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U.S. Department of Defense
Office of the Assistant Secretary of Defense (Public Affairs)
News Transcript

Presenter: Secretary of the Air Force Michael B. Donley; General Mark A. Welsh III, Air Force Chief of Staff; and Brigadier General Les Kodlick, Director Of Public Affairs, U.S. Air Force January 11, 2013

Air Force News Briefing by Secretary Donley and General Welsh on the State of the Air Force in the Pentagon Briefing Room


BRIGADIER GENERAL KODLICK: Good morning.

While you're getting situated, good morning, everybody. I'm Brig. Gen. Les Kodlick, the director of the Air Force public affairs here in the Pentagon.

It's my privilege to introduce Secretary Mike Donley and the Chief of Staff of the Air Force Gen. Mark Welsh to the press briefing this morning. We're going to talk about the state of the Air Force.

It's the first press briefing the secretary and the chief have had the opportunity to do together. It's our intent to do this periodically to inform you and the American people about our Air Force.

You heard from the secretary of defense and the chairman yesterday, so it's appropriate that we're here today to talk in large part about force structure, readiness and modernization. We've got about 45 minutes for today. We do have a hard stop due to a follow-on appointment. So what I'd ask you is as we do this time frame, I'll call the last question at 11:40. Usual routine: state your name and affiliation, do a question and a follow-on.

So, Mr. Secretary, over to you for your remarks and then we'll take questions.

SECRETARY DONLEY: Thanks, Les.

And good morning, all. Thanks for being here.

The chief and I thought this would be a valuable opportunity to begin the year by sitting down with you to discuss the state of our Air Force and some of the issues and challenges we expect to address in the year ahead and beyond.

To start, I'd like to thank the House and the Senate for approving the conference report to the FY13 National Defense Authorization Act, and thank the President for signing the bill into law. This important legislation provides the authorities and policy guidance that enable DOD to support our warfighters, to provide for our airmen and their families, and to protect the American people.

The enactment of the NDAA is a significant achievement, and demonstrated strong bipartisan commitment to national security. We hope this success may spur progress on critical issues that still remain.

Those issues include efforts to develop a balanced deficit reduction plan to prevent the arbitrary sequestration cuts required by the Budget Control Act, a final FY13 appropriation bill to replace the current continuing resolution, and the upcoming consideration of the president's FY14 budget.

Congress' recent decision to delay pulling the trigger on sequestration for two months was a positive step. And although we welcome the delay, we're still deeply concerned about what may happen should we fail to reach deficit reduction agreement by the end of February.

Our nation's ongoing budget gymnastics exert costly consequences upon the Air Force and our sister services and create an atmosphere of unease among many of our uniformed and civilian airmen.

Failure to enact a settled budget leads to repeated budget iterations, which, along with the overhanging threat of large and largely arbitrary cuts, creates wasteful churn.

Given that we are now into the second quarter of fiscal year '13, we can no longer live under the uncertainty of sequestration and the continuing resolution without taking action now.

As Secretary Panetta described yesterday, even though we're not presuming this worst case will occur, prudent planning for the third and fourth quarters is required. We received the secretary's guidance to begin implementing prudent measures that will help mitigate our budget risks to ensure these measures are reversible and recoverable, and to the extent feasible, minimize any harmful effects on readiness.

The Air Force is currently turning the secretary's guidance into direction to our major commands, which we expect to issue in the next few days.

The impacts to the Air Force will be in the same categories outlined by the secretary yesterday: civilian hiring restrictions; curtailing non-readiness or mission essential flying and travel; curtailing or stopping minor purchases such as furniture and IT refreshment; and deferring non-emergency facility sustainment, restoration and modernization.

To be clear, these near-term actions cannot fully mitigate the impacts of sequestration should that occur. If we do not have resolution by March, sequestration will have immediate and negative impacts on Air Force readiness, specifically flying hours and maintenance.

As Secretary Panetta has reiterated, the focus now must be on taking the threat of sequestration off the table and enacting a budget agreement that will stabilize defense planning for the remainder of FY13 and the years ahead.

Looking ahead, our Air Force will continue to balance competing defense needs among the size of our force structure, today's readiness, and modernization for the future.

From previous Defense drawdowns we've learned that during periods of austerity, tough decisions have to be made to avoid a hollow military, one that looks good on paper, but has more units and equipment than it can support, lacks the resources to adequately man, train and maintain them, or to keep up with advancing technologies. To avoid the perils of a hollow Air Force, we believe the best path forward is to become smaller in order to protect a high quality and ready force that will improve in capability over time.

