TYPE: COMMITTEE HEARING

LENGTH: 23950 words

COMMITTEE: HOUSE APPROPRIATIONS DEFENSE SUBCOMMITTEE

HEADLINE: U.S. REPRESENTATIVE JERRY LEWIS (R-CA) HOLDS HEARING ON FY 2003 NAVY AND MARINE CORPS APPROPRIATIONS

SPEAKER:
U.S. REPRESENTATIVE JERRY LEWIS (R-CA), CHAIRMAN

LOCATION: WASHINGTON, D.C.

WITNESSES:

GORDON ENGLAND, SECRETARY OF THE NAVY
ADMIRAL VERNON CLARK, CHIEF OF NAVAL OPERATIONS, UNITED STATES NAVY
GENERAL JAMES JONES, COMMANDANT, UNITED STATES MARINE CORPS

BODY:

 
HOUSE COMMITTEE ON APPROPRIATIONS: SUBCOMMITTEE ON DEFENSE
HOLDS A HEARING ON FY 2003 NAVY AND MARINE CORPS APPROPRIATIONS
 
MARCH 6, 2002

SPEAKERS:
U.S. REPRESENTATIVE JERRY LEWIS (R-CA)
CHAIRMAN
U.S. REPRESENTATIVE C.W. BILL YOUNG (R-FL)
U.S. REPRESENTATIVE JOE SKEEN (R-NM)
U.S. REPRESENTATIVE DAVID L. HOBSON (R-OH)
U.S. REPRESENTATIVE HENRY BONILLA (R-TX)
U.S. REPRESENTATIVE GEORGE R. NETHERCUTT (R-WA)
U.S. REPRESENTATIVE RANDY "DUKE" CUNNINGHAM (R-CA)
U.S. REPRESENTATIVE RODNEY P. FRELINGHUYSEN (R-NJ)
U.S. REPRESENTATIVE TODD TIAHRT (R-KS)
U.S. REPRESENTATIVE JOHN P. MURTHA (D-PA)
RANKING MEMBER
U.S. REPRESENTATIVE NORMAN D. DICKS (D-WA)
U.S. REPRESENTATIVE MARTIN OLAV SABO (D-MN)
U.S. REPRESENTATIVE PETER J. VISCLOSKY (R-IN)
U.S. REPRESENTATIVE JAMES P. MORAN (D-VA)
 


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LEWIS: As I explained to the secretary, our meetings are usually at 10 o'clock, but we've got some members here, so we might as well get rolling.

Mr. Secretary, your entire statement will be included in the record. My entire statement will be included in the record. You can read it if you will.

In the meantime, I want to say before all those who are present that the country should be very proud of our Navy and the Marine Corps and the job that they have been doing for us. The delivery of a message from the United States by way of Afghanistan and other parts of the world in a very significant way was handles very adeptly by our Navy. In my own statement, I've expressed a serious concern about the fact that, as we go about trying to build our forces and raise the level of funding, in my judgment, the Navy is significantly shortchanged in that process. I have read overnight that the secretary has publicly expressed similar concerns, and with that, we certainly are in accord.

As we go forward with our discussions today, there are a number of questions that the members will have. I will, as well, but, in the meantime, Mr. Secretary, I want you and the commandant to feel welcome to the committee and know that we're proud of the work that you do.

With that, let me ask my buddy, Jack Murtha, if he has comments.

MURTHA: I have nothing, Mr. Chairman.

LEWIS: So, Mr. Secretary and Commandant and Chief, we will include all your comments in the record. Welcome to the committee and proceed as you will.

ENGLAND: Chairman Lewis, Chairman Young, Congressman Murtha, and members of the committee, thank you for the opportunity to be here. It is an absolute delight to be back here with you this year.

I have been the secretary for just about a year now, and I've had the opportunity to work with Admiral Clark and General Jones now for about a year. I will tell you as secretary of the Navy, I'm absolutely blessed to have these fellows as CNO and commandant, and the nation is blessed to have them in these leadership positions.

They are absolutely magnificent Americans. They do a magnificent job running their services, and they are part of the leadership team for the Department of the Navy. I just want to tell you we are literally blessed to have them, and I'm delighted to be here with them today. I'm proud and privileged to be here with them today.

I do have comments for the record, and they have been submitted in a written statement. I do have just a few comments I want to make, however.

As you commented, there has been superb performance by our naval services. I've had the opportunity to actually be over in the Arabian Sea on board our carriers and ships and in Bahrain with our men and women.

We do have magnificent and superior technology, but that's really not what the difference is. The difference is really our people. We do have superior people. We have magnificent people who volunteered to do this for their nation, to protect and defend liberty, and that's really the discriminator for the United States.

So while we generally talk about our equipment, at the end of the day, it's really our people, in my judgment, that make this difference. Other countries can buy equipment, but they don't have our people. That's really our discriminate, and I'm very proud of our people.

I'm not sure there's been a time, at least since World War II, where the Navy-Marine Corps team has been more important to our joint war fighting effort. The importance of our ability to take the fight to the enemy and sustain that has been demonstrated in Afghanistan and around the world as we have forward deployed forces.

Our naval forces will continue to offer secure sea bases, from which our sailors and marines will be able to operate both in war time and peace time alike. And those sea bases do offset the restrictions we otherwise have on bases, sovereignty issues, where otherwise we don't have access. So this is going to be particularly important as we go forward.

As you know, we were on station in the Arabian Sea. We were there on day one, literally on day one, ready to carry the fight. And, of course, in this case, we carried the fight far inland. So I think this is a whole new dimension in terms of naval power, the ability to literally project power far inland.

I want to comment that while we did a lot of the combat missions, this was not just a Navy-Marine Corps effort. This was a joint effort. We could not have done this without the support of the Air Force, particularly with their tanker support, but also all the intel assets.

This was, indeed, a combined fight of all the military services, very, very joint, and this could not have been accomplished -- our naval forces could not have done that job without the support of our other services. So we appreciate that, and that's obviously a view into the future.

I do want to comment on the president's budget for fiscal year 2003, because this budget does accurately reflect the priorities that were set by the three of us at the table today. The chief of naval operations, the commandant, and I agreed early on that we would continue to keep faith with our people by providing them the pay and the benefits that they so richly deserve and also making sure that our forces remain trained and ready to carry out the missions of the war on terrorism.

I view this 2002 and 2003 budget as literally developing the roots for the tree. Everybody's out looking at the leaves on the tree, but this was really a time to build a foundation and to make sure we actually had everything in place as we go forward as a naval service.

So we prioritized spending on critical readiness elements such as flying hours and steaming days, spare parts, redundant maintenance, and replenishing our stockpiles of precision munitions. We added more than $3 billion to our operations and maintenance accounts.

Another billion we put in our munitions account, and on the personnel side, we increased those accounts by over $4 billion. And that's real money, and we believe that's where it does the most good.

Now, there's been reports lately that we're not putting enough money into shipbuilding and aviation procurement. I will tell you those accounts are accurate, but we did prioritize what we felt was most important this year to build this foundation as we go forward.

And as we go forward, we do, indeed, increase the funding in those accounts, and I'm confident, as we go forward, that will occur, because we have now fixed what I believe were a lot of the systemic problems we had in the past. So as we go forward, you will start seeing in our fit-up increased procurement of ships and airplanes. It doesn't mean we wouldn't like to do it earlier, but we prioritized, and they were the hard decisions we made.

The good news is we did fund the conversion of the first two of the four Tridents, and that gives us the cruise missile shooters, or the SSGNs, as they're called. That was about $1 billion we put into that conversion.

We added another $1 billion to pay off old debts. You know, we've had this problem. We inherited a lot of bills, about $3 billion, bills to be paid for prior year shipbuilding accounts. We paid off that this year, and, in addition, we put in about another $400 million to fund our accounts appropriately to help forestall those problems in the future. So, in total, that was another billion dollars.

We did increase our spending on aviation this year by about $300 million. We actually bought somewhat less airplanes because of the mix of airplanes even though we put more money in those accounts.

Now, we do need to increase our shipbuilding to get to eight or 10 a year. We finally reached 11 at the end of the fit-up. We need to get our airplanes up to about 200 a year, and we do need to do that.

We do have to get this recapitalization underway. But, again, we prioritized. We have fixed a lot of problems this year. Again, in my view, we have literally fed the tree in terms of developing a root system, and that was vitally important to our men and women in uniform.

So we made difficult choices, but I firmly believe that the three of us at this table made the right choices for fiscal year '03. We cannot fix every problem in one year, so we did prioritize our funding.

We cannot afford to break faith with our people on adequate pay and benefits and readiness, particularly when our nation is at war. The CNO, the commandant, and I also agree that efficiency in our operations and in our business practices is more important than ever, and we are committed to continue to find funds to help fund our recapitalization.

So with that, I do look forward to the questions and the discussion here today, and I thank you for the opportunity to be here, Mr. Chairman.

LEWIS: Thank you, Mr. Secretary.

Admiral Clark, I must say as you begin your remarks that the secretary was very gentle about the budget patterns. But this is my third year chairing this committee. I've heard the story three years in a row now, and I'm just wondering when we're really going to kick- start this thing. So maybe you can help us with that, Chief.

CLARK: Thank you, Chairman Lewis and Chairman Young and Congressman Murtha. I want to thank you for the opportunity to appear before the committee.

This is a very important day for our Navy. It's an important day when I get to come and testify before the committee on behalf of the men and women of the United States Navy, and I count it as a privilege for that cause. I do want to thank this committee for its support, because I do believe that it's been vital to making sure that our Navy is ready, sharp, ready to go.

When I talk about congressional support, Mr. Chairman, I want it to not just be interpreted as a broad-based, oh, yes, he said thank you. I want to be more specific.

First, I want to talk about the action taken by the committee and the Congress to approve the funds that were necessary for us to create the readiness so that we really would be ready for this war on terrorism. And I am talking about a turnaround in readiness, because that's truly what has happened over the last couple of years.

CLARK: The Congress and this committee, specifically, have helped us stop a decline -- and you've heard chiefs come up here and talk about, well, we were nose down, but maybe we've leveled out. We clearly are on an upswing, and that's where we need to be.

Secondly, I want to thank this committee for the numerous actions that you have taken to make sure that our people are ready, and that includes every issue from compensation to all the other issues related to quality of service. It has greatly strengthened our Navy, and the actions of this committee and the Congress have clearly made a difference in helping us retain the kind of people that we need to make sure that our Navy remains the best that this world has ever seen.

Last year, when I came and testified, I said the '02 budget was the best that I had seen in over a decade. And the '03 budget submission will further help our effort to maintain our Navy with that classification.

I want to talk briefly about Operation Enduring Freedom. We've had great operational success in the global war on terrorism, and it's due to a couple of things, number one, the dedication of our sailors, and, number two, the manpower and current readiness investments that have been supported by the Congress.

I do believe that Operation Enduring Freedom has proved once again why this nation has a Navy and the importance of the Navy-Marine Corps team -- the value of sovereign naval platforms operating in the far reaches of the world, taking the fight to the enemy, a distant enemy, influencing events, and carrying out the American foreign policy via freedom of the seas.

The secretary mentioned the word, sovereignty, and I've been talking about sovereignty for the 19 and a half months since I've been the CNO. I do believe that it is about taking the sovereignty of the United States of America to the far corners of this world.

And this global war on terrorism is proving once again that naval forces are flexible. You know, anywhere-anytime is more than a bumper sticker. We don't need a permission slip from a foreign government to conduct operations around the world.

Our forces are about precise combat operations. Our forces are about being ready every day. And our forces are about persistent combat power, a very important word, persistent combat power, being there and being able to sustain our combat operations.

When we show up, we're ready to go to work. We're ready for the long haul. And, Mr. Chairman, no other forces can respond with this kind of unique capability, the combination of independence and mobility and precision and persistence, as your Navy and Marine Corps can.

So again, it's a privilege to be here representing the people of my service and to talk to you about the things that are important for us.

I feel much more comfortable about the status of the current readiness of our force than I did a year ago when I came to see you. But when we look at the future, it's clear that there is more to do, and it starts with new procurement.

Buying sufficient numbers of ships and aircraft to meet future threats is the biggest challenge that my Navy now faces. And the focus, I believe, should not just be on the number of ships, but the right kind of ships and aircraft.

The five ships and 83 aircraft requested in this budget are going to help. But my task in sending a recommendation forward is to develop a balanced naval capability to ensure our current combat readiness. And, frankly, I could not find the resources to buy the numbers of aircraft and ships that we need to secure the Navy's future.

The budget represents my recommendations, and I don't want any comment that I make to distance myself from the recommendations that are in this budget. This budget represents my view of the way we should be proceeding in fiscal year '03.

It represents some very difficult choices, but those choices are based upon the view, first, that we have to take care of the Navy that the taxpayers of this nation have already bought and paid for, and that means that the focus on current readiness continues. That is not something that we can do one year and then set it aside.

To meet the future needs of the Navy, we still need to buy 180 to 210 airplanes a year, and we need eight to 10 ships, as the secretary has already said. My preliminary analysis is that while the QDR sets out the broad structure for the Navy of the future, with 12 carriers and 12 (OFF-MIKE), in the future, we'll be talking about, with the introduction of the family of ships in the future, somewhere -- we need a Navy that's somewhere closer to 375 ships than what we have today. That'll be a different mix of ships, and perhaps we can talk about that in the questioning period.

But in addition to buying enough ships and aircraft, we have to buy the right ships and aircraft to deal with the threats of the future and to make sure that our Navy is ready to take on any task and possesses the capabilities that we will need to triumph over any enemy and any emerging threat. I am impressed with the programs that we have on the books, and it's things like DD(X) and CVNX and the new littoral combatant ship, the requirement for LPD-17 and the SSGN, as the secretary has talked about, and airplanes, like Joint Strike Fighter.

