third Army?’’ And he says, ‘‘Well, we did 

not really have any rules of engagement. They told us to kill Germans, and that is what we did.’’ And I said, ‘‘Well, if a German 

squad escaped into a church, would you have pursued them into 

the church?’’ ‘‘Oh, heavens no,’’ he says, ‘‘we would have blown up 

the church.’’ And my question is, can we look any of these young 

servicemen and women in the eye and tell them that we back them 

with the full might and fury of our country when we have placed 

them in harm’s way? And that we gave them the battlefield discretion that has been given to every generation of fighting men since 

the beginning of this republic? 

General DEMPSEY. It is never been, despite what the veteran told 

you from World War II, it is never been the tradition in our country to use force indiscriminately. And the rules of engagement are 

reviewed by the commanders in the field with great frequency. The 

particular form of conflict in which we find ourselves now, where 

what truly hangs in the balance is the support of the population, 

and less so, killing a particular number of insurgents, requires us 

to be particularly careful about the use of force. But one thing I can 

assure you, no man or woman who we sent into previously Iraq 

and now Afghanistan, ever is hamstrung in their ability to protect 

themselves. And so some of what you are referring to, I have seen 

it myself, I have heard it myself, a good bit of it is misinformation. 
49 

Mr. MCCLINTOCK. Well, I would suggest that if World War II 

were conducted in the same manner as we have conducted our affairs in Afghanistan, that war would still be going on. 

Chairman RYAN. Thank you. This was a fast-moving hearing. I 

wish we had more time, but I appreciate your indulgence. Thank 

you, Secretaries, for coming. Thank you, General. This hearing is 

adjourned. 

[Questions submitted for the record and their responses follow:] 

QUESTIONS SUBMITTED FOR THE RECORD FROM CHAIRMAN RYAN

SECRETARY HAGEL

Afghanistan 

1. Recently we have seen several high-profile Taliban attacks. The Afghanistan 

NGO Safety Office reported that Taliban attacks are up 47 percent from this time 

last year. Do you consider this increase in attacks significant? Why has the military 

stopped publishing data on the volume of enemy attacks? What metrics are you 

using to determine whether we’re making progress? Is there a level of violence that 

would necessitate revising the current drawdown plans? 

2. In FY 2013, the Department of Defense faced a $12 billion shortfall in funds 

available for prosecution of the war in Afghanistan. Please quantify the contributing 

factors to this shortfall. What steps were taken in preparing the FY 2014 war funding request to ensure there would not be another shortfall in FY 2014? 

GENERAL DEMPSEY

Defense Efficiencies 

3. In response to a question from Mr. Rokita, General Dempsey testified that a 

significant factor in the increase in the number of civilians employed by the Joint 

Staff was due to the disestablishment of Joint Forces Command and the absorption 

of civilian employees from JFCOM into the Joint Staff. One reason cited for closing 

JFCOM was to reduce costs. Please provide an itemized estimate of the savings 

achieved by disestablishing JFCOM net of any costs that were assumed by other 

elements of the Department of Defense. 

4. General Dempsey’s prepared statement noted that given recent budget reductions ‘‘everything must be on the table’’ and specifically noted that included civilian 

force reductions. Please specify what additional statutory authorities DOD need to 

efficiently reduce the size of its civilian workforce. 

QUESTIONS SUBMITTED FOR THE RECORD FROM HON. JAMES LANKFORD, A

REPRESENTATIVE IN CONGRESS FROM THE STATE OF OKLAHOMA

SECRETARY HAGEL AND UNDERSECRETARY HALE

Defense Management 

In response to my question, Under Secretary Hale testified that the planned reduction in DOD’s civilian workforce ‘‘is heavily dependent on BRAC.’’ The DOD civilian workforce has increased 17% since 2001. During that same time period, no new 

domestic bases were established and DOD executed BRAC 2005 which was arguably 

more extensive than all four previous BRAC rounds combined as it involved 24 

major base closures, 24 major realignments, and 765 minor closures and realignments. The evidence does not suggest that BRAC necessarily leads to a smaller civilian workforce. Given the compressed time available for the hearing, I wanted to 

provide you an opportunity to explain this seeming discrepancy. 

QUESTIONS SUBMITTED FOR THE RECORD FROM HON. BILL FLORES, 

A REPRESENTATIVE IN CONGRESS FROM THE STATE OF TEXAS

SECRETARY HAGEL

I. Recommendations adopted in the Executive Order stated that Coastal and Marine Spatial Planning will require ‘‘significant initial investment of both human and 
50 

1See Page 43, Final Recommendations of the Interagency Ocean Policy Task Force (‘‘Final 

Recommendations’’), released July 19, 2010, available at http://www.whitehouse.gov/files/documents/OPTF_FinalRecs.pdf. 2See Draft National Ocean Policy Implementation Plan, National Ocean Council, released 

January 12, 2012, Page 5, available at http://www.whitehouse.gov/sites/default/files/ 

microsites/ceq/national_ocean_policy_draft_implementation_plan_01-12-12.pdf. 3See http://northeastoceancouncil.org/wp-content/uploads/2013/04/Membership-Roster-NERPB1.pdf. 4See http://www.whitehouse.gov/files/documents/2010stewardship-eo.pdf. 5Federal entities required to take actions pursuant to Executive Order 13547 include members of the National Ocean Council, comprised of the Departments of State, Defense, Interior, 

Agriculture, Health and Human Services, Commerce, Labor, Transportation, Energy, Homeland 

Security, and Justice, the Administrators of the Environmental Protection Agency and National 

Aeronautics and Space Administration, the Chairs of the Council on Environmental Quality, 

Federal Energy Regulatory Commission, and Joint Chiefs of Staff, the Directors of the Office 

of Management and Budget, National Intelligence, the Office of Science and Technology Policy, 

and the National Science Foundation, the Under Secretary of Commerce for Oceans and Atmosphere (NOAA Administrator), the Assistants to the President for National Security Affairs, 

Homeland Security and Counterterrorism, Domestic Policy, Economic Policy, and Energy and 

Climate Change, and a federal employee designated by the Vice President. 6See Page 30 at http://www.whitehouse.gov/files/documents/OPTF_FinalRecs.pdf. 7See http://www.whitehouse.gov/administration/eop/oceans/faq. 

financial resources,’’ 1 and in early 2012 the National Ocean Council noted that federal agencies had been asked to provide information about how ‘‘existing resources 

[can] be repurposed for greater efficiency and effectiveness’’ in furtherance of the 

National Ocean Policy.2

In addition, DOD and Joint Chiefs of Staff representatives are currently serving 

on newly-formed Regional Planning Bodies created under the Executive Order in regions including the Northeast.3

Q: Please describe how many DOD and Joint Chiefs of Staff resources and personnel have been directed toward activities specifically in support of the National 

Ocean Policy to date, the specific activities that they have been engaged in, and how 

many resources and personnel are being requested to support such activities in the 

FY 2014 budget request. 

Please describe the DOD and Joint Chiefs of Staff response to the National Ocean 

Council inquiry about the repurposing of existing resources, and any actions that 

DOD and the Joint Chiefs of Staff have taken or plan to take in this regard. 

