Testimony, briefings and other communications of information. So it is standard for this committee to ask certain questions on order to exercise its legislative and oversight responsibilities. Have you adhere to applicable laws and regulations governing complex of interest . I have. Will you ensure that your staff complies with the deadlines established request to communications, including questions for the record in hearings . I will. Will you cooperate in providing witnesses and briefings in response to congressional requests . I will. Will those witnesses be protected from reprisals for the testimony or briefings . Yes. The you agree to appear and testify upon request before this committee . Yes. Do you agree to provide documents including copies of electronic forms of communication and in time and when requested by duly constituted committee or to consult with a Committee Regarding the basis for any faith, later denial and providing such documents . Yes. Have you send any duties or undertaking any action which would appear to resume the outcome of the confirmation process . No. In the interest of time i will submit my Opening Statement for the record. I know that will come as a terrible blow to other members of the committee. I now feel upset they are in missing that come and maybe with a little luck, senator reed will do the same. [laughing] its your lucky day, mr. Chairman. I just want to welcome mr. Shanahan, ms. Campbell, the chance to speak to mr. Shanahan, ive every confidence in his abilities. Thank you the enemy also, senator sheen wanted to be. She may not make it into and without i would ask to submit my statement. Since a quorum is present as a committee to consider a list of 995 pending military nominations pick all of these nominations have been before the committee. The required length of time is a motion to table the report these 995 military nominations to the senate to vote . Is a second. All in favor say aye. The motion carries. Welcome, mr. Shanahan. You are deprived of the important Opening Statements of senator reed and myself. [inaudible] but before we allow you to speak, senator cantwell is here and i apologize. Senator cantwell, for not recognizing you to introduce mr. Senator cantwell, welcome. Thank you, mr. Chairman. Chairman mccain, Ranking Member reed and distinguished members of this committee, proud to introduce an extremely qualified candidate, Patrick Shanahan come to service a deputy secretary of the department of defense. I, too, want to welcome his family. They are here and that sure he will make that appropriate introduction to mr. Shanahan has unique experience leading major reforms of large highly complex programs at the boeing company such as the 737 and the 787 greenlighted. These aircraft at cutting edge technology, keeping yo ahead ofe global competition. His entire career has been about solving problems no one else can solve, and the skills would be invaluable at dod. He drives change that building teams think outside the box and then convince others to think in doing things new ways. Mr. Shanahan has driven reforms and talent management, affordability, technology and supply chain. And he sat an impressive 31 your career at the boeing company last serving as Senior Vice President of supply chain operation. His handson leadership inspires those around him to strive to achieve results ontime and on budget. And mr. Shanahan managing the boeing Companies Highly complex operations in washington and south carolina, he has served as head of the commercial airplane program. His attention to detail, operatinoperative some of the lt manufacturing operations of the world, will prove invaluable at dod. He is also fearless beginner stands what our country is up against when it comes to the russians and the chinese and the north koreans, and it wont facing picky focuses on big Game Changing innovation and science and technology and will not be deterred by the bureaucracy of dod. Mr. Shanahan also knows the department of defense operates and that served as Vice President general manager of the boeing Missile Defense system, and was responsible for the use Army Aviation program and activities in philadelphia and in mesa arizona as Vice President general manager for rotorcraft systems. So hes been able to achieve positive results throughout his career. He understands the need for fiscal responsibility and for innovation of the department. Dod is a largest employer in the world with almost 3 Million People and the Largest Military budget in the world, guess a management skills from the private sector to guide dod successfully into the future. I am confident he will be an effective leader in this position for our country. Thank you, mr. Chairman come and go to excuse myself, but again thank the committee for this opportunity to introduce mr. Shanahan. We thank you, senator cantwell, and we fully understand you have other duties in the senate, thank you for taking the time to introduce mr. Mr. Shanahan. Thank you, senator cantwell, for your very kind words, thoughtful introduction and enduring support. Before i begin my thoughts and prayers go out this money to the families of the seven sailors killed in the tragic accident on the uss fitzgerald. Chairman mccain, Ranking Member reed, and members of this committee, i greatly appreciate the welcome and time to meet with you this morning. Im grateful to the president and secretary mattis for nominating me to the position of secretary of defense can deputy secretary of defense. Id like to acknowledge my three children who have accompanied me here today, kayla, will and jack are seated behind me. I also want to take a moment to recognize and honor my parents, joann and Michael Shanahan. Im the oldest of three boys. My father Michael Shanahan and still in my brothers and i from his early as i can remember service before self. My father was an army veteran who served in vietnam. He taught his voice to love their country and value its freedoms. My father served in