CLARK: And we will soon be addressing a replacement for the EA- 6B, the AEA (ph), the analysis of alternatives for the new electronic aircraft are under way, and the new P-3, whatever shape that takes, and the importance of E and F as it's delivering today.

Now, I want to say something about efficiency, too, and the secretary alluded to it. We recognize that we have to dedicate more resources on future readiness, but we also are focused on purchasing more with the resources that this committee and the taxpayers of this nation have provided our Navy.

We are doing this with a focus on reducing overhead, partnering with industry, and working with these partners so that we can plan more efficiency. It's one thing to say that, and I know it's another thing to do that.

Let me speak briefly, if I can, Mr. Chairman, about transformation. We are dedicated to transforming our Navy and making it ready for the 21st Century. Critical concepts such as Forcenet, building on network centric warfare, and sea-basing takes us to the future.

New and innovative technologies -- most importantly, DD(X). The DD(X) family of ships is the heart of our research and development future. It is the right ship at the right time, and it is about defining the family of ships that will make what the Navy is all about for the next four decades.

Achieving organizational agility is part of transformation, and we have made a lot of changes in the last year. It's also about making sure that we are sponsoring and supporting programs that are going to actually get in the fleet, and it is about tough choices -- and I will tell you that we've terminated seven programs in the budget that's been brought forward this year and restructured 12 others -- and making sure that the dollars are going where they will be best used. I will just tell you that we're not done yet with that task. We'll see more of that in the year to come.

So, in summary, Mr. Chairman, I believe our Navy is performing superbly in the global war on terrorism as we speak. We are concluding a record-setting year in retention. We are winning the battle for people. Current readiness is vastly improved.

The Navy and the Marine Corps team is postured for the future and is committed to keeping today's Navy the number one naval force in the entire world and to making sure that those that succeed us have a Navy that they can sail in and be proud of.

Again, I want to thank this committee for your steady, steadfast support to make our Navy what it needs to be and for your support of our sailors and their families. They are committed, and they are inspired by the knowledge that this nation is standing behind them and united in this war against terrorism.

They are serving with pride and dedication, and some even to the last full measure of devotion, as most recently shown by Petty Officer First Class Roberts, who was killed in action on Monday in Afghanistan. And we are winning this war.

Thank you, sir, and I look forward to your questions.

LEWIS: Thank you, Chief.

I'd like to welcome the commandant as well.

General Jones, your statement will be in the record, and we're anxious to hear from you.

JONES: Thank you, sir. I have just a few brief opening remarks.

The first thing I'd like to do, Mr. Chairman, is thank you for inviting us here today. It's a great pleasure to represent the Marine Corps family, civilian and Marines, all active duty, reserves, retired ranks. It's a great privilege to serve as commandant of the Marine Corps and to appear before this committee for the third time.

I want to also start out by associating myself with the remarks of the secretary and the CNO. I consider the privilege of serving alongside these two great men a singular honor, a professional privilege, and a personal pleasure.

I'd like to just make a few remarks about the year that we're executing right now, the '02 budget, because, as the CNO pointed out, it has really been important to the welfare of the Marine Corps. This is clearly the best readiness budget I've seen in many, many years. It has enabled us to do several things.

First, your Marine Corps today is absolutely secure in its identity and who it is and what it does. We like our missions. We like what the nation asks us to do, and there's an unbelievable amount of evidence to support that claim.

We are a sea-based, rotational, expeditionary, combined arms force. All of the words in that sentence are very important, and there is an awful lot contained behind those words. That's who we are, and that's what we do.

We are very proud of our naval heritage, and we're very proud of the teamwork that we join in with the United States Navy to provide the nation with an immediate response, a persistent application of force, and a sustainability of effort that is unparalleled and unequal anywhere in the world. I apologize for appearing to be immodest, but it is not equaled anywhere else in the world.

The central element of the Marine Corps' war fighting punch is found today in the Marine Expeditionary Brigade. It is the nation's foremost expeditionary middleweight combat power projection capability from a sea base, and it will continue to develop and continue to be better as the years go forward.

The second point I would like to make about '02 is that it has allowed us what I call cultural stability. We've achieved that in the Marine Corps.

Astounding evidence of that cultural stability is found in our recruiting successes, which have marched on without a single dip for the last six and a half years, month by month. We're recruiting up to 98 percent of high school graduates. We have an unbelievably high quality of young men and women who seek to serve their nation.

But the biggest test of any culture is in its retention. All across the board, in our retention figures, first-term, second-term retention, we are doing extraordinarily well. I attribute that, in part, to the service that our young people want to provide the nation, as well as to some very serious transformational reforms in how we manage our most important assets, our people, in the Marine Corps. And I'd be happy to elaborate on that a little bit later.

We have supported our families. We have supported our single Marines. Sixty-eight percent of all Marines are on their first enlistment all the time, which means that the average age of a United States Marine is about 24 years old. I do not put myself in that category, but I have a vague recollection of what that life was like.

Housing, pay, and health care are all being addressed, and that contributes to the stability of the culture.

The third point I'd like to make is that this budget really addresses the uniqueness of the Marine Corps, a uniqueness represented by the fact that, as a combined arms force, we do provide 20 percent of the nation's combat power any way you measure it, from infantry battalions to squadrons of helicopters, squadrons of fixed-wing aviation, tactical aviation, and the like. The key to that capability is our partnership with the Navy, and I will say without any fear of contradiction that that partnership is as strong today as I've seen it in 36 years. It is not only strong today, but it is getting stronger as each day goes by, and the CNO and I can elaborate on that if you'd like.

We are today expeditionary vice amphibious. That's an important distinction. We are expeditionary because of the increased use of technology and capabilities that we have.

Increasingly, in the 21st Century, my prediction would be that we will project power from sea bases, and those sea bases will include the family of ships that we have today. But they may look different, they may be faster, and they may come from bases that are unimaginable today but may come to being in the 21st Century as fixed operational bases coming from the sea, because, as the CNO pointed out, sovereignty is a big issue.

We are facing an array of nations around the world who exercise their sovereignty whenever the United States wants to use their bases, the land bases, as part of our nation's decision to project our forces. Because of those restrictions in access and the time it takes to negotiate the permissive entry qualities that we desire and the operational force projection that we want, we lose an awful lot of time.

Nowhere is this more evident than in Afghanistan, which, as you know, is surrounded to the north by several nations, all of whom exercised their sovereignty rights when we tried to tell them how important it was that we have access to bases in order to prosecute Operation Enduring Freedom. The result of those negotiations is, one, that they're still going on; and, two, that sea-based platforms from the carrier bases and from the big amphibs and other ships of the line were responsible for projecting most of the power from the sea to the shore over incredibly long distances.

The fourth point I want to make is that we entered Operation Enduring Freedom in this budget year. And for the Navy and Marine Corps team, in addition to providing the majority of the tactical aviation to the campaign, it meant projecting Marines of the First Marine Expeditionary Brigade which was composed at that time of two different Marine expeditionary units embarked on two amphibious ready groups between 400 and 600 miles from the coastline of Pakistan.

This was a clear answer to the sovereignty restrictions. As you said, we didn't have to ask permission. We just executed.

It presented a seamless integration that we should all celebrate between the war fighting competence of our soldiers, sailors, airmen, and Marines. The integration between the special operations forces and the two Marine expeditionary units in the brigade and the follow- on entry of United States Army forces was absolutely clear evidence that the joint war fighter is better trained and better equipped from day one of combat to do his or her mission than ever before.

I want to say that the First Marine Expeditionary Brigade was composed of only 56 people and its headquarters element. As recently as five or six years ago, that would have been 356 people. And it was ably led by an officer who is here with us today, Brigadier General Jim Mattis, who just returned from the area of operations.

Jim, would you please stand?

General Mattis led the First Marine Expeditionary Brigade into Afghanistan, and I wanted him to come here. He just got off the airplane, so if he looks a little thin and tired -- he's been to MacDonald's, and he got his first milkshake in about six months.

But during his tour over there, he pulled off a couple of major exercises, one, Bright Star, which was before the Marines were committed to support Operation Enduring Freedom. And then he was seen frequently on television operating out of Kandahar where he led Marines into Camp Rhino and Kandahar and completed a flawless execution of a challenging mission of historical proportions.

This evidence of a brigade going these distances is clear evidence that we're no longer the amphibious force of the 20th Century, which lands on the beach and seizes the island after five days of bloody fighting. But we are able to project forces where the enemy is not, build up that force, and then, using the principles of expeditionary maneuver warfare, achieve our mission safely and securely. So we're very proud of General Mattis and very proud of his Marines.

For '03, this request, for me, represents the gateway to transformation. We are emerging from the years of failure to recapitalize. Among other things, it added $1.3 billion to our military personnel, $0.5 billion to procurement R&D, $0.5 billion to operations and maintenance, and a 20-percent increase in our family housing.

It also provided for the targeted pay raise, career sea pay, and reduced the out-of-pocket expenses of our Marines for housing. We will achieve, I think, the goal of reducing the total to zero in '05, thanks to the support of the Congress.

We have real program growth over the '01 baseline for the operating forces, as much as 25 percent, 11 percent real program growth for bases and stations, and we have a very executable program for our depot maintenance. And this budget sustains our modernization and transformation.

This is an exciting time to be a United States Marine. There is great pride in the force and great pride in what the nation has asked us to do.

We are manning our embassies. We're standing up the brigade for anti-terrorism capability. As we speak today, there are almost 100 Marines from that unit guarding the compound in Kabul in Afghanistan, so immediately upon creation of that unit, it was put to work.

JONES: The chemical and biological incident response force continues to do great work, visible here in the Capitol, but also available to the domestic fight against terrorism and the international fight against terrorism.

We thank you, Mr. Chairman and members of the committee, profoundly for your interest and attention to Marines and their families during the course of this past year. We're excited to be here today to tell you a little bit more about what it is we have planned for the future.

Thank you, Mr. Chairman.

LEWIS: Thank you very much, General Jones.

General Mattis, welcome, and congratulations to you as well and all of your men and women for the magnificent job done. You'll hear a lot in this discussion, General, that our committee strongly supports what you have been about on the job you're doing.

We want to share with you directly our frustration with the level of funding. Even though we have increases this year, we have a long way to go, and you'll hear some of that today.

All of those who are present know that probably the busiest guy in the Capitol is the chairman of our full committee. His presence here is a reflection of not just his support for the Navy and the Marine Corps, but expressing the same concern as well.

So, Bill Young, whatever you want to do -- comment, question, take over the meeting -- what do you want to do?

YOUNG: Mr. Chairman, first of all, be assured that you are in charge. However, as I have told you so many times, you have the best job in the Congress, not me.

Mr. Secretary and Admiral and General, thank you for being here. You know that we appreciate everything that you do in order to maintain the security of this country.

Mr. Secretary, you know, members of this committee spend a lot of time visiting with your Navy and Marine Corps at every opportunity. And I can tell that, for some reason, Gordon England has become very closely related to the men and women of the Navy and the Marine Corps.

There's just something about you and your willingness to be available to them. They know that, and they appreciate that. I'm sure you know that, but it doesn't hurt to say it again. You have really made yourself important to all of their lives, as have the commandant and the CNO. They're outstanding military leaders, and we can't say enough about the good work that they do leading a tremendous military force.

Let me go to a couple of questions quickly, and I know that all of the members of the committee have a lot of questions for you. But I wanted to ask the commandant about something that we've worked on together for quite a while, something important for the Marine Corps, specifically, and that's Blount Island.

You know, General, we made some progress there in doing what the Corps needs done at Blount Island. But we had a problem with encroachment, and we hadn't actually taken possession of enough of the properties around the immediate facility.

Is encroachment an issue or problem at Blount Island?

JONES: Sir, in a broader sense, encroachment is a big problem in many of our bases around the country, and it is also a problem at Blount Island, which is why in easing into this program, which I strongly support as one of our most important acquisition projects, we are coming up to the end of the lease life of the facility. It's my strong recommendation that we should continue to stay on course to acquire the facility.

In the few years that we've been working on this, we've been able to buy up some of the easements around Blount Island, and we are working assiduously with the ownership to continue in that project. I don't think we're losing ground, but I think we need to stay focused on it, and we need to set 2004 as the year in which we actually, in my opinion, should acquire and complete the buyout of Blount Island.

It is fundamentally important to a very, very important part of the Marine Corps' war fighting concept for the naval force, actually, and that's because Blount Island supports the maritime pre-positioned shipping program. And those ships, each squadron of which -- to use a strategic airlift figure, it takes 2,000 C-17s to lift the equivalent that you find in one squadron of the maritime pre-positioned ships -- 2,000 C-17s.

It has the opportunity to transform the fight immediately upon arrival. And the source, the base source, the home port for those ships, is Blount Island, and that cannot be duplicated anywhere else. It's extraordinarily important that we systematically address any obstacles to acquiring the property and bringing that into our inventory. And I thank you, Mr. Chairman, for your continued support of this important effort.

YOUNG: Admiral and General, you all have been very busy and have done a tremendous job, and the country is really proud of you. I remember some of the battles we had some years back about reducing the end strength that you all have.

But, now, you've been awfully busy. Should we be considering increasing end strength or giving you more personnel? Are you stretched really thin? Where do we stand there?

CLARK: That's a real timely question, Mr. Chairman, because of all of the activity going on and the dramatic change in security requirements since 9-11. I don't think it's widely known, but last year, we did increase our end strength by 4,000 in the Navy. We did it in a middle of the year process in a supplemental. We purchased 4,000 more billets.

We had been running 10,000, 11,000, 12,000 gaps at sea, and it wasn't working. Our retention has so much dramatically improved, and I didn't want to lose ground from where we were, so we bought 4,000 last year.