II. Section 6(b) of Executive Order 135474 that established the National Ocean 

Policy in July 2010 requires ‘‘[e]ach executive department, agency, and office that 

is required to take actions under this order shall prepare and make publicly available an annual report including a concise description of actions taken by the agency 

in the previous calendar year to implement the order, a description of written comments by persons or organizations regarding the agency’s compliance with this 

order, and the agency’s response to such comments.’’ 5

Q: Pursuant to this requirement, have DOD and the Chairman of the Joint Chiefs 

of Staff—both members of the National Ocean Council—prepared and made publicly 

available any such annual report for calendar years 2010, 2011, or 2012? If so, 

please describe the findings and contents of such reports, and if not, why has this 

not occurred? 

III. The recommendations adopted by the National Ocean Policy Executive Order 

state that effective implementation will require ‘‘clear and easily understood requirements and regulations, where appropriate, that include enforcement as a critical component.’’ 6 In addition, the Executive Order requires federal entities including DOD and the Chairman of the Joint Chiefs of Staff to implement the policy to 

the fullest extent possible. 

At the same time, the National Ocean Council has stated that the National Policy 

‘‘does not establish any new regulations or restrict any ocean uses or activities.’’ 7

What if any commitment can you make that DOD and its affiliate branches will 

not issue any regulations or take any actions having a regulatory impact pursuant 

to the National Ocean Policy, including Coastal and Marine Spatial Planning? 
51 

QUESTIONS SUBMITTED FOR THE RECORD FROM HON. LUKE MESSER, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF INDIANA

SECRETARY HAGEL

Question Series #1—National Guard Facilities, Muscatatuck Urban Training Center 

(MUTC) in Butlerville, IN 

The Muscatatuck Urban Training Center, which is located in my home district, 

is a 250-acre campus and 180-acre reservoir with urban infrastructure consisting of 

1,560 training structures, including a school, hospital, dormitories, light industrial 

structures, single-family type dwellings, a dining facility and administrative buildings totaling approximately 850,000 square feet of floor space. Additionally, the 

training area includes an extensive, 1,866-foot underground utility tunnel system 

and over 9 miles of road. This installation provides a critical service for preparing 

National Guard soldiers, Department of Defense civilian personnel, and U.S. State 

Department personnel for deployments to Afghanistan and other locations through 

simulations and immersion experiences, as well as other training opportunities for 

first responders, law enforcement and homeland security personnel. 

Question: The Vibrant Response 13-2 Northern Command exercise—held at the 

Muscatatuck Urban Training Center—is the largest homeland security exercise conducted annually. This exercise brings together over 8,000 people across 22 states to 

test and evaluate our ability to respond to a nuclear detonation in an urban environment. The exercise will run from July 21 to August 23, 2013, with incidents on July 

30 and August 10. 

The Vibrant Response exercise is an excellent opportunity to experience the 

unique capabilities and environment the National Guard has designed to prepare 

the U.S. military for combat and humanitarian operations in urban environments, 

and also to witness our whole-of-government response to major humanitarian disasters. 

1. On May 7th, the entire Indiana Congressional Delegation sent you a letter inviting you to come to Indiana to observe the Vibrant Response 13-2 Northern Command exercise which runs from July 21 to August 23. If you are unable to attend, 

would you consider a site visit to personally observe the joint training programs at 

Muscatatuck Urban Training Center and Camp Atterbury? 

Background on Civilian-Military Training at Camp Atterbury (CA) and Muscatatuck 

Urban Training Center 

Camp Atterbury and Muscatatuck Urban Training Center have been supporting 

integrated civilian—military training since July 2009. The programs were created 

in response to a need to prepare civilian personnel for overseas deployment in support of U.S. military missions. Prior to these programs, the ability to bring together 

civilian and military interagency teams for pre-deployment training was stymied because programmatic and systemic obstacles. 

In January 2010, the Department of Defense initiated the Civilian Expeditionary 

Workforce (CEW) program to provide civilian personnel with ‘‘real world’’ training 

prior to deployment to a conflict area. This joint, pre-deployment training and mobilization program plays a critical role in preparing civilians to work side-by-side with 

military personnel in support of humanitarian, reconstruction, and combat-support 

military missions. In June 2009, the State Department initiated its own integrated 

civilian-military training program for the purpose of providing its personnel with individual mobilization and situational training. 

Questions: 1. While the Civilian Expeditionary Workforce (CEW) program initially 

was stood up to support our military missions in Iraq and Afghanistan, as we draw 

down in Iraq and Afghanistan won’t there still be will be a need for an integrated 

civilian-military workforce to support operations globally? 

2. The current programs in place which have the needed partnerships established 

and are fully operational and coordinated provide the Department of Defense and 

the Department of State a platform to build an enduring, global program upon. Do 

you think that the Department of Defense/Department of State Integrated CivilianMilitary Training program has value and, if so, is it worthy of expansion of its scope 

to meet global needs? 

Question Series #2—DOD Broadband Spectrum, Spectrum Scarcity Background 

In 1993, 1997, 2004 and 2012, Congress addressed spectrum scarcity in the commercial mobile industry by requiring spectrum assigned to the federal government 

to be reallocated to the FCC for private sector use. The enormously successful spectrum management policy approach has been to have the federal entities clear the 

spectrum, reallocate the spectrum to the FCC, and then to make the spectrum available for exclusive use via competitive bidding (i.e. auctions). Spectrum scarcity has 
52 

reemerged and now exists in the wireless industry and the industry is in dire need 

of additional spectrum to meet the data and video driven uses by consumers, especially those with smart phones and tablets. 

Questions: 1. Secretary Hagel, you have actual expertise in these spectrum issues 

and in the commercial mobile industry having formed Vanguard Cellular Systems, 

Inc. in 1984. To what extent do you intend to utilize your spectrum experience when 

it comes to the management of the enormous amount of spectrum that is currently 

assigned to the Department of Defense? 

2. On March, 20, 2013, then FCC Chairman Genachowski advised NTIA that the 

FCC intended to auction the licenses in the 1695-1710 band and 1755-1780 band 

as early as September 2014.The Spectrum Act of 2012 requires that the 2155-2180 

band be licensed by February 2015. Recent estimates indicate that the auctioning 

of the 2155-2180 MHz band alone would yield $ 3.6 billion, but auctioned together 

with the 1755-1780 MHz, the yield would be $12 billion. Can we be assured that 

DOD will take all steps necessary to clear this 1755-1780 band, so that it can be 

auctioned with the 2155-2180 band? 

3. Do you believe that the opportunities for clearing and reallocating to the private sector spectrum currently assigned to the Department of Defense and other 

federal entities have been totally exhausted, with spectrum sharing between federal 

agencies and commercial users being the only alternative to spectrum scarcity? Or 

do you believe that there are still opportunities for spectrum currently assigned to 

federal agencies to be reallocated to the FCC for private sector use? 

[Response to questions submitted for the record follow:] 

CONGRESSMAN CICILLINE

Question: What’s the Department’s status with implementing item-unique identification (IUID) markings? Will sequestration cuts adversely impact IUID implementation? 