More than two decades of war and other operations have had an impact on our readiness, straining our airmen and their families, reducing opportunities for training, and taking a toll on equipment.

The need for modernization is pervasive across our Air Force. While service life extension programs and modifications have largely kept our inventories up-to-date, the -- the cost of maintenance and sustainment is rising as budgets are flattening, and new threats and technologies require new investments.

Like the other services, the Air Force will work with our defense and national leadership to fine tune our plans and programs as we confront both a dynamic security environment and the nation's fiscal challenges, as well. We'll adjust and compromise as necessary, but we will need broad consensus with the Congress on the way forward to avoid a hollow military. This must be our priority.

Nevertheless, despite enduring challenges, I'm pleased to note that our Air Force has made progress in many areas and can point to a number of accomplishments during the past calendar year. We worked through the active component-reserve component force structure challenges that were part of the FY13 president's budget proposal to produce a compromise which Congress passed, unfreezing previously approved force structure changes.

We confronted the problem of sexual assaults and unprofessional relationships at basic military training, and have convicted offenders. We're strengthening our sexual assault prevention efforts, and recent initiatives in this area include the Air Force-wide health and welfare inspection and the establishment of a special victims' counsel program.

With regard to space launch, the Air Force completed nine successful national security space launch campaigns in the EELV program, and this makes 55 consecutive successful EELV launches to date and 90 consecutive successful national security space missions.

We've implemented a new EELV acquisition strategy to efficiently purchase up to 36 cores, while introducing a competitive environment for up to 14 cores from new entrants, starting as early as FY15.

This for the first time gives new entrants a clear path to compete for national security space missions.

Our procurement strategy is driving down satellite costs, resulting in savings of more than $1 billion on the advanced extremely high frequency, AEHF satellites, and savings projected of more than $500 million for the SIBRS program. We've resolved as best we know how the previously unexplained hypoxia incidents in the F-22 and put this critical aircraft on the path from return-to-flight to full operational capability.

The F-35 continues to mature, and with the completion of our operation -- operational utility evaluation, the OUE, training at Eglin Air Force Base will begin this month.

Although combat operations in Iraq are complete, missions continue in Afghanistan, and we remain a nation at war.

Over the holidays, the chief master sergeant of the Air Force, Jim Roy, and I had an opportunity to visit Air Force commanders and airmen throughout the CENTCOM AOR. And we found that, despite the challenges of deployment, the morale of our airmen is high.

America's airmen are focused on their missions, and they demonstrate every day what it means to be members of the world's finest air force. Thousands more uniformed and civilian airmen in the U.S. and around the world work to support our airmen down range. And these total force airmen -- active duty, Guard, Reserve, and civilian -- are the reason I can say without reservation that the state of our Air Force remains strong.

General Welsh and I and the entire Air Force leadership team are committed to doing all we can to ensure that the Air Force stays that way: Strong, ready and capable of delivering airpower whenever and wherever the nation calls.

Another major milestone this year was the arrival of our 20th chief of staff, Gen. Mark Welsh, who's brought new energy, tremendous operational insights, and inspirational leadership to the top of our Air Force team.

So before we take your questions, I'll ask Gen. Welsh to make a few remarks.

Sir?

GENERAL WELSH: Thank you. I appreciate that.

And good morning ladies and gentlemen. Thank you for taking the time to be here.

I apologize for my extra hardware this morning. It -- it's actually -- it's ugly in these sequestration meetings.

(LAUGHTER)

We were struggling for resources between the service chiefs the other day, and I think it was the first time I realized just how big Ray Odierno really is. So I'm recovering slowly.

Yesterday we released an updated vision for the United States Air Force. It's focused on airmen, mission, and innovation. And the intent is to capture what today's Air Force is all about, as well as to kind of point out the areas that we think we should be focused on in the future.

It highlights airmen as the source of our strength as a service, and it outlines the five enduring contributions that will continue to guide us as we move forward, no matter what happens in -- with the fiscal realities of the future. They will be our contribution to the nation's defense and they'll remain the Air Force's calling cards.

The vision also embraces innovation as almost a genetic trait of every airmen. I believe that's true. In order for -- for us to be successful, I think it has to be true.

