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U.S. Department of Defense

February 25, 2020

Media Background Briefing on the Secretary of Defense Posture Testimony

Senior Defense Officials

STAFF: At DOD, so this call is going to be on background. Just to give you a sense of who you're hearing from, we've got Senior Defense Official 1; we've got Senior Defense Official 2; and then Senior Defense Official 3.

We're going to -- I'm going to go ahead and kick it to Senior Defense Official 1 to talk us through, kind of top like, what we're looking at in the secretary's posture hearing tomorrow on the Hill. We'll give you guys kind of an overview and then open it up to questions.

Just -- say, embargo these comments until the end of the call. Additionally, we are going to circulate to the folks on this call, the secretary's opening statements. We'll circulate them this evening with an embargo until tomorrow morning at 6 a.m.

SENIOR DEFENSE OFFICIAL 1: All right, so, good evening. Real quick, just obviously stepping in to the secretary's first posture hearing, as Secretary of Defense, coming in what is obviously the beginning of an election year -- political season, fairly partisan environment on Capitol Hill. Lots of big issues swirling around, but the secretary has been aggressively meeting with members of Congress and talking to members of Congress over the last, you know, 30 plus days on both sides of the aisle.

And so I think, you know, he has a good grasp of some of the issues they want to talk about. I think they have a pretty good grasp of where he's at and continuing to build on his relationship with the Hill, which as you all probably know, is pretty extensive just on -- from his personal background and his time as Secretary of the Army where he also did lots of engagements with members of Congress.

And on some of the key issues like nuclear modernization. The secretary was just out at Minot Air Force Base, and then at STRATCOM [U.S. Strategic Command], at Offutt Air Force Base, just a few days ago. He had also met with a large number of congressional members out at the Munich conference. There was about 30-plus members that were out there, to include the Speaker of the House, who he spoke to as -- while he was there.

So again, lots of outreach, lots of talking to members, to include he had lunch with a senior member today from the committee. And continue to make phone calls and talk to members. So that was sort of the background of where we are. If you're not tracking, the HASC [House Armed Services Committee] is a very large committee, so we're talking, you know, almost 60 members or so.

So this will be a long, long hearing that will probably cover, you know, dozens of issues. So I'll turn it over to Senior Defense Official 2.

SENIOR DEFENSE OFFICIAL 2: Great, thanks Senior Defense Official 1 -- thanks everybody. Just to set the stage a little bit, as Senior Defense Official 1 said, I think we expect it to be a pretty partisan environment that the secretary is walking into, and obviously Secretary Esper has made it a clear priority to protect the department, keep the department apolitical. That's a challenge, but that's his goal going in to this.

The other tough factor that you're all aware of is that we're grateful that we have a budget deal, and we have a top line in place. But that budget deal between fiscal year '20 that we're in right now, and fiscal year '21 that we're moving -- that we're proposing the budget for right now, it's actually negative real growth -- about 2% negative real growth.

And so that forced a lot of tough choices in areas that -- you know, the last couple of years we've seen pretty significant growth. This budget does not have that. So, I think you'll hear the secretary make his pitch for in future years some real growth, he's publically talked about 3-5%.

I think the other thing you'll hear from him is a good deal of conversation about reform. His Defense-Wide Review last fall, which produced $5.7 billion in a single year of savings -- there are choices in there that individual members, or groups may not like. But the way he approached it was not whether an individual program was valuable in and of itself, but whether that program was more important than some of the priorities that the NDS [National Defense Strategy] describes in terms of investing in lethality.

So, and with that I'd say Secretary Esper will focus consistently on irreversible implementation of the National Defense Strategy. Our three lines of effort -- lethality, allies and partners, reform. His personal priority of people, happy to go in to any of that -- but that's -- he will continue to talk about that.

And then his reform -- both Defense-Wide Review, reforms going forward in terms of the new sort of organizational management structure for the Fourth Estate. His guidance to each of the military departments to do their own version of the Defense-Wide Review or night court.

And then his ongoing review of all combatant commands. I think, combined, that's where he'll spend a lot of his time. Senior Defense Official 1 already mentioned nuclear triad trip last week was important.

We just rolled out AI Ethical Principles this week, a couple of personnel items -- spousal employment report just came out, secretary's memo on childcare prioritization is out. There's a number of things that are all in the zone for a conversation tomorrow. But, I think that's probably where he'll be trying to spend a lot of his time.

STAFF: And with that, guys, we'll go ahead and open it up to questions. If you can state your outlet as you ask a question.

Q: Hi, it's Paul McLeary from Breaking Defense. Thanks for doing this. You mentioned that compared to '20, the '21 budget is 2% negative growth. And, obviously, service secretaries have said that they expect budgets to be flat going forward.

So, do you expect the budgets in the next few years to be flat, to grow? And in order to undertake these modernization programs, is this going to have to be part of the Defense-Wide Review? Is that really the only way to do this is to try to save money on the backend?

SENIOR DEFENSE OFFICIAL 2: Well, thanks for the question. I think you identified some of the challenges we face. What you didn't mention was personnel growth. We've got a significant pay raise in here as well for civilians and military, some of that in '20, some of it in '21.

I think the secretary's view is one, yes, we do need higher top lines in future years, but also with that comes responsibility to use every dollar wisely, and he's convinced there continues to be room for improvement in savings and reform, which is why he's driving after Fourth Estate, why he's driving after combatant commands, why he's holding the services to account for what he expects them to do.

SENIOR DEFENSE OFFICIAL 3: I think the one thing you will continue to hear the secretary say is we're thankful for every penny that we're getting from Congress, and we realize, and we understand that that is a large budget figure.

