[Senate Hearing 108-681]
[From the U.S. Government Publishing Office]
S. Hrg. 108-681
CONTINGENT EMERGENCY RESERVE FUND REQUEST FOR IRAQ AND AFGHANISTAN FOR
FISCAL YEAR 2005
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HEARING
before a
SUBCOMMITTEE OF THE
COMMITTEE ON APPROPRIATIONS UNITED STATES SENATE
ONE HUNDRED EIGHTH CONGRESS
SECOND SESSION
__________
SPECIAL HEARING
JUNE 2, 2004--WASHINGTON, DC
__________
Printed for the use of the Committee on Appropriations
Available via the World Wide Web: http://www.access.gpo.gov/congress/
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__________
COMMITTEE ON APPROPRIATIONS
TED STEVENS, Alaska, Chairman
THAD COCHRAN, Mississippi ROBERT C. BYRD, West Virginia
ARLEN SPECTER, Pennsylvania DANIEL K. INOUYE, Hawaii
PETE V. DOMENICI, New Mexico ERNEST F. HOLLINGS, South Carolina
CHRISTOPHER S. BOND, Missouri PATRICK J. LEAHY, Vermont
MITCH McCONNELL, Kentucky TOM HARKIN, Iowa
CONRAD BURNS, Montana BARBARA A. MIKULSKI, Maryland
RICHARD C. SHELBY, Alabama HARRY REID, Nevada
JUDD GREGG, New Hampshire HERB KOHL, Wisconsin
ROBERT F. BENNETT, Utah PATTY MURRAY, Washington
BEN NIGHTHORSE CAMPBELL, Colorado BYRON L. DORGAN, North Dakota
LARRY CRAIG, Idaho DIANNE FEINSTEIN, California
KAY BAILEY HUTCHISON, Texas RICHARD J. DURBIN, Illinois
MIKE DeWINE, Ohio TIM JOHNSON, South Dakota
SAM BROWNBACK, Kansas MARY L. LANDRIEU, Louisiana
James W. Morhard, Staff Director
Lisa Sutherland, Deputy Staff Director
Terrence E. Sauvain, Minority Staff Director
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Subcommittee on Defense
TED STEVENS, Alaska, Chairman
THAD COCHRAN, Mississippi DANIEL K. INOUYE, Hawaii
ARLEN SPECTER, Pennsylvania ERNEST F. HOLLINGS, South Carolina
PETE V. DOMENICI, New Mexico ROBERT C. BYRD, West Virginia
CHRISTOPHER S. BOND, Missouri PATRICK J. LEAHY, Vermont
MITCH McCONNELL, Kentucky TOM HARKIN, Iowa
RICHARD C. SHELBY, Alabama BYRON L. DORGAN, North Dakota
JUDD GREGG, New Hampshire RICHARD J. DURBIN, Illinois
KAY BAILEY HUTCHISON, Texas HARRY REID, Nevada
CONRAD BURNS, Montana DIANNE FEINSTEIN, California
Professional Staff
Sid Ashworth
Jennifer Chartrand
Alycia Farrell
Tom Hawkins
Robert J. Henke
Lesley Kalan
Mazie R. Mattson
Brian Potts
Kraig Siracuse
Brian Wilson
Charles J. Houy (Minority)
Nicole Rutberg Di Resta (Minority)
Betsy Schmid (Minority)
Administrative Support
Janelle Treon
C O N T E N T S
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Page
Statement of Hon. Joel D. Kaplan, Deputy Director, Office of
Management and Budget.......................................... 1
Opening Statement of Senator Ted Stevens......................... 1
Statement of Senator Daniel K. Inouye............................ 2
Timing of Fiscal Year 2005 Supplemental.......................... 3
Opening Statement of Joel D. Kaplan.............................. 4
Prepared Statement of Joel D. Kaplan............................. 5
Statement of Lawrence J. Lanzillotta, Under Secretary of Defense
(Acting Comptroller), Department of Defense.................... 6
Prepared Statement of Larry J. Lanzillotta....................... 6
The President's $25 Billion Reserve Fund......................... 7
Funding Flexibility.............................................. 7
Statement of General Peter Pace, United States Marine Corps, Vice
Chairman, Joint Chiefs of Staff, Department of Defense......... 8
Guard and Reserve................................................ 8
Justification Materials for Request.............................. 9
Protection of Troops............................................. 10
Coalition Partners............................................... 12
Heavy Truck Recapitalization..................................... 12
Embassy Construction and Civil Operations........................ 13
Funding for U.S. Mission in Iraq................................. 14
Release of Funds From $25 Billion Reserve........................ 16
Flexibility for Use of the $25 Billion........................... 17
Role Played by the Military Services............................. 18
Mid-year Review.................................................. 18
Recruiting and Retention......................................... 19
Monthly Costs of Operations...................................... 20
Access to the Contingent Emergency Reserve Fund in Fiscal Year
2004........................................................... 21
Troops in Afghanistan............................................ 23
DOD Need for Greater General Transfer Authority.................. 23
Home Security Forces............................................. 24
Estimating Fiscal Year 2005 Incremental Costs.................... 26
How Has Fiscal Year 2003 and 2004 Supplementals Been Spent?...... 28
Likely Changes in Funding Requirement............................ 29
Iraqi Government................................................. 30
Operations in Afghanistan........................................ 32
Elections........................................................ 34
Additional Committee Questions................................... 34
Questions Submitted to Hon. Joel D. Kaplan....................... 34
Questions Submitted by Senator Christopher S. Bond............... 34
Question Submitted to Lawrence J. Lanzillotta.................... 35
Question Submitted by Senator Christopher S. Bond................ 35
Question Submitted to General Peter Pace......................... 35
Question Submitted by Senator Christopher S. Bond................ 35
CONTINGENT EMERGENCY RESERVE FUND REQUEST FOR IRAQ AND AFGHANISTAN FOR
FISCAL YEAR 2005
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WEDNESDAY, JUNE 2, 2004
U.S. Senate,
Subcommittee on Defense,
Committee on Appropriations,
Washington, DC.
The subcommittee met at 10 a.m., in room SD-192, Dirksen
Senate Office Building, Hon. Ted Stevens (chairman) presiding.
Present: Senators Stevens, Cochran, Domenici, Bond, Gregg,
Burns, Inouye, Byrd, and Dorgan.
STATEMENT OF HON. JOEL D. KAPLAN, DEPUTY DIRECTOR,
OFFICE OF MANAGEMENT AND BUDGET
opening statement of senator ted stevens
Senator Stevens. Good morning. Welcome to our witnesses.
We're pleased to have you all back with us again. Our
subcommittee is meeting this morning for a special hearing
convened specially to review the President's request for $25
billion as a reserve fund for military operations in Iraq and
Afghanistan. Deputy Director Kaplan, we welcome you in your
first appearance before the committee, and Mr. Lanzillotta, we
welcome you back. You testified with Secretary Rumsfeld about 1
month ago, and it's a challenging and important time to be the
acting Department of Defense (DOD) Comptroller, I'm sure of
that. So we thank you for your service. General Pace, it's
always good to see you. We welcome you again. We look forward
to hearing your perspective.
As we meet today, our servicemen and women remain engaged
in combat missions in Iraq and Afghanistan. They are the ones
who are fighting and winning the global war on terrorism. To
meet their commitment and ensure that they have the resources
they need to get their job done, the President has proposed $25
billion in a contingent emergency reserve fund. Our military
commanders must make prudent operational plans. They must be
prepared to respond to the dynamic events on the battlefield.
We expect nothing less of our military leadership and our
people in uniform.
So the Congress also must plan for and provide the
resources for our military forces needed to do their job. Our
military commanders in the field and the troops that are doing
the hard work must not find that fiscal issues or the
availability of money constrain them in any way. The last thing
we want an operational commander concerned about is whether or
not there's enough money to do the job. I applaud the
President's decision to ask for these resources now and the
President requested resources for the Iraqi Freedom Fund (IFF),
a flexible transfer account that Congress created in 2003 with
the Iraqi supplemental.
As requested, this version of the IFF is different in two
important ways. First, funds are explicit only to support
operations in Iraq or Afghanistan. Previous IFF language was
somewhat broader and allowed the use of the funds for the
global war on terrorism. Second, funds would become available
after two actions by the President. The President must first
transmit an official budget request and designate the amount as
an emergency and as essential to support the activities or
agencies in Iraq or Afghanistan. The request includes the
requirement for a 5-day advanced congressional notification
before making any transfer from the fund, the same requirement
that Congress included in the original Iraq Freedom Fund.
I want to remind the committee that this hearing is about
the President's request for the $25 billion reserve fund. It's
really not an appropriate place to have a policy debate on Iraq
or a hearing on the allegations of Iraq prisoner abuse. It's
our hope that this hearing will stay on track and focused on
the appropriations matters before us. We expect other members
to--ranking member, former chairman, is with us now. I do
expect a full committee to attend this hearing.