Now, with 10,000 reserves called up and anti-terrorism and force protection people that are being applied to the task of establishing the new baseline, we are evaluating -- as we're having testimony here this morning, Mr. Chairman, our commanders are doing a zero-base review of how we're going to go forward with manpower. This takes us to the point that, with 10,000 reserves called up, I'm approaching -- a year ago, the number was 372,000. I'm approaching -- and the authorization to go up 2 percent -- I'm up to almost 390,000 people on active duty.

One of the serious issues for us has been how we pay for that and the issues with supplementals and so forth. These were all unplanned when the budget was put together.

So we have grown the end strength. I believe I can operate under the existing rules, which allow me to go down one and up 2 percent. The issue for me will be resources to pay for that.

YOUNG: Retention had been a fairly serious problem a few years ago. I think you've turned the corner on that, if I understand correctly.

CLARK: I'm so proud to be able to sit here and tell you that the fiscal year we just completed is the best retention year I have ever seen since I have been in the Navy, and I joined in 1968, Mr. Chairman. It's just been terrific. That year ended on September 30th. That was not a result of 9-11. That was the year before 9-11.

For example, in January of this year, my first term retention -- first term eligibles were 70 percent. It's phenomenal. Our young men and women are responding.

You know, you can't put your finger on one reason why this has all happened. It's actions the Congress has taken. It's the unified purpose of the United States of America and the global war on terrorism.

It is making sure that their leaders understand and are representing them to make sure that the issues of quality of service are taken care of. The secretary mentioned them, and General Jones mentioned them. It's going great.

YOUNG: General, you mentioned earlier that retention and recruiting was very successful right now. What about recruiting and retention of members with critical skills? Are you able to maintain the critical skills as well as the general skills?

JONES: In a broad sense, Mr. Chairman, we are. Now, that's not to say we don't have some problems in some areas with critical skills. But because of the focused application and authorizations and appropriations that the Congress has provided, we've been able to earmark incentives for Marines with special skills to stay. The inducements and attractions are there. Sometimes it ebbs and wanes every now and then, but it's not anything that's a significant problem.

YOUNG: Recruiting and retention is not only up to the person that serves in the uniform, but the families are very important. Members of this committee have sessions with families on a regular basis. I've heard the term, family readiness.

Mr. Secretary, give us a discussion about family readiness and where we are and what we should be doing relative to family readiness.

ENGLAND: Let me make a comment, if I could, Mr. Chairman, because, first of all, this is a family affair. The military is a family. I found that out myself. It's a family affair in my own family, and I know as I travel around how important this is for families.

Families are important for the reenlistment. It's not necessarily the individual. It's what spouses say and the families say. So that's vitally important.

In a general sense, let me say that this year, we are really focusing on family housing, the environment for people, and single barracks for our people who are single. We are trying to improve across the board our families' health and welfare. And, by the way, our medical benefits that you supported, the pay, and the housing allowance increase that went into effect January 15th all certainly help our families in terms of their life style.

The security aspect is very important. When the CNO and the commandant talk about security, providing security where our families live is very important in this environment.

The sea pay last year, by the way -- I mean, again, God bless the CNO and the commandant. You go out and you talk to people about sea pay -- one, it provided them an increase in terms of their incomes. But, more, it was a message of how important they are to the nation. So there are a lot of factors that went into this.

I believe this is a leadership issue, starting with the president down, of how important our men and women in uniform are, and that extends to the families. So it shows up in money, but I think it's more than money. I think it's also the leadership, and, again, the fellows on my left and right here provide that.

JONES: Sir, I'd like to add just a brief statement to that. When we talk about transformation, we talk, in many cases, about technology. But I would suggest that the most transformational thing that's happened to the armed forces in the last 30 years is the transition from the conscripted force to the all volunteer force.

That has transformed us in ways that we are just now reaping the benefits of. And the commitment to the all volunteer force meant that we were going to also commit to the families, because you can make the case that you can recruit just about anybody if you're a good salesman, but you cannot retain that volunteer if, in fact, the expectations that that individual had when they joined the service are not met by the service, any service.

So we recruit Marines, but we probably retain families. The welfare of those families is very, very important so that the sailor, Marine, soldier, airman, or whatever, can go out confidently and competently to do the job that the nation wants, and we are reaching retention figures, in terms of quality, that are astounding.

CLARK: May I piggy-back very briefly?

YOUNG: Go right ahead, Chief.

CLARK: The issue of spousal support, I believe, is really crucial today, and it's going to continue to become more so. And here's what I mean by that. General Jones mentioned the all volunteer force, the nature of this, and the issues that face our families.

I think we have to deal with every family in a fair way, and in our policies, we need some principles to go by, and fairness is at the top of the list. You know, when I came into the Navy, we had a term that our detailers used to assign people, you know -- needs of the Navy. If somebody wanted to go someplace or didn't want to go someplace -- needs of the Navy.

With an all volunteer force and with families, we have to look at ways to support the families and make this work. And so we're experimenting with some things this year. One of them is geographical bonuses.

When we send a family to a foreign base, and maybe the family has relied on the income of the spouse, and that income is not available to the spouse where they go overseas, we have to figure out ways to deal with this. We're also working this year with some experimental programs to provide better support to spouses in relocation. It's part of the guidance that we put out to our Navy -- put programs together and help us figure out better ways to do this.

So I believe we've become more keenly attuned to this, as we have been in this battle for people. I heard General Jones say that you recruit a Marine, but you retain the family, and I believe that it couldn't be more true.

YOUNG: Gentlemen, thank you very much.

Mr. Chairman, you've been very generous with time.

LEWIS: Thank you for being here, Mr. Chairman. Both Mr. Murtha and I appreciate your ongoing support.

Mr. Murtha?

MURTHA: Isn't it gratifying for this committee to hear the turnaround from the people who are testifying? Ten years ago, when the wall came down, we didn't hear anything about readiness or quality of life. As a matter of fact, when I joined in 1952, in the middle of the Korean war, you got a wife issued to you. You had to get permission.

The Marine Corps still did a pretty good job, because my mother cried for days when I went into the Marine Corps. But my three brothers went, and she was worried the last one was not going to go. So you can see the message that the Marine Corps gets out.

But we have been working ever since the wall went down on increasing quality of life. The threat has changed. Before, it was deploy two forces on the land, the Saudi Arabia type deployment. I never believed we could deploy two forces at the same time, but that was the mission that we had during the Cold War.

And right now, it's absolute quality of the person, because they have to make a decision when they fire, they have to make a decision who they kill, and they have to make a decision what is important for the mission. And these young people I've talked to know the mission.

Now, it's changed since Beirut, where the rules of engagement were very loose. And then it kind of changed through Somalia. Now, they understand. And, unfortunately, we sometimes have some accidents which kill civilians, but the point is we have such quality people, those are at a minimum. So this is just gratifying to me.

As you know, this committee is the one that changed the pension, and we had to struggle. You know, the Defense Department wasn't anxious to do that. It was $15 billion in five years. And, of course, Tricare we funded fully.

So it really makes you feel good that we have finally changed the thinking, and I agree with you. I told the secretary of defense this is the best personnel budget I've ever seen.

Now, you go the next step. We're talking about invading Iraq. We're talking about invading Iran. We're talking about North Korea.

You can say, well, we don't interpret it that way. But let me tell you something. When we put troops in Saudi Arabia, it took us six months to get half a million troops on the ground, and we had modern port facilities, we had the world united behind us, and we had them paying. This committee collected $60 billion that went through this committee to pay for that deployment.

I don't think we're ready for that. I don't think there's any way that we could deploy a force that size in the time that it took even 10 years ago.

So I do think we have some work to do. The quality -- no question about it. But on the other hand -- Norm asked me to ask some questions about jammers. We spent 80 percent more on jammers readiness, and the readiness went down from 67 to 60 percent. What do we need to do with the jammers?

CLARK: We need a new jammer.

MURTHA: We need a new airplane.

CLARK: Absolutely. And the analysis of alternatives has been completed. It's in the review process, and it's in the program of record.

But the EA-6B, which is the best jammer in the world, is getting old. And the other part of it is that it's got a lot of high tech avionics and electronics in it. It has moved to the top of my list, Congressman Murtha. It is the most expensive airplane in cost per hour of any airplane that flies in General Jones' air force and my air force.

MURTHA: So that is because it's old.

CLARK: That's because it's old.

MURTHA: You've got old equipment, old airplanes, and the electronics is old in them.

CLARK: Yes, sir.

MURTHA: Now, what about the tankers, your tankers?

CLARK: Well, I currently tank with S-3s. S-3s will be retired as the E&Fs come online, because the E&Fs are going to carry a lot of gas, and we'll be able to take our tankers with us with the speed that we need. And what that means to me is that -- you know, in discussions before this committee before, I've talked about the spiraling cost of this aging air force.

The average age of my air force is 18 years old. The average age of the ships in my Navy is now approaching right at 16. A 30-year ship ought to be 15 or 16 years -- the fleet on average. There's no air force that ought to be 18 years of age, on average.

And now, we've got the documentation that shows how much it's costing to operate this. I can prove now with data that the demand for spares on this aged force is going up 9 percent a year.

This budget puts forth a couple of ideas. It says we are going to get rid of old airplanes as fast as we can replace them. My tankers, the S-3 -- as quick as we can get it out of the inventory. To get it out of the inventory, we've got to bring E&Fs on at the fastest rate possible. We are buying at the low end of the multiyear, and we could do better in economic order quantity.

MURTHA: Is it 54 you're buying?

CLARK: We're buying 44 this year.

MURTHA: What should you be buying?

CLARK: As close to the top of it as we could get. If we could get to the top end of the multiyear, that's where we ought to be. The planes would be cheaper, even...

MURTHA: So this eliminates the need for the tankers?

CLARK: That's correct. I will take the S-3s out as the E&Fs come on the flight deck.

MURTHA: So how many would we need to increase in order to solve that problem?

CLARK: Well, the way I've got it planned now, there are eight S- 3s in each air wing. With each E&F squadron that comes into the air wing, I'll pull off four tankers. So I need two squadrons, because, you know, E&Fs are doing more than just tanking. So I need two squadrons in each air wing to have the S-3s eliminated.

MURTHA: But I'm not clear on how many more you need...

CLARK: No, it's not more. It's integrated into the operations. We're going to...

MURTHA: So the 44 that are in the budget this year, as soon as they're out in the fleet, will eliminate the need for the tankers.

CLARK: Well, 44 would get you one and a half wing support...

MURTHA: That's what I'm asking. So what do you need in order to -- because, you know, these deployments -- you've got 60 different countries you're going to deploy to. And from General Franks tells me, you've got 4,000 people on the ground, 4,000 American soldiers, and you've got 26,000 supporting those folks on the ground.

Now, you know, with 78,000 reservists called up, the employers are starting to get upset about this. So you need to tell us, and we need to work with the administration. I know the pressure you're under not to tell us that you need more.

This is a damn good personnel budget, but we need to know where we can save money and how we can save money by adding a few things here and there. We've always done that, and it's made a hell of a difference in the long run. So, you know, we need to work together with some of these things so that we can end up having what you need quicker and reduce this damn maintenance cost which is killing us.

ENGLAND: Mr. Murtha, I'd like to make just one comment on the EA-6B. As the CNO said, we are finishing the AOA, the analysis of alternatives. We also have a wedge going in in '04 and increasing so we can actually work a replacement airplane and replacement system.

So we will know in about two months what the recommendation is in terms of how we replace EA-6B. So we are actively working that. We do have wedges in the out years.

Now, this year, because of the aging airplanes like F-14s, as the CNO said, we're actually starting to take out some of those old airplanes. In the meantime, we've increased the O&M, because we need to to support those airplanes. So we have increased O&M.

Eventually, we'll buy out way out of them. Now, obviously, the sooner we can buy our way out, we reduce the O&M. But you have to work both sides of this.

MURTHA: So you're looking at the balance between the O&M cost and the initial cost of what those airplanes, whether it's a tanker or a B2-C (ph), whatever it might be -- you're looking at the up-front cost versus the maintenance cost.

ENGLAND: And, obviously, we would like to replace those airplanes as soon as possible, because that O&M cost is going up. In the meantime, though, we do have to continue that O&M cost, because they're being deployed.

So it's a little bit of a catch-22, but we made those decisions to support the airplanes we have, and also start this recapitalization. It would obviously be beneficial to do more recapitalization in time, and we do have that in the fit-up. This is a question of priorities.

MURTHA: That doesn't solve the problem. I mean, if we're going to be serious about some of these other countries, if we're going to project power, we've got to have this stuff pretty soon.

I mean, you know, (OFF-MIKE) a couple of years out. That's not going to solve our problem. And if we keep wearing out the equipment, that's going to be another thing we have to worry about.

ENGLAND: Right. We will eventually wear this out.

MURTHA: It shows me if you don't get to 197, it's (OFF-MIKE).

LEWIS (?): Jack, if I could just -- right on the back of this -- the reason we want to dwell on these questions at a hearing like this is that, in my lifetime, in looking at the challenges our military faces, I've never seen a time of greater opportunity. The public is behind us. There's little doubt that they're proud of the work that you all have been about.

But in the meantime, it almost seems to me that the men and women who did the job, who demonstrated how good they could perform with a lack of support in many arenas, one way or another are at the end of the line in terms of changing the pattern of things. It's not good enough to wait until '06 and '07, because between now and then, that whole environment is going to change. A little bit more about news of people being killed, and the public's mood changes. Then, suddenly, where are we?

And so I'm looking for my CNO and my commandant and my secretary to be screaming, no matter what the administration might be saying about, hey, you guys get in line, wait a little while. There is a headline story where the CNO did suggest that there was a shortfall.

But it's about time we started banging on the drum, gentlemen, and we're here to urge you to do that. We're ready to back you, if you're willing to do it.

MURTHA: Just one other line -- you're wearing these airplanes out overseas. As I understand it, I guess it's the tankers that you're using up a year's length of service for the tankers in the last year. So you used two years instead of one year for the tankers.

