He is the chairman of the House Armed Services committee. The first texan to ever have that role and a texan whose family goes back to ranching in the 13th district as far back as 1881. Probably wondered what he was doing in a rainy washington up here dealing with the federal budget when he could have been back home in the texas spring time but we are grateful for your service and to all of you for being here today. District as 1881. Probably wondered what he was doing in a rainy washington up here dealing with the federal budget when he could have been back home in the texas spring time but we are grateful for your service and to all of you for being here today. It is a momentous time in American Foreign policy and defense policy. Well get quickly to matters of the Defense Budget, defense spending and where the entire debate may go with tomorrows release the president s budget and Congress Really gearing up in its normal hearing season on these subjects but i thought just to get us energized on a good monday morning if you could please join me in welcoming the chairman to brookings. And, chairman thornberry, before we get to budget i thought maybe i could ask you to summarize your acquisition reform bill of last week. Any couple three headlines that you wanted to make off that and one additional aspect of my question might be that i remember last year when you were here and elsewhere talking about your efforts with senator mccain and others last years acquisition reform, a lot of what you emphasized was, listen, if it saves money thats nice but the most important thing is to get technology to the war fighter quickly and efficiently. I know that remains your driving concern but i was also struck in this bill that youre also trying to help the taxpayer with reforms and efficiencies that may save money looking hard at contractors, looking Harley Davidson at various kinds of requirements, Logistics Matters and how we purchase regular supplies so i wondered if you could explain the latest reform proposal in the context of how you think about acquisition reform. Chairman thornberry sure. Maybe ill start with a bit of context as you alluded. I think as far as congresss responsibilities when it comes to National Defense these days we essentially have two. One is to help rebuild the military. To the second is reform help the military be more agile and innovative. And so the budget largely deals with the rebuild. What you spend money on, etcetera, on the agility side, e face a world with the widest array of complex challenges we have ever faced and a world where technology moves and adversaries can direct investments and capabilities at a much faster pace than they ver have before. All of that requires us to be more agile and thats the reason i think acquisition reform is so important as you point out. It is about all of that requires us getting our country can provide into the hands of the war fighter in a timely way. We owe them that. A lot of what weve done in the past two years has focused on the big acquisition programs. Planes and carriers and all of that. This years bill focused as you mentioned more on the daytoday sorts of things. So probably the thing that will resonate the easiest with folks is one of the reforms we roposed is to ahow d. O. D. To buy things on, commercially, online like on amazon business to business. There are several other competitors like that. So now youve got two choices. You can go off the g. S. A. Schedule, which costs more and which Many Companies have decided theyre not going to participate in because of the requirements. You can go through that contracting process, which takes forever and youve got to do the bids and all of that sort of stuff. None of which is the definition of agility. So one thing is to allow d. O. D. Folks to go buy commercially, on these lf items online portals. We also try to update the audit the way that companies are audited on the costs they incur. Theres lots of different sorts of audits at d. O. D. But this one basically starts bringing in private sector Audit Companies to do some of this job. Its happening in other agencies. It ought to be able to happen in d. O. D. Just two more right quick. 70 of the costs of programs are on sustainment not on buying it at the beginning. Its on everything it takes to keep it operating over its lifetime yet we dont really Pay Attention to that. We just buy the cheapest thing we think will get the job done at the beginning. One of the changes is to require you consider sustainment costs from the getgo. And then the other one as you mentioned, Service Contracts of all of the things that d. O. D. Contracts for, 53 of it is service, not weapons and equipment. Yet if you ask d. O. D. What are you spending this money on and lots of other logical questions they cannot answer it. So this years bill we try to get our arms around the Service Contracting that d. O. D. Does with an eye toward making it, yes, more efficient but also more agile in the future. There are other things. Others in the room may want to return to this topic a little later on. Well have a conversation up here for a bit longer and then go to you for questions. Let me move on to the defense budge. We have slides up that are showing some of what you presented and proposed. But even if they dont come up for whatever reason let me quickly summarize what i understand to be state of play with your proposal. As we all know, President Trump has proposed a, quoteunquote 4 billion increase in the 54 billion increase in the budget for 2018. That is measured against the sequestration. Against president obamas level it is only about a 20 billion increase, which is real money but only a few percent of the Defense Budget over all. What you are now suggesting is President Trumps proposal is not enough and you want to add roughly another 37 billion to what he suggested. Wondered if you could, partly because our technology is failing here, but lay out a little bit of what the major components of that