It's only about 1,000 words long, takes about three minutes to read, and Les Kodlick can get you a copy if you haven't seen it, if you'd like to take a look. The bottom line, though, is that we intend to remain the world's greatest air force, powered by airmen and fueled by innovation. And that's what the vision says.

I guess it's not news that we have some budgetary uncertainty, as the boss mentioned. I think we can be confident that defense budgets will shrink, but how far remains to be seen.

Secretary Donley has already made some pretty tough budget decisions that are now reflected in the FY13 National Defense Authorization Act. And those decisions translate into an active duty Air Force of about 329,000 airmen, about the same as when we -- when we became a separate service back in 1947.

In just the last 10 years, we've retired about 1,900 airplanes. We've separated about -- not separated, but we've dropped about 30 -- 30,000 active duty billets in our active component.

And none of those things is inherently bad, by the way. They're simply reflective of today's fiscal and strategic environment. But I'd like to echo the secretary's message and just tell you that what it means to us is, as we've moved toward that smaller and more capable and ready force, we have to be careful to protect our core missions, and we have to be able to execute those enduring contributions I mentioned before. Because if we don't, the entire joint force is impacted, and it's impacted in a significant way.

The director of the Air National Guard, the chief of the Air Force Reserve and I have spent an awful lot of time and energy lately focused on communication and coordination between our three components. And Gen. Frank Grass, the chief of the National Guard Bureau, and I have put the same effort toward coordination, communication between the Air Force and the National Guard Bureau.

Obviously, the force structure, the mix between the active and the reserve components of the Air Force, is a contentious issue and has been for the last six to eight months, clearly -- and it continues to be. I'd -- I'd characterize our coordination with the group I just mentioned as energetic and improving.

But we're absolutely committed -- everybody in the group I just mentioned is absolutely committed to ensuring that in the future when we come forward with force structure and mix recommendations to the secretary, to the secretary of defense and to the president and to the Congress that we speak with one voice. We're going to do everything we can to get there.

You know, the first memory I have of my grandfather is him pulling up in front of our house in this '53 Chevy convertible, green and white. It was a sweet car. Now if we were at Minot today I could take you out on the flight line, I could show you a whole bunch of "sweet" B-52s. And in 2028 when we deliver the last KC-46 tanker, we'll still have about 200 "sweet" KC-135s on the ramp. And they'll be about the same age then -- 60 -- as my grandfather's car would be today.

And the difference is that my granddad's car has an antique auto plate on it. And in 2028 your kids are gonna be flying those KC-135s into contingencies and combat zones around the world.

Modernization isn't an option. It doesn't matter if we get smaller. We have got to figure out how to make modernization happen.

We've got a pretty good track right now with our fighter, bomber programs and our space programs. It's a good start, but it's just a start. We have to figure out how to keep it moving.

The boss talked about readiness. We've been flying combat sorties in the Middle East since 1991 nonstop. Decreasing force structure, increasing OPSTEMPO after 9/11 combined to create a readiness problem that started to really show itself in about 2003, and our readiness statistics have been declining steadily ever since.

We've been forced to put full training -- full spectrum training excuse me, onto the back burner in order to take care of the current fight. That's had an impact on us.

And what makes any Air Force, but in particular our Air Force an asymmetric advantage for America is our global range, our speed, our flexibility, and our precise striking power. That's what Air Forces do. It's not always a pretty business, but that's what we do.

Strategic agility and responsiveness require a high state of readiness from airmen, equipment, and based on training. And sacrificing that readiness really sacrifices many of the strategic advantages of airpower. And I believe that's always a bad idea. And so that's in the background as we look to the future and put our plans together.

As America responsibly draws down from Afghanistan and rebalances to the Pacific, the demand for airpower will likely remain about the same. I don't think it's going to change significantly. The Air Force will just haul troops, cargo or humanitarian supplies in a different direction. We'll continue to fly ISR sorties. This time we'll be filling collection needs of the other combatant commanders who haven't had the support they would like over the last 20 years.

We'll build partner capacity. We'll stand the nuclear watch. And we'll stay ready for the next call to action -- because I'm pretty confident there's one coming.

Secretary Donley and I will work hard to ensure that whatever resources we do have are used responsibly to attain the best balance of force size, modernization, readiness possible. That's our job, and we'll do it to the best of our ability.