CLARK: That is exactly what is going on. I had a briefing last week. It's called FLE, and I don't remember what the acronym stands for, but it's a life expectancy of the airplane.

The S-3s, which we use to tank, are flying extensively. And, of course, the range of these missions -- we're flying 200 to 250 percent of our normal load over there.

Some airplanes are not taking a beating. For example, the F-14 is faring pretty well, and each one is calculated in a different way.

So let me just lay it out, Mr. Chairman. I believe that the answer to this is us coming to grips with what the fixed investment stream has to be to get us well. We have given you what we've recommended, because we don't have enough top line to do. Certainly, we'd like to have more.

But that's why I said in my opening comments I want to identify with all the decisions that were made in this budget. I believe that they are made correctly, given where we are.

But I also have said this. We should be -- in the Navy Department, I should be bringing you forward a program that invests in the neighborhood of $33 billion to $34 billion every year in acquisition.

The whole decade of the '90s, it was $23 billion. It's been $10 billion short for 10 years. And so that's what we really need to do.

I wish I had the resources to lay out in front the secretary that says, OK, you need $12 billion in new ships, and you need at least $10 billion in new airplanes, and that's what we need to be doing. And then with all the other acquisition pieces, you'd get to $33 billion or $34 billion.

We do not have the resources to do that. But that's the number that we need. And we need to figure out how to level our investment stream so we can then get the right economic order quantity so we're paying the right amount for each of these assets.

MURTHA: What we need the Navy to do is do the study, and then tell us what you'd save in O&M cost, what you'd save in all types of other items, and then let us make the decision, even though the White House thinks they're the ones that do the appropriating.

You know, we're the ones that do the appropriating, and we've made some substantial changes that have made a hell of a difference over the years. So we're not trying to undercut the White House. We're trying to solve this problem in the best way we can.

ENGLAND: I need to comment, however, that from my perspective, there are national priorities across a full spectrum of the nation. I mean, there's national priorities, as just said, there's priorities within the Department of Defense, and there's priorities within the Department of the Navy. I think everybody, every single aspect of government, every single aspect of DOD, every military always needs more funding to do something.

Now, this year, we got a lot of new money into the system. Last summer, we were before these committees for an appropriation so we'd have enough steaming hours and flying hours. We did not have enough money to steam our ships and fly our airplanes.

ENGLAND: I can tell you we have fixed those problems. Between the '02 increases and between '03, we have put those problems behind us, and we have fully funded that. And, in addition, we have...

MURTHA: Mr. Secretary, you're missing my point. My point is the threat changed 10 years ago. Now, it's possible it's going to change again. We have to take a realistic look, what do we need to do in case the threat does change dramatically and we need to deploy 500,000 people in some area. That's what I'm saying.

LEWIS: Thank you, Mr. Murtha. We have a vote on so I'm going to call on Mr. Nethercutt. I'll run up and vote and come back. It's a very important journal vote, gentlemen.

NETHERCUTT: Thank you, Mr. Chairman.

Welcome, gentlemen. I think you know how much we appreciate your service. Everybody on this subcommittee, and I think throughout the entire House of Representatives. So, thanks so much.

Admiral Clark, I've had a chance to look at the surface combat system baseline plan that you all have done. Particularly, Admiral, is it Balisle?

CLARK: Balisle.

NETHERCUTT: Balisle, has done a nice job, and really looked at the issue of cost and modernization and commercial off the shelf and commonality. All those things, I think, make a lot of sense. I think that's what our subcommittee here has been pushing for some time in the services to try to save money and economize well.

The document that I mentioned, this system baseline plan, mentions an open-distributed architecture with maximum commonality across ship classes, which is easy to maintain and modernize and mitigates the cost of inevitable technology refresh.

I'm wondering if that approach is solely funded in the budget. Have you got a line item or a cost of implementing that kind of an approach to, as far as I'm concerned, saving money and economizing?

CLARK: Well, the particular program that I think you must of talked to Admiral Balisle about talks about the upgrading of the Aegis systems and so forth.

The real program that you're talking about for the future that does that is DDX. DDX lays out a whole family of new systems and they are all going to be built around just what you defined. And this is what -- if we were creating them today, it would be all open architecture systems. I have to just plug in here, Congressman, I have 50 percent of the ships today that I'm going to have in the year 2020. So, some of these, he was talking about changes that we need to make to existing systems to make us better able to inject new technology in the future.

So, when we talk about all of our new systems, we want, and are creating exactly what you have cited here, it's more difficult and we do not have a fully funded program to go back fit all of the legacy systems.

NETHERCUTT: Well, the reason, in part, I mention this, is because I'm familiar with spray cooling technology, and, perhaps, you are too. It's been employed on the AAAV. It's been employed on the EA-6B and the concept is to spray cool the electronics on these platforms in a ruggedized fashion and in a smaller area that's consumed and recognizing the space is premium on this equipment.

And I think this spray cooling concept is a good thing. And it has some utility, certainly, for the Marines, and as well as the Navy. And I'm wondering, you know, if we're going to fund that in such a way that we make attractive to contractors to come in say I can provide that function of the Navy's and the Marines' and others' needs across the services. I think it has great utility.

So, I'd just -- perhaps, we can a conversation about it at some point, and talk a little bit more about what I perceive as the utility of it and the benefit cost-wise to the services. And there are other, DDX, as you mentioned, is also employable with respect to this kind of idea as well.

With that, Mr. Chairman, I'll stop and go vote. And thank you for your being here.

LEWIS: OK. Thank you, Mr. Nethercutt. Mr. Cunningham?

CUNNINGHAM: Thank you.

LEWIS: You got here early, you've been here often, so...

CUNNINGHAM: Mr. Secretary, I want to thank you for, not only your timeliness, but the attitude at which you go about some of our requests. You know, it's been very refreshing, and I want to tell you that also.

I would like to see more wings up here in the flag ranks. I think when I was a Lieutenant, I used to say why let rank lead when ability can do it better. And I see you've got two aids back there wings on them. So, we'd like to see some of that move up the line.

ENGLAND: Supporting arms, sir.

CUNNINGHAM: Yes, sir. Maybe if Senator Daschle would come to some of these he wouldn't need as much information deficits. No, I'm just kidding with you, Mr. Chairman.

General Jones, I don't think that we'd need our carriers at San Diego if we didn't a base at Miramar. And I know there's not enough room at Pendleton to put a base, and, yet, BRACs coming up. Every Secretary that I've ever known, both the Secretary of the Navy and (inaudible) has said the value of the, NAS Miramar, now Marine Corp Miramar with its location to Pendleton, to your strike units to spa wars (ph), to the carriers.

Could you just tell me the importance that you feel Miramar is in the upcoming BRAC round?

JONES: Absolutely, the value of the air station is...

LEWIS: Excuse me, General. What base was that you were talking about? Miramar, did you say?

JONES: I understand, sir, totally understand. The value of our California bases cannot be overstated.

LEWIS: Would you like to stop right there?

JONES: Yes, sir. I'd be happy to respond to any questions. Two-thirds of the operating arm of the United States Marine Corp operates in the Pacific. The investment and the location of our bases are Miramar or 29 Palms, or Camp Pendleton, are not arrived at frivolously. They are geographically positioned to support that two- thirds of the operational Marine Corp operating in the Pacific and, as we've seen, through the Pacific and on into the North Arabia Sea.

So, these bases are extraordinarily important. And in addition to, I think, making a significant contribution to the economic vitality of the region, it also, I think, they also serve as a powerful reminder that what sailors and Marines do in executing their missions is very important.

To support the carrier battle group deployments, to support the amphibious-ready group deployments, helicopters and Marine Corp aviations, since we're talking -- you've asked a question about Marines, to load the infantry battalions and all of the supporting -- the combat service support equipment that goes to making the Marine Corp team unique, comes from those bases.

And if you did not have that entire package of an expeditionary capability, and the true difference between this force and anything else, is its sustainability and, as the CNO said, its persistency and you can only generate that from a proximity to our coastline. We are a maritime nation and we project power from the sea. And in the war on terrorism we will be doing a lot of that in the years ahead.

CUNNINGHAM: So, right now you wouldn't closing Miramar, you think it's pretty important.

JONES: It would not even cross my mind.

CUNNINGHAM: The Marine Corp is looking at a power plant out at Miramar, I know they're going through some studies. And I think it's a win-win situation. It's the cleanest power plant that is in existence. It'll provide needed electricity for Miramar with impacts. The guy is, what I would call, an extreme environmentalists.

JONES: Yes, sir.

CUNNINGHAM: But in this case, I think it's a win-win for the Marine Corps and the community. And I hope that those are favorable and that should be coming out shortly.

JONES: I would support anything, sir, where the bases can be of service to the local community, and I think a program just like that would be ideal.

CUNNINGHAM: Thank you, sir.

Admiral Clark, I want to tell you I really appreciate your commitment to ship depot maintenance. You know, the president called me aside the other day and we all met and pointed out that, Duke, there's other issues besides ship depot maintenance. But he is also realizes that of the pitfalls that we have. But I want to thank you, not only in ship depot maintenance, but the readiness. When you don't have the aircraft and you've explained the age of these airplanes, retention was low, cannibalizing parts, that your focus on retention is going to save a lot of lives, and create a lot more missions and the capability to complete those.

You're flying these old machines, you're driving old ships, you've got to put the money in the retention. And I want to personally, I think, from my limited view, I think it's the right thing to do. And I want to thank you for that.

I would say, though, that right now you've got over a billion dollars in backlog, which you've been working on. And I've heard figures up to 300 million shortage in ship depot maintenance. So, some of those availabilities are going to slip out. Can you give me the Navy -- to my knowledge, that's the Navy's numbers as far as a shortage and realizing we have limited revenue.

My concern is that when we're in a war, a lot of the funds kind of O&M and then the carrier and the sub-accounts are also affected because you've got to keep them up and that takes money out. But I also know you tried to fence that. Do you have a fairly good number that -- you don't have to give it to me now, if you could provide me that...

CLARK: Well, I would like to address that. First of all, thank you for your statement. And we all know that you are a very informed source with regards to these kinds of issues. And so, my backlog number, in preparation for this hearing that I had, was that we were $360 million last year and we're down to 175 this year.

A real issue for us is the manner in which we eat away at the backlog. You can't get the backlog all at once. It's not possible. You don't have access to the ships. They're deployed and you get them during the next availability. But I think the key thing is this. Remember when we appeared before you before, I said that as a matter of principal, we had understated the requirement and then we had underfunded the understated requirement?

That is exactly what was happening in the 90s. And here's what has happened. The '01 comparison to '03 in the ship repair accounts, the requirement has changed. If you baseline in '01, the '03 requirement is 145 percent level. So it's a 45 percent growth. Of that, we are funding 96 percent of the requirement of a requirement that's 45 percent bigger and we funded 85 percent of it in '01.

And so we have committed and this is what's the principle, we're going to take care of the Navy that the taxpayer bought and paid for. The over '01, it's a billion dollar increase in the maintenance accounts. So, we are not going to eat the backlog up instantaneously. But we're on a good ramp. And so one of the solutions is to, you mentioned the word fencing, is to fence these funds so they don't migrate.

And what I have directed my staff to do is to fence these so that -- that doesn't say that they will never move in a crisis. But if they move, I want to know about it.

CUNNINGHAM: Yes, sir. Mr. Secretary, one of the things that I think we can help is when we have shortage of funds, my opinion, and I'm pretty knowledgeable about the different accounts, is that public yards end up costing us about three times the amount that private yards do when you're looking at apples-to-apples. We're hiring over 700 people for the Norfolk yard just to sit around. And to me, that is a waste of resources and assets.

And I think you're a private kind of guy. And I wish that you would take a look at those hiring's because anytime we hire more bureaucrats, whether it's in the military or Department of Education or what, it eats out of our ability to put those resources other places.

ENGLAND: Mr. Cunningham, I actually have asked and I've asked for a report on that, because I understand we are hiring people at Norfolk and I did ask the question, and that's due back to me. So, I understand why we're doing that.

CUNNINGHAM: Yes, sir. Thank you.

And real quickly, General Jones, we're looking at technologies for chemobio protections and we're kind of focusing on prevention. There's a lot of options that are coming up and I've got some companies and I'm sure other members do, that I think are very effective and once the chemobio, like in the Hart Building, or something gets in there and how you remove it and if you're looking at those things or if we can submit some plans, I think, that we feel that would speed that up and you'd look at that, I think that would be helpful.

JONES: I'd be very happy to, sir, thank you.

CUNNINGHAM: I've got a lot of things, but I don't want to take too much of my time, and I'd like to submit the rest of them for the record.

LEWIS: We'll get back to you, Duke, (inaudible).

Mr. Moran?

MORAN: Thank you, Mr. Chairman.

I have some questions on computer and telecommunications technologies. First, I want to ask of the status of the Navy Marine Corp Internet Program. You've got a major ramp-up in the FY '03 in this budget for full implementation, I want to know how that is going and particularly in terms of cyber security to the extent to which we are better protected in our computer programs.

But also since the Persian Gulf War, this subcommittee invested a good deal of money in having systems where, in the theatre, you could identify troop movements, movements of vehicles and other military equipment, and one of the ways was that right down to a combat unit you could have a laptop computer that will tie into satellite photographs that NIMA would be doing and it would magnify it and you could have it interpreted so you'd know exactly what was going on in the theatre.

And, of course, this would be particularly helpful in the current Operation Enduring Freedom campaign, but I understand they're not doing it because even though the program has been -- was fully funded and is ready to go the Air Force hasn't been able to put these satellite dishes on the ground so that you can't use the kind of broad bandwidth communication that you need to be able to do it.