additional 37 billion would be and we can talk maybe a little about each of them. Sure. A little bit of context. Last year as House Republicans were putting together an agenda to run on the speaker asked our committee to look at what we think needs to be spent on defense. What would it take to repair the damage that has been done from eight years of c. R. s, five years of the budget control act, a high operational tempo . All of these things had accumulated. His charge to us was okay. Lets figure out what it would take. President trump is elected. He starts talking about a specific size navy, etcetera. How t we did was to say, much money would accomplish the goals that President Trump has set forward but could be responsibly spent we believe in fiscal year 2018 . Ats where we end up at 640 billion. I think that the budget that the administration will propose is roughly 3 more than what president obama had suggested for this year. Its roughly a 5 increase over current years funding. So i think it is fair to say its basically the obama approach with a little bit more but not much. Whats the difference . We try to lay that out and i think this shows some broad categories, air dominance for example is about 10 billion above what president obama has suggested. Now, that is these are kind of broad labels. Thats not just more airplanes. That includes the maintenance and the operations, the training thats required for us to go against, high end adversaries like russia, china, which we have not done so much of in recent years. So thats the reason you see these categories there. Some of it bring our Ground Forces up to date. Some is Ballistic Missile defense. If i were to look at this today, looking at whats happened with north korea im not sure we put enough into missile defense. Both increasing the number of interceptors in current systems which are woefully short, and research into other kinds of systems that hopefully will be more effective and cost effective. Im not sure we put enough into munitions by the way. There was a little bit in munitions and appropriation bill that just passed. We put some here but we have some sig can munitions shortages in various items if you look at it. But that is the reason that there are these categories. Im afraid when we talk about budgets we get into these numbers games and say, oh, this number, that number. Throw them around. What we lose sight of is what the numbers mean. And which capabilities are we willing to forego with a different level of budget . I think we have to be concrete about that. Because the men and women on the front lines will have their life affected by what were not fixing by the new capabilityy were not getting or whatever choices were making. We need to make it more concrete rather than a 640, 620, well split the difference. Just to underscore and thank you for putting the slide up this is the base budget. This does not include war costs. Were talking about the base budget for the department of defense and Nuclear Weapons activities in the department of energy but the 640 billion you would recommend would then have an additional 60 billion roughly in overseas Contingency Operation costs . Just for ballpark . Yes. I think all of the estimates have roughly 65 billion in oco account. The you are absolutely correct. This is the 050 account which includes n. S. A. And department of energy and other things not all strictly pentagon. This is not trying to change the long standing practice of putting base costs in the oco account. In other words there are some people who have been saying what we should try to do is take all of this, quoteunquote, war costs in the overseas Contingency Operation budget many of which are now base budget related and try to put them back in the base. You dont have enough money here to do that, right . This is not accomplishing that goal. It does not. I think that is a worth while conversation to have. What concerns me is that if there is just transfers from o. C. O. Into the base budget and people call it a defense increase it will not be accurate. It will not tell you the facts, which is you really havent increased anything at all. You just changed the label on the money. I still think it is a worth while conversation to have mainly because putting base requirements into o. C. O. Makes it very difficult to plan and means the money is not spent as efficiently as it could be. And yet we have become very dependent upon that over the years to get around the budget. So the 2018 proposal you are offering as you said is designed to fund things we know we can actually do reasonably well in reasonably short order. Is it also fair to say this is consistent with the candidate trump vision of roughly a 350 ship navy now, the generals proposal to increase the size of the air force which candidate trump also proposed, getting the army back to 540,000 or so active duty soldiers, are those sort of the four Structure Goals behind this . Yes. I just want to be clear though. You cannot accomplish those goals in a budget or two. It takes time. The general has told us, for example, it takes 10 years and 10 million to grow a fighter pilot. So the air force today is roughly 1500 pilots short. You cannot snap your fingers and then open the Training Pipeline up big enough to fix all of those problems. This takes time. If i can make one other point on that, earlier this year we had the testimony about the state of our military. General points that wills made is that air force pilots today receive fewer hours of training in the cockpit than they did during the military of the 1970s. So that was my reaction. I went back then and looked. Okay. We all know about the hollow military of the 1970s. Nobody would suggest that we have equivalent problems with people and so forth but there are a remarkable number of parallels between the damage done today and the damage that was done then. What did it take to get out of that . The last year of jimmy carters administration was a 15 increase in