Answer: The Department continues to make progress in the implementation of 

IUID markings. It is tracking the marking of both legacy and newly procured items 

by class of supply. Currently, almost 7 million legacy and over 14 million new contract receipt items are marked. Each Service developed plans of actions and milestones to track progress. In addition, an IUID system indicator field is included in 

the Department’s inventory catalog system. This helps facilitate the identification 

of assets requiring the IUID mark and trigger the inclusion of the required IUID 

contract clause. Finally, the Department is revising its policy governing the implementation of the IUID marking to reflect the current approach. 

Sequestration and the budget uncertainty in FY14 and beyond may impact 

progress in the following manner: 

1. Reduced ‘‘opportunistic IUID marking’’ on legacy assets based on slower induction rates into the depots, since this is the approach most widely used by the Services to mark assets in inventory. 

2. Reduced ‘‘dedicated marking teams’’ for legacy assets because this implementation is being accomplished mainly through contractor-supported efforts and associated funding may be impacted. 

3. Potential delays in IUID IT system enhancements due to budget prioritization. 

The Department remains committed to the importance of IUID marking, but future efforts will need to be weighed against other mission priorities based on future 

years’ budgets. 

CONGRESSMAN MESSER TO SECDEF HAGEL

Question No. 1: Muscatatuck Urban Training Center (MUTC) in Butlerville, Indiana 

Question: The Muscatatuck Urban Training Center, which is located in my home 

district, is a 250-acre campus and 180-acre reservoir with urban infrastructure consisting of 1,560 training structures, including a school, hospital, dormitories, light 

industrial structures, single-family type dwellings, a dining facility and administrative buildings totaling approximately 850,000 square feet of floor space. Additionally, 

the training area includes an extensive, 1,866-foot underground utility tunnel system 

and over 9 miles of road. This installation provides a critical service for preparing 

National Guard soldiers, Department of Defense civilian personnel, and U.S. State 

Department personnel for deployments to Afghanistan and other locations through 

simulations and immersion experiences, as well as other training opportunities for 

first responders, law enforcement and homeland security personnel. 

The Vibrant Response 13-2 Northern Command exercise—held at the Muscatatuck 

Urban Training Center—is the largest homeland security exercise conducted annually. This exercise brings together over 8,000 people across 22 states to test and evalu-
53 

ate our ability to respond to a nuclear detonation in an urban environment. The exercise will run from July 21 to August 23, 2013, with incidents on July 30 and August 

10. The Vibrant Response exercise is an excellent opportunity to experience the unique 

capabilities and environment the National Guard has designed to prepare the U.S. 

military for combat and humanitarian operations in urban environments, and also 

to witness our whole-of-government response to major humanitarian disasters. 

On May 7th, the entire Indiana Congressional Delegation sent you a letter inviting 

you to come to Indiana to observe the Vibrant Response 13-2 Northern Command exercise which runs from July 21 to August 23. If you are unable to attend, would you 

consider a site visit to personally observe the joint training programs at Muscatatuck 

Urban Training Center and Camp Atterbury? 

Answer: I appreciate the Indiana Congressional Delegation’s thoughtful invitation 

to visit Muscatatuck Urban Training Center and Camp Atterbury to observe the annual Vibrant Response exercise. However, due to other commitments, I will be unable to observe this year’s exercise. 

I agree that the Vibrant Response exercise is an excellent opportunity to visit 

Muscatatuck and observe firsthand the whole-of-government response to a simulated complex weapon of mass destruction catastrophe in the homeland. I look forward to taking advantage of a future opportunity to do so. 

CONGRESSMAN MESSER TO SECDEF HAGEL

Question No. 2: Background on Civilian-Military Training at Camp Atterbury (CA) 

and Muscatatuck Urban Training Center 

Question: Camp Atterbury and Muscatatuck Urban Training Center have been 

supporting integrated civilian—military training since July 2009. The programs 

were created in response to a need to prepare civilian personnel for overseas deployment in support of U.S. military missions. Prior to these programs, the ability to 

bring together civilian and military interagency teams for pre-deployment training 

was stymied because programmatic and systemic obstacles. 

In January 2010, the Department of Defense initiated the Civilian Expeditionary 

Workforce (CEW) program to provide civilian personnel with ‘‘real world’’ training 

prior to deployment to a conflict area. This joint, pre-deployment training and mobilization program plays a critical role in preparing civilians to work side-by-side with 

military personnel in support of humanitarian, reconstruction, and combat-support 

military missions. In June 2009, the State Department initiated its own integrated 

civilian-military training program for the purpose of providing its personnel with individual mobilization and situational training. 

1. While the Civilian Expeditionary Workforce (CEW) program initially was stood 

up to support our military missions in Iraq and Afghanistan, as we draw down in 

Iraq and Afghanistan won’t there still be will be a need for an integrated civilianmilitary workforce to support operations globally? 

2. The current programs in place which have the needed partnerships established 

and are fully operational and coordinated provide the Department of Defense and the 

Department of State a platform to build an enduring, global program upon. Do you 

think that the Department of Defense/Department of State Integrated Civilian-Military Training program has value and, if so, is it worthy of expansion of its scope 

to meet global needs? 

Answer 

1. The need for an integrated civilian-military workforce is driven by the requirements of the Combatant Commanders and in fact the Civilian Expeditionary Workforce currently supports the world-wide needs of all Combatant Commanders. Further, the portability and transferability of the Iraq and Afghanistan pre-deployment 

training and mobilization can be adapted to meet global requirements based on 

identified needs and requirements. This gives Combatant Commanders greater contingency manning flexibility. 

2. The Department of Defense sees great value in the Integrated Civilian-Military 

Field Training Program that it conducts in partnership with the Department of 

State. The Atterbury-Muscatatuk field training portion of the course is consistently 

praised by its graduates and has certainly proven its worth in Afghanistan. The potential to expand this training course globally depends on a statement of need from 

both the State Department and Combatant Commanders. The genesis of the current 

training course at Atterbury-Muscatatuk was contingency operations in Afghanistan. Future contingencies will in all likelihood require civilian federal agencies and 

military personnel to serve side-by-side. If so, there is a high potential this need will 

once again be identified. 
54 

CONGRESSMAN MESSER

Question No. 3: Spectrum Scarcity Background 

In 1993, 1997, 2004 and 2012, Congress addressed spectrum scarcity in the commercial mobile industry by requiring spectrum assigned to the federal government to 

be reallocated to the Federal Communications Commission (FCC) for private sector 

use. The enormously successful spectrum management policy approach has been to 

have the federal entities clear the spectrum, reallocate the spectrum to the FCC, and 

then to make the spectrum available for exclusive use via competitive bidding (i.e. 

auctions). Spectrum scarcity has reemerged and now exists in the wireless industry 

and the industry is in dire need of additional spectrum to meet the data and video 

driven uses by consumers, especially those with smart phones and tablets. 

1. Question: Secretary Hagel, you have actual expertise in these spectrum issues 

and in the commercial mobile industry having formed Vanguard Cellular Systems, 

Inc. in 1984. To what extent do you intend to utilize your spectrum experience when 

it comes to the management of the enormous amount of spectrum that is currently 

assigned to the Department of Defense? 