We will make your statements, gentlemen, a part of the
committee record in full, and we'll ask you to present them to
us as briefly as you may. I would like to turn now to the co-
chairman of the subcommittee for his remarks.
STATEMENT OF SENATOR DANIEL K. INOUYE
Senator Inouye. I thank you very much. I'm pleased to join
our chairman in welcoming all of you to discuss the
administration's request for fiscal year 2005 emergency funding
for the wars in Iraq and Afghanistan. We did not anticipate a
supplemental request to come before Congress this year. When
the Congress passed the $87 billion supplemental last October,
we were told by the administration that those funds would cover
the costs of war for the next 18 months.
However, due to unforeseen circumstances in theater that
called for more forces than planned, resulted in more damage
and loss of equipment than predicted and longer duration than
anticipated, the services' accounts are running short. I think
we should make it very clear that this committee and this
Congress support our forces deployed overseas and we'll make
certain that we provide adequate funds to provide for their
safe return.
Nevertheless, Mr. Chairman, I have several concerns and
questions about the request before us this morning. It is my
understanding that when the administration fashioned this
request that the services were not consulted. Without their
input, how did the administration arrive at this $25 billion
figure and determine what accounts to apply it to? The request
includes $5 billion to reimburse other appropriations and
classified programs. There's no information regarding how that
$5 billion would be spent and I hope that you will address how
the Department plans to use the unclassified portion of these
funds.
We have learned in recent weeks that the Army has
procurement shortfalls for activities such as resetting the
force and modularity. In addition, both the Army and Marine
Corps have shortfalls for replacing lost and damaged equipment
and for critical items such as aircraft survivability
equipment, ammunition, vehicle armor, and rapid fuel equipment.
I understand there's no funding in the supplemental request
earmarked for these items. I'm interested in hearing from you
on how the Department intends to address these concerns.
Furthermore, with rising costs associated with increase in
troop strength on ground, what is the status of the remaining
fiscal year 2004 funds? We've been told that this is part one
of a two-part supplemental request for fiscal year 2005. We
anticipate receiving another request for funding the wars when
the administration sends over next year's budget request.
I hope you will discuss this morning how the administration
determined what is funded in this supplemental versus the one
we expect to receive next year. I raise these points, Mr.
Chairman, because the Congress has been provided very limited
information on how these funds will be used, and because I
noted in a recent Wall Street Journal article that an
unidentified senior administration official said that Congress
is not provided detailed information if they don't ask the
right questions.
Finally, I remain concerned about recruiting and retention.
I think all of us do. The Active Forces are stretched thin. We
are relying heavily on our Guard and Reserve forces to serve
extended tours overseas. The forces are performing
magnificently, but how long can we sustain this pace of
operations? How can we expect the operational tempo to slow
down?
So, Mr. Chairman, these are some of the questions that have
been of concern to me, and I hope that you'll be able to
respond to these issues. I thank you, Mr. Chairman.
Senator Stevens. Thank you. It will be my intention to ask
that members accept a 5-minute limitation. You and I have used
about 3 minutes apiece. I'll just ask one question and then
yield to Senator Inouye and then we'll follow the early-bird
rule and first early bird was Senator Byrd, so we will try to
move along so everyone that comes in will have a chance to
ask--make some comments or ask questions.
TIMING OF FISCAL YEAR 2005 SUPPLEMENTAL
My question really pertains to the change. I was the one
that went to the Office of Management and Budget (OMB) and
asked that we not have a supplemental presented to us this
summer because of the shortness of this session due to the long
recess for the two conventions. And we were told that OMB and
DOD agreed and they would not seek a 2005 supplemental this
year, a supplemental until next year, until after the first of
the year of 2005. That has obviously changed and the President
requested $25 billion. We expect this to be used as indicated
for--only for Afghanistan and Iraq plus the $5 billion that
Senator Inouye mentioned. And we've had another change, and
that has been the decision to not reduce the forces in Iraq,
but to maintain the level of 135,000 through calendar year
2005.
Now, my question really goes to Director Kaplan and Mr.
Lanzillotta. We understand that it's difficult to present a
supplemental for what might occur over the next 18 months, and
this reserve fund really seems to be directed to the first 4
months of the next fiscal year. Is there a plan to add to this
supplemental after the beginning of the year? Could you tell
us, one of you, what timeframe does this reserve fund really
purport to cover?
Mr. Kaplan. Yes, Mr. Chairman. As you know, due to many
conversations you've had with the administration, it was not
the administration's plan to come forward with a fiscal year
2005 supplemental until calendar year 2005 when we will have
more precise and reliable estimates of what the needs on the
ground in Iraq and Afghanistan will be.
You mentioned some of the challenges in terms of
operational requirements that have developed in the last couple
of months. The President has been very clear with us at OMB and
throughout the administration in his commitment to provide the
commanders on the ground the resources they need and the
confidence that the resources will be there when they need
them.
With that in mind, Secretary Rumsfeld came to the President
several weeks ago and reported that because of changing
conditions in Iraq and Afghanistan, we needed to request from
the Congress basically an insurance policy. It had been our
intention to cash flow until we could submit a full and
reliable supplemental request in calendar year 2005. Given
uncertainties, the developments in Iraq, the political
situation, the security situation, we thought it was advisable
to get an insurance policy in place to help the services get to
the fiscal year 2005 supplemental. It remains our intention,
Mr. Chairman, to come before the Congress in early calendar
year 2005 and ask for that full supplemental to carry us
through the rest of fiscal year 2005.
Senator Stevens. I apologize to the committee and to our
witnesses. I failed to let you make your statements in my
eagerness to answer my question. Would you care to make your
statement, Mr. Kaplan?
OPENING STATEMENT OF JOEL D. KAPLAN
Mr. Kaplan. As you wish, Mr. Chairman. I'll be very brief.
Thank you, Mr. Chairman, and members of the committee for
inviting me to appear to discuss the President's request for
the $25 billion contingent emergency reserve fund. The
administration as always, Mr. Chairman, appreciates your
support and this committee's unwavering support for our men and
women engaged in the war on terror, and we look forward to
working with you on this important request.
I do have a full text I'll submit for the record, but I'll
just be very brief in highlighting the key factors, and we just
talked about a couple of them, that shaped our thinking in
putting together this request. First, we were guided by the
President's clear and consistent direction, make sure the
commanders and troops in the field have the resources they need
to accomplish the mission.
Second, the request would appropriate the reserve into
service accounts within the Iraq Freedom Fund, which was
established by the Congress, as you mentioned, Mr. Chairman, in
the fiscal year 2003 supplemental. We wanted to work with an
existing structure for which the Congress has shown support in
the past.
Third, the funding is requested as a contingent emergency
reserve with the funds activated only after the President
submits a request designating all or part of the funding as an
emergency and essential to operations in Iraq or Afghanistan.
Fourth, again, as you mentioned, Mr. Chairman, the reserve
is intended for operations in Iraq and Afghanistan only.
Fifth, we're seeking this reserve in addition to funds
requested for DOD's base in the President's 2005 budget. The
President believes strongly that the transformation agenda and
rebuilding of our core defense capabilities must be funded on a
predictable and reliable path, and we urge the Congress to
fully fund the Department's base request.
PREPARED STATEMENT
Finally, as I just mentioned in my answer to your question,
Mr. Chairman, I'd like to note that we do continue to plan to
come to the Congress with a full supplemental request for
fiscal year 2005 early in the calendar year when we can have
more precise and reliable estimates of what the operational
needs are likely to be during 2005. Thank you, Mr. Chairman. I
look forward to answering the rest of the committee's
questions.
[The statement follows:]
Prepared Statement of Joel D. Kaplan
Thank you, Mr. Chairman and Members of the Committee, for inviting
me to appear before you today to discuss the President's request for a
$25 billion contingent emergency reserve fund for operations in Iraq
and Afghanistan. In recent remarks, the President reiterated this
Nation's commitment to our Armed Forces engaged in Iraq, Afghanistan,
and elsewhere around the world in the War on Terror. The President has
never wavered in this commitment. Consequently, his direction to us has
been clear and consistent: make sure the commanders have the resources
they need to accomplish the mission and protect our men and women in
uniform.
It is with those men and women in mind that the President decided
to propose this contingent emergency reserve fund, to provide the
commanders and the troops in the field the confidence that the
resources they need will be there when they need them. This reserve
fund, if enacted by Congress, will guarantee we have the ability to
respond to rapidly changing conditions in the region, while affording
the necessary time and experience after the transition in Iraq and the
elections in Afghanistan to ensure that a Supplemental request made of
the Congress in early 2005 more accurately and completely reflects real
needs.
There are several core principles that guided the Administration's
request for this reserve fund. First, it should be made available as a
contingent reserve activated only after the President submits a request
designating the funds as an emergency and essential to operations in
Iraq or Afghanistan. Based on our work with the Department of Defense
and the Services, it is clear that they will need to--and can without
disruption--pull forward funds planned for the second half of the year
to use in the first and second quarter for operational needs if the
tempo continues at the current high pace. However, in the current
environment, a need to ``cashflow'' from the last two quarters in 2005
has the potential to raise concern about the availability and
reliability of resources later in the year. We wanted to provide
commanders, as well as the troops serving in the field, with the
confidence that nothing will stand in the way of the President's pledge
to provide them with the resources they need to accomplish their
mission. A reserve fund guarantees they will have what they need when
they need it.