We're lucky in that effort because we have a secret weapon. We've got 700,000 unbelievably dedicated, committed and talented men and women in our Air Force components who help us do it every day. We are privileged to stand beside them.

Let me close by acknowledging two of them very quickly before we get to your questions.

At the end of this month, a couple of great airmen are retiring. One of them is Lt. Gen. Bud Wyatt, the director of the Air National Guard. Bud's led the Guard fantastically well for the secretary, for Chief Schwartz and now -- now in association with me throughout his entire tenure. He's a great airman, he's a great officer, and he's a great leader.

To me, he's also a role model, a mentor and a great friend.

And as he and Nancy move on to their next chapter in life, the entire Air Force is going to miss him.

Also at the end of the month, our Chief Master Sergeant of the Air Force Jim Roy and the lovely Ms. Paula will retire and move down to South Carolina to begin their next adventure.

Chief Roy has served the secretary and Chief Schwartz and I unbelievably well. He is a special human being. And if he's been the backbone of our Air Force for the last three-and-a-half years, Paula's been the heart. Every airman -- every airman is going to miss them.

And we wish him huge success and happiness in the future.

Thanks for listening, folks. Thanks again for taking your time to be here, and we're ready for some questions.

Yes, sir?

QUESTION: Thanks very much. Spencer Ackerman with Wired.

Under this curtailment that the secretary announced yesterday, what's going to take a hit immediately? Is R&D on the table? Do you see that going down? And over the long term, are you still confident you'll be able to build the long-range bomber that the Air Force has been looking forward to?

SEC. DONLEY: The secretary's guidance asks us to focus on -- on adjustments and spending patterns that are reversible and recoverable to the extent possible. And so I think while it'll affect all parts of our Air Force, we are focused on the operation and maintenance parts of our Air Force which -- which fuel the day-to-day operations of the Air Force.

So those are the areas that I think will have sort of immediate impacts. We've talked about -- I talked about facility sustainment and restoration. I think that is a large part of our operation and maintenance funding to support all the facilities and buildings that we maintain. So I think that's a particular area.

We do have to address the civilian personnel aspects. We talked about civilian hiring constraints, perhaps freezes in some particular areas. Because civilian pay is about 40 percent of our operation and maintenance budget. So, it's a significant piece. We can't ignore it going forward. So we have to do prudent personnel planning.

Long term, we're committed to the long range strike bomber to which you referenced. We're going to try to keep programs like that on track. But every program would be affected if sequestration were to hit.

Let's go in the back here.

QUESTION: Michael Hoffman with Military.com. I wanted to ask about flying hours, and if you expected those -- the numbers to go down this year.

SEC. DONLEY: We're going to try to protect readiness-related training as far into the year as we possibly can. So the curtailments we're looking at now relate to non-mission essential or non-readiness related flying. And we'll let the commanders make the individual calls on how best to do that.

Again, this is a large expense for the Air Force, and broadly it's a big chunk of operation and maintenance funding. So -- but we're trying to protect the readiness impacts from flying hour reductions as long as possible.

But to come back to the basic point here, the measures we're taking now are the prudent things we can do to mitigate risks. If sequestration hits and the multi-billion dollars reductions fall on the last two quarters of the fiscal year, there is no way not to impact training, flying hours, and maintenance, which are things, right now, we are trying to protect as long as we can.

Yes, Jeff?

QUESTION: Hi. Question -- the memo by Secretary Carter talks about the possibility of canceling third and fourth quarter ship maintenance and aviation and ground depot-level maintenance activities. I want to know how specifically will this affect the Air Force.

And also, Gen. Welsh, what happened to your arm?

SEC. DONLEY: Well, on the first part of that, as I mentioned, we're -- we're trying to take prudent actions now that are as reversible, recoverable as possible. We're trying to protect maintenance for aircraft and weapons systems sustainability as long as we can into the fiscal year.

We will have to look at what the third and fourth quarter execution will look like as we go week by week into assessing how many inductions of aircraft that we take into our depots and what -- what the expected output is, and what has the most or least impact on readiness.

So our life-cycle management commands and those that work in these areas will be assessing, you know, by every aircraft type, sort of, what the workloads will be and trying to figure out how to minimize readiness impacts.

But, again, if these cuts fall on the third and fourth quarters, there's no question there will be impacts.

GEN. WELSH: Secretary Donley's not nearly as nice a guy as he appears in public.

(LAUGHTER)

Yeah.