Answer: I fully intend to apply my spectrum experience with full commitment to 

balance national security and economic goals in the implementation of U.S. spectrum management policy. In that regard, I am already actively working with the 

Department of Commerce’s National Telecommunications and Information Administration (NTIA), other Administration partners, the FCC, and industry in support the 

President’s goal to make 500 MHz available for commercial mobile broadband use. 

In terms of how much of this scarce resource is available to DOD, the perception 

of ‘‘enormous’’ amounts of spectrum being available to DOD is relative. Based on the 

United States Frequency Allocation chart, and using the strict interpretation of the 

allocations, one will find in spectrum between 225 and 3700 MHz 18% federal exclusive use, 33% non-federal exclusive use, and 49% federal/non-federal shared use. 

Within spectrum allocated for exclusive federal use, the majority of the spectrum 

is shared between DOD and all of the other federal agencies, across a wide array 

of systems, performing a multitude of varied missions, often with very different 

technologies. 

2. Question: On March, 20, 2013, then FCC Chairman Genachowski advised NTIA 

that the FCC intended to auction the licenses in the 1695-1710 band and 1755-1780 

band as early as September 2014. The Spectrum Act of 2012 requires that the 2155- 

2180 band be licensed by February 2015. Recent estimates indicate that the auctioning of the 2155-2180 MHz band alone would yield $ 3.6 billion, but auctioned 

together with the 1755-1780 MHz, the yield would be $12 billion. Can we be assured 

that DOD will take all steps necessary to clear this 1755-1780 band, so that it can 

be auctioned with the 2155-2180 band? 

Answer: DOD understands the desire to bring the 1755-1780 MHz to market rapidly, particularly with industry’s desire to pair the band with 2155-2180 MHz. To 

that end, DOD actively supports interagency processes for repurposing spectrum for 

commercial broadband purposes that entail both sharing and relocation possibilities. 

The Department has significant concerns with the FCC’s proposed auction timeline, 

since it presents a very risky possibility of being required to ‘‘clear’’ operations from 

the 1755-1780 MHz or compress operations into the 1780-1850 MHz without the 

necessary accommodation of comparable spectrum and funding, which are both required by statute. 

The Department’s concerns are heightened when expectations seem to be that 

DOD can simply alter assignments or protection requirements, in turn its operations, to clear the 1755-1780 MHz band, in spite of the findings from analysis done 

thus far. These findings indicate that both complete relocation or total compression 

of federal operations into the 70 MHz between 1780-1850 MHz have major challenges associated with them, if either one is attempted without proper accommodation. 

The Department is prepared to support a balanced solution to address just the 

1755-1780 MHz band, as desired by industry, but remains certain that such a shortterm solution without assured long-term status of the remaining 70 MHz will put 

warfighting capabilities at further risk. The analysis findings highlight that a realistic and balanced solution will likely need to include a combination of sharing, relocation, and some compression. An approach that considers such combination of 

strategies and that takes into account national security and economics could reduce 

the total relocation costs for federal agencies and lessen demands for comparable 

spectrum. 

3. Question: Do you believe that the opportunities for clearing and reallocating to 

the private sector spectrum currently assigned to the Department of Defense and 
55 

other federal entities have been totally exhausted, with spectrum sharing between federal agencies and commercial users being the only alternative to spectrum scarcity? 

Or do you believe that there are still opportunities for spectrum currently assigned 

to federal agencies to be reallocated to the FCC for private sector use? 

Answer: This question is best answered by NTIA, the federal spectrum regulator. 

DOD is a user of spectrum that gets assigned by NTIA based on need, taking into 

account all other federal agencies’ requirements. However, the increasing demand 

for this invaluable, finite resource for both commercial use and federal missions indicates the importance of evaluating all alternatives, including spectrum sharing. 

Consistent with the national economic and security goals of the President’s 500 

MHz initiative, DOD supported and continues to support interagency processes for 

repurposing spectrum for commercial broadband purposes that entail both sharing 

and relocation possibilities. 

From a DOD perspective, both sharing and relocation decisions pose potential 

risks. While no decision to repurpose spectrum is ‘‘risk free,’’ the risks can and must 

be managed. To date the interagency efforts the Department has been involved 

with, have identified ?400 MHz of federally allocated spectrum for potential commercial broadband use. The Department is committed to continuing its strong working relationship with government and industry partners to develop equitable spectrum repurposing solutions to make more spectrum available for commercial use 

without impact to national security and other agencies’ missions. 

CONGRESSMAN CALVERT TO SECDEF HAGEL

Question No. 4: DOD Civilian Workforce 

Question: In our challenging fiscal environment, I am concerned that the Department of Defense is not tracking the size of the civilian workforce as effectively as it 

can. I have heard official and unofficial testimony while under my Defense Appropriations Subcommittee ‘‘Hat’’ to the effect that DOD has difficulty managing the civilian workforce which has increased in size by 114,000 employees (17 percent) since 

2001. Specifically, the very high proportion of retirement eligible employees and the 

difficulties in terminating employees who are not performing has raised some red 

flags. A former service secretary has told us that it was easier to shrink the size of 

the force by tens of thousands of uniformed personnel than to fire a single civilian 

employee. 

In addition, the Government Accountability Office (GAO) reports that the Department of Defense has yet to include an accurate assessment of the appropriate mix of 

military and civilian personnel capabilities in its strategic workforce plan. Its latest 

strategic plan from March 2012 cites 22 mission critical, civilian personnel occupations. However, the report had only conducted competency gap analyses for 8 of the 

22 occupations identified. The GAO also reports that the DOD has neglected to provide full data on the mix of military, civilian, and contractor workforces. Of the 11 

groups reporting, only two provided the proper data while nine provided partial or 

no data. 

1. Do you share these concerns about the constraints on your ability to manage 

your department effectively? 

2. When can we expect an accurate assessment of your military and civilian personnel capabilities as part of your strategic workforce plan? 

3. Can you describe the process for terminating employment for a civilian employee 

who is underperforming? 

4. Are there legislative measures that Congress can take to assist the department 

in managing the civilian workforce in a more cost effective manner? 

Answer 

1. I do not share the concerns attributed to a former service secretary. The Department’s managers and commanders have a wide variety of tools and authorities 

to incentivize and shape their civilian workforce. The execution of large shifts in any 

sector of the Department’s workforce requires thoughtful planning. The high proportion of retirement eligible employees is very concerning as is the on-going, unjustly 

negative characterization of public service. Further, it is a mischaracterization that 

it is hard to terminate a poorly performing civilian. It is no harder and requires no 

more documentation than to cancel a poorly performing contract, or release a military member for an infraction. The burden of proof is appropriately high for all of 

these actions to guard against arbitrary, retaliatory, or capricious actions. 