Second, we wanted to propose a structure based on authorities and
accounts familiar to and supported by the Congress. Therefore, we have
requested funds appropriated into the Iraq Freedom Fund, established by
the Congress in the fiscal year 2003 Supplemental. We have also
requested allocation of funds into specific service accounts, again as
enacted by the Congress.
Third, the reserve fund should provide adequate flexibility to
allow us to respond to a fluid operational environment and emerging
requirements. The Department of Defense and we believe that at the
current pace the pressure points in planning and executing are likely
to develop in the Operation and Maintenance accounts, and particularly
Army and Marine Corps O&M. This understanding is reflected in the
allocations in the request we sent to the Congress. However, we also
are seeking to assure that these resources are matched with transfer
authority to promptly address changing requirements, including emerging
procurement requirements related to force protection.
Fourth, the reserve should address requirements in Afghanistan and
Iraq only. We believe the base 2005 request provides ample resources to
meet requirements unrelated to the critical operational missions in
Iraq and Afghanistan.
Fifth, we want to assure that enactment of the contingency
emergency reserve does not come at the expense of the President's 2005
base request for the Defense Department of $401.7 billion. Early in his
Administration, the President determined that predictability in funding
was critical to fulfilling the Department's transformation agenda. That
predictability is even more important now as the services are asked to
fully engage in the war against terror abroad, even as they
fundamentally transform their organization, infrastructure, force, and
doctrine. While some may argue to shift requirements identified in the
2005 base request into the proposed reserve, such a shift risks
creating uncertainty and disruption in the Department's planning and
execution of key national security policies and missions.
Finally, I'd just like to note that this Administration has
tremendous respect for Congress' Constitutional role, and its
responsibility, in authorizing and appropriating resources for our
Armed Services. It is in deference to this role that we want to make
sure that the next supplemental request you consider is accurate and
precise as to the military's needs. Some have recommended that we
simply extrapolate from today's costs, multiplying those costs over
some fixed period as the basis for a request. We have found that such
estimates often mean funds are mismatched with accounts and the
requirements that actually develop. The combination of a reserve fund
that can be activated as needed with a future supplemental built on
actual 2005 conditions assures we will spend what is necessary to
support our troops and their vital mission.
Thank you again for the privilege of appearing before this
Committee with my distinguished colleagues. I will be happy to take
your questions.
Senator Stevens. Yes, Mr. Lanzillotta.
STATEMENT OF LAWRENCE J. LANZILLOTTA, UNDER SECRETARY
OF DEFENSE (ACTING COMPTROLLER), DEPARTMENT
OF DEFENSE
Mr. Lanzillotta. Thank you, Mr. Chairman. I will leave my
statement to be submitted into the record. But to just
emphasize the point that Director Kaplan made, and to answer a
question that Senator Inouye raised, it was this consultation
with the services during the mid-year review to understand
corporately the financial situation that we were in and the
Department that led the Secretary to seek and report to the
President on this condition and why we needed certain things
for the end of the year.
I just wanted to emphasize it was the consultation with the
services at every step of the way that led us to get a full
understanding of our 2004 requirements, our plan, and also the
need for this reserve fund to get us to the supplemental in the
spring next year.
Senator Stevens. Thank you.
[The statement follows:]
Prepared Statement of Larry J. Lanzillotta
Mr. Chairman and Members of the Committee, I am happy to be here
today to testify in support of President Bush's request for a $25
billion reserve fund.
THE PRESIDENT'S $25 BILLION RESERVE FUND
The reserve fund we are requesting will provide an insurance plan
so the Department of Defense (DOD) has adequate resources for both its
core defense activities and its operations in Iraq and Afghanistan. It
is critical to avoid any disruption in funding for our military forces.
The Department's plan had been to cash flow fiscal year 2005
operations in Iraq and Afghanistan until a Supplemental budget request
could be prepared by early 2005. Now, however, our higher projected
troop levels increase the risk that certain accounts--especially
Operation and Maintenance, Army--would have difficulty cash flowing
operations beyond the February-March timeframe in 2005. This reserve
fund will eliminate that risk and provide a margin of safety.
The reserve fund would be used primarily for operation and
maintenance (O&M) requirements, but a portion is expected to be used
for force protection needs. Requirements are likely to include:
--Fuel for helicopters, tanks, and other vehicles.
--Transportation costs for movement of personnel and equipment in and
out of the theater of operations.
--Equipment maintenance (such as lubricants, repair parts) and
logistics supplies.
--Force protection needs such as individual body armor and up-armored
HMMWVs and for possible support for Army modularity.
The Administration still anticipates submitting a supplemental
appropriation request to Congress in early 2005 to fund incremental
costs for contingency operations. It continues to be impossible to know
what our total supplemental funding needs will be for fiscal year
2005--particularly after the election in Afghanistan and after
sovereignty is transferred in Iraq. Depending on the circumstances, we
could face the need for either more or fewer troops--and more or less
intensive operations.
FUNDING FLEXIBILITY
I want to make a special plea for giving the Department of Defense
the needed flexibility that this reserve fund would provide. The
request was structured to reflect the reality that certain O&M accounts
will have the greatest difficulty in meeting requirements without this
reserve, until a full supplemental request can be provided.
I especially urge you to avoid designating a portion of this fund
for specific investment programs, because that would undermine the
central purpose of the fund. It would make it much more likely that the
Department could not finance its incremental war-related requirements--
especially O&M requirements--all the way until fiscal year 2005
supplemental appropriations are approved. As the President requested,
funding should be in accounts likely to be under the greatest strain
during the first half of fiscal year 2005.
Besides supporting the flexibility requested for the $25 billion
reserve fund in fiscal year 2005, the Department of Defense needs the
Committee's help in making it through the rest of fiscal year 2004. The
Office of Management and Budget and DOD leaders continue to expect that
fiscal year 2004 requirements can be financed with the resources
available in the fiscal year 2004 DOD budget and fiscal year 2004
Emergency Supplemental Appropriations. However, to accomplish that the
Department needs to be able to shift funds to finance and sustain its
current operations. We soon will have exhausted our existing transfer
authority, and so we will have no authority to move resources to meet
all our must-pay fiscal year 2004 bills. I urge you to approve an
additional $2 billion in general transfer authority (GTA) to enable the
Department to get through the remainder of fiscal year 2004 with its
existing resources.
Finally, looking ahead to fiscal year 2005, I urge you to support
the $4 billion in general transfer authority requested in the
President's budget. The Department's need for higher GTA, especially
during this time of war, has been evident in this current fiscal year.
CLOSING
In closing, I want to thank this committee for your continuing
strong support to U.S. security and to our military people. We look
forward to continuing to work closely with you on behalf of America's
armed forces and their vital missions around the globe. Thank you.
Senator Stevens. General, do you have an opening statement?
STATEMENT OF GENERAL PETER PACE, UNITED STATES MARINE
CORPS, VICE CHAIRMAN, JOINT CHIEFS OF
STAFF, DEPARTMENT OF DEFENSE
General Pace. Sir, I'll keep my remarks very brief, but I'd
be remiss if I didn't say a few thank you, first to this
committee and through you all to the entire Congress. We do
have the world's best military and we have it because of the
sustained bipartisan support of this Congress and we thank you
for that.
Second to the magnificent young men and women who are
serving right now overseas and defending our freedoms. They and
their families deserve our respect and our appreciation and
they certainly have it from everyone in this room. And to the
guardsmen and reservists who have put their lives on hold to be
able to serve their country and to their employers. The
guardsmen and reserves are truly performing magnificently well,
and they performed so well that it's obvious that the employers
who have let them go have gaps in their workforce and we
appreciate their support.
Last, if I may have the temerity to do so, sir, we just
completed a wonderful Memorial Day weekend where we, among
other things, witnessed the unveiling of the World War II
memorial, to you, Senator Inouye, your medal of honor, to you,
Mr. Chairman, your distinguished flying cross. To everyone on
this committee and in this room who served, thank you very
much.
Senator Stevens. Thank you very much, General. Senator
Inouye, you have 2 minutes left.
Senator Inouye. General Pace, when Senator Stevens and I
were in World War II, we knew that we would be there on the
front until combat ceased. But today you're trying your best to
limit our force deployments to 6 months or 1 year. But now we
find that we've gone to the limit, all the available forces are
being used, reservists are being used, National Guard units all
being used. In fact, we are pulling out forces from Korea.
In light of the current situation in Iraq, do you think
that this is a good strategy?
GUARD AND RESERVE
General Pace. Sir, we've gone back and reviewed the time in
combat where a soldier or marine is effective, and all of the
studies from World War II and Korea and Vietnam indicate that
at about the 1-year mark a person's, an individual's personal
capacity to endure combat drops off significantly. So I believe
that we have the correct strategy as far as the time that we
ask an individual to spend continuously in combat.