Law Enforcement for over 25 years. He taught us to treat people fairly, respect law and order, and the importance of protecting the community. My father cofounded a food bank in 1982 that is ongoing. To date it has estimated over 200 Million Pounds of food to the needy. He showed us that with initiative and outreach, good ideas and skill to make a big difference. At age 52 my father was afflicted with parkinsons. He battled that savage disease for 17 years before passing. And i never once heard him complain. My father model for us what it means to have grit. That is, the ability to maintain an indomitable spirit and persevere no matter what the challenge. I so wish you were here today, i know exactly what he would say to me. He would say, patrick, dont screw this up. My mother, joanne, could not be here. She is here in spirit. My mother always supported me unconditionally if she taught my brothers and i to support others unconditionally. What i appreciate most about her that i would like to share is she taught me to truly believe in myself, and that i could do anything i set my line two. She taught my brothers and i bet its not the size of the muscles that matter, its the size of your heart. She taught me to be a better parent, and as a gift i can never repay. Her words for me today were you will do fine. Im here to earn your support. I aspire to join a strong and capable dod team. I aspire to help them dominate and when. I aspire to help usher in a new age of innovation and effectiveness in the department. I believe i have have prepared myself to contribute as deputy secretary of defense. I bring over three decades of leadership honed at americas largest manufacturing exporter. Ive led large geographically dispersed organizations focus on developing and fielding complex engineered products. I have experience converting technological innovation into operational capability. I bring with me a formula for leadership that has a record of delivering affordable highperforming Business Systems and operations under adverse conditions. Leadership tasks a long shadow, and strong leadership can create teams that achieve ambitious change at scale. I believe my skill set strongly complements that a secretary mattis. He is a master strategist with deep military and Foreign Policy experience. As deputy secretary of defense as secretary mattis chief operating officer, i bring strong execution skills, with a background in Technology Development and business management. Areas this committee in particular has identified four reforms. If confirmed, i will work tirelessly with congress and the department to deliver on our commitments to our men and women in uniform and their families to defend the nation and to be relentless stewards of the taxpayers money. I appreciate the time youve afforded me today to answer questions. Thank you, mr. Shanahan. In your question that was submitted to come one of the questions was about providing the ukrainians with lethal defense weaponry with which to defend themselves. Inexplicably you respond by saying you would have to look at the issue. Its not satisfactory, mr. Shanahan. What you wish to abridge or amend would you wish to abridge or a major statement concerning go ahead. I support equipping the ukrainians. You support . Yes. Providing a lethal defensive weaponry to ukraine . Yes. All right, good. Im glad to hear that but i have to tell you, mr. Shanahan, our job is advice and consent. We are equal branches of government. Your response to the question was, frankly, very disappointing to me. You have been associated for the last, i dont know how many years, with one of the five corporations that provide 90 of the defensive weaponry, the weaponry to defend this nation. And you, your answer was, well, id have to look at the issue. Thats not good enough, mr. Shanahan. Im glad to hear you have changed your opinion from what was submitted, but its still disturbing to me. Its still disturbing to me after all these years that you would say that you would have to look at the issue. Have you not been aware of the issue . Having not been aware of the actions of the Senate Armed Services committee . Have you not been aware of the thousands of people that have been killed by Vladimir Putin . Have you missed all that in your duties at one of the major defense corporations in this country . No, chairman. Im aware of that. Well, ive got to tell you its very disturbing. One, im disturbed that we now have an executive from one of the five major corporations that has corralled 90 of our defense budgets, and on one of the major issues that this committee has had hearings about, has had markups about, has had reported out our bill, and you want to find out more information. Not a good beginning. Not a good beginning. Do not do that again, mr. Shanahan, or i will not take your name up for a vote before this committee. Am i perfectly clear . Very clear. Senator reed. Thank you very much, mr. Chairman. Mr. Shanahan, one of the issues that youre going to face is generically termed the third offset. Bob work who you are succeeding has done a remarkable job i think and hes been a leader for this effort. Its essentially trying to counter technologically and otherwise our adversaries, their error denial to those, cyber capabilities, asymmetric capabilities and leap ahead with new technologies. In trying to deal with that, the congress reestablished a position under secretary of defense for research and engineering. As deputy sector you will play a Critical Role in supporting the new or revised undersecretary but also reaching out to the whole community, the intelligence community, technological community. Can you give us some sense how you will continue mr. Works efforts with respect to the third offset . Yes, senator reed. If confirmed, i will spend time with the group that has done the third offset work, and ive not received the classified briefings on the work that i have done. The effort i would undertake is to make sure we have a clear path