And so all you have is the narrow UHF channel that is very limited in being able to take in this data and make it usable. I'd like to hear your response. I'm going to ask the Air Force about it as well, but it doesn't make sense if we fund this new technology and then, what appears to be just bureaucratic delay, it isn't put in place when it's actually needed. And I can't image a better time to use this technology than now and yet it's not being used.

So, if you could tell us that and any other comments about what tactic and national intelligence systems are proving particularly vital in the current conflict.

ENGLAND: Mr. Congressman, I was looking at a photograph just recently it was -- and, as a matter of fact, I've commented on this a number of times, if a photograph of the Northern Alliance on horseback carrying AK-47s and RPGs. And if you look at the photograph very closely, there's also a Special Forces officer on horseback. They tell me he had a lot of Vaseline, they're not used to those old saddles by the way. But in his hand is not an AK-47 or an RPG, but it's a laptop.

MORAN: A laptop computer.

ENGLAND: It's a laptop and he is actually in direct communications with overhead assets calling in precision weapons. I mean, if you talk about a transformation, on horseback, charge a light brigade going back a long time, but laptops, direct communications, calling in precision weapons in front of this attack.

My impression from all the briefings I've gotten is that you are now looking at the beginning. You are looking at the beginning of what warfare will be in the future. That is large, integrated systems. And that's what these are. These are now network systems and literally globally network systems that we bring together these assets.

And it's made all the difference in Afghanistan and we now have precision strike, I don't know if the number is classified, so I'll void the number, but at a much higher, a much higher percentage than we did just 10 years ago, dramatically better, as a matter of fact. And that's because of these network systems have been funded in the past.

I mean this is money well spent in the budget as we go forward, there's a lot of investment in these types of assets, the intel is critical, particularly in this kind of warfare ring. I mean you have to know the target to go after it. So, Intel, communications, networking, this is fundamental to everything we do and our Navy budget, we have put more money in our own CEC and the ability to tie in with all these systems. NMCI is important to us, I will tell you we struggle with NMCI, but in the last year, I believe, we are now on the path of NMCI.

We now have dedicated program miles. We have magnificent leaders. We work this with our supplier base. We are turning over seats now at an ever-increasing rate. Every day we turn over more seats than the day before. The security of the system is vastly better than what we have today, and it continues to get better.

So, I believe that these programs, this is part of my comment earlier; I mean we are -- we have this year fixed, I believe, every broken program or problem we had in the past. We have tried to address, either in terms of funding, or technology. And we are now, I believe, have the right foundation to go forward for the Navy across the board and we will see, and I'm convinced you will see, the Navy continuing to improve each year.

And if I can circle back to -- I know the out years we've always shown growth in the out years, but I will tell you this year we did try to fundamentally fund and fix all the things we knew about. We put money in all these programs, so as we go forward, we have a solid foundation now to improve the funding for ships and airplanes and other things we need to go buy.

But this whole area of "electronic warfare", I mean we're investing a lot and that has paid off dramatically in Afghanistan. It is paying off dramatically in all these other places around the world. I mean this has been a magnificent investment. And I thank you for all the work of the committee.

MORAN: I know it has, but if I could just say, Mr. Secretary, I understand that some of that equipment, through not fault of the people on the ground, has limited usefulness because the bandwidth is not broad enough to transmit the data and it's because we're not able to receive all the signals that could be received from the satellites overhead. And you may just want to look into that, or...

ENGLAND: OK.

MORAN: Or, General Jones, and the outcome, I don't know.

ENGLAND: OK. Thank you, sir. And we will look at it, bandwidth, you always want more bandwidth, there's never enough bandwidth in the world.

CLARK: May I comment briefly? On NMCI, the point the Secretary made that we've struggled, this struggle is to break through all the old approaches that we've been using. And the struggle is good and healthy for our institution.

ENGLAND: And that's true.

CLARK: And so the oversight of the Congress because the Congress has been looking at this program carefully is good. And the struggle occurs with us having legacy applications that we're spending millions of dollars on. And pulling this all under an umbrella so that we can all be on one system and one application. There's real -- this is very important to our future.

One word on integration, John C. Stennis, and we're in an open hearing, so I'll be careful with this, but John C. Stennis, is in the operating area of Afghanistan. She has an experimental system that we have onboard and it's called Naval Fires Network. It is the integration of and getting down lengths from all kinds of other sensors. This is the future.

And the real issue for us is speed and agility, an acquisition that allows us to make these changes on the run and provides the power of knowledge that the Secretary was talking about that makes us more lethal than an enemy. And we're not looking for any fair fights. If they're going to square up with us, we want all the advantage we can get.

MORAN: Thank you.

Thank you, Mr. Chairman.

LEWIS: Mr. Tiahrt?

TIAHRT: Thank you, Mr. Chairman. I want to join with the rest of Americans and tell you how proud I am of the job you're doing. I think America would be hard pressed to find a better team for the Navy and Marines. I'd like to commend about a couple of specific programs, maybe get some responses and then talk a little bit about procurement reform.

General Jones, landmines, I think, are a big problem. There's millions in Afghanistan. They're all over the world. There was a program that the Marines reviewed several years ago. It's called a powerblade. It's a dozer blade with a track embedded in it that actually boils the landmines to the surface. We have some old technology where we slap the ground and hope the go off. And I think this is worthy of a second look.

I reviewed what was done when the Marines looked at it. I don't think it meets the quality of review that you're doing today. And I think it justifies another look at it. It's called a powerblade. And I hope you'll consider looking at that again.

JONES: I'd be happy to, sir.

TIAHRT: The Navy's have got some old C-9s that are proving very valuable now going back and forth. But, you know, I think the average age is almost 30 years. Most of the pilots are younger than the airplane they're flying. And I think, because of the limit of range, the high maintenance cost, the high noise factor, I think there's a good, solid case to get new C-40's to replace those. I think we would dramatically improve the capability that we have in the Navy.

And I want to encourage you. I know it's on the unfunded list like some other important programs like, JPATS, as you know, we've talked about.

One other thing I'd like to -- it's way down on your list on your unfunded list, but I think it probably needs to be moved up is the avionics modernization program, AMP, the Air Force has about 500 C- 130's they're upgrading the cockpit. It's communication. It's navigations. It's pretty broad. It's very effective to slotting their line. I think it would save you potentially hundreds of millions of dollars rather than waiting too long.

I know that the Navy has priorities. If you had a dollar today you'd put on the F-18. I think that's what you told me. I think that's probably a good decision in knowing what we're doing today. But in the priority things, I think this is a pretty good way to save money long-term if we can slather with that.

Now, procurement reform, some would say during a time of war maybe we ought to put just kind of a lower priority. I would disagree. I think that we have -- we spin our wheels of the process of buying new things. One of the things that I think could help is if we had this -- a system of rapid, like a rapid acquisition account, especially when it comes to new technology.

We've tried the commercial off the shelf costs. It's, I think, been effective, but needs to be improved. But with the rapid acquisition account, I think we could get some rapid technological assertion and I know especially on your ageist destroyers there's some equipment that could probably be slotted in more quickly.

So, I hope we can figure out a way to do that. And I'm working on some procurement reform paperwork, consolidation, and some other things. So, I hope that we can, you know, try to develop that type of fund to give your program managers more flexibility, especially in the areas of new technology.

One thing that I think is an internal problem in the Navy. And again, this is from an outsider looking in and I may be wrong, but I do think this is a problem. Admiral Clark here has professionally grown up in the system, so you may have a different view. But I see a matrix organization where everything comes to the top with you, Mr. Secretary. And I think there's a lack of communication at some times in some programs between the users and the program managers and the contractors.

And sometimes I just think there is gaps that aren't being bridged and because of that there's inefficiencies included in the system. I think there's a stronger to make that at the time of war you don't want to restructure a service then trying to avoid procurement reform. So, it may not be the exact time, but I do think you need a workaround program, perhaps some type of internal teams, by program that where they meet in the room, and maybe you're doing this now. If not, I'd like to know if you have plans to do that though.

And you're familiar, Mr. Secretary, with how that works, brining all the elements together so that there's no lack of communication. So, if -- that's part of, I think, the procurement reform we need to do and if you could comment on that.

ENGLAND: Mr. Congressman, I will tell you I'm in violent agreement with you comments there about procurement reform and the fact that we're in the wartime is all the more reason we have to do it because you have to get technology to the field as quickly as you can. It's high on my list, and I know it's high on the Commandant and the CNO's list. It's really, frankly, more my responsibility because of Title 10 issues.

John Young is our Assistant Secretary in this area. He and I have worked this. Anything we can do rapid acquisition accounts, whatever. I mean we would be delighted to work with you in that arena. We definitely have to find ways to cut the time to get high technology to the field. And however we can do that, you will find me extremely supportive to find ways to go do that.

Regarding the users, program managers and contractors, we try hard, and I hope we're being successful of having integrated product teams across our programs. Now, we haven't, I know, in all of those, but we're working very hard to get integrated product teams that are users, program managers and contractors because they all contribute. I mean this takes an integrated team approach to make these programs work.

My experience is the more we do that, and we're doing that on an NMCI now, for example. The more we do that; we improve the probability of success on all of our programs. So, again, I definitely agree, we need integrate product teams across all of our procurement areas. We need to shorten those times. And when we do that, by the way, they generally cost us less. But we get better quality at less cost.

So, look, I agree, and we will work closely with you. Any recommendations, any approach as rapid acquisition, we'd definitely like to pursue with you if there's a way to do that. I mean we're definitely would like to work that with you.

TIAHRT: We've been in touch with Vice Admiral Mullen in good communications. And I think we're on the right track. And I think you're on the right track too.

ENGLAND: Good.

JONES: And if I can piggyback, Congressman Tiahrt, the ARCI Program is a submarine program, Acoustic Rapid Cost Insertion, one of the real winners is an example of using costs and doing this right, and, we are doing an analysis this year in our program bill to see where we can utilize this methodology.

JONES: I want to restate my view that we need to do that. Because what's happened in areas that are maybe not so visible to the senior leadership of the department is that we are building a culture of acquisition specialists who really and truly believe in what the law says. And they are following the law.

And, essentially, the implication is that you guys, meaning Vern Clark and Jim Jones, are only be there four years, we're going to be here 25 years or 30 years. And because the law builds these firewalls, the acquisition community can actually make decisions that we might not even be consulted on.

And I think that's fundamentally wrong. In very important programs like the B-22, for example, I expect to be held accountable. But if I'm going to be held accountable, then I want to have the law written in such a way that I can actually get into some database, if I want to, with regard to the acquisition of the program.

I want to be able to manage; I want to be able to have my share, my voice in the management of the program. The laws are not written, technically speaking, in such a way that I can do that. And I think that that needs to be corrected.

And so I would say that a key element of our transformation is in business and acquisition reforms. And I've said this before, but when you have a situation where the defense agencies of the Department of Defense are on an upswing in terms of the percentage of the Defense Budget that they consume, 106 percent over the last 15 years or so, and you have corresponding declines in the percentage of the defense budgets accorded to the services, you have something fundamentally out of whack.

One, just brief example, of a small success, but a case in point, the Marine Corps decided to procure a new combat uniform, quality jump, technology jump, acquisitioned process, challenged, tested, pushed back, the end result is that from the idea to the acquisition was one year, testing, everything done. Those uniforms are rolling off the assembly line. It's a quality jump in terms of the product. It's a pay savings for the troops because it's extremely cheap to maintain and it's cheaper because we took some innovative ways in which to do the business relationships with industry to bypass one of the principle defense agencies that normally would do our business for us. But because they insisted on a 22 percent carrying charge, we said no thank you, we'll do it ourselves.

But the system is that we would say please procure this uniform for us and they would say fine, and they would tack on a 22 percent a middleman charge. Now, neither the CNO or I have ever had another job. We are not businessmen by trade. But we learn about this on the fly and generally we have about four years to try to make an impact. And we're fighting an institution that has 30 years in which to resist us.

So, if the law doesn't get changed to allow us the access of the people who develop the requirements, and that's where my -- by law, that's where my role stops, at the requirement level, then I think we're going to continue to have these discussions.

LEWIS: This is getting some reaction, I'm sure from (inaudible).

JONES: Yes.

LEWIS: One of the problems that I find is every time we try to change come some of these requirements, the lawyers stop you. Now, you know, Secretary Cheney, when Vice President Cheney was Secretary of Defense, he came to us, we eliminated an awful lot of the general provision. And then we found out he had to have them because the lawyers said they couldn't do it. We hear that all the time.

There are things that you can't do because of lawyer. Long Island was a perfect example of a problem we ran into because of the lawyers. In one other admonition, I remember this committee, one of the members came to me and said, look, we need a million dollars and we want to develop quickly a vehicle that will do anti-mine warfare. And we don't want to go through the normal procedures. We just want that money.

Well, we had a lot of problems in Afghanistan and we gave them the money. Three or four months later the two guys were building this were showing each other the machine at a gas station and blew the gas station up. So, there are some -- it was all in the papers, headlines and so forth.

But the point is there are some safeguards you have to have when you're buying this stuff. And I realize the cumbersome nature of acquisition and I certainly agree with that. But just keep in mind the safeguards, particularly with weapons systems you need.

ENGLAND: You know you can, if I can just make one commend. You know, can take the laws and build barriers and decide to isolate this. But the law does not require you to build barriers. I mean you can have a very open inclusive system and do this in gold water nickels. I mean we are trying and I believe we are succeeding in the Department of Navy to do that.

I mean you can now. Unfortunately, it's subject to the people, right? I mean, you know, they can build the fires if they want. But I think reasonable people acting reasonably everyday can actually do this job very well if they want to. As I said, the law doesn't force you to do it.

LEWIS: Mr. Secretary, having said that, all of us seem to agree that there are serious problems there between the procurement shops and the marketplace and some of the things that you need to get your job done.

If nothing else, in the remaining time that we've got here doing these jobs, especially you two guys, if you would join in partnership with us and help us talk to those other lawyers and get recommendations as to how we really can change this thing, we actually might make some history here.