defense spending. President reagan comes in and has a 17 . The next year an 18 . The next year a 13 . And then three more years of 10 . Thats what it took to overcome the neglect and damage done in the 1970s to our military. I think that sort of context kind of helps us with the size and the duration of what sort of repair work is needed for the problems that we have created. By the way, ive noticed in recent weeks for example in an aviation week in Space Technology article last week there was more data about which aircraft have which Mission Capable rates. Do we think we need to get more of that data to the public . I know there is a tension between classification concerns not wanting to tip off adversaries but also trying to be specific about the defense needs. Ive been pushing for more openness and frankly have had some debates with the leadership of the pentagon about this because they are concerned about telling our adversaries too much about what our problems are. My focus being more political admittedly than theirs is to get the Political Support we need to have the sort of rebuilding like they did in the 1980s well have to be more explicit about that. Now, i will say when you have things like happened last month you had a fair number of pilots go on strike because they believe the aircraft they were being asked to fly were not safe. It does help wake people up a little bit. I think but weve had a number of classified briefings with my committee and i think the more people know about the facts, the more urgent fixing this problem becomes. Let me bore in on one more example about readiness problems, which is army brigade combat teams. And for the last two or three budgets the army has been saying it wants to send roughly onethird of its brigade combat teams per year to the National Training center to do the full unit, you know, threeweeklong exercises in training that are sort of the culmination. One would think if weve been trying to fund that for two or thee years and doing onethird of the brigades per year were starting to catch up and apparently were not, right . The army is still talking today in the same kind of dire tones it was two or three years ago at least to my ear about the state of readiness, the lack of proper, full unit training and exercising. So whats going on . Is it because of all these continuing resolutions and other problems that impede the army from, you know, carrying out its plans even if it winds up close to the amount of money requested . We have been spending 600 billion a year on the military. Its not chump change. Why hasnt the army been able to catch up . I think you are right for part of it. We have not been spending money efficiently and certainly for units to rotate through the National Training center you got to plan for that. So we havent been doing that. Ill tell you, again, part of the reason i believe the readiness problems are deeper than most of us have realized is just like we are cannibalizing parts off of planes to keep other planes flying, cannibalizing parts off ships, we are cannibalizing army units in order to make those that we are sending on deployments full. And so you talk to the commanders about this and part of their challenge is they never have their full units. You have these people coming and going all the time and so if they have a chance to go to the National Training center, they come back a bunch of their people are taken away and plugged into other units and so theyve lost a lot of that benefit. The general says what he is looking for to increase the number of people in the army is not to increase war structure but to plug the holes so that you can keep units together. Units training together is required to go required to go against these more sophisticated adversaries. Theres a number of other examples where our people are so good when you send them off on a mission, they will accomplish that mission. But if you look at the cost, the damage that is done to accomplish that mission, whether it is mechanics working around the clock or the cannibalization, that is part of the reason im convinced the damage is deeper than we understand. One morelon should part of the readiness debate be thinking about how we do foreign deployments. We are going to poland now. We still have that brigade in korea and its generally rotated soed and its a strain on the army. Could we start considering some deployments to be permanent with families . Allow one unit to do the job instead of three units . Things like that . Chair thornberry i think so. Study basedd for a on cost, at least. About is thelking human toll on families and weewhere and i do think ought to look at those options. Part of the reasons we ought to is to show our commitment to allies in various parts of the world but part of it is strain on the force and then we need to evaluate. I dont know what the cost data will show. Convinced that it is cheaper to rotate a bunch of units through rather permanent presence. Mr. Ohanlon it strikes me this 640 billion plus the war costs, its a lot of money in one sense but only 3. 5 of g. D. P. Done the math . Rep. Thornberry thats in the ballpark. And i think one of the most one can see iss the percentage of g. D. P. Over time weve spent on defense. Reagan bump but then its been plummeting. Question,on my last this is the inevitable question because everything sounds so reasonable while were talking about it in defenseonly terms but then theres the question of how to pay for it. Were seeing increasing discussion about President Trump wants to cut the state department, cut foreign assistance accounts, leave aside domestic issues which will be controversial and a lot of people are saying the d. O. A. Ons budget is capitol hill because of the cuts but i do wonder if there are you wouldinciples in mind. S to pair rep. Thornberry the first job government is to defend the country so the first dollar we receive from taxpayers ought that purpose and then Everything Else is secondary. So i guess