2. The Department is committed to a comprehensive Strategic Workforce Plan 

(SWP) that helps address the demographic (talent, competency, education, skill) 

make-up of its civilian personnel inventory. As part of a continuous process to improve the accuracy and relevancy of the SWP, the Department is maturing its com-
56 

petency modeling process and skill gap analysis. That said, let me assure you that 

the Department’s programming and planning processes consider the balance of capabilities and the Department’s ‘‘sourcing’’ of functions and work between military 

and civilian personnel, as well as contracted services. The Department’s Total Force 

is sized and structured based on the capabilities necessary to implement the national military and security strategies of the United States as well as delivering the 

readiness and support to organize, train, and equip a force capable of executing 

operational plans in support of those strategies. The Department aligns its workforce (both in size and structure) to mission and, as such, justifies the current size 

or possible reductions/increases to that workforce based on mission workload rather 

than competency or skills gaps. The FY14 budget request reflects a balanced workforce that decreases spending on military personnel, civilian full-time equivalents, 

and spending for contract services. It reflects a carefully coordinated approach based 

on the Department’s strategy and policy that balances operational needs and fiscal 

reality. 

3. The Department is subject to Office of Personnel and Management-established 

rules for removing employees for unacceptable performance. Generally, under the 

government-wide rules for a performance-based action, an employee must clearly be 

put on notice of their unacceptable performance as well as the consequences of unacceptable performance, and be provided an opportunity to improve their performance 

to an acceptable level. If after the opportunity to improve, the employee’s performance continues to be unacceptable in a critical job element, the employee is given 

written notice of proposed removal, which includes an opportunity for the employee 

to respond to the proposal orally and/or in writing. Upon conclusion of consideration 

of the employee’s response, the employee may be removed and appeal rights charged 

in the employee’s status. 

4. Congress could assist the Department with better total force management by 

repealing the requirements in section 955 of the FY13 National Defense Authorization Act and instead requiring a future year’s defense plan that reflects the Defense 

Strategic Guidance, given on-going fiscal pressures, risk, required readiness, and a 

rebalancing of the total force—active duty, guard, and reserve military, government 

civilians, and contracted services. 

CONGRESSMAN CALVERT TO SECDEF HAGEL

Question No. 5: Electronic Health Record 

Question: In the 2008 NDAA, Congress mandated that DOD to jointly develop and 

implement electronic health record systems or capabilities to allow for full interoperability of personal health care information, and to accelerate the exchange of health 

care information between the Department of Defense (DOD) and the Department of 

Veterans Affairs (VA) by September 2009. DOD and the VA were initially on board 

with that plan. Now, this past February, it was announced that instead of building 

a single integrated electronic health record (iEHR), both DOD and VA will concentrate on integrating VA and DOD health data by focusing on interoperability and 

using existing technological solutions. This is unacceptable. The creation of a single 

electronic medical health record is not rocket science and private industry, which 

services many more people than DOD and VA, has been able to implement electronic 

medical health records. 

My questions for you are: 

1. Why, after four years of being on board with the concept, are DOD and the VA 

moving away from the single electronic medical health record? 

2. Is DOD partnering with private industry health providers to implement a plan 

to solve this problem? 

3. Do you have any data comparing the long-term cost savings of a single electronic 

medical health record vs. interoperability? Would you expect that a single electronic 

medical health record would provide more savings than interoperability? 

Answer: Thank you for the opportunity to discuss with you and the committee 

DOD perspectives on the healthcare record system. The questions that you asked 

are reasonable and the answers follow: 

1. Why, after four years of being on board with the concept, are DOD and the 

VA moving away from the single electronic medical health record? 

DOD and VA are committed to jointly establishing standards-based healthcare 

data interoperability through a single electronic medical health record since Congress directed the establishment of the Interagency Program Office (IPO) in 2008. 

Since that time, DOD and VA also initially agreed to modernize their respective 

healthcare management systems to equip clinicians with state-of-the-art clinical decision support through the joint development of a single healthcare management 

system. Based on concerns by my predecessor regarding the viability of the joint de-
57 

velopment approach, DOD and VA reconsidered the joint development and VA subsequently declared its commitment to modernizing its legacy VistA system. Following an internal DOD review, I issued a memorandum on May 21, 2013, reasserting DOD’s commitment to working with VA to establish healthcare data interoperability and separately directing a competitive acquisition to modernize DOD’s 

healthcare management systems. DOD continues to remain committed to a seamless 

integration of electronic medical health data based on standards-based healthcare 

data interoperability with VA, independent of the healthcare management system 

acquired by each respective Department. 

2. Is DOD partnering with private industry health providers to implement a plan 

to solve this problem? 

The DOD/VA IPO is working with the Department of Health and Human Services’ 

Office of the National Coordinator for Health Information Technology (IT) to establish and implement national health IT standards. Through this effort, the Departments seek to establish interoperability of healthcare data with private industry 

health providers, many of whom provide direct care to Service Members, their dependents, and our Nation’s veterans. 

3. Do you have any data comparing the long-term cost savings of a single electronic medical health record vs. interoperability? 

The Director, Cost Assessment and Program Evaluation (CAPE), performed analyses in 2010 and 2013 to determine the optimal approach for DOD, including 

lifecycle cost estimate comparisons between candidate solution approaches. My May 

21, 2013, memorandum directing a competitive acquisition enables DOD to review 

and evaluate the costs and benefits of potential electronic healthcare record solutions, including the possibility of acquiring an evolved VistA, based upon responses 

to a forthcoming request for proposal. DOD remains committed to establishing 

standards-based healthcare data interoperability with VA, regardless of the outcome 

of our healthcare management systems modernization effort. 

4. Would you expect that a single electronic medical health record would provide 

more savings than interoperability? 

The DOD path of pursuing a competitive acquisition to consider commercial- and 

Government-developed solutions offers a technical and cost advantage for DOD. Regardless of the outcome of the competition, DOD is required to establish healthcare 

data interoperability based on national standards to permit healthcare data exchanges with private healthcare providers. Interoperability with the numerous electronic healthcare management systems utilized by private healthcare providers is 

essential since they provide 65 percent of the healthcare received by Service Members and their dependents. The competitive acquisition approach to modernizing our 

healthcare management system as an effort separate from, but closely tied to, establishing healthcare data interoperability, will provide DOD with the flexibility to 

evaluate potential options and acquire the most capable solution to serve our Service Members and their dependents for the best value to the American taxpayer. 

CONGRESSMAN CALVERT TO SECDEF HAGEL

Question No. 6: BRAC 

Question: Given our fiscal challenges and continually evolving military requirements, the Base Realignment and Closure (BRAC) process can provide us another 

way to address the Department of Defense’s extensive footprint and its associated 

costs. Knowing that this process can become a political quagmire, is there a way the 

Department of Defense can come up with a methodology for executing a BRAC system 

that allows for a simpler and speedier process? 

Answer: While the request for BRAC authorization can become mired in politics 

as you suggest, the BRAC process itself represents a grand political compromise 

that makes military value the primary consideration and is structured to be free 

from political influences. BRAC is recognized as the only fair, objective, and proven 

process for closing and realigning installations because it includes a sound analytical process, an independent Commission review, an ‘‘All or None’’ review by the 

President and Congress, and a legal obligation and date certain for completion. 

Therefore, the BRAC process is comprehensive and thorough and, as such, it takes 

time to do it properly. 

