On efforts to modernize the army was the focus of discussion covering concerns about increasing Global Threats to military readiness. This is an hour. All right. Thank you everyone for sticking around while we made our transition. As i mentioned, were going to roll into the second half of the event where were going to focus on Army Modernization. And today rolling out a report on Army Modernization. Called the Army Modernization imperative. A new big five for Army Modernization. I want to begin thanking the sponsors of that study because without sponsors we dont get to do studies. This was sponsored by a combination of support from general dynamics, d. R. S. Technologies, part ofley nardo and l3, as well. So we want to thank them for their support. Im going to briefly walk through the chief findings and recommendations of the report. Its about 80ish pages but a pretty quick read with a lot of pictures. I urge you to read the whole thing. Ill hit the highlights and well bring up our distinguished panel to give us the real scoop on Army Modernization, how we should think about it and what we should do with it. I want to start by saying with this study weve always every time we talk about it we start by saying this is not a critique of Army Acquisition but a look at, if you start with a premises the army needs to modernize, how does it develop a strategy for doing that, which it can clearly and forcefully communicate within the army, within the department of defense, and with the congress in order to get the resources to actually carry that out. So, thats the focus of this study. Its less procedural and more of a strategic overview. In terms of our findings because we wanted to set the scene in doing this study to say what is the state of Army Modernization today. And we came back with a finding that the armys experiencing a modernization triple whammy. Ill get into more detail what we mean by that in a couple of minutes. The Army Modernization is below its historic level both on average and during periods when the army is seeking to modernize because the army like most services go through phases of modernization that are represent peaks and valleys as is the case with the overall Defense Budget. Theres little relief on the way, both in terms of the budget control act discussed heavily by senator cotton and the limits it puts on defense suspending and aerl spending by imindication. And in terms of the issues the army is confronting such as readiness that the senator referred to. Even if the army had a robust budget for Army Modernization the army has very limited options as of today because the Technology Effort has been more focused on the early stages and given the level of funding available thats probably appropriate but there hasnt been a lot of Platform Development or System Development in the army budget in recent years which we could then seek to modernize the army in a rapid basis. The army was through the drawdown period thought to minimize harm and i think they did a pretty good job on that. Again our study is not a critique of the tough decisions made under sequestration to try to salvage some sort of form of Army Modernization but we believe its clear that they dont leave the army in a position with a ready and obvious path forward and so work needs to be done to develop that and weve taken a crack at that. And then lastly one of our findings is that we think there is not a consensus on priorities for Army Modernization and will talk about why we think thats the case. Let me just talk about this idea of the triple whammy, which we coined a little bit i think last year and has been picked up in some circles, what do we mean about that . This is not the first time this drawdown that happened because of the bud jet control act and sequestration and end of wars in iraq and afghanistan, not the first time the army has drawn down. It happened in the past. We looked at how does the current drawdown compare to previous ones. There are definite similarities but some notable differences. The first difference, the first leg of the triple whammy, that this drawdown is larger than previous drawdowns. If you look on the righthand column under total modernization, total Army Modernization, the drawdown was 74 . This is in contract obligation dollar terms. That exceeding relatively robustly previous drawdowns. The second leg of the triple whammy, though, is where most of that extra drawdown, if youll concede me that point, came from. Because if you look at the procurement column on our chart youre not seeing what im seeing on my paper. Excuse me. There it is. Okay. So, that righthand column has total Army Modernization, 74 during this drawdown in excess of previous drawdowns by 10 to 15 . But, the source of most of that excess drawdown if i may call it that in the r d accounts. The decline in procurement was relatively consistent with previous drawdowns but the r dawn was 52 . If you look at the first two drawdowns you average them, an average drawdown in the r d kw accounts of 23 . In this drawdown, the reduction in r d is almost twice the average of the previous two, more than twice the average of the previous two drawdowns. The last element of the triple whammy on the bottom of this chart, the state the army entered this drawdown n. In previous drawdowns most notably after the cold war the army was in a substantial process of modernization in the 1980s to which our report title refers were basically all procured or in the process of completing procurement when the last drawdown happened. However when this drawdown went into effect the army was coming off some regrettable program collapses, future combat systems, comance, crusader, a