The truth -- this is really kind of embarrassing. The truth is about a year ago my wife and I went wakeboarding with my oldest son and our grandkids. My wife is a very good water skier -- never tried wakeboarding, nor had I. But she immediately jumped on a wakeboard, came out of the water instantly and was incredibly good -- which of course meant that I had to be better. Being the guy it was important for me to show her up.

And so about 10 face plants later and a torn up shoulder I can see it once again that my wife is better than me at everything. And now I need to get the depot repair in before sequestration hits.

(LAUGHTER)

So that's why (inaudible).

Yes, ma'am? Back here.

QUESTION: Thank you, General. Amy Butler with Aviation Week.

I'm curious, given the churn going on around the F-35 program, does the Air Force -- Air Force have a path and can you articulate it to us to understand more fully what the sustainment costs will be for the aircraft and to bring that data, you know, into a system, the outcome of which will decide how many you can afford and when you will bring them into the fleet and what the maintenance processes will be.

GEN. WELSH: Let me start. I know the secretary has an opinion on this one.

Let me tell you what the effort has been over the last six months or so. Lockheed Martin put together a briefing while I was still in my last assignment -- that I saw; that was shared with our European partners in the program -- that talked about the sustainment costs of the program. The number -- and they referred to it in terms of cost per flying hour -- that number was not the same number that I had seen in briefings from our Air Force. Not intentionally. It was just characterized in a different way, different format.

And so when I got into this job, I asked our acquisition workforce and our program office to get with the Lockheed Martin team and -- and put these numbers side by side and figure out exactly what the differences were between the number we had thought and the number they had, to try and get at that problem. So that's one piece of it, can we determine where reality is and the figures we're using?

And that -- that process is pretty far down the path, and I think we're getting to a point where we have a pretty good understanding of the cost per flying hour as we will define it in the Air Force. The numbers are going to be a little bit different for the Marines and the Navy, and we're trying to kind of resolve all that, too, so we're comparing apples to apples.

The second part of that is making sure that as we get more and more actual numbers now -- because we're flying the airplane. It's a real airplane. It's flying at Eglin Air Force Base every single day, not just in a test program at Edwards. My first trip to Eglin, I got out of the airplane, looked up, and a four-ship of F-35s came off a mission.

It's -- so, it's real.

(CROSSTALK)

GEN. WELSH: Well, I'm sure it wasn't.

QUESTION: Okay.

GEN. WELSH: It was impressive.

And so we are now getting actual data that we can track and add into this equation, which will be very helpful for us, I think. And that will get more and more definitive as we fly more and more aircraft.

So it's very important that we get this -- a clear understanding of this number. It's critical to us for all kinds of reasons: for funding support, for our allies' satisfaction and comfort level that the airplane is going to do what it's supposed to do.

I'll tell you one thing about my visit to Eglin -- the one quote I took away as an operator. When you talk to the guys flying the airplane, who are kind of the ultimate realists -- they aren't impressed by PowerPoint slides. The one quote they give you is that, 'They got the airplane right.' That's a quote from Andy Toth, who's the wing commander down there. He said, 'We're working all the other stuff -- the details of any development program, but they got the airplane right.' That's really a pretty powerful statement to people who fly airplanes.

Mr. Secretary?

SEC. DONLEY: Well, just to add briefly, there's a lot of work focused on sustainment and support for the F-35 program because it's transitioning into a more robust training environment and ultimately to a deployed environment. So these aircraft are coming off the line. They're being sent to Eglin, to Nellis, other locations. And -- and so the services are starting to take ownership of this, and it's very important we get this right.

How to control support costs and provide for streamlined support on a worldwide basis is on the Joint Strike Fighter program agenda for all of the partners to be working. There's ongoing work on how to do the global logistics support for this, and it's an issue inside the Department of Defense.

I'd also, you know, point to the fact that the -- in -- in the context of building this program, the F-35 simulator is the most sophisticated simulator that we have in the fighter world now. So it provides a great opportunity to look more carefully at how we divide actual flying hours from sim time. In some other areas this can be more challenging if the simulators have not kept up or the ranges have not kept up with modern technologies. In this case, we have a very modern simulator so there is some advantages we'll need to take advantage of there.

QUESTION: If I may follow up (inaudible) can you tell us what those cost per flying hour projections were?