CONGRESSMAN FLORES TO SECDEF HAGEL

Question No. 7: National Ocean Policy 

Question: Recommendations adopted in the Executive Order stated that Coastal 

and Marine Spatial Planning will require ‘‘significant initial investment of both 
58 

1See Page 43, Final Recommendations of the Interagency Ocean Policy Task Force (‘‘Final 

Recommendations’’), released July 19, 2010, available at http://www.whitehouse.gov/files/documents/OPTF—FinalRecs.pdf. 2See Draft National Ocean Policy Implementation Plan, National Ocean Council, released 

January 12, 2012, Page 5, available at http://www.whitehouse.gov/sites/default/files/ 

microsites/ceq/national—ocean—policy—draft—implementation—plan—01-12-12.pdf. 3See http://northeastoceancouncil.org/wp-content/uploads/2013/04/Membership-Roster-NERPB1.pdf. 4See http://www.whitehouse.gov/files/documents/2010stewardship-eo.pdf. 

human and financial resources,’’1 and in early 2012 the National Ocean Council 

noted that federal agencies had been asked to provide information about how ‘‘existing resources [can] be repurposed for greater efficiency and effectiveness’’ in furtherance of the National Ocean Policy.2 In addition, DOD and Joint Chiefs of Staff representatives are currently serving on newly-formed Regional Planning Bodies created 

under the Executive Order in regions including the Northeast.3

1. Please describe how many DOD and Joint Chiefs of Staff resources and personnel have been directed toward activities specifically in support of the National 

Ocean Policy to date, the specific activities that they have been engaged in, and how 

many resources and personnel are being requested to support such activities in the 

FY 2014 budget request. 

2. Please describe the DOD and Joint Chiefs of Staff response to the National 

Ocean Council inquiry about the repurposing of existing resources, and any actions 

that DOD and the Joint Chiefs of Staff have taken or plan to take in this regard. 

Answer: Both DOD and the Joint Chiefs of Staff designated representatives to 

each of the nine proposed or constituted Regional Planning Bodies (RPB). Such personnel were assigned this additional duty based on existing military duties or federal civilian job performance objectives, which include working in various interagency forums as well as engaging in strategy and policy planning activities. DOD 

personnel are supporting the National Ocean Policy at multiple levels, including: • Regional Planning Bodies (13 individuals/additional duties), • multiple interagency working groups (seven individuals/additional duties), • the Ocean Resources Management Interagency Policy Committee and the Ocean 

Science and Technology Interagency Policy Committee (two individuals/additional 

duties), • senior policy representative (two individuals/additional duties), senior executive 

representatives (two individuals/additional duties). 

The Navy is serving as the federal co-lead for the South Atlantic and Gulf of Mexico regions, even though neither of these regions is a formal RPB yet. A Navy officer 

has also been detailed to the National Ocean Council staff for the past three years. 

Moreover, DOD and the Joint Staff established an Executive Steering Group (ESG) 

comprised of flag/general officers and senior civilian personnel to provide leadership 

and guidance for ocean policy matters arising from any issues or questions that may 

arise while the regional planning bodies carry out activities consistent with the National Ocean Policy. The ESG is comprised of 32 flag/general/SES members and supported by 86 staff members. Working in support of ocean policy is within the current 

assignments and subject matter portfolios for all of these DOD personnel. They meet 

and engage on issues on an as-needed basis, consistent with the pace and range of 

issues raised by the National Ocean Council and regional planning bodies. 

DOD and the military services do not have accounting lines for National Ocean 

Policy activities in the FY 2014 budget. Furthermore, DOD is not requesting additional personnel to support National Ocean Policy activities. In response to the National Ocean Council’s request regarding how DOD is furthering the National Ocean 

Policy, the Department identified existing mission areas that align with and support 

the goals and objectives of the policy. By leveraging these appropriate mission objectives with those of other agencies, DOD is supporting and contributing to the goals 

and objectives defined by Executive Order 13547, Stewardship of the Ocean, Our 

Coasts, and the Great Lakes. For example, DOD informed the National Ocean 

Council that it is concerned about climate change for multiple reasons, and that sea 

level rise must be planned for and adapted to at multiple bases that are located in 

the coastal zone. The Department specifically said that it would leverage the work 

of the Strategic Environmental Research and Development Program (SERDP), 

which estimates the potential effects of sea level rise. 

CONGRESSMAN FLORES TO SECDEF HAGEL

Question No. 8: National Ocean Policy 

Question: Section 6(b) of Executive Order 135474 that established the National 

Ocean Policy in July 2010 requires ‘‘[e]ach executive department, agency, and office 
59 

5Federal entities required to take actions pursuant to Executive Order 13547 include members of the National Ocean Council, comprised of the Departments of State, Defense, Interior, 

Agriculture, Health and Human Services, Commerce, Labor, Transportation, Energy, Homeland 

Security, and Justice, the Administrators of the Environmental Protection Agency and National 

Aeronautics and Space Administration, the Chairs of the Council on Environmental Quality, 

Federal Energy Regulatory Commission, and Joint Chiefs of Staff, the Directors of the Office 

of Management and Budget, National Intelligence, the Office of Science and Technology Policy 

(OSTP), and the National Science Foundation, the Under Secretary of Commerce for Oceans and 

Atmosphere (NOAA Administrator), the Assistants to the President for National Security Affairs, Homeland Security and Counterterrorism, Domestic Policy, Economic Policy, and Energy 

and Climate Change, and a federal employee designated by the Vice President. 6See page 30 at http://www.whitehouse.gov/files/documents/OPTF—FinalRecs.pdf. 7See http://www.whitehouse.gov/administration/eop/oceans/faq. 

that is required to take actions under this order shall prepare and make publicly 

available an annual report including a concise description of actions taken by the 

agency in the previous calendar year to implement the order, a description of written 

comments by persons or organizations regarding the agency’s compliance with this 

order, and the agency’s response to such comments.’’5 Pursuant to this requirement, 

have DOD and the Chairman of the Joint Chiefs of Staff—both members of the National Ocean Council—prepared and made publicly available any such annual report 

for calendar years 2010, 2011, or 2012? If so, please describe the findings and contents of such reports, and if not, why has this not occurred? 

Answer: DOD and the Chairman of the Joint Chiefs of Staff submitted materials 

to the White House Council on Environmental Quality (CEQ) and the White House 

Office of Science and Technology Policy (OSTP) for 2010, 2011, and 2012 for inclusion in the Federal Ocean and Coastal Activities Report (FOCAR). DOD provided 

CEQ and OSTP with material for the 2012 report in August 2012. DOD reported 

on the activities of the Office of Naval Research, Naval Ocean Sciences, Applied 

Ocean Research, National Oceanographic Partnership Programs (NOPP), Marine 

Mammal, Oceanography, and Geospatial Information and Services programs. 

CONGRESSMAN FLORES TO SECDEF HAGEL

Question No. 9: National Ocean Policy 

Question: The recommendations adopted by the National Ocean Policy Executive 

Order state that effective implementation will require ‘‘clear and easily understood 

requirements and regulations, where appropriate, that include enforcement as a critical component.’’6 In addition, the Executive Order requires federal entities including 

DOD and the Chairman of the Joint Chiefs of Staff to implement the policy to the 

fullest extent possible. At the same time, the National Ocean Council has stated that 

the National Policy ‘‘does not establish any new regulations or restrict any ocean uses 

or activities.’’7 What if any commitment can you make that DOD and its affiliate 

branches will not issue any regulations or take any actions having a regulatory impact pursuant to the National Ocean Policy, including Coastal and Marine Spatial 

Planning? 