There are sacred cows around this place. But even sacred cows can be improved upon. And, so, I'd urge you to look at this at a major objective over the next couple of years.

Now, the Duke has a quick question and then one of my buddies who had to go to another meeting has come back and let's move that along.

CUNNINGHAM: I won't take more than a minute. First of all, the V-22, I believe it's going to be a valuable asset. I've had agreement with General Crulack (ph) to stand up a squadron at Miramar to get rid of those aging helicopters where we have fixed wing -- with only fixed wings, at the same time you stand up to training squadron.

Secondly, I'm alive today because I got fly against adversary aircraft. Most of our adversary squadrons are gone. Captain Pierson (ph) is standing up in adversaries -- a civilian adversary squadron. I think it will be very beneficial to the training of Marine Corps and maybe pilots.

The last thing is that there's a, Mr. Secretary, there's a TA-4 this Congress authorized to give away a TA-4 to a historical foundation. Those rascals down at DLA have found fit, because it's got a gyro in it, not to give it away. I mean, I flew that thing in 1967.

ENGLAND: We fixed the problem, I believe, sir. I think the DLA...

CUNNINGHAM: See how effective I am.

ENGLAND: DLA issues are resolved, I believe, sir. Let's move it along now.

CUNNINGHAM: Thank you, sir.

LEWIS: Every once is a while it's going to call (inaudible).

Let's see, gentlemen, I think you know that some of our members have other hearings going on that they have responsibilities for and that's some of the evident flow here. Mr. Dicks was here earlier and we couldn't quite to him.

DICKS: I thank you, Mr. Chairman.

And I want to welcome our three witnesses. And I had a chance to personally talk to them over the last months on a number of important issues and I think we're very fortunate to have three outstanding Americans in these positions and people who I have the greatest confidence and respect for.

Let me ask, I told you we had a chance at a little conversation before the hearing started, that I want out to Miramar and then down to North Island just to look at the equipment. And one of the things that I've been concerned about is that with us being, as you've testified already I'm told, that we've been $10 billion short for a number of years and we're still $10 billion short and the -- General Meyers testified that we should -- that procurement should be at $100 billion to $110 billion. You know, what is the condition of the equipment? I think we've been extremely fortunate.

I went out and so some of the depots, some of the people who work on this stuff. And I think these people are doing an extraordinarily good job of keeping these planes and helicopters flying. What I worry about is at some point, you know, you have your shake test and you look at how this equipment is going -- how long it can possibly last even if we go back and remanufacture it.

So, that was my concern. And one of the things that I found out about and I know this is something I know you must be very concerned about is the center barrel replacement program. Now, this will be for both Navy and Marine Corps aircraft. But, as I understand it, and I'll start with General Jones, that your people out there are very concerned that in 2005, 2006 and 2007, approximately 50 percent of your airplanes are going have to go into the depot to have this work done.

Is this going to be a problem for the Marine Corps?

JONES: Well, we talked a little bit about the average age of our aircraft and certainly the ECP-583 program will modify the F-18As and two F-18 Charlie's and the center barrel replacement program is crucial to getting us to joint strike fighter and making sure that with our -- in the tact air community, between the harriers and our F- 18's we actually can prolong the service life to get, not only the adequate combat power that we need to deploy rotationally on a regular basis, but to also employ.

So, the programs of record that will get us there are extremely important to us. I would also be remiss if I didn't highlight the fact that in Marine Corps we have C-130s that are 39-years old.

DICKS: Yes, we talked about that to at Miramar.

JONES: Yes, sir we have CH-53 Deltas who are 31-years old, well past their service life. The CH-46 predates me in active service and look what I look like after 35 years.

DICKS: Well, you know, I want to mention this to my colleagues. When I went out there I notices this -- and they took us on a CH-46 that oil was dripping from the ceiling. And I said, well, tell me about this, and they said, well, sir, if it only drips two times a minutes, it's acceptable. If it drips more than two times a minute then it's unacceptable.

LEWIS: Minimize the smoke those aircraft.

DICKS: Well, and also, the thing that's interesting when these helicopters were first built, they could handle 24 people. Now, they're down to 12 because of the engines are having problems and they said well -- I said, why don't you get a brand new engine? They said we can't do that because then the transmission can't handle the new engine. And this is what they're -- and, this young man whose -- and these people are so good, so dedicated, so committed. I said are you getting worried that the V-22's never going to get there? And he said well, I was told when I was trained that we were going to get the V-22 and it still seems to get pushed to the right.

So, somehow we've got to do something about this. I was just appalled at the condition. And, yet, these -- I was so impressed by the fact that these young men and women are so committed to making these systems work and keeping them safe. And I think they are safe. But how long can we go along?

JONES: Well, in the case of the CH-46, we are at the end. I mean we are -- the replacement aircraft is going to be the tilt rotor technology, it's going to be the V-22. And I'd like to say a few words about that if I could.

But I wanted to highlight the fact that our UH-1Ns are also 27- years old. So, there's your family of aging vehicles. And in the case of the UH-1N and the Cobra, which is not quite as old, we do have a program to get into the four bladed helicopters that will give us additional service life and additional capability. But in the 46, where the crisis really is, the V-22 is important and I want to thank the members of the committee for their steadfast support.

Let me just say up front that I consider the tilt rotor technology is transformational. I believe it is the exit path for, away from rotary wings if it proves to be what we think it can be, and it will dramatically transform the force. Had we had the V-22 in Afghanistan we would have had the mission profiles that were flown by Marines and Special Operations Forces would have been done much safer, much quicker, without nearly the manpower investment on the ground.

Without the intermediate saving bases, without the concerns over lack of performance at altitude, without the refueling problems and with a degree of speed and precision and lethality that would have dramatically avoided the crashes that we had due to the horrific flying conditions of airmen doing the very best they could with pushing the limits of the technology.

DICKS: So, it's your testimony, then, that we are now starting to see, because of the age of this equipment, that we're putting these kids a risk that if we had the new equipment they would not be at risk. And they are at risk because the equipments getting old and we haven't replaced it?

JONES: I believe that the equipment is safe. But, I mean, we would not put anyone in the air without absolute confidence that the maintenance and airworthiness of the aircraft is beyond question.

But what I'm getting at is we have an opportunity now to go beyond the limits of this capability and the demand for expeditionary forces is not to see where we can utilize this methodology because we're clear believers. I'm in violent agreement too.

I want to say one other thing. The secretary has supported us in trying to restructure our organization in a way that I hope will allow us to do a better job in bringing the pieces of the structure together.

I believe that the fleet has fundamentally been left out of this process. And I think of myself as a fleet guy, even though now I'm a Washingtonian. And we created a new command structure this year, the secretary has supported it that puts an individual and makes him responsible for the generation of the requirements process and will make the fleet a more active player, the users, if you will, on the combat end.

In NMCI, it's a different group of people. The ones where the rubber really meets the road is at the combat end. And so, we do welcome working with you, Admiral Mullen has back briefed on his discussions with you and we're anxious to be part of the team.

ENGLAND: Mr. Congressman, I do want to comment, I just last Saturday came in from Singapore in the C-9. And a C-40 would be much better than the C-9.

Message received.

TIAHRT: Thank you, Mr. Chairman.

LEWIS: Gentlemen, I'd like to extend our discussion along the lines that many members have raised. Jack Murtha specifically suggested that as you are beginning to think about just how loud you should scream and he suggest produce reports that might be helpful to us. If you'll produce those reports, we'll use all of our good offices to do everything we can to get them before they're amended by somewhere else in the department.

I know the problem that you have at communicating your message the way it ought to be communicated before God and everybody in hearings like this.

But if in the meantime, I have a question in here. There are a lot of questions that members have, but I hope you will respond for the record. But I have a question that addresses itself to the CVN- 77. I'm not going to ask you to answer that specifically, but by way of using the area as an example of a problem.

That picture of the guys on horseback in wooden saddles with a computer in their lap is an amazing picture. The one piece of it that's really interesting is indeed the Special Ops guys got there and they found they were wooden saddles. But there procurement processes is enough different from the Navy in general or military in general that they're able to order up 100 saddles and get them like that because they clear the decks for that kind of procurement.

Now, there's a disconnect when we can do that for a relatively small unit and we can't make the kinds of changes in a procurement sense that affect the rest of our men and women who are out there trying to do the job.

They did a magnificent job and oftentimes were ill-equipped. So, the question is this, my buddy Duke has been concerned about me from time to time when I question the value of reform. And I question it often because when we go about it, from a Congressional perspective, reforming, we often screw things up. We've talked about glow water nickels around here. But within that mix, one of the things we did is create a separation between people like yourself, who are carrying forward a mission and you've got specific efforts to allow you to deliver that which we need you to deliver.

And over here in a procurement officer there's some guy who's very comfortable with business as usual and legacy systems as usual who just doesn't want to cross the bridge and find that new opportunity out there. Now, that disconnect is very real. And if you don't sense it, that it's very real, then there's something wrong.

But when I look at CVN-77, for God's sakes, and we're talking about a legacy radar system, there's no excuse for a procurement process that takes us to that. And I would submit that somewhere within the mix of reorganization in the past, we've cut of eliminated your ability to communicate these very, very serious problems.

Now, let me just have you react to that commentary and maybe it will lead to some exchange here.

ENGLAND: My view is, Mr. Chairman, that we have addressed that, I believe, meaningfully, at least in the last year here. We have tried very, very hard to tie together, as the CNO said and the Commandant, the users with our procurement people and we have tried to put a team approach together within the Department of Navy. So, I really don't believe that they are separate from all the requirements people and the user people. We have tried to make that a very open environment for everyone to participate and the decisions are not made just by the procurement people.

I mean, these are made now in consultation across the Marines, across the Navy, across the secretary of the Navy's office. So, we have tried very hard to tear down those walls. And I believe, we have pretty much succeeded. Now, there's still a "Title 10" that is who makes the ultimate decision. But because there's certain people who make decisions doesn't mean that people can't participate as part of a team to help arrive at those decisions.

So, this has been, in my judgment, at least and the CNO and the Commandant will certainly give you their view of this, in my judgment, we do now have a team approach that works quite effectively. Now, I'll also say that we're never satisfied with this. I mean, we continue to work this, to find ways to do this job better. But this is high as part of our business reforming issues, this is very high on our list.

And this whole acquisition approach is very high on our list. By the way, it's hard on Secretary Rumsfeld's list. And this is a subject we have with him, how do we streamline, make this more efficient, make this more effective and the Secretary Aldridge has made a lot of changes, Under Secretary Pete Aldridge in the acquisition arena.

Now, my judgment is, we need to move more and more to a commercial type process. I mean, I believe that we have too many rules and processes and laws and everything that impede the way we do the acquisition process.

The more we can make this commercial like the quicker we'll be. The more responsive it will be. And the more inclusive it will be in terms of all the companies that can participate. So, I mean, I agree with this initiative fully. And I can tell you, I'm quite confident Secretary Rumsfeld does. And I can tell you that we're trying to work this between our services.

LEWIS: Before we go to your colleagues then, Mr. Secretary, to me, one of the values of having people with business experience in a job like yours is that it can lead to change that's pretty fundamental. But I can't figure out how you can or how that third level can help you rationalize, putting those old radar systems, and including combat systems in the CVN-77. That's just an illustration, but how do you rationalize that?

ENGLAND: This was discussed throughout the Navy. This was not just somebody out in another room that did this. I mean, we decided that in this case, we would design the island of the carrier so it would accommodate both the older system and the new system. I mean, frankly, we did not want just one new system out there. We felt we had to have a more reasonable approach to this, so we decided as a team to put the legacy system, it's an excellent system, it's not that old a system, it's an excellent system. We would design it then so we could readily upgrade at the right time. So, that was a decision that was made openly and with the full consent of the people in the Navy and people in my office.

It was the best decision, in our judgment, based on the cost, when we could introduce it, and the fact that we didn't want just one of a kind out there in the fleet. So...

LEWIS: It sure strikes me that if we follow a pattern that is past that or business as usual, that those legacy systems in CVN is going to make it all the more difficult, especially at the third level, within this process, to change the systems, jump over hoops, if you will, when we get this CVNX.

ENGLAND: Well, we are designing it for the new system. So, we're not precluding putting a new system in, Mr. Chair. We are designing CVN so that we can put in the new system and also put in the system we currently have today. And, frankly, when you look at the technical aspects, the cost aspect, the schedule aspects that appeared to be the right decision. But again, it was a comprehensive discussion. This was not just a decision made by one person. This was with the full understanding of everyone involved in the military.

I believe we made the right decision in that regard, and I'll ask the Admiral to comment on his view of this. But my view is we all had an input into this system and made what we felt was the best decision.

LEWIS: For all of you gentlemen, we've had a lot of personal discussion about this, so you know how strongly I feel about it. But I'd love to hear from you, Admiral.

CLARK: Mr. Chairman, we talked earlier about the prior year ship building challenge. When I became the CNO I was presented with one of the first things that happened, the very first bill that came to me was -- here, came a prior year bill. And it was 200 -- every other year, up until the time I got to the office, it had been never more than, I'm told, by a couple hundred million dollars.

And I got there and we suddenly needed $560 million, you know, in the next few weeks or we were going to have to shut down yards and things like. I said, my goodness, what is this? Well, you know, there's always one side, this is happening, and on the other side the cause and effect side.

The issue with this radar was just exactly that. If we made the change and bought a one of a kind system, I knew what this was going to be like. So, without naming systems, I didn't want any part of that approach. Now, the issue was did we have the -- were we at that stage where we could bring the new system online? And I didn't want to create a $200 million to $400 million prior bill, which is what I was told this was going to cost.