list i wont go into all in detail but you did not see the substantial buildup of a new systems in the army, that preceded certainly the cold war drawdown. We call that the triple whammy. You started behind, had a drawdown larger than in the past and in particular your r d accounts drawn down much more substantially than had been done previously. We then wanted to get a sense of where is Army Modernization today in the context of broader Army Modernization . So we went back and looked at Army Modernization going back to the end of world war ii, sort of in the modern era and developed, if you see the two dotted lines on your chart, the lower line is the historic average level of Army Modernization across that entire postworld war ii period. The higher line is the average level of Army Modernization during periods when the army was actually modernizing. In those upcycles seeking to replenish or regenerate technology you had that higher level up at around 35 billion and the historical average about 30 billion. Thats in constant fy 17 dollars. You see where we are today, which is about 5 billion below the historical average of Army Modernization, about 10 billion below the level during periods when the army was actually engaging in aggressive modernization. That suggests if the army is seeking to modernize technology today, it is gonna probably require additional funding to actually make that happen. Lets talk a bit about this issue of the priorities. In order to get funding for Army Modernization you got to be able to go to the congress and also to the leadership of d. O. D. And say this is why we need this funding that means setting some priorities about what it that needs to be modernized. What we are showing here, a list or some of the example also of modernization priorities expressed in recent documents or testimony by the army to congress. And the gist of this is that every list is theres slaths similarities across list but different and have different points of emphasis and have different starting points what they are talking about. Aviation as a priority is an important area for prioritization but doesnt convey a lot how you will pursue in the aviation world. We think there is a lack of a clear message on priorities. Now, well talk a bit about the geostrategic position a big focus of the senators remarks and title of our event today on the implications of the russia challenge for the treaty and Army Modernization. And, you know, interestingly enough when we started this report, it was prior to, you know, the election controversies and attack on the election system. But, pretty quickly when you look at questions of Army Modernization, you do find as i know the chief has testified that russia is a pacing threat not necessarily because we expect to go to war with russia in europe or elsewhere, but russian systems are the core systems for most of the adversaries we contemplate potentially getting into Armed Conflict with. So the rapid advance of Russian Technology in recent years as they have invested back when they were investing heavily when oil was high, have gone into systems that are not just russian systems but are proliferated to others, as well. Iran is certainly in that group. And theyve particularly gone after an a2 ad concept. Certainly the technology the senator focused on is a big piece of that but sort of keeping the u. S. , allies and systems away from the defended areas the russian systems are defending. Of course in the case of russia, thats russian territory. And its a sophisticated, layered redundant approach, longrange artillery, cruise missiles, radars, tanks, its a real suite of capabilities they have developed and deployed and shared with others the u. S. Army is likely to face if it gets drawn into highintensity conflicts somewhere in the world particularly focus on lelectronc warfare and cyber they have focused on probably more so than the United States has as weve been evolved in the coin challenge in the middle east. So, ill move now to kind of our recommendations and what we talked about, a new big five for the 21 sst krncentury. How do you invest and develop a Modernization Program that delivers on those priorities . And one of the one of the tricky i think slightly subtle arguments we make in the report is that its much better to talk about this in terms of capabilities than in terms of platforms. The previous big five was a list of platforms the abrams tanks, bradley, patriots, handful couple of others, the black box and apache so five platforms that were going to meet the threat of that day. In todays world, i think you are better off talking about capabilities. The reason why is platforms take depending on who you ask, 10 to 20 years, maybe more to develop. And so, going to the congress in 2017 and saying, we have an urgent problem i want you to join me in a new Platform Development that in 20 years will give us the answer. Thats a tough case to make. If on the other hand what youre asking for is you know we have a significant deficit in Electronic Warfare and Investment Plan to increase our capabilities to meet that, you can actually show progress on that priority relatively quickly while, also, developing a longterm plan. And these are the five that we have recommended. I would say we had two workshops and talked to a lot of experts. We think these are the right five but, of course, the army will ultimately come up with its own and i know theyve been working hard on that. But, this idea that thinking of it in terms of capabilities rather than platforms we think is very important enlisting the support the army will need to do its Modernization Program. Just wrapping up my piece there need to