Second, with regard to the use of the Guard and Reserve,
clearly because we have now been using the Guard and the
Reserve for more than 2 years in certain military occupational
specialities, we need to rebalance the force.
And General Schoomaker and the Army have identified about
100,000 billets that are either in the Guard and Reserve right
now or in the Active Force that should be flip-flopped with
each other so that we have more of the requisite skills in the
Active Force so we do not have to rely quite as heavily in the
future on the Reserve and the Guard, sir.
Senator Inouye. Speaking of General Schoomaker, the General
requested additional 30,000 troops, but in this funding we have
nothing there for 30,000, I think about 1,200. What do we
expect from you? What can we expect from you?
General Pace. Sir, General Schoomaker has requested from
the Secretary and has received from the Secretary temporary
authority to go over the standing end strength of the Army by
about 30,000 soldiers. That will allow him to take his 10
divisions, which are currently configured in 33 brigades, and
swap out, as I've mentioned, some of the skills, retrain,
reorganize, and have 43 to 48 brigades at the end of this
reorganization process.
Right now, the proposal to fund that is as part of the
transformation, as part of the resetting of the force, as part
of the supplemental request, yet to be submitted for next year
to be funded, sir.
Senator Inouye. So it's not in this $25 billion?
General Pace. It is not in this $25 billion, no, sir.
Senator Inouye. My time is up.
Senator Stevens. Thank you. Senator Byrd, you're recognized
for 5 minutes.
JUSTIFICATION MATERIALS FOR REQUEST
Senator Byrd. Thank you, Mr. Chairman. We've done a great
job in sending a man to the Moon and returning him to Earth
safely, but it's amazing that we haven't yet been able to
prepare an adequate and good system, public address system.
Senator Stevens, since I'm limited to 5 minutes, I'll save
it, but a little at this point. The amendment that you and
Senator Warner are proposing on this $25 billion request is a
vast improvement, and I thank you, a vast improvement over the
outrageous power and money grab that the President sought in
his original request to Congress. He wants it all, no strings
attached. But our chairman and our ranking member and Mr.
Warner have proposed to do things differently.
I commend you, Mr. Chairman, for the steps you've taken to
impose accountability on the Defense Department and to provide
the means for Congress to exercise some oversight of how this
money is spent, and we ought to insist on that always. That's
not only the right, but it's the duty of the appropriators in
their fairness to the request, of course, and also in their
fairness to the expectation of the taxpayers.
I think we can do more, however, without infringing on the
flexibility that the Defense Department so badly wants. For
example, I believe that the transfer authority should be
limited to $2.5 billion, which amounts to 10 percent of the
entire $25 billion. That seems to me to be giving the Defense
Department an adequate bit of flexibility. It seems to me that
giving the Defense Department a 10 percent margin of error in
calculating where it will need these funds provides more than
adequate flexibility.
I also believe, Mr. Chairman, that the chairman and ranking
members of the House and Senate Appropriations Committees
should be included in the consultation and notification process
in addition to the congressional defense committees. This
request, after all, amounts to supplemental funding regardless
of what the administration chooses to call it.
Furthermore, I believe that this committee needs to see
detailed justification material on this request before we sign
off on it. For my part, I have seen no coherent explanation of
how the administration arrived at the figure of $25 billion,
and I believe we need to have that explanation before we okay
the request. Mr. Chairman, I thank you again for what you have
already done in seeking adequate accountability.
I have a question now for Director Kaplan. Director, does
the administration intend to submit a detailed justification
for this $25 billion request?
Mr. Kaplan. Yes, Senator, we will submit a justification
for the request. Should the Congress appropriate the contingent
emergency reserve fund, as the President, in consultation with
the Secretary of Defense, designates needs as an emergency and
essential to operations, we fully intend and expect to consult
with the Congress in advance of submitting that request.
Senator Byrd. Let me ask the question again so I can be
sure I understand what you're saying. Do you intend to submit a
detailed justification insofar as you possibly can for this $25
billion request?
Mr. Kaplan. Yes, Senator, insofar as we possibly can,
keeping in mind the evolving situation on the ground and our
expectation that it will continue to evolve in ways that we
don't necessarily know at this time.
Senator Byrd. All right. I guess my time is up. My time is
up, thank you.
Senator Stevens. Thank you very much. Senator Cochran is
next.
Senator Cochran. Mr. Chairman, thank you very much for
convening this hearing. We appreciate the cooperation of the
Defense Department, OMB, and the Deputy Chairman of the Joint
Chiefs for being here and helping us understand this request.
It seems to me that the request is, as submitted, is
something that is justified if the ongoing costs above what you
have available to you is expected to be $5 billion a month. We
do need to respond in a way that provides you the resources you
need to be sure that our troops are protected who are in the
field. I understand that some of these funds will be used to
upgrade the capacity of our vehicles to withstand attacks from
these improvised explosive devices. Is that correct, General
Pace? Is that one of the reasons for this supplemental being
requested at this time?
PROTECTION OF TROOPS
General Pace. Senator, some of the funds from the
supplemental could be used for that purpose. As you know,
Congress this year allowed us to use almost $1 billion, over
$750 million specifically for force protection of our troops to
include body armor, up-armored Humvees and the like. So as we
spent the fiscal year 2004 money, we were able to come to you,
explain to you what we wanted to use it for, and you allowed us
to do that.
The $25 billion that is the emergency fund could be used
for those purposes or for others, depending upon what we face
once we get to October 1, sir.
Senator Cochran. Well, I just want to make sure that the
record is clear that the request is being submitted for
additional funding that can be used to enhance force protection
of our troops who are in the field. We've all come to realize
through news reports and the briefings that we've received here
on Capitol Hill that this is a very real threat, and that more
and more of these rocket-propelled grenades and other devices
like that that are designed to kill our troops who are
operating vehicles and trying to protect the Iraqi people as
they establish their capacity for self-government and for
ruling their own country through a democratic process. To me
it's a very timely request and I'm hopeful that our committee
will act quickly and with unanimity in approving and supporting
the administration's request.
General Pace. Sir, it can be and it will be.
Senator Cochran. Thank you, Mr. Chairman.
Senator Stevens. Senator Bond.
Senator Bond. Thank you very much, Mr. Chairman, and
welcome, Mr. Kaplan and Mr. Lanzillotta and General Pace. I
particularly appreciate and associate myself with the remarks
of General Pace and we thank you for those, sir. We look
forward to working with the chairman and the ranking member and
I certainly agree with Senator Cochran on the need to ensure
that our troops have everything they need to fulfill the
mission.
I was very interested in some things that came up recently.
Apparently in Iraq no news is good news. Two months ago
everybody was talking about Fallujah, the brutal murder and
desecration of four Americans, every mosque in the city calling
for jihad, local police and fire departments ceasing to exist.
But thanks to the great work of the marines and the cooperation
of the Iraqis, everything's quiet and it's off the news pages
now.
Just this past weekend I watched the movie, ``Ike:
Preparation for D-Day'', and the thought struck me that if we
had had 24-hour news coverage of D-Day with all the problems
that were encountered there and all of the changes in plans
that occurred, all of the things that went wrong, the New York
Times and the Columbia Broadcasting System (CBS) would be
calling for the firing of General Eisenhower and probably the
defeat of the President as a result.
I am concerned we are not getting some reports on the
successes that are coming out of Iraq, and I think the American
people deserve to know about the so-called rest of the story.
And I hope we can do a better job of that. With the new Iraqi
interim government we may have an opportunity to get a better
picture.
But General Pace, I'd like to ask you a question. There are
some people who are saying we have far too few troops in Iraq.
Obviously the protection of the troops themselves is key to the
accomplishment of their mission and requires a certain level of
troop strength. However, I think there are other considerations
about the presence, the total presence of United States (U.S.)
forces that may be a factor. Could you comment on whether you
think we have adequate troops, and will the additional troops
being sought enable us to fulfill our mission within the
constraints that exist?
COALITION PARTNERS
General Pace. Senator, thank you. We review that
constantly, both here in Washington, and more importantly, the
commanders in the field. And General Franks and General Abizaid
have come in with their troops request. Those of us on the
Joint Chiefs have reviewed their request and done our own
independent analysis. We thought we would be at about 115,000
troops today. As a result of the increased attacks, because the
enemy is concerned about the fact that we are in fact going to
return sovereignty on June 30, the increased attacks have
resulted in us analyzing that we need more troops on the
ground, an extra 20,000 were asked for and have been provided,
and that 135,000 now will be the level to stay at for the
foreseeable future.
We're also reviewing literally as I speak in the Pentagon
right now, and we'll be presenting in the tank this afternoon,
a lookout for the next 5, 6, 8 months, how the U.S. forces are
deployed, how we are intermixed with our coalition partners and
whether or not that's right, and then how we intend to begin
looking at the turnover of individual responsibilities to the
new Iraqi army, the new Iraqi police force, and the like. So
this is a constant process, sir. I am personally comfortable
with the size force we have there right now. When you combine
135,000 United States and about 24,000 coalition and another
250,000 Iraqis, granted in various stages, but all coming
online, that's a very significant coalition force.