Answer: In order to comply with environmental laws, such as the National Environmental Policy Act (NEPA), the Marine Mammal Protection Act (MMPA), the Endangered Species Act (ESA), and the Coastal Zone Management Act (CZMA), the 

Department engages in numerous environmental planning activities while executing 

its title 10 mission. Relative to its title 10 mission, DOD and its components are 

regulated entities and do not issue regulations or take actions that have regulatory 

impact pursuant to the National Ocean Policy. The U.S. Army Corps of Engineers 

does exercise regulatory responsibilities under title 33 (Corps Civil Works / Regulatory mission) in navigable waters, but does not report to the Secretary of Defense 

for these activities. The U.S. Army Corps of Engineers will continue to operate 

under its existing authorities, and any new regulations would be issued on a caseby-case basis independent of the National Ocean Policy. 

CONGRESSMAN RICE TO SECDEF HAGEL

Question No. 10: Survivor Benefits 

Question: Secretary Hagel, I would like to ask you about Survivor Benefits for 

members of the Guard and Reserve who die while performing their primary mission 

on an Inactive Duty Training (IDT) status. My understanding is that there is a longstanding inequity in the calculation for survivor annuities of reserve personnel killed 

while performing inactive duty training and this concerns me. The families of anyone 

who perishes while wearing the uniform—whether on an IDT status or active duty 
60 

status—deserves to have their survivor benefits calculated with consistency and equity. 

A hypothetical based on current law could be the way Survivor Benefits Plan 

(SBP) would be calculated for two Air Force Majors, both with 18 years of service. 

Let’s assume Major A is on Active Duty orders and Major B is a reservist on IDT 

status. If both Major A and Major B are piloting a T-38 and that T-38 is involved 

in an unforeseen incident that results in the deaths of both Major A and Major B— 

SBP annuity payments for Major A and Major B will be calculated differently, despite being killed in the same incident. The surviving spouse of Major A would receive an annuity of $2,908 per month, while the surviving spouse of Major B would 

receive an annuity of just $969 per month. This type of inequity for the families of 

a loved one who perished while serving their country is wrong and needs to be corrected and fixed for those who have died and those who may die. 

1. What efforts has the Department of Defense made to end this survivor annuity 

inequity between Active Duty orders and IDT status? 

2. Are you aware of a bill I authored with Rep. Jason Chaffetz—H.R. 1770—that 

would provide the necessary legislative fix for this inequity? This bill would also include retroactive payments for the 98 families who had loved ones die while assigned 

an IDT status and have been receiving either a reduced or no annuity. According to 

a Congressional Budget Office (CBO) score in the 112th Congress, this legislation 

would have a cost of $12 million over the 10-year budget window—$1 million in retroactive payments and $11 million in future annuity payments. This bill is also 

being heavily supported by the Military Coalition, which as you know, includes 33 

uniformed services and veterans associations representing more than 5.5 million current and former servicemembers and their families and survivors. 

3. Would the Department of Defense support the efforts of HR 1770, including the 

retroactive payments for the 98 families? 

4. Will the Department of Defense officially request that Congress find a legislative 

fix to this inequality between IDT and Active Duty—either in future budget submissions or other means? If so, will the Department of Defense assist the Congress to 

identify an acceptable $12 million offset in Department of Defense mandatory/direct 

spending? 

Answer: We are aware of the concern you raise and of the bill you co-sponsored, 

H.R. 1770. The Department does not support H.R. 1770 and believes the retroactive 

provision in the bill could create significant unintended consequences. 

At this time, we are complying with current law regarding the Survivor Benefit 

Plan (SBP) and acknowledge the differences in the annuity calculation. The Services 

are currently reviewing the discrepancy between Active Duty and Inactive Duty 

Training (IDT) survivor annuities and will make a recommendation to me on whether or not to maintain status quo. If we conclude a change is necessary to address 

this issue, we will submit a request for legislation. 

CHAIRMAN RYAN TO SECDEF HAGEL

Question No. 11: Afghanistan 

Question: Recently we have seen several high-profile Taliban attacks. The Afghanistan NGO Safety Office reported that Taliban attacks are up 47 percent from this 

time last year. Do you consider this increase in attacks significant? Why has the military stopped publishing data on the volume of enemy attacks? What metrics are you 

using to determine whether we’re making progress? Is there a level of violence that 

would necessitate revising the current drawdown plans? 

Answer: The Department of Defense (DOD) assesses the level of violence in Afghanistan using data from many data sources, including reports from the International Security Assistance Force (ISAF) and the Intelligence Community. DOD 

neither uses ‘‘Afghanistan NGO Safety Office (ANSO)’’ data, nor does it have insight 

into ANSO’s methods of collection, level of fidelity, impartiality, or accuracy. The 

ISAF metric that appears to be most similar to the ANSO ‘‘Armed Opposition Group 

attacks’’ metric is Enemy Initiated Attacks (EIAs). Between October 1, 2012, and 

March 31, 2013, ISAF reported no change in EIA levels when compared to October 

1, 2011, through March 31, 2012. 

The Department no longer uses nationwide EIA totals, and historical comparisons 

of these totals, as a main metric of success in Afghanistan. In the past, ISAF public 

reporting and media coverage of the conflict in Afghanistan relied too heavily on 

EIA reporting as a ‘‘scoreboard’’ for progress. DOD’s primary assessment of the conflict in Afghanistan, the semi-annual report to Congress on ‘‘Progress Toward Security and Stability in Afghanistan,’’ draws from a wide array of security, governance, 

and economic metrics that provide a more comprehensive picture of the overall situation than the total number of EIAs. These metrics include: improvised explosive 
61 

device events, direct fire attacks, high-profile attacks, complex attacks, indirect-fire 

attacks, civilian casualties, Afghan National Security Force (ANSF) capability ratings, ANSF operational reporting, ANSF facilities construction and maintenance, 

ANSF funding, ANSF recruitment, GDP growth rates, population polling, international community donations to Afghanistan, Afghan government budget execution 

rates, school attendance, economic infrastructure build, cell phone usage, counternarcotics indicators, health indicators, and many other metrics and indicators. A 

tally of EIAs is not now, nor was it ever, the most complete measure of the campaign’s progress. At a time when more than 80 percent of EIAs are happening in 

areas where less than 20 percent of Afghans live, this single facet of the campaign 

is less relevant in evaluating progress against the insurgency. 

There is no pre-set level of violence that would necessitate revising the Department’s plans to execute President Obama’s direction announced in February 2013 

that the United States reduce force levels in Afghanistan by 34,000 personnel by 

February 2014—a level one-half the size of U.S. forces in Afghanistan at the time 

of the announcement. This timeline provides support to the ANSF through two crucial Afghan-led fighting seasons, as well as assist the ANSF during the 2014 election period, the success of which is critical to the long-term stability of Afghanistan. 