do its Modernization Program. So just wrapping up my piece here and then well do the discuss, our recommendations developed a clear, articulated, focused modernization strategy. Make modernization a priority. It is on the chief list of priorities. But there is this competition with spending on personnel and spending on readiness. Those are important priorities as well. But the army has to really think hard about how to make modernization a higher priority. Focus on capabilities not platforms. Making Army Acquisition more agile by focusing on evolutionary innovation. So as i mentioned being able to deliver improvements and capabilities rapidly even as you move towards longer term innovations along the road. Making room within your Modernization Program to address emerging opportunities and challenges. Then aligning Human Capital with this modernization strategy and some of our panelist have civilizational ideas about what youd have to do to make this approach work. Without for ado i will call them up to the stage and we can hear from them. Thank you for joining us today. Im going to introduce the panel and then well turn and get their thoughts. To my right is heidi shu, the former assistant secretary of the army for acquisition logistics and technology. She is currently serve as chairman of the board. Is formally chairman of the air force. To her right is colonel dan roper. Hes director of National Security studies at the association of United States army. Former managing director of Strategic Solutions and the author of global counterinsurgency. To his right is doug bush. Former colleague of mine. From House Armed Services staff. Professional staff member. A former National Security analyst and former army officer. Heidi, i want to start with you. If you could maybe start us out. You obviously have thought a lot about this the strategy for Army Modernization. If you can give us your thoughts on the strategic approach that you think is most likely to be effective. Absolutely. I think you guys have did a great job in terms of covering the impact of the bca in 2011. I do want to emphasize, i want to second what you have said. When i looked at the army toa from fy 10 to 15 the army budget declined by 15 , the top line. The rda pot decreased by 33 . Army modernization cant happen when your budget is cut that significantly. During the last five years, i want to emphasize one other thing. The annual cr create even bigger turmoil than people realize. Because if you cant get the budget on october 1st, youre sitting there waiting. You cant spend, you cant start new programs. You cant wrap up ramp up production, right . Tremendous turmoil on programs. Okay . And during the sequestration, plus, the annual cr, what the army had to do was stretch out programs, right . Restructure them, reduce the procurement quantity down to the minimum sustainable rate without breaking any multiyear contracts. And we didnt start programs that was planned or we terminated it. There was significant turmoil within our basically across every single one of our portfolios. So we think the declining budget environment, seconding what you said, i actually drew a pyramid to talk about lets divest the old equipment because we need to save the ons cost. We have to reset the equipment so were ready to fight in the next contingency. We will modernize our existing platforms, we will choose carefully what new capability is developed to increase our mobility, lethality, and survivability. Well invest in our s t to enable the next generation capability. Thats our strategy in a declining budget environment. Looking ahead, it was a great dialogue this morning, i really appreciate being here. I will give you my personal perspective. Based upon what i see are the threats that the army will face and i what i deem the modernization effort has to focus on. Okay . Well obviously see cyberattacks and disinformation on social media. That will never stop. Okay . Well see jamming of our gps, our radar and our communications system. Weve seen that and it will continue. So what are the modernization effort thats required . We have to ensure operation in contested environment. That means we need assured pnt position, navigation, timing. We need to operate beyond just ew. Ew is absolutely critical. But we need to be operating in the intersection of an integrated ew and io. Because of the agility of the threats. You dont have to time to be stove pipe system any more. And we need assured communications. Okay . The other type, you guys talked about this morning, is the tremendous proliferation of weapons systems. Okay . With increased sophistication. We see the rpg, we see much longer range missiles and rockets, cruise missiles, advance theater ballistic missile. We see an exponential growth in uavs, performing surveillance and reconnaissance systems, think about the nextgeneration which will perform attack. What do we need to do . I will expand upon what you will talk about in integrated Missile Defense. Layered integrated active and passive iamd to enable Missile Defense offense. Okay . Its layer in the sense we have started this program its called fic. That is for base protection against rockets, armors, missiles, uavs, cruise missiles. We need to continue that program, push that forward. The next layer of protection that we have is really plug and play. Our existing stovepipe system into a which our legacy system, into a common fire control network. So the integrated battle command system is going to be critical. Ibcs. That is absolutely critical. Another leg under that umbrella thats absolutely critical is get a patriot aesa. Compared to what we currently have today. Aesa will significa