Senator Bond. I hope my colleagues would agree with me that
the decisions made by the commanders in the field and the
leadership in Washington should be the definitive word on the
number of troops.
HEAVY TRUCK RECAPITALIZATION
Let me ask either Mr. Lanzillotta or Mr. Kaplan, I recently
supported an effort calling for $200 million to increase the
heavy truck recapitalization fund account. We hear reports that
trucks in Afghanistan and Iraq are getting years' worth of use
in 2 months. Does this supplemental adequately factor in the
costs associated with the Army's reset requirements for its
transportation fleet?
Mr. Lanzillotta. Senator, let me take a stab at that one.
This reserve fund is not meant to address all the resetting of
the force requirements that we're going to incur. This fund is
only to allow us to support the cash flow or reduce or mitigate
the problems and the risks associated with cash flowing our
operation and maintenance (O&M) accounts, specifically in the
Army, through this time period. The resetting of the force or
the wear and tear on the equipment is a problem. It's one that
the Department is addressing and it's one that the Secretary
has charged the Director of Program Analysis and Evaluation
(PA&E) to do a study as to what that requirement actually is,
because we are finding as we study more and more that this
equipment ages differently on wear and tear. The Director of
PA&E is going to do that study and we hope to address this
issue, and when we do the full supplemental later this year, or
I should say earlier next year.
Senator Bond. Thank you, Mr. Chairman.
Senator Stevens. Senator Gregg.
EMBASSY CONSTRUCTION AND CIVIL OPERATIONS
Senator Gregg. Yes, Mr. Kaplan, in this $25 billion, is
there any money allocated toward the construction of the new
Embassy, which is estimated to be $1 billion, and the
maintenance of the civil operations, which the authority is
going to hand off to the State Department post-June 30?
Mr. Kaplan. Senator, as to the first part of your question,
there is no money in this contingent emergency reserve fund for
construction of a new Embassy. It is the view of the State
Department that we're not quite there yet on construction of a
new Embassy. As you mentioned, Senator, the State Department
will be taking responsibility for the mission in Iraq post-June
30, and there will be funding requirements for the State
Department at that time. For the remainder of 2004, we have
identified available funding in the administrative accounts for
the reconstruction fund in monies that the State Department
received for an Embassy in the previous supplemental that the
Congress appropriated.
When we get to fiscal year 2005, the State Department has
estimated the cost of running the Embassy operations will be
about $1 billion exclusive of any construction, which again
there are no plans for at this time. Of that $1 billion, only
about $170 million of that have to do with traditional Embassy
personnel-type operations. The State Department, as I said, has
some money in 2005 for that. Our expectation is that the State
Department would cash flow from their accounts until the
supplemental in 2005 to make up the difference of that $170
million. The rest of that $1 billion is for security and
logistics, which are currently being covered by the Department
of Defense, and our expectation is that the Department of
Defense will continue these activities until the fiscal year
2005 supplemental is available to carry those costs.
So we do think that the State Department will be covered
until we can get to that fiscal year 2005 supplemental. We have
discussed this at some length with both the Department of
Defense and the State Department and there's an agreement that
everybody's comfortable will provide the State Department the
resources they need.
Senator Gregg. Well, that comes as news to me and I'm
chairman of the committee that has responsibility for funding
the State Department, so I suggest you get that information up
in writing to us, because we're not going to fund an area that
you people think you've got the money for in that--in the
framework you just laid it out, and we certainly don't want to
be pointed to as underfunding the State Department----
Senator Byrd. Mr. Chairman, would the distinguished Senator
speak a little louder?
Senator Gregg. It's just a long way from--I'll move over a
little closer to it, Senator.
Senator Byrd. It's better now.
Senator Gregg. So I would like to get that explanation of
how you plan to fund the State Department, the building of the
Embassy, the maintenance of the Embassy, and the operational
requirements that they will have post-June 30, all of which in
your explanation, as I understand it, will require no
additional funds being put into the State Department accounts
in the 2005 budget as it was sent up.
Mr. Kaplan. That's right, Senator, in the 2005 regular
appropriations. We would expect to address your concerns,
Senator, in the full fiscal year 2005 supplemental.
Senator Gregg. I just want that in writing.
Mr. Kaplan. Absolutely, Senator.
Senator Gregg. Thank you.
Senator Stevens. An interesting point. I thought there was
still some money left in Mr. Bremer's account from the $87
billion to initiate the construction of that Embassy.
Mr. Kaplan. Senator, you're correct. I think I omitted
reference to--there is a fourth quarter apportionment in the
Coalition Provisional Authority (CPA) account that's about $180
million that will go toward the 2004 costs. I don't believe
it's for construction, Mr. Chairman, but it is for the ongoing
operations, and that will defray some of the 2004 costs of
maintaining and operating the mission once it opens its doors
for business on July 1.
Senator Stevens. That's not before us now, but Senator
Gregg is right, we need to have some explanation of what will
be the transitional situation for funding for the non-defense
portion of our activities in Iraq post-June 30.
Mr. Kaplan. We'll provide that for you in writing, Mr.
Chairman.
[The information follows:]
Funding for U.S. Mission in Iraq
As Deputy Secretary of State Armitage and Under Secretary Grossman
have testified before the Senate Foreign Relations Committee and House
International Relations Committee, the total cost of the U.S. Mission
in Iraq for fiscal year 2004 and fiscal year 2005 is currently
estimated to be approximately $1.5 billion, excluding costs of
construction of a new embassy. (Please see ``Funding Availability for
State Department Fiscal Year 2004/05 Operations in Iraq.'')
For the fourth quarter of fiscal year 2004, the costs to stand up
and operate the U.S. Mission and continue necessary functions of the
Coalition Provisional Authority (CPA) will be in the range of $480
million, including funds to support readying temporary facilities,
providing additional Information Technology infrastructure,
administrative and personnel support costs, establishing regional State
Department teams, and funding a temporary Iraq Relief and
Reconstruction Management Organization (IRMO). These costs will be
covered through existing funds in CPA's fourth quarter operating budget
($196 million) available to State as the successor to CPA, the one
percent transfer of Iraq Relief and Reconstruction Funds ($184 million)
available under law for operating expenses, and from funds directly
appropriated to the Department of State in fiscal year 2003
supplemental appropriations ($97.3 million).
For fiscal year 2005, the estimated operating cost is approximately
$1 billion, which is exclusive of capital facility costs for a new
embassy compound and the Program Contracting Office (PCO). The largest
cost components of running the U.S. Mission in fiscal year 2005 are
logistics and security. Deputy Secretary of State Armitage together
with Deputy Secretary of Defense Wolfowitz testified before the Senate
Foreign Relations Committee on May 18 that their expectation is that
DOD will continue to supply Logistics Civilian Augmentation Program
(LOGCAP) and security support for the new Mission until Ambassador
Negroponte and his team have time to assess the actual needs and
provide an estimate that can be included as part of a 2005 supplemental
request. The annual cost of this support is currently estimated at
about $800 million. The remaining fiscal year 2005 traditional embassy
operating costs will be covered through funds requested by the State
Department in the fiscal year 2005 budget and any remaining funds
carried over from the fourth quarter of fiscal year 2004. State may
have to rely on portions of its base Diplomatic and Consular Programs
(D&CP) regular operating account to cash flow any interim requirements
until a supplemental is requested in 2005. These estimates continue to
be in flux and will be refined as we work through the transition
process.
With respect to the new permanent embassy, the State Department has
begun the planning process for a new compound in Baghdad and has
selected a site for construction. The Department continues to work to
develop requirements, such as determining the appropriate number of
staff for the facility, so that when we do come forward with a cost
estimate, it is based on the right size and build for the Department's
long term plans. In the interim, the Department is in the process of
renovating three facilities (a chancery building, an embassy annex, and
the ambassador's residence) in the Green Zone, using funds appropriated
for this purpose in the Iraq Reconstruction supplemental.
FUNDING AVAILABILITY FOR STATE DEPARTMENT FISCAL YEAR 2004/05 OPERATIONS
IN IRAQ
[In millions of dollars]
------------------------------------------------------------------------
Amount
------------------------------------------------------------------------
Identified State Resources/Support for Iraq
Fiscal Year 2005 State Budget Request................... 46.2
Fiscal Year 2003 War Supplemental....................... 97.3
Fiscal Year 2004 4th Quarter CPA operating expenses..... 195.8
IRRF up to 1 percent transfer for ``Operating Expenses'' 184.4
of the CPA.............................................
---------------
Total State Resources Fiscal Year 2004/2005....... 523.7
===============
Estimate of State Fiscal Year 2004/05 U.S. Mission Costs
for Iraq
Fiscal Year 2004 Embassy Operations (including regional 482.5
teams, security, and logistics)........................
===============
Fiscal Year 2005:
Embassy Operations (excluding security and 191.4
logistics).........................................