And even if it's -- even though we believe that more funds are necessary to accomplish some of the goals that we've been asked to do, we're thankful for that number; but there also comes a responsibility to make sure we're using it in every -- using it wisely, and that we're examining it closely to make sure the American people are getting the best value for the money that they're giving to the Department of Defense.

STAFF: Thanks guys, next question. Do we have another question on the line?

Q: Hey, Alyssa. It's Lita.

STAFF: Hi, Lita.

Q: Do you all have any sense whether or not there's going to be any need to make some either new requests or some arguments for funding to replace money that's being put to the border wall? And or funding in any way or reason for the coronavirus? And do you expect discussion on savings that could come from any potential withdraws of troops from Afghanistan?

SENIOR DEFENSE OFFICIAL 2: So, I think first you saw from OMB [Office of Management and Budget] yesterday, the administration's request for emergency funding for coronavirus; defer you to OMB on that one. My understanding right now is that all of DOD support is reimbursable, so we're not essentially paying for support.

The other two, I'm going to think, we'll let the secretary speak to Afghanistan. Border, I think we, again –

SENIOR DEFENSE OFFICIAL 3: You know, I would say around Afghanistan we don't want to get ahead of any potential announcement that could be coming in the coming days with regard to that. So, he may address that a little bit more broadly tomorrow, but for us I don't think the three of us are in a position to comment on that more broadly.

SENIOR DEFENSE OFFICIAL 1: I would just say in terms of the funds used for the border wall, those came from adds that were either early to need or beyond what the request was, and so I'm not sure I see, at least at the moment, any immediate need to backfill any of those funds, because those are things that were not asked for by the department.

STAFF: Thanks, Lita. Any additional questions?

Q: Yeah, this is Ryan Browne with CNN. Is the secretary concerned that -- that he's going to lose his ability to reprogram funds in the future given kind of the pushback on this reprogramming move, and is he going to make the case as to why DOD needs that ability still?

SENIOR DEFENSE OFFICIAL 1: So, I don't think we'll lose that ability. We certainly, you know, will acknowledge that we made some members pretty unhappy about the process, there's no question about that. But in the end they know that reprograms are just -- it's a necessity over a budget that was built, in essence, almost two years ago, you know, debated a year ago, and then -- you know, implemented in its current day that there are going to be changes, and they know that.

I think the one thing that we have been pretty consistent with is, following the practice that we did last year, which was, you know, as we get back to reprogramming that we followed our sort of traditional, normal processes which is -- you know, we submit it to Congress for their approvals. And so we'll go through our normal things of -- as we've done for decades, of giving Congress the final say on what they approve and don't approve in terms of reprogramming.

SENIOR DEFENSE OFFICIAL 3: So, I have no doubt that the secretary will have opportunities tomorrow to explain the value of the reprogrammings and the value of that authority, and he will -- he will definitely make it clear that the department believes we need that ability in order to adjust as things happen throughout the year -- two years, plus after a budget is requested and passed.

STAFF: And I would just add on that, the secretary has consulted with members of Congress throughout this process, and has heard both their concerns and support with regard to the border specifically. But he's made the point, the president's declared a national emergency -- border security is national security, and expressed that to the Congress. So we anticipate that issue will come up, and he's prepared to discuss it.

Next question?

Q: Hi, Connor O'Brien with Politico. Thanks for doing this. I was just kind of curious, there's been some pressure from the Hill for the secretary to deliver the third year shipbuilding plan, give an update on the force structure -- a lot of angst over the shipbuilding budget with the Navy. Members saying it doesn't go enough towards building the 355-ship Navy. You know, what do you expect his message to be?

SENIOR DEFENSE OFFICIAL 2: Thanks, Connor. One, I'd refer you to the secretary's remarks at SAIS [Johns Hopkins School of Advanced International Studies], I think about a week and a half ago, where he talked a little bit about his philosophy on this.

Number two, you know, our shipbuilding plan is in the budget in terms of year one, and -- I think through the first five years. Number two -- no, number three, I would say that's a good question, and I'm sure it'll get discussed in the hearing tomorrow, so I don't want to -- I'll let the secretary speak for himself.

STAFF: Thanks Connor. Next question.

Q: Hi, it's Paul again, I just wanted to follow-up on that. There was a report today that the Navy's shipbuilding plan has been kind of put on hold by Secretary Esper as he reviews it. Just wanted to know if you guys could confirm that, and give us a sense of why he's holding it up, and kind of when he expects to release that?

SENIOR DEFENSE OFFICIAL 3: Hey, Paul, I think what we'd say on that is that the secretary is currently looking at that plan, but is -- as Senior Defense Official 2 just mentioned, the first five years of our shipbuilding plan are in the budget that we've submitted. The secretary will often say that even this budget, he has -- he's coming in to this starting in July, the budget process starts -- started earlier.

And, so this is his first opportunity, going in to the next cycle to have a full imprint of his prioritization on the budget. And, so, he's taking time to review things, including major expenditures like shipbuilding, to make sure that it reflects his views with regard to the National Defense Strategy, and to prioritize the priorities that he sees the department to have.

So, he's looking at it. I'm sure he will be asked about it tomorrow, and he will -- he'll be talking about it with the members.

STAFF: Thanks. Do we have another question? If no – if there are no further questions, with that we'll wrap it up. We appreciate you guys making the time and being flexible, I know we scheduled this at a couple different times. And, we will be sure to circulate his opening remarks to you with an embargo of 6 a.m. tomorrow.

Thank you.


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