GEN. WELSH: I don't have -- I don't have the specific number, but I think the folks in the program office and the folks at Lockheed Martin are getting to a point where they understand exactly what the numbers are. What number we're going to use, I don't know yet.

QUESTION: (off mic) could we get a follow up on where they started when you got that briefing?

GEN. WELSH: Sure, yeah. Absolutely.

In the back over here (inaudible).

Yes, ma'am. How are you?

QUESTION: Fine, thank you.

Let's say you avoid sequestration, and -- but everybody agrees budgets are being cut and the Air Force budget will be cut. And let's say you still are going to be asked to do the same kind of flying missions.

Where do you see the force after these budget cuts? How is the Air Force going to change? And what won't you be able to do? Or can you give us an indication of how -- how things are going to change in the next few years with budget cuts?

SEC. DONLEY: I think that the mission set of the Air Force and the things that -- that Gen. Welsh referred to, the core functions and -- and the calling cards as -- as the chief refers to them as, would -- would stay the same. We're going to continue to do global ISR. We're going to continue to do global precision attack -- attack, mobility, command and control, special operations. All these things remain part of the Air Force's job jar.

The challenge for the Air Force -- and not just the Air Force, other services as well -- is capacity. What will be the size of the military? How much of that will we have? So I think -- I think those are the issues pressing in on the U.S. military.

We all understand the value of the joint capabilities, which the Air Force, the Navy, the Army bring to the joint team, the importance of that to coalition operations in all its dimensions. We need all of these piece parts to bring together the world's finest military capability.

The issue is capacity, how much of it will we -- will we have? You can see what the Air Force will look like now in 2020 in terms of new capabilities coming onboard. The tanker will be fielded. The F-35 will be fielded. We'll be well along in the development of the bomber program. We will have developed further in the cyber area, for example. So you can see based on our -- our priorities, and the -- the dollars that are being invested now when these capabilities will deliver.

So I think in terms of new capabilities coming in, you can see some of what the future Air Force will look like. But the the underlying issue is size, overall capacity of the armed forces.

QUESTION: (off mic) does it have to go?

SEC. DONLEY: As -- as I tried to articulate in -- in an op-ed earlier this week, I think there are questions about how much smaller the Air Force can go in some of these areas without impacting the capability that we provide to the joint and the coalition teams.

QUESTION: Diane Barnes, Global Security Newswire.

Can you provide any updates on nuclear surety reform activities at Global Strike Command or elsewhere in light of the weapon mishaps of a few years ago?

SEC. DONLEY: (inaudible) I think we're in a much stronger place than we were a few years ago. We have -- we've put in -- in place a more rigorous inspection processes. We've put in place much more intensive oversight. We restructured our nuclear enterprise operations under Air Force Global Strike Command to help us get through -- to -- to help us get unified management over this capability.

We've worked very hard with -- through the Nuclear Weapons Center and Air Force Materiel Command to get very close alignment between operations and sustainment. So I -- I think we've made considerable progress in our oversight of -- of the nuclear enterprise in the Air Force.

QUESTION: One quick follow-up quickly: Have you made any preparations for deployment reductions in preparation for New START obligations?

SEC. DONLEY: The Air Force is in the midst of implementing the New START agreement, with respect to preparations for adjusting the size of the bomber force and also planning for adjustments in the size of the ICBM force. So we're doing the advanced planning that goes with START implementation.

Yes?

QUESTION: Jon Harper with the Asahi Shimbun. Is there any plan to deploy the CV-22 to Okinawa or any other place in Japan?

[Editor's note for correction to the record: There have been no decisions made about the deployment of the Air Force CV-22 aircraft in the Asia-Pacific region. As part of the planning process, the Department of Defense evaluates a range of possible basing options for our forces. That process is currently on-going.]

QUESTION: Sir, after all of the -- Jim Garamone with American Forces Press Service. But after all of the fiscal cliff negotiations, there's been a lot of chat around the Internet from -- from airmen saying that they can't plan for the future. And a lot of these folks, who are good folks, are getting out rather than -- rather than staying. Is that a problem that you're trying to address?

SEC. DONLEY: Retention in the Air Force remains very strong. But I -- I did offer commentary here that if the current uncertainty associated with the budget processes here in Washington does create anxiety and frustration among, certainly the Defense leadership, and -- but among airmen, as well.

They see and understand what's going on in Washington. They're very well-connected. They're the most educated force we have ever had. And they stay connected to what's going on in our Air Force and what's going on in our military, what's happening in Washington. So they -- they're -- they are watching this and reaching -- making their own judgments about the process.