So, what's the best way out of this for us? Now, I would say this is the -- I'm dealing with an effect now. Let's go deal with the cause. The cause of this is the FAR, rules about the way contracts are written and all kinds of stuff that I don't have anything to do with. We need a more agile system. I mean, that thing isn't going to deliver now for a number of years. It would have been far better if we've got a system that would allow us to make these changes down closer to the delivery date.

Now, I think that the issue with us in the -- and, so, I'm going to say, what he said is true. We had a full and open discussion and disclosure on this. Now, it gets back to, it isn't always that way. This secretary is working to open up the channels. And in previous testimony, I've been asked about, you know, are there things in gold water nickels that need to be addressed? It's my view that there are. And they are virtually all in the acquisition arena.

LEWIS: I don't want to interrupt your line of thought. You've pointed to the fact that in other arenas we know we've got problems.

CLARK: Yes.

LEWIS: But when a laymen like me can have the understanding that there are radar systems out there that are better, and yet someway, someone within the mix is rationalized, you know, it might cost too much to make a change. It just causing me to scratch my head. And the committee, the whole committee is scratching its head about this problem.

Excuse me.

CLARK: Well, that's fundamentally it. I think this is an effect we're dealing with. We need to deal with the causes of this. I think that the process is too slow, it's too cumbersome, the issue with the saddles is a consumable. But when you get into -- and we can buy consumables in a fairly rapid way. In fact, we're buying them on the web now, which is the way it ought to be done. But there are many areas that are far too slow.

Let me give you one example and then I'll turn it over to General Jones. How are we going to deal with, in the future, an IT kind of world where the technology turns like it does, and I have to build a budget and -- the '03 budget, when we initially put it together was two years ago and I didn't even know the technology that was going to be available to us. I mean, we are going to have to have other budgeting an acquisition schemes to be able to bring real, late- breaking technology to bear for us.

LEWIS: General Jones?

JONES: Transformation is an over used word in town. But it's an important word because there's a lot of that going on. And we will eventually arrive at a common definition. But in my view, transformation has four parts to it. The one that gets talked about most easily is leap ahead technologies. And that's certainly a key part of it. The second one, in my opinion, is institutional transformation. What are the things that you can do within your own organization, military organization, that you couldn't do 10 or 15 years ago?

I mentioned that General Maddis (ph), General Maddis's (ph) headquarters in Afghanistan had 56 people in it. That's transformational if you considered that 10 years it would have had 356 people.

Another area is operational, what are doing on the field of battle and what can we do that would be transforming in such a way that you use less manpower.

And then the last area, and the one that gets, perhaps, talked about the least, but absolutely has to be included, is business reform and acquisition reform.

JONES: The secretary is absolutely right. Within the Department of the Navy, we have a level of collegiality and partnership that is allowing us to overcome a lot of the built in walls that are there as a result of gold water nickels.

The CNO and I and the other chiefs are on record in front of, I believe, the authorizing committee's last year, asking specific questions about whether we need to look at the unintended consequences of gold water nickels.

And with regard to acquisition, I want to restate my (inaudible) not to hit the beach anymore and fight for an island. It's to go deep. And Afghanistan showed us that. The tilt rotor technology is the gateway to that kind of capability. But I want to...

DICKS: But it is true, though, if we'd have had -- you said, that if we had the tilt rotor, this probably -- that accident -- those planes would have been replaced, those accident and the C-130 that crashed...

JONES: It's hard to predict what would have and would not have happened, because nothing in vulnerable. No machine that flies in the air is guaranteed to stay up there forever. And there's always the enemy situation.

But as General Holland and I have came around the corridors and talked to folks, we believe that the mission profiles, superimposed on top of the current technology would have been much more achievable and at a lower cost and a lower risk.

But the risks are acceptable. They're part of our job. But we owe it to our people to put the best technology in their hands.

DICKS: Right.

JONES: The good news here is that in April of this year we're going to back in the testing mode for the tilt rotors and this will be an event-driven, not timeline driven and I'm very hopeful that we can get tilt rotor technology in the hands of our special operations forces on range and hopefully, eventually, our sailors, and, hopefully, eventually the United States Army.

LEWIS: Mr. Dicks, you don't need or oppose (inaudible).

DICKS: Yes.

LEWIS: It's just that this hearing's been begging me for a number of reasons, but one of them is that you all are so very, very good at what you do, but also the way you explain the challenges before us. And this hearing shouldn't be held in this room. We ought to have five times the people here and five times the media because if the public out there understands what you're saying, we'll get a surge of reaction that will allow us to sustain that funding that's so necessary.

Excuse me, sir. Thank you.

DICKS: Admiral Clark, tell me your reaction on the center barrel replacement for the Navy and also we kept hearing out there, and I was concerned about this that it's getting tougher and tougher to get ready for the next deployment. And also, that, in terms of having the spare parts and the training, there's a lot of pressure now because of the cycles being sped up because we're in a war.

Also, that we were having a hard time getting the spare parts. And I know Congress has tried to provide a lot of additional money for spare parts, but apparently aboard these ships there -- for the engines in particular, they're having a problem getting and maintaining adequate supply of parts to do the work that they have to do to keep these engines running. Could you comment on those?

CLARK: There are three issues there. First, the cycle has been stepped up because we are -- the president said we're going to keep this enemy on the run.

DICKS: Right.

CLARK: We are the tools to do that. The CINC in CINCOM has asked for a level of support that was higher than we had been providing. And so we have progressively deployed each battle group a little earlier. And you know, as you do the second, the third and fourth time, well, now the person that's -- the unit's that's fourth down may be going four or five months earlier.

We've moved maintenance availabilities from a prior year into a current year to accommodate all this. So, all that is true. Our folks on the point are doing this well. We know what the requirements are and we have a -- you know, day in and day out, we do this at a peacetime pace. Wartime pace, we know how to step it up. We know how to evaluate the risks. We know how to certify the folks when they're ready to go.

DICKS: One point just on that, there was a lot of discussion that you may not have as many planes available for training because you've got to do the center barrel replacement, you've got to have a lot of other depot maintenance. And that you're taking planes as they come in and you put them back on the carrier and the other ones are broken down. And therefore, there's not enough planes to do training. We heard that at Miramar. I'd like to have you both -- is that a problem?

CLARK: Well, it absolutely is a day-to-day issue for the leader of any RAG, you know, your Readiness Air Group that's training your pilots, somebody's been ashore, coming back. I will tell you, it has been that way in the Hornet community for at least the last half a dozen years. And that's one of the reasons we went after funding 100 percent of the requirement.

DICKS: And they testified to not being able to steam the ships earlier in this hearing. The problem's been there for a long time.

CLARK: Now, what this means to us is the spare, you know, if you turn the -- you put the water in the pipe and you turn the faucet on, it's going to be awhile before the inventories get where they need to be. And so I testified getting, it's getting better, but we have to tell our people this too, you know, we're going to get you the tools and the Congress is supporting you and it is getting, the part stream's getting better, but it doesn't get better over night.

On all of our forces forward, with the level of operations that we have been flying, they haven't been maintaining the required and the CNO goals for readiness. They're maintaining it just fine.

The vast of them, for the guys that are at home, is still there. And it will get better with the investment in parts that we're making, and we're buying out a lot of these cross deck items. And so it'll get better. But it's an issue.

Point three, center barrel replacements, earlier we talked about burning up airframes. The issue with tankers, their FLE, it's happening in the Hornet community in particular. And so, the -- a rough order number we've been flying two and a half times what would be normal for a deployment for those units that are over there in terms of the number of hours that they're flying. That's burning up life, you know, life out of the airplane.

Center barrel replacements will be an issue. I had not heard what you have said here today that -- and, I don't know if it was directed to General Jones or me, that half of our airplanes are going to be in depot. I had not heard that number. We need to get...

DICKS: You better check on that, I think it was...

CLARK: We need to get the details.

LEWIS: Moving right along, gentlemen, we've taking a lot more of your time than I expected. Mr. Hobson's come back as well, and he did...

DICKS: Thank you for the time, Mr. Chairman.

LEWIS: OK. Thank you.

HOBSON: Thank you, Mr. Chairman.

Gentlemen, nice to you.

General, I can you tell you that Brian Crocker (ph) who's in charge of the affair in Kabul says that he's got eight of the best Marines he's ever seen in the world guarding that facility there. And let me tell you that is not great duty for any of those people there. That's really something else over there. But they're doing a great job.

I have a couple questions that I want to ask and then I want to talk about the V-22 and the helicopters and the RPG's. But anyway, I want to talk about, as Chairman of the Military Construction and Appropriations Subcommittee, I had a hearing with the Navy also this morning and I was -- I doubly appreciate the chairman's questions on Page 14 on what used to be called real property maintenance, but not it's being called facilities sustainment, restoration and modernization.

And I've got four or five things here I'll run through real quickly and then you can comment. And they're what you'd call how much money you need to fully fund these activities, how much is the budget for these activities, how much of a shortfall is this? And how do you propose to address this shortfall and what impact is this going to have on readiness?

So, I don't know who wants to answer that, whether you think it's important or not.

ENGLAND: I was hoping, you know, Mr. H.T. Johnson is going to answer those questions for me today at your hearing.

HOBSON: Well, he did somewhat, but I think you guys -- one of the problems is between the MILCON people and you all, sometimes things get lost and that budget, I think is inadequate.

ENGLAND: Well, I believe in total between the MILCON and all of our sustained accounts, we are up in '03 now. And we also put a lot of money into '02. We also have a lot of private, public ventures, as you know, going on throughout the Navy. And that not only applies to housing, but also to barracks now. We're trying to find ways to work that with the barracks also.

So, we have taken a lot of initiatives across the board here to improve our housing, our facilities. As I have recently spent a lot of the time going to our different bases and all and it looks like, frankly, the worst part of all this, we have plans in place to go fix. I mean I haven't found areas yet where it's just no one's paying attention.

I've been encouraged, as I've talked to the people, both in our housing and in our facilities, we are fixing a lot of things and we're actually paying a lot of attention. I mean that's high on our list.

So, I don't have all the specifics because, frankly, our Assistant Secretary of the Navy deals with most of that issue. But at least my perspective, I think we're making some headway here and the public private venture is really paying off for us.

HOBSON: Well, one area that I'm glad to see that you're looking at is where we do with sailors who are onboard ship...

ENGLAND: Absolutely.

HOBSON: ... to coming home. Currently, we don't have a lot of help for them. But it looks to me like you're beginning to address that problem, and I think that's very important.

ENGLAND: No, we defiantly are, that's a major issue.

HOBSON: And I want to point out, I don't know where Mr. Murtha went, but General Jones, I'm glad to see that Quantico, there's a couple of people very interested, as I mentioned in the hearing today, at our hearing, a couple people, two or three people very interested in seeing that Quantico was fixed and, as well as other places. And I'm glad to see that there's some new special attention as a result of a couple of visits to Quantico that are going to be taking place. Do you want to comment? I think Mr. Murtha was particularly interested in that, along with Mr. Young and Mr. Lewis, so you might want to make some comment about your progress that Quantico.

JONES: Sir, we appreciate very much the visits and the interests. And frankly, one of the most exciting that are going on in the Marine Corps in terms of housing is our -- the success of our public private venture programs. And as a result of the increases in the BAH, we are able to spin-off of the successes out at Camp Pendleton, California to include Quantico and it's my belief that starting in '03 we have the potential to replace every single house at Quantico, which really needs to be done.

The only house that will be left standing will be the historical house that we all -- that those of us who visit know, but starting in '03, we intend to replace 100 percent of the family housing at Quantico.

HOBSON: Let me end with one other question I've got. I am a skeptic on the V-22, and I'm to be convinced, I hope, but anytime you have a rotary aircraft you're going to have some problems. You know, this was hit by an RPG. It is my information, and I was there, there's some new technology and I think one of the things that we have tenancy to do is we make our decisions and we move forward, especially in certain services, with full speed ahead, and, you know, we're not going to stop for anything and we're going to go steam ahead.

But there's some new technology out there called the DP-2, that is not a rotary aircraft and it uses a different mechanism to get in an out. I am concerned, I would disagree, I would think that in the configuration the V-22 was going into to land in that facility, it would be as susceptible to taking the type of hit that the helicopter took and with the rotary wings, as it's coming down in that situation, now you might of gotten in there a little faster, but as you get into the landing mode, and those people had that place zeroed pretty well, you could of taken a similar type hit with it that a different type of vehicle might not have taken.

And so I'm hoping we're -- while we're moving through this phase that we're not turning our heads on other types of technology that may come in the future. Because you were talking about the IT thing, here we come along with another type of -- maybe, I don't know if it's the right thing or not, but some people have been funding this and I know that services have been hesitant to look at this sort of thing because they get locked in.

When they get locked in they forget about everything else.

LEWIS: I might mention, Mr. Hobson, that you are extending a very part of what our hearing was about earlier.

HOBSON: OK. But if we'd have looked -- if the Air Force would have been stuck before, the F-16 would have never been built because they were on a total other flight. And along came somebody and said we're going to build this other airplane, it's a little cheaper here and it's turned out to be the thing we've sold all the world and probably one of the better airplanes we've ever had.

So, I just don't want to see people get stuck if there's another technology and if it's not there, fine, that's...

DICKS: Mr. Hobson, would you yield for a minute.

ENGLAND: I'm sorry.

DICKS: I'm sorry, Mr. Secretary, I wanted to introduce to you and the Chief and to the Commandant and to my colleagues on the committee two very distinguished Americans today we're talking about pride and those who serve our country in uniform, these two gentlemen have served our country extremely well during the Olympics. And we have Johnnie Shay (ph), a gold medal winner in the luge; and, Mark Grimmet (ph) with his silver medal.

And if John Sweeney has educated me correctly, Mark is the first American ever to win a gold medal in luge, is that correct, Mark?

GRIMMET: Gold medalist. (Inaudible).

DICKS: Oh, he's a skeleton. Anyway, here are two more American heroes that serve our country. And I wanted you all to have a chance to greet them and give them that warm welcome, which you already did.