Security and Logistics.............................. \1\ 817.2
---------------
Total............................................. 1,008.6
===============
Fiscal Year 2004/2005 Total estimated U.S. Mission 1,491.1
Costs............................................
------------------------------------------------------------------------
\1\ DOD will provide security and logistics support.
State Operations
The fiscal year 2005 State budget includes $46.2 million in
Diplomatic and Consular Programs (D&CP) for operations, security, and
personnel funding to support activities in Iraq. This includes: $29
million to cover 120 staff positions being moved to the Iraq mission;
$10 million for basic Baghdad mission operations; and $7.2 for security
costs.
$97.3 million from the fiscal year 2003 War Supplemental is
available in fiscal year 2004 and 2005 for embassy facilities and set-
up costs--including $35.8 million for initial operating and security
costs and $61.5 million for temporary embassy facilities.
Of CPA's operating expenses, $195.8 million has been apportioned to
the 4th quarter fiscal year 2004 and should be available to the State
Department after the June 30th transition, based on current
apportionment schedules.
Pursuant to the fiscal year 2004 Supplemental, up to 1 percent of
the Iraq Relief and Reconstruction Fund (IRRF) ($184.4 million) may be
transferred to CPA or its successor organization for operating
expenses. In addition, the fiscal year 2004 Supplemental language
provides that up to 10 percent of IRRF funds that are obligated,
managed, or administered by agencies (other than CPA) can be made
available to pay for administrative expenses.
DOD support for Security and Logistics
The largest cost components for the fiscal year 2005 Iraq mission
are logistics and security. It is the expectation that DOD will
continue to cover logistics and security contracts for its uniformed
and civilian personnel and the Iraq mission until the State Department
has time to assess the actual needs and provide an estimate that can be
included in a 2005 supplemental request.
If necessary, State may rely on portions of its fiscal year 2005
base Diplomatic and Consular Programs (D&CP) regular operating account
of $3.626 billion (excludes D&CP worldwide security funding) to cash
flow any interim requirements in fiscal year 2005 until other funding
becomes available. Approximately 45 percent of State's D&CP regular
operating funds are apportioned to the 3rd and 4th quarters.
Senator Gregg. My point was that they're not expecting any
of this $25 billion to be used for that, so they're looking for
some--there's unaccounted-for funds which are going to be used
to accomplish that, which I'm still trying to figure out where
those funds are and how we're going to get them.
Mr. Kaplan. If I may, Senator, in the period beginning in
fiscal year 2005 on October 1, we expect that the Department of
Defense, until the fiscal year 2005 supplemental is enacted,
will continue to cover the costs that it's currently incurring
with respect to security and to the logistics contract, which
the Department of Defense currently owns.
Senator Gregg. I'm not sure the State Department
understands it in those terms and I'd want to make sure
everybody's on the same page here. That's why I would like to
get a written statement from OMB as to what your understanding
is and I intend to vet it with the State Department to see if
that's their understanding.
And don't forget we've got $1 billion sitting somewhere to
build an Embassy, which I haven't seen the money for yet. It's
not in the budget.
Mr. Kaplan. That's correct, Senator.
Senator Stevens. That's an additional aspect to this
transition, and I hope that you'll ask OMB to cover the full
scope of that transition, not just Defense activities, but
under possible--under this reserve account, but where we're
going to get the money to continue the activities that
previously have been done by Mr. Bremer's accounts.
RELEASE OF FUNDS FROM $25 BILLION RESERVE
I would like to ask this question, and that is how would
this contingency emergency reserve fund really operate in terms
of the drawdown? Do you anticipate making requests for bulk
transfers or is this going to be a line-by-line operational
account that we are asked to release?
Mr. Lanzillotta. Senator, we would plan to handle this much
similar to how we do the IFF. Right now it requires a 5-day
notification of a move out of the transfer out of the account.
We do quarterly reports and then we do spot reporting as
requested as to how these transfers occur.
Senator Stevens. Well, there are two differences from the
IFF account under this request. These funds are specifically
only for Iraq and Afghanistan. The IFF language allows that
money to be used for the global war on terrorism. Second, this
request two actions by the President. One is the transmission
of the official budget request, and second, a designation that
the amount is emergency essential to support the activities in
Iraq and Afghanistan.
Now, again though, are we looking for bulk money to be
transferred going in from the fund to another activity or are
we going to look at this on a line-by-line basis?
Mr. Lanzillotta. We would look at this fund, you're
correct, Mr. Chairman, as far as the restrictions and the
framework that this fund would be used for.
Senator Stevens. Totally military requirements now?
Mr. Lanzillotta. Totally military requirements for Iraq,
Afghanistan, to support the operational costs that are
associated with those operations and some force protection
needs. We outlined as to which accounts that we believe that
money should go to up to, I think $14 billion up to Army O&M
account. The procedure I was outlining is what the current
procedure is that we have in place as far as notification to
Congress as to when these transfers occur.
FLEXIBILITY FOR USE OF THE $25 BILLION
Senator Stevens. Let's make sure--the request is written so
that the funds may be available to transfer to service
operations and maintenance accounts, and $14 billion for O&M
Army, $1 billion for O&M Navy, $2 billion for O&M Marine Corps,
$1 billion for O&M Air Force, $2 billion for O&M Defense-wide,
and up to $5 billion for other DOD appropriations that might be
supplemented. The language is permissive, not binding.
Now, what I want to know is, what is binding about this?
Can you send us a request you want the whole $25 billion
transferred without any strings attached?
Mr. Lanzillotta. Senator, when we--the fund is set up,
those accounts specifically for the O&M accounts because we
know those are the accounts that are under the most stress.
Where we were looking for some flexibility was in the
centralized piece of it or down at the bottom was what we
normally refer to as the IFF portion. And what we wanted the
flexibility for was to address force protection needs,
specifically like Humvees, we were recently made aware of the
Army requirement for a possible other 3,000 up-armored Humvees.
Senator Stevens. I'm over on my time, but some of my
colleagues have said that you're asking us to give you a blank
check because that word ``may'' in this provision. Now, I would
intend to change that to say it shall be used only for these
accounts except for the $5 billion. Are you going to object to
that?
Mr. Lanzillotta. As long as--no, Senator. What we would
like to have though is the general transfer authority necessary
that if the situation would change on the ground, we would have
the sufficient flexibility with notification to Congress to
make those changes.
Senator Stevens. The food and forage concept applies to the
funds we give you for the Department of Defense. If you run
into trouble you can use any funds you've got. What we're
talking about is this reserve fund now. Can you take it and put
it wherever you want, just notify us we want $25 billion and
we're going to put it wherever you want? That's a blank check
theory and it's something we're going to run into in the floor
and I don't like to run into it. So I intend to change that
word to ``shall'' so that there's no blank check involved. You
shall use this money for those accounts. You have broad
discretion, $5 billion for other appropriations. Now, I think
that's sufficient under this. I hope you agree.
Mr. Lanzillotta. Yes, Mr. Chairman.
Senator Stevens. Thank you. Senator Inouye.
Senator Byrd. Mr. Chairman, might I ask a question along
the line that you----
Senator Stevens. Yes, sir. If Senator Inouye agrees.
Senator Byrd. He said yes in answer to your question. We
don't know what that means.
Senator Stevens. It means that we will change the word
``may'' to ``shall'' and they shall use these funds only as
designated in the request for those specific funds and there is
no possibility of asking for a blank check, take all the
amounts and do what they want. They must use it either for O&M
account up to $14 billion, $1 billion for the Navy, $2 billion
for Marine Corps, $1 billion for Air Force, $2 billion for the
Defense-wide, and there's $5 billion for other DOD
appropriations that they can use that within the Department as
they see fit, but it still is limited to Iran--pardon me, to
Iraq and Afghanistan.
Senator Byrd. I fully agree and I compliment you and our
ranking member. I just wasn't sure what the witness meant when
he just said yes.
Senator Stevens. Well, I hope he agreed with me, Senator.
Mr. Lanzillotta. Correct, Mr. Chairman.
Senator Byrd. Now, what does that mean?
Mr. Lanzillotta. There were specific accounts laid out with
specific dollar amounts that Mr. Chairman has said that this--
we change from discretionary authority to ``shall.'' He would
leave a small IFF-type account at the bottom that we would be
able to use to address our force protection needs or a changing
situation on the ground.
Senator Byrd. Thank you, Mr. Chairman.
Senator Stevens. Senator Inouye.
ROLE PLAYED BY THE MILITARY SERVICES
Senator Inouye. Yes, sir. I'm still concerned about the
process being used to develop this request. I've been told that
the services had very little to do with the final determination
of the size and purpose of this supplemental fund. What role do
you permit the services? Do they play any role?
Mr. Lanzillotta. Senator, when we developed the mid-year
review process, the services played an active role in every
step of the situation to develop the requirements for 2004.
When we developed the reserve account as it was presented by
the administration to Congress, this was simply meant to
address the Army's need and the Department's need to relieve or
mitigate the risk associated with cash flowing these accounts.