This -- it is extremely inefficient and disruptive to have multiple -- to be, basically, operating a multi-billion dollar, 100-plus billion dollar enterprise, which is the United States Air Force on a month or two at a time. This is not a sensible way to approach budget operations and execution. We can do better.

GEN. WELSH: Jim, if I could make a comment on this, Mr. Secretary. Let me tell you what the people in the Air Force are, and that's proud. They're also a little tired of deploying for 20-plus years, of -- of trying -- of working hard to keep weapons systems operating without the funding needed to keep readiness levels where we think we need them. And so that's why we have to go to the smaller force so they don't have to face that frustration.

I don't believe that what you describe is a major issue. They're not begging to get out the door. Our retention rates are great. They're still proud of who they and what they do. They express it every single day. But they wanna know what's coming.

Because they are much better informed than they were when I was a young guy in the Air Force, for sure. We had 19-year-old airmen asking me questions I didn't worry about until I was a colonel or a brigadier general. They're phenomenally engaged. And so we're trying very hard to keep them informed and improve the communication with them.

You do that for us, by the way. You help us with this. Good news and bad news, it's all important for them to hear.

The vision that I mentioned -- I sent to every airmen in the Air Force. It's -- it's not a -- posted on our website. It's an e-mail to each one of them with a note from me with -- I send them a note once a month to kind of tell them what are we doing on the air staff, what are the key issues we're trying to work, which direction do we think we're moving with these things. The intent is to try and keep that going to ensure all of our commanders at every level and our supervisors are doing the same thing.

Communication for us right now is absolutely essential internally if we're going to be successful down the road. And so we're working this pretty hard.

Yes, sir?

QUESTION: (inaudible) Federal News Radio.

We heard an outside assessment earlier this week indicating that were sequestration to happen DOD would have to furlough the entire civilian workforce for the maximum amount legally possible. A, does that jive with what your expectations would be? And, B, how does that impact your various mission sets? Any thinking so far on how to mitigate those bad effects?

SEC. DONLEY: Well, we do have to pay attention to the planning that would be necessary to do that later, if -- if required because of the various personnel rules that are in place -- and, rightly so, notifications to union and all that, so we have -- to unions.

So we have to -- we have to pay attention to that, plan for that at some point, just to be prudent in terms of how to approach the third and fourth quarters.

Again, if the sequestration falls on just the last two quarters of the fiscal year, we can't avoid these kinds of impacts. And in this case, as I mentioned, I think about 40 percent of our operating account is in personnel -- civilian personnel.

So these things have to be looked at seriously. They cannot be avoided.

Sir?

QUESTION: Yes, Brian Everstine, Air Force Times.

Can you say if there's anything new on the intra-theater airlift working group? If there's any decisions on the 32 additional airlifters directed by the NDAA? And if there's a breakdown of C-130s and C-27s in that group?

SEC. DONLEY: That -- that work continues. I do not anticipate that we're going to change our position on -- from the president's FY13 budget to terminate the C-27 program. I don't think we're going to revisit that. So we're focused in this group mostly on, sort of, what to do about additional aircraft authorized by Congress. And we're developing courses of action appropriately to -- to address that. But I don't think we're going to revisit the C-27 issue.

Yes, ma'am?

QUESTION: Mr. Secretary, Sandra Erwin with National Defense Magazine.

The Air Force was criticized by several members of Congress in the last few months for spending a billion dollars on an expeditionary logistics system that was canceled. Can you talk about what steps you might be taking now to prevent those kinds of problems in the future with -- with major acquisitions? I mean, $1 billion now with a budget cut seems like a lot of money to have been wasted on a single program.

SEC. DONLEY: There are important lessons learned from ECSS, and -- and we're trying to capture that and apply it going forward.

We do have other enterprise resource programs related to new budget systems and new personnel systems that are making some progress and are coming -- coming along.

ECSS, we simply lost confidence in the ability of that program and that contractor to deliver on what was intended. It's unfortunate we had to go a few years into it before doing that, but we expended time, resources, effort to adjust the program to see if it would be recoverable, and -- and to try to set it on corrective paths. That did not work, and -- and so we just lost confidence in that program.

But we do think there are lessons learned. We -- we owe the department a plan for the way forward here later this month. We also have some correspondence to answer to Senate Armed Services Committee and others on Capitol Hill as well.