LEWIS: And one more time, Beverly Young brings the light into our life.

MURTHA: For those Olympians, I'd just like to say to you while we're extremely proud of the service you brought for our country, as well as for the world watching, the guys who are here, the Secretary of the Navy, the Chief of Naval Operations, Admiral Clark, as well as the Commandant of the Marine Corps, these gentlemen are providing a great service as well. And, to say the least to see you all here together is a very important and moving opportunity. Thank you.

LEWIS: Thank you, John.

MURTHA: Thank you.

LEWIS: If you guys would like to sign up for the Special Forces, let us know, will you?

Gentleman?

HOBSON: All right, who wants to answer my question about the V- 22 and the DP-2?

ENGLAND: We are evaluating the DP-2. I mean we do have an active program, we are evaluating them. My understanding is we're actually working the flight control system because that's the next issue that needs to be addressed. So we are working that, and I appreciate the opportunity to work the new technologies.

We have not excluded that. We do have an active program evaluating it. A comment about the V-22, my assessment is, now my assessment having my career in aviation and early on in the F-16 program also, is that this program is going to work out to be very, very beneficial to the United States Marines, to the United States military. I do believe the redundancy and the safety features will prove to be invaluable.

Now, at this point, as the General said, we start the flight test program in April, it will run nominally until September of next year. And that flight test program includes operational evaluation. That is on the deck in real operational conditions.

We are in the meantime, buying 11 of those airplanes this year. So, we are buying the minimum-sustaining rate because we intend to continue this program. And, they will, perhaps, have to be modified some depending on the flight test findings. But, my professional judgment is is that airplanes going to work out very well, but frankly, the flight test program will prove that or disprove that.

I mean at this point it is strictly up to the flight test program to demonstrate the airplane. So, we're at the right point on the program and we'll know as we proceed through the flight test program. I'm, frankly, confident it's going to work well very well, Mr. Congressman. I think we've done all the right things on the program.

I am very impressed now with the overall design and operation. But, it has to prove itself and that's why we have a flight test program.

JONES: If I could piggyback for one second. Two bonafide, independent panels have reviewed this program independent of the interest that the Marine Corps has and validated that the technology is mature. The technology is ready to be fielded. The problems with the aircraft had more to do with engineering. And those problems have been identified and they've been systematically addressed and we're now to the point where we think we can safety return to flight.

I've spent -- and I did volunteer for this, in and out for the last 15 years as an infantryman, I've gotten to know tilt rotor technology. We should never have such a tunnel vision that we can't walk away from a bad idea if it's a bad idea.

We are at the point in the V-22 program where it is now time to fish or cut bait. No future commandant could sit in front of this committee for much longer and say to the committee I think the CH-46 is good for another 10 years. It is not. Neither is the 53 Delta, neither is the UH-1N. And we critically have to address those shortfalls.

So, this is a moment in time that is -- we should celebrate. We're going to find out what we need to know and we're going to do it dispassionately. We're not going to do it with blinders on. And if it turns out to be not -- from an engineering standpoint, not able to be developed, then I'm confident that it will, but if that should be the -- if the reverse should turn out, then I will be the first one to sit here and say it's time to move on and time to have an alternative solution.

But, we can't wait for it. And, what that means is that we will go back to flying some sort of helicopter until we wait for whatever the next generation is. But, I'm optimistic in what we're going to try to do.

HOBSON: Just one last statement. My only problem, and I agree you, and we've had some problems with credibility on this before, and I don't think we're going to have that again because you're not going to let that happen.

JONES: Sure.

HOBSON: My problem is that we are so far down the road and we have not prepared for an alternative if this doesn't work in the short run to the point that this is almost a predetermined thing because we don't have, that I can see, any strong change that we could make to another aircraft in the period of time that it's necessary because we put all our eggs in one basket. And, that really concerns me about our interim capability. And, so I think there's going to be force that this is going to work.

JONES: Well, we've been asked to look, many times, at alternatives, and each time the, again, fairly independent assessments have shown that economically and technologically this progress. This is transformation and this is the direction we need to go in. but, if it turns out that that is not the direction, for whatever reason, I assure you that we will propose a plan that will hang together so that we can fly Marines in safe aircraft and they'll be rotary wind aircrafts. They'll be helicopters. They just won't be CH-46s.

HOBSON: I thank you for your time and I appreciate it and I'm sorry, I've got to be ahead hearing going on.

LEWIS: Thank you, Mr. Hobson. I think you've notices members coming and going. If we hadn't had conflicts with other committees, in no small part, because of the job you've been doing out there, the room would have been filled with members all day long. Mr. Dicks had a quick question and I know Mr. Frelinghuysen would like to say hello.

DICKS: Admiral, is the Navy going to attempt it's new (inaudible) in prototype onboard the aircraft carrier? If so, do you have sufficient funds in the current program to prove that the concept is feasible prior to entering (inaudible)?

JONES: The test program is not designed for that vehicle yet. You know, it's out in the future, and so I can't answer that question. But, I don't know why we wouldn't test it on a carrier, because I fully expect to be operating unmanned vehicles in our carriers in the future. The same applies to definition, then, of the funding stream that would go with it.

LEWIS: Thank you. It's a good line of questions, so I hope you help us pursue it.

Mr. Frelinghuysen?

DICKS: Thank you, sir.

FRELINGHUYSEN: Sorry to be late, Mr. Chairman.

I guess this question would go to the Commandant, General Jones, it has to do with the lightweights the 155 Howitzer, in fiscal year 2002 the Marines will be conducting an operational assessment of the lightweight 155, as opposed to an operational testing, which is not scheduled to take place until mid-2004. Marine Corps cannot conduct operational testing because no production representative guns are available. The guns the Marines will assess in fiscal year 2002 are assembled, as I understand in Britain, primarily of European components.

Production representatives, which will be assembled in the U.S. primarily of U.S. component, will not be available until early fiscal year 2003. Under DOD guidelines, a system much successfully complete operational testing prior to entering low rate initial production.

General Jones, in fiscal year 2002, the Marine Corps plans to conduct an operation assessment of the 155. What's the difference between the scheduled operational assessment and operation testing? I've seen some of that testing out in Yuma. I'm supportive of the program, but where are we going with this?

JONES: Sir, thank you very much for the question on a fundamentally important program for the Marines and the Army. This lightweight 155, the decisions we make this year will be pivotal. Last year we lost $5 million in the program in '02. And, we've been working to minimize the impact of that loss.

FRELINGHUYSEN: It could have been worse. It could have been a lot more money we'd put in.

JONES: Yes, sir. And, I have recently visited the program site and talked to the program manager and I've seen the gun and I've talked to the people who are working on, and there's high enthusiasm that this is going to be a very, very important capability when it comes online to deliver to the sailors and Marines.

This is, Mr. Chairman, this is the only expeditionary fire support artillery piece that will be in our inventory. Years ago the Marine Corps made a decision to shelve it's heavier artillery, its mechanized artillery and the like. And we went down to one cannon and that's the M19R8, a good field artillery weapon, but a lousy expeditionary weapon. It doesn't fit well on ships. It's doesn't transport easily. The features that have been built into the lightweight 155 have taken care of all of that, plus the extended range and the increased accuracy and the like. So, when I look at the shortcomings in our combat capability I have highlighted consistently that sea based and land based fire support systems need our attention and they need it urgently. We have invested way too much in airborne platforms from that particular standpoint. That was the tradeoff. That was the tradeoff. And, we said we'll go with air systems. The truth of the matter is, you need both.

So, I'm excited by this possibility and this year's the critical year. The difference between the operational test and the operational assessment is twofold. First, as you highlight the operational assessment, it will be conducted on weapons built to support the engineering and manufacturing development phases, EMD, of the program. And these weapons, except for the cannon assembly and fire control were, as you said, manufactured in the United Kingdom.

The operational test will be conducted on weapons actually assembled in the U.S. using components manufactured mostly in the United States.

And, secondly, the number of assets used for the operational assessment it two weapons, as opposed to four for the test. And the duration and scope of the testing on each weapon is exactly the same. And, the operational assessment to be conducted this spring meets the requirement for an LRIP (ph) decision. And, so we hope to get to that point.

It should also be noted that the first Howitzer to utilize the U.S. subcontractor base will be assembled in the U.S. and will be delivered this summer and will be tested prior to milestone sea decision.

FRELINGHUYSEN: Well, this is an exciting weapon, and I'm, obviously, supportive of giving the Army what it needs too, but in terms of the Marines this is your baby.

JONES: This is critical.

FRELINGHUYSEN: And, the nice thing about that is that the operative adjective is light, which this committee and everybody seems to be so apprehensive about that we have things that weigh too much and you can't move them to different theatres. But, we've got to be able to move this...

ENGLAND: Mr. Congress, if I could add a word too.

FRELINGHUYSEN: Mr. Secretary?

ENGLAND: Just for the Commandant, you know, in our priority we obviously made a lot of hard decisions in terms of procurement accounts. This year we put $200 million into this program. So, this does go into low-rate initial production and we funded it because of the value of this to our Marines, and also, of course, the Army. But, this firepower is critical expeditionary. So, we obviously, supported the Commandant here in terms of putting that money on the program this year.

LEWIS: I want you to know, Mr. Secretary, one of the things that this committee likes the most is to have people come forward and say they like X program, but also put money in the budget. That's not always the case.

ENGLAND: Thank you.

(UNKNOWN): But, why is it taking so long?

ENGLAND: Taking so long for the test program, or?

(UNKNOWN): Yes. You're going to test a British gun (inaudible)?

ENGLAND: No, this is being built in the United States, right? This is British design...

JONES: Sir, the answer to your question is without naming names, but the manufacturer has changed twice and the initial manufacturer failed to meet the specifications until we got to the right provider we did meet some failure.

But, we now have a solid program. I mean there is nothing that should preclude from going ahead with this that I can see.

FRELINGHUYSEN: Give me another minute here, or you want to recognize someone else?

LEWIS: We're proud to have you come in.

FRELINGHUYSEN: Sorry to be late. Relative to non-lethal weapons, the Marine Corps, correct me if I'm wrong, is the military's lead on developing non-lethal munitions...

JONES: Right.

FRELINGHUYSEN: ... for all of our services?

JONES: Correct.

FRELINGHUYSEN: I know you've partnered with the Army, done some good work there. Can you give us a quick update as to what we're doing in this particular area?

JONES: Yes, sir, our non-lethal weapon technology is important because of the spectrum, the whole spectrum of operations from peacekeeping to war fighting. And, we have -- we are proud to be the joint lead. It is a joint program. All services are represented. And, we think, particularly in the area of peacekeeping and peacemaking, we are going to be providing some exciting technologies in the future to our men and women in uniform who have to do within the span of three blocks, as my predecessor used to say, go from peacekeeping to urban war fighting and we planned on continuing to develop those technologies so that we can put the right tool in the right place at the right time.

FRELINGHUYSEN: Can you give us an example of what we're talking about here?

JONES: Well, there's all kinds of weapons that we can -- non- lethal weapons that can be used to disburse crowds, for example, where you don't want to inflict casualties in a combat sense. There's an exciting program that's directed energy program that when fired has a range of about 1,000 to 1,500 meters and when triggered it causes the person to experience a heat sense in a portion of the skin that's exposed. It causes that person to have to meet. It's not intolerable, but it causes no long-term damage.

FRELINGHUYSEN: Sounds like something we could use against our political opponents.

JONES: Exactly. We're always looking for ways to transfer to civilian use.

FRELINGHUYSEN: Thank you very much, sir.

JONES: We've been using it successfully against the Army.

FRELINGHUYSEN: Good. I'm stopping right there.

JONES: Is that on the record?

LEWIS: Everything you say is on the record. Mr. Secretary, and gentlemen, I'm (inaudible) but there are a lot of questions that members have for the record and we appreciate you paying attention to them. But, those members who were present, I want to ask them all why you are here, so I'm sorry about that. Mr. Dicks has one more brief question and we're going to let you get out of here.

DICKS: Very quickly, multi-mission maritime aircraft, can you (inaudible) on that?

CLARK: The analysis of alternatives has been in work and is in the review process. I can't tell you exactly how it's going to come out. But, clearly there are several options. One is a repeat, PETE 3 (ph), one would be a commercial derivative. Our vision for this is very clear. Our vision is we're in a world where fixed sensors in an airplane don't make sense. It is about speed and agility and adapting an airplane and a sensor package to the area of operations.

So, I envision an airplane with an architecture in it, a bus that will be able to do plug and play sensors, because I believe that's what is going to be required for the future. That's the way we've laid out the thinking of what our need will be in terms of the requirement. The solution has not been determined.

DICKS: Thank you, Mr. Chairman.

LEWIS: Thank you.

Gentlemen, Mr. Secretary, Admiral Clark, General Jones, this has been a very valuable hearing and even though we're asking questions that sometime cause you to wonder, this committee is very proud of the work you're doing.

I want to close the hearing, however, by recognizing one more time, General Maddis (ph), I hope you have a sense -- a committee like this does not know very much about partisanship. It's a reflection of the country's support for what we're about and we're very proud of the work you've been doing and I thank you for being here.

This meeting's adjourned.

END

NOTES:
[????] - Indicates Speaker Unknown
   [--] - Indicates could not make out what was being said.[off mike] - Indicates could not make out what was being said.

PERSON:  JERRY LEWIS (94%); JOHN P MURTHA (60%); JOE SKEEN (57%); C W (BILL) YOUNG (57%); DAVID L HOBSON (56%); GEORGE R NETHERCUTT (56%); HENRY BONILLA (56%); TODD TIAHRT (55%); RODNEY P FRELINGHUYSEN (55%); NORMAN D DICKS (54%); MARTIN OLAV SABO (53%); JAMES P MORAN (53%); 

LOAD-DATE: March 12, 2002