The services have been briefed every step of the way to
include service secretaries, service chiefs, on the actions
taken, and they have been able to play and provide their input.
MID-YEAR REVIEW
General Pace. Senator, if I might add, I was in the room
during the mid-year review. The way Mr. Lanzillotta just
described it is exactly accurate. There was a general
discussion in the room based on what we learned in the mid-year
review that it looked like it would be prudent to have a
contingency fund as we got to the beginning of fiscal year 2005
so that we could stabilize the way we were spending on the
force, stabilize training, and be able to continue operations.
So that discussion did take place.
With regard to the specific numbers of dollars that would
be asked for, sir, I was not privy to that particular
conversation.
Senator Inouye. So you're telling the committee that the
service chiefs were well aware as to size and the purpose of
these funds?
General Pace. No, I did not say that, sir. What I said was
the service chiefs were very much aware and part of the
discussion with the Secretary of Defense that said we should
come forward if we could earlier than February, March 2005 and
get some kind of insurance policy for our operations. The exact
size of that was not discussed in the meetings that I was.
Mr. Lanzillotta. Can I clarify that point, Senator?
Senator Inouye. Yes, sir.
Mr. Lanzillotta. The services fully participated in
developing what the requirements were for 2004 and 2005. When
we developed what the size of this number should be, we have--
it was kind of done at a technical level with what we call a
cost team, and on the cost team there's representatives from
the services, there's representatives from the joint staff that
they use and they together and they try to cost out what the
impact of the operations would be next year. And we looked at
that to see, based on what this cost team had put together from
the services and the joint staff that participate, as to what
that number ought to be to get us to the point where we thought
that we could get a supplemental submitted and approved by the
Congress. The exact number of the $25 billion was never taken
to the service chiefs.
General Pace. But the service chiefs were aware of that
once the number was developed and the chairman was told by the
Secretary it looked like it would be about $25 billion. The
chairman shared that with the rest of the Joint Chiefs in the
tank and that was very, very satisfactory to all of us.
RECRUITING AND RETENTION
Senator Inouye. I have just one more question. Can you
provide this committee at this time on the numbers involved in
recruiting and retention?
General Pace. Sir, I can take for the record the exact
numbers. I can tell you, sir, that on the active side of the
house for recruiting we are meeting our goals, for retention we
are meeting our goals. On the Reserve side, the last numbers I
saw, recruiting were off by 1 or 2 percent, retention was off
by 1 or 2 percent. National Guard right now, the Air National
Guard, the last number I saw recruiting was off about 23
percent, but I can get you the exact numbers, sir.
[The information follows:]
FISCAL YEAR 2004 RECRUITING STATISTICS (THROUGH APRIL 30, 2004)
------------------------------------------------------------------------
Percent of
Service goal
------------------------------------------------------------------------
Active:
Army................................................ 100
Navy................................................ 100
Marine Corps........................................ 101
Air Force........................................... 103
Reserve:
Army National Guard................................. 93
Army Reserve........................................ 95
Naval Reserve....................................... 109
Marine Corps Reserve................................ 109
Air National Guard.................................. 77
Air Force Reserve................................... 92
------------------------------------------------------------------------
Senator Inouye. So you're satisfied with those numbers?
General Pace. No. I'm satisfied that those are accurate
numbers, sir, not satisfied with what the numbers portend. We
need to be very attentive to the way that we're using
especially our Guard and Reserve. We need to ensure that when
we ask these great Americans to put their lives on hold and
serve their country that the mission we are giving them is a
valid mission, that we are up-front with them as far as when we
are going to call them back to duty, how long we are going to
keep them on active duty, when they will be returned to their
employers, and that we do as quickly as we can the rebalance of
the force so that we do not rely on the Reserves for things
that Active Forces should be doing.
Senator Inouye. I thank you.
Senator Byrd. May I ask the Senator to yield?
Senator Stevens. Senator, you're recognized for 5 minutes.
Senator Byrd. I would ask the Senator from Hawaii, what
were the Army and Guard statistics? I don't believe I heard
them.
General Pace. Sir, I don't have in my head the exact
number. I believe the Army Guard is about 2 or 3 percent. I'm
not positive of that. I do know that the Air Guard is off about
23 percent. And what I said to Senator Inouye, sir, is that I
would get for the record the exact number so you have it
correct.
Senator Byrd. How long does it take to get that for the
record?
General Pace. Sir, we should be able to get that today.
Senator Byrd. Mr. Chairman, I think it would be good if we
knew those figures today.
Senator Stevens. Yes, Senator, we'd be happy to have them
today as requested, Senator Byrd. The numbers for the Air Guard
remind me of the numbers at the time of the Persian Gulf war.
You remember, Senator Inouye, we were over and met with them.
Those fell off at that time too. The Air Guard was particularly
disturbed at that time as I recall. But we would like to have
the numbers if you'll provide them.
General Pace. Yes, sir. Can do.
Senator Stevens. Senator, you're recognized for 5 minutes.
MONTHLY COSTS OF OPERATIONS
Senator Byrd. General Pace, what is the current monthly
cost of operations in Iraq and do you expect the anticipated
spike in violence over the coming weeks to affect that cost?
General Pace. Sir, I'd like to turn to Mr. Lanzillotta for
the answer to the exact cost. I have a number in my head, but I
know he knows exactly.
To answer your second question, we do expect violence to
increase between now and June 30 as it already has in April and
May, because our enemies fully understand that transfer of
sovereignty back to the Iraqi people and their ability as an
Iraqi people then to hold elections later on this year, to
write their own constitution, to have a representative form of
government, goes at the very heart of what the terrorists are
trying to do, which is to stifle freedom.
Senator Byrd. You're going a little beyond my question, but
thank you. Do you have any concern if the transfer----
Senator Stevens. Senator, Mr. Lanzillotta had answers to
your question, the first part of your question, if you'd like
to hear them.
Senator Byrd. Yes, thank you for calling that omission on
my part.
Mr. Lanzillotta. Senator, our current operational tempo in
Iraq is about $4 billion a month. We expect with the increase
of troops that were recently announced that that will jump each
month between $120 million to $160 million, depending on the
rotation of the troops that are coming out there each month.
Senator Stevens. $160 million now you're talking about?
Mr. Lanzillotta. Correct, Mr. Chairman. Now, for
Afghanistan, our current operational tempo rate is about $700
million. It changes on a monthly basis.
ACCESS TO THE CONTINGENT EMERGENCY RESERVE FUND IN FISCAL YEAR 2004
Senator Byrd. Do you have any concern if the transition is
bloodier than anticipated that some of this $25 billion will be
needed before the end of this fiscal year?
Mr. Kaplan. Senator, the Department of Defense has
conducted their mid-year execution review for fiscal year 2004
and as I understand it, the conclusion of that review is that
based on the needs as we know them today, with sufficient
transfer authority, general transfer authority in 2004, the
Department will be able to cover those needs as we know them
today.
To your question, Senator, if the situation on the ground
in the next few months were to be more violent than even
General Pace described, then having some portion of the reserve
available as an insurance policy in 2004, I expect would
provide the services additional comfort.
Senator Stevens. Would the Senator yield there?
Senator Byrd. Yes.
Senator Stevens. It would be my intention to ask the
committee to provide that whatever funds are available for this
IFF would be available upon enactment just to make sure we
don't face another request for the balance of this year. So we
would make these funds available upon enactment in the event
such emergency would occur.
Senator Byrd. Well, Mr. Chairman, I thank you for that. I
am concerned about this IFF, what that means, what additional
flexibilities that may give.
Senator Stevens. My proposal would only affect--only impact
the effective date of the availability of these funds. As
requested, they would be available on October 1. Under my
amendment, they would be available from the date of the
enactment of this bill, just the fund itself, not the whole
2005 defense funds, but just for this reserve fund, the reserve
would be there as soon as Congress enacts the bill, or passes
the bill and the President signs it.
Senator Byrd. When the term IFF is used, does that mean
that there may be some needs beyond those pertaining to Iraq
and Afghanistan?
Senator Stevens. This bill--this fund applies only to Iraq
and Afghanistan, Senator.
Senator Byrd. I thank you, Mr. Chairman.
Senator Stevens. I correct that. There's $5 billion that
could be allocated to any one of the services at the request of
the President with the approval of Congress.
Senator Byrd. But would that--would the committee have the
understanding that anything that goes beyond Afghanistan and
Iraq comes back to this committee?
Senator Stevens. That's correct. That's my understanding.
The request for the reserve is limited to Iraq and Afghanistan,
but $5 billion could be used throughout the services again
without regard to their limitations of the request for a
specific service.
Senator Byrd. But--I'm sorry if I'm taking too much time--I
want to be sure that none of that money can be used for making
wars elsewhere. I want that understood that the funds would be
used only for Afghanistan and Iraq.
Senator Stevens. It specifically states in the bill that
it's for an emergency essential to support activities and
agencies in Iraq or Afghanistan, period. Even the $5 billion
for the Defense-wide and classified programs are limited to
Iraq and Afghanistan.