The pace and size of this drawdown of U.S. forces is consistent with the recommendation of Commander, ISAF to draw down in a manner that protects our 

forces and maintains the gains of the past two years. These drawdown plans are 

based upon a comprehensive analysis of the situation in Afghanistan, of which violence levels are only one of many factors considered. 

CHAIRMAN RYAN TO SECDEF HAGEL

Question No. 12: Afghanistan 

Question: In FY 2013, the Department of Defense faced a $12 billion shortfall in 

funds available for prosecution of the war in Afghanistan. Please quantify the contributing factors to this shortfall. What steps were taken in preparing the FY 2014 

war funding request to ensure there would not be another shortfall in FY 2014? 

Answer: The Department is experiencing higher-than-expected costs in FY 2013 

war spending because operating tempo in Afghanistan and transportation costs are 

higher than anticipated when preparing the war budget 2 years ago. The Department estimates a $7 to $10 billion shortfall for FY 2013, and continues to refine 

this estimate based on operational needs. The contributing factors include greater 

than expected requirements for: 

• In-theater maintenance providing organizational and intermediate level maintenance repairs on various air, ground, and support equipment; 

• The Logistics Civil Augmentation Program providing operational support to the 

warfighter and other support personnel in the form of food preparation, power generation, and other basic life support functions; 

• Base communications throughout the U.S. Central Command area of responsibility for network operations, satellite communication bandwidth and transmissions, 

air traffic control landing system support, and teleconferencing; 

• Base and facilities operations, transportation and storage of perishable foods in 

theater, air operations, and other activities that sustain vital mission capability; and 

• Military operations including increases in the number of flying hours being 

flown, changes in Military Service mix, e.g., less Marine Corps but more Army, and 

other operating tempo changes; 

In preparing the FY 2014 Overseas Contingency Operations (OCO) request, the 

Department made every effort to ensure all anticipated war costs are included and 

reflects the most current military assumptions available for FY 2014. 

CHAIRMAN RYAN TO GEN DEMPSEY

Question No. 13: Defense Efficiencies 

Question: In response to a question from Mr. Rokita, General Dempsey testified 

that a significant factor in the increase in the number of civilians employed by the 

Joint Staff was due to the disestablishment of Joint Forces Command and the absorption of civilian employees from JFCOM into the Joint Staff. One reason cited for 

closing JFCOM was to reduce costs. Please provide an itemized estimate of the savings achieved by disestablishing JFCOM net of any costs that were assumed by other 

elements of the Department of Defense. 

Answer: The disestablishment of JFCOM provided an estimated savings of approximately $292M for FY12 and $1.9B for FY12-FY16. See below for details: 
62 

[Dollars in thousands] 

Program FY12 FY13 FY14 FY15 FY16 Total 

Operating Forces (USA) ...................................................... $8 $18 $28 $39 $39 $132 

Operating Forces (USN) ...................................................... $120,626 $127,887 $135,144 $138,066 $140,363 $662,086 

Admin & Service-Wide Activities (USN) ............................. $23,265 $29,477 $29,978 $30,488 $31,006 $144,214 

Operating Forces (USAF) .................................................... $6,546 $8,639 $8,836 $9,059 $9,213 $42,293 

Operating Forces (SOCOM) ................................................. $1,861 $3,179 $2,235 $2,292 $2,347 $11,914 

Admin & Service-Wide Activities (DIA) .............................. $16,313 $17,926 $18,300 $18,872 $18,628 $90,039 

Admin & Service-Wide Activities (OSD) ............................. $15,800 $31,349 $26,966 $24,985 $25,410 $124,510 

Personnel & Command Support Equipment (USN) ............ $3,998 $3,395 $4,581 $9,996 $9,423 $31,393 

Electronics & Telecommunications Equipment (USAF) ..... $917 $931 $937 $951 $967 4,703 

Major Equip (DIA) ............................................................... $900 0 0 0 0 $900 

Major Equip (OSD) ............................................................. $20,604 $25,123 $20,432 $20,151 $19,282 $105,592 

Operational System Development (USAF) .......................... $3,319 $4,011 $4,068 $4,124 0 $15,522 

Advanced Technology Development (OSD) ......................... $54,215 $61,868 $62,816 $63,984 $66,374 $309,257 

Advanced Component Development & Prototypes (OSD) ... $13,177 $15,886 $16,090 $16,281 $16,971 $78,405 

Management Support (OSD) .............................................. $42,493 $43,465 $39,994 $37,126 $36,627 $199,705 

Operational System Development (OSD) ............................ $17,481 $19,674 $19,629 $20,203 $21,097 $98,084 

Total ...................................................................... *$341,523 $392,828 $390,034 $396,617 $397,747 $1,918,749 

*The savings of $292M for FY12 was calculated by taking the $341,523 referenced above and subtracting the $49M the Joint Staff received in FY12 from Resource Management Decision 703A2 (JFCOM Disestablishment Costs). 

CHAIRMAN RYAN TO GEN DEMPSEY

Question No. 14: Defense Efficiencies 

Question: General Dempsey’s prepared statement noted that given recent budget reductions ‘‘everything must be on the table’’ and specifically noted that included civilian force reductions. Please specify what additional statutory authorities DOD need 

to efficiently reduce the size of its civilian workforce. 

Answer: No additional statutory authorities are needed to reduce the size of the 

DOD Civilian workforce. Civilian reduction in force regulatory guidance is contained 

in Title 5, Code of Federal Regulations, Part 351. The Secretary of Defense has the 

authority to decide whether or not a RIF is necessary, and when the RIF will take 

place. 

CHAIRMAN RYAN TO SECDEF HAGEL, USD(C) HALE

Question No. 15: Defense Management 

Question: In response to my question, Under Secretary Hale testified that the 

planned reduction in DOD’s civilian workforce ‘‘is heavily dependent on BRAC.’’ The 

DOD civilian workforce has increased 17% since 2001. During that same time period, 

no new domestic bases were established and DOD executed Base Realignment and 

Closure (BRAC 2005 which was arguably more extensive than all four previous 

BRAC rounds combined as it involved 24 major base closures, 24 major realignments, and 765 minor closures and realignments. The evidence does not suggest that 

BRAC necessarily leads to a smaller civilian workforce. Given the compressed time 

available for the hearing, I wanted to provide you an opportunity to explain this 

seeming discrepancy. 

Answer: The BRAC 2005 focus was realignment and consolidation of infrastructure, not on closures necessitated by force structure reductions. A more appropriate 

comparison of the BRAC requested in the FY 2014 President’s Budget is to BRAC 

93/95. The focus for those BRAC rounds was on shedding excess Cold War infrastructure of which generated approximately 36,000 civilian full-time equivalent reductions. 

The BRAC requested in the FY 2014 President’s Budget will allow the DOD to 

rightsize and align its infrastructure to the needs of its evolving force structure, 

which is critical to ensuring that limited resources are available for the highest priorities of the warfighter and national security. The BRAC authorization is required 

to meet the fiscal limitation of statutory spending caps, while providing important 

assistance to affected communities. 
63 

[Whereupon, at 2:55 p.m., the committee adjourned subject to the 

call of the Chair] 

Æ