to being able to operationalize the capability. When i look at the strategy exercise that we will be conducting to put together the fy 19 budget, it will be critical that we have an assessment of how much funding needs to be applied against the third offset i believe the restructuring of r d will give us the concentrated skill sets so we can have a more informed recommendation. Well, thank you very much and i presume also because of your significant experience in private industry, you are have some ideas of companies that are not currently involved but could be major contributors to efforts, summaries pathbreaking, but technology companies, is that i could . That is correct. Two chairman mccain spoken we need to run our Industrial Base and support we develop other capabilities and other companies as well. Thank you. One of the other changes that we made in last years ndaa was creating another secretary for acquisition, also chief management officer picked in many respects you are really the chief management officer as the deputy secretary defense but how will you work with the chief management officer . Any ideas with respect to that issue . I do. The chief management officer, as i see it, has responsibility for helping to streamline business operations. So as the deputy its all of operations for the department. Thats how i see my responsibility. A subset of it is the business operations. But i will work hand in glove with the chief management officer. I have experience in this area is how do we quickly capture efficiency and the opportunities by standardizing and sharing many of these services, if you will, across the department. Very good. One of the areas that is complicated, troubling, daily since we seem befalling guide is no concept of information operations. Its ironic that the country that created madison avenue is now sort of trying to catch up with, in terms of influencing individuals through media. Department of defense has a role in this. The first question is, at its inception i think the secretary of defense will be very much involved in this, but do you see a role will play in terms of trying to coordinate all the different aspects just within dod . And then again reaching out to other agencies . Sir, i do. I think that the deputy chief operating officer role really needs to ensure that we have the right structures so that we are effective in interfacing with these other organizations and that we have the proper architecture of the systems are cost effective. With the proper architectures so that we can upgrade and easily and if all this technology changes. Very good. Again, than thank you, mr. Shan. I think youre bringing significant expense are very challenging job. Thank you very much. Thank you, mr. Chairman. Thank you, mr. Chairman. Mr. Shanahan, i appreciated your comments in our meeting about the Nuclear Deterrent, and being a weapons system that we use every single day, this fact is often overlooked but every day we had missa layers who are in Launch Control centers and with submarines that are on alert defending our nation. Secretary carter characterize our Nuclear Deterrent as the bedrock of our National Security. Do you agree with that statement . I do. I knew the forthcoming npr will that the particulars, but in general do you support the modernization of our nuclear weapons, the sosa delivery vehicles, commandandcontrol architecture and the supporting infrastructure . I do. General selva, the vice chair of the joint chiefs of staff has testified that the joint staff but a Nuclear Deterrent as number one priority for modernization and recapitalization. And that is based on the fact in his words that we have squeezed about all the life we can out of the systems we currently possess. Do you agree with his assessment and the level of urgency and party that this requires . Senator, if confirmed, i will come ive not had a review of the priorities of the department. Understand the importance of the Nuclear Deterrent, and i will take it, advise some general sullivan and make sure he gets the proper support. Thank you. When you were in my office, we talked a little bit about technology and innovation but one thing we didnt touch on is the question of risk tolerance. Innovation is inherently risky and not all good ideas handout, but the current environment seems to be very intolerant of risk. Do you believe the department and the services need to be more tolerant of risk, and that he think the can better navigate that tension between effectively using scarce resources and tolerating the amount of risk thats required if were going to have any innovation take place . In my view on risk is that you have to manage risk. So out at the pointy end of the spear we dont want to really any risk. I think when it comes to innovation, this is the mindset i developed working in the commercial world. Innovation is messy, and if you try something and it fails, i think thats, your point a run risk, we shouldnt be afraid. Organizations that pride themselves on execution tend to be afraid of failure. So im a proponent of failing, failing fast, learning quickly. I think the faster you do that, the more we end up training people. Its not about the technology. Its about our people learning how to develop the technology, because they know how users can apply it . In your response to the committee advance policy questions regarding russias a violation of the imf treaty, you state i understand that the administration is reviewing a number of potential responses as part of its ongoing review of this issue. And i will be keenly interested in making sure these are translated into action. So to be clear for the record, do you believe a response is necessary beyond simply expressing concern through diplomatic channels which is already been done . I do. Do you have any personal thoughts right now on what options would be available to be some of those responses . I do not. You all so noted that russias action in violation of the inf treaty, if it is