BRIG.GEN. KODLICK: Ladies and gentlemen, we have time for about one more question. Lita, why don't we do that with you. And then Chief, Mr. Secretary, I'll give you a chance to just wrap things up.

QUESTION: Thank you. Lolita Baldor with the Associated Press.

Can either of you just provide a little bit more detail on the budget savings that -- that you're expecting to find over the next several days as you start to put out this -- these memos and these orders? How much do you think you have to find in savings? And where do you think the bulk of that is going to come from if you need to at least protect maintenance? Is it going to come from these personnel savings, or not?

And have you started to try and put out any of these notifications to civilian employees about potential either furloughs, layoffs, and freezes? And how much can you save from those?

SEC. DONLEY: At the back -- the back part of your question, the answer is we're going to put out guidance in the next few days. We are -- we are not making notifications with respect to furloughs. That is not on the table at the present time. But we do have -- have to consider a hiring freeze or certainly -- perhaps with some mission essential exceptions. But we will be -- this is what we are working through right now. So there will be some impact on our civilian personnel management processes.

We're not targeting particular dollar amounts to save. And I come back to this. The secretary addressed this yesterday. There is nothing we can do in the next two months or in the next nine months, the remainder of this fiscal year, to mitigate the impact of sequestration. So there are no particular targets. It is simply prudent management steps to start adjusting the way we expend dollars so that we -- we literally do not fall off of our own cliff created by this sequestration problem. That's our challenge as managers of the taxpayers' resources.

So there are no -- no specific targets, because they -- they wouldn't mitigate the impacts of -- of sequestration, and all they can do is sort of anticipate, slow, sort of prepare, as the chairman described yesterday, to steel ourselves for what might happen.

QUESTION: (off mic) what share of this -- of this entire pie of cuts that the Air Force would have to bear?

SEC. DONLEY: We do have a sense for this, and I think at the macro level it was about 18 percent, I think, to 20 -- 20 percent reductions in our O&M accounts. I'll see if I can get a little bit more detail for you on that. But I think that -- that is the -- the estimate if all this were to take place.

But again, we're -- in the near term, as we introduce these mitigating strategies over the next month or so to slow spending, we're not -- not looking at particular targets.

BRIG.GEN. KODLICK: Mr. Secretary, one minute remains. I'll give you both the opportunity to close.

SEC. DONLEY: Chief?

GEN. WELSH: Sir, thank you.

The airmen in the Air Force right now are wondering about what our job will be in the future and where they fit in it. That's their big question. I stress to them whenever I get the chance that the job description for the Air Force was written in 1947 in the National Security Act. It's never changed. The five missions in that National Security Act are the ones we're still doing today. I don't expect them to change.

The space and cyber capabilities we developed to do those missions better, were not envisioned in 1947, and so those need to continue. And our focus needs to be on getting better and better and better at the way we do these missions.

The the future for us is figuring out how to integrate data, how to better integrate information, how to move it quicker, how to connect platforms and sensors together. That's not as expensive as new weapons systems. It's more near-term return, and it benefits us in the way we do the job today. And so we have people all around the Air Force focused on that problem right now.

And let me close kind of where I started with: Airmen are the strength of what we do. My job, the secretary's job, and our focus everyday is to make sure that -- that we enable them to do their job, and then we stand back and are amazed at how well they do it.

Thanks for being here.

SEC. DONLEY: And thank -- thank you, Chief.

Just to reiterate and sort of pick up on the chief's theme, it takes our Total Force airmen -- active, Guard, Reserve and civilian -- to do all this work, and we rely on them to help us get the missions done every single day.

Our obligation as leaders is to hand off to our successors an Air Force that is better than the one that was handed to us. And that is how our Air Force has gotten better and better, decade after decade. So our obligation is to keep this Air Force the finest air force in the world.

We have airmen that will help us get through the challenges ahead, and we do face significant strategic challenges and fiscal challenges at the same time. But, you know, we've been through lots of ups and downs over the years, and if we support our airmen and their families in this work -- active, Guard, Reserve and civilian -- they will get us through.

And I'm confident, making prudent choices, difficult decisions between force structure, readiness, and modernization, these difficult trade-offs going forward, we can still stay the world's finest Air Force -- and will.

Thank you.

http://www.defense.gov/transcripts/transcript.aspx?transcriptid=5174



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