Senator Byrd. Mr. Chairman, that answers my question. Thank
you.
Senator Stevens. Senator, I used some of your time, so if
you wish to have a few more minutes, please proceed.
Senator Byrd. Thank you. General Pace, I'm growing
increasingly concerned about the continuing and possibly
growing insurgency in Afghanistan. That's where the first war
began. That's the war I fully support. Four American military
personnel were reported killed in Afghanistan in recent days as
were four Afghan soldiers. The news report I read described the
toll on the U.S.-led coalition forces in Afghanistan as among
the worst for a single attack since the United States invaded
Afghanistan in 2001. This is a troubling development.
Afghanistan seems to have become the forgotten war. And yet
reports like this remind us that it is still a war and that
American military personnel are continuing to fight and die
there.
Would you give us an assessment of the current situation in
Afghanistan? Let me just finish this question. At the end of
April, General Abizaid reported that there were approximately
20,000 U.S. military personnel in Afghanistan as a result of
increased offensive operations and troop rotations. That level
is about twice what the U.S. military presence in Afghanistan
had been. Approximately--here's my question--how many U.S.
troops are currently in Afghanistan and how many coalition
forces? And then I asked an earlier question which you won't
have time for right now, Mr. Chairman, I want General Pace to
give us an assessment of the current situation in Afghanistan
whenever you see that we have time without imposing on the
other members. I don't want to impose on their time. But
specifically, approximately how many U.S. troops are currently
in Afghanistan, how many coalition forces?
TROOPS IN AFGHANISTAN
General Pace. Sir, we have approximately 19,000 U.S. troops
in Afghanistan right now. We have approximately 8,000 coalition
troops in Afghanistan. The four soldiers you mentioned who were
killed in action in the past week were in a vehicle that hit a
mine. Most of the U.S. forces are in the south, southeast part
of Afghanistan operating in the provinces along the Pakistan
border and are working in cooperation with the forces from
Pakistan as they work--as the Pakistan forces work in Pakistan.
Senator Byrd. Thank you, Mr. Chairman.
Senator Stevens. Thank you. Senator Cochran.
Senator Cochran. Mr. Chairman, the Memorial Day break gave
us all an opportunity to go back to our States and I had the
good fortune of being able to visit a new defense manufacturing
facility in Stone County, Mississippi, which is assembling and
installing on Bradley fighting vehicles a reactive armor plate
that permits the safeguarding of these vehicles and the
occupants of these vehicles against rocket-propelled grenade
attacks. It was a very interesting experience for me and it
shows that we have technologies evolving and are using
technologies that are evolving now to make it safer for our
troops and safer for our equipment, less costly for equipment
that would have otherwise been destroyed by these rocket-
propelled grenade devices.
My question is, I assume from the answers to your questions
from Senator Stevens and others that the funds in the $5
billion account may very well be used for helping to ensure
that we're taking advantage of emerging technologies and new
developments in defensive mechanisms to protect our forces in
the field in Afghanistan and in Iraq. Is that correct?
General Pace. Sir, that is correct.
Senator Cochran. I have no other questions, Mr. Chairman.
Senator Stevens. Thank you very much. Senator Domenici.
Senator Domenici. Thank you, Mr. Chairman. I have one
technical question and then I'd like the General to talk about
another issue. Mr.--how do you say it--Lanzillotta. I should
know that, I should know how to say that. They've said mine
wrong so many times I tried to say yours right, but I couldn't.
DOD NEED FOR GREATER GENERAL TRANSFER AUTHORITY
Let me ask you, it seems to me that even with what we have
been talking about that you may need some general transfer
authority in order to make this work. Can you discuss with me
that issue and tell us what you think about the necessity for
that?
Mr. Lanzillotta. Thank you, Senator. We have completed--are
in the process of completing our mid-year review, and hopefully
in the next couple of weeks we'll have our annual omnibus
reprogramming that we'd normally do up to the Hill. We feel
that we're going to be short in general transfer authority
somewhere in the neighborhood of $1 to $2 billion.
The problem is we were provided general transfer authority
in the supplemental and then we were provided general transfer
authority, but the combination of the two doesn't make up to
allow us to transfer the money where we have assets available
from under execution to where the bills are. To complete this
year though, we will need between $1 to $2 billion of general
transfer authority.
Senator Domenici. Thank you very much. General, the most
startling thing to me that's happened with reference to America
is what happened in Saudi Arabia with terrorists taking over a
building within the compound for civilian workers in the oil
patch. I think it indicates, I regret to say so, but I think it
indicates that the Saudi oil is vulnerable, that the Saudi
kingdom is vulnerable. I'm very, very worried about it. As a
matter of fact, I believe that this generation serving right
now is going to go down in history as the worst generation
instead of the best in terms of the energy situation.
If in fact we do not do anything about the situation of an
energy policy, I clearly believe that some of us won't be here,
but some will, when America will be brought to her knees
without a terrorist firing a shot in America if we get a
substantial oil disruption. How many remember the Iranian
disruption? We were in gas lines. In Brooklyn, they shot each
other, remember, Senator Byrd, because somebody went around the
line and somebody had a pistol and got mad and early in the
morning, 5 o'clock, they were waiting in gas lines. That was a
little tiny disruption. This one could be a monster disruption
from what I see.
Now, General, you can't fix the world and you can't fix
Saudi Arabian anti-terrorist forces, but I guarantee you that
Iraq won't work unless the police and military of the Iraqis
are ready. Can you tell us, how is the training of these men
and women from Iraq? How is it going? What's your assessment?
Are they really getting better? We're talking about turning the
government over. Will they be ready to take a significant
portion of the load, or will we still be almost exclusively in
charge? Now, I think they've been doing better. I read even, in
the biased press, that some of the trained Iraqis are involved
in a number of these security situations--putting out the
fires, et cetera. Could you just address this for us? I think
it's terrifically important.
General Pace. Sir, they have been doing better, but we can
be doing better in helping them to get better. In the Iraqi
Civil Defense Corps (ICDC), for example, the forces that are--
--
Senator Domenici. What is ICDC?
HOME SECURITY FORCES
General Pace. The home security forces, battalion-size
organizations that we're going to have about 36 of, to a tune
of about 40,000 across the entire country. Their equipment
right now is on order but not yet in theater. Their training is
being done by local U.S. forces, but we need to be working
first, as we are, and with Congress' support, to get the
equipment to them more quickly, to train alongside them, and
then to work alongside them in the field.
One major lesson from the last month is that understandably
Iraqis do not want to fight for a foreign power no matter who
that is. They want to fight for their own government. And with
the stand up, the announcement and the stand up of Prime
Minister Alawi and the rest of the interim Iraqi Government,
these Iraqi soldiers will now have an Iraqi Government to
respond to, an Iraqi flag to fight under, and have a purpose
for which they can lend their energies.
But we do need to do better with the five forces, the civil
defense corps, the new Iraqi army, the police force, those that
are providing protection on the fixed facilities like oil
fields and the like, and the border guard. We need to increase
that, and in fact, there is a general officer who was just
confirmed last week by the Senate to go over and take charge of
that entire Iraqi security force operation for us. He is going
over this week.
Senator Domenici. What's his name?
General Pace. That is Lieutenant General Petraeus, Dave
Petraeus. General Petraeus was a Major General obviously until
about 2 weeks ago. He was the 101st Airborne Division commander
up in Mosul, did a fantastic job there for 1 year, has been
home about 2 or 3 months and has been selected to go back
because of his demonstrated capabilities in the battlefield to
help us reorganize all parts of the Iraqi security force.
Senator Domenici. Mr. Chairman, I would like to say to you
and Senator Inouye that I believe this is the most important
issue, training the forces of Iraq. None of this is going to
work if they are not properly trained and equipped. I believe
we ought to push the military to get that going as fast as
possible and spend as much money as necessary to see that it
works. In fact, it is not so good if they can't get their
equipment. Why will they believe us if in fact we train them
and tell them they are in charge and then we don't have their
equipment?
So, General, I know you're not in charge, but I hope that I
speak for these Senators. There is no way to win this without
the Iraqis becoming trained and taking over, or having a plan
for them to take over. Thank you, Mr. Chairman.
Senator Stevens. Well, Senator, as I understand this
proposal, if the money was used in Iraq by the Department of
Defense to train people of Iraqi descent, that would be
consistent with the request. Senator Dorgan.
Senator Dorgan. Mr. Chairman, thank you very much. I regret
I was late, delayed by another committee, but I have read your
testimony. First, let me say I don't think there's anyone on
this subcommittee that will ever withhold the resources that
are needed to carry out your missions, and I think the evidence
is the chairman and the ranking member and every member of this
subcommittee wants to support that which is necessary for our
troops who are doing what this country has asked them to do.
I do want to, however, say that this--that the $25 billion
reserve fund is an unusual request I think in the scheme of
things over many years, and it is, according to your testimony,
to provide flexibility, and you urge us to avoid designating a
portion of the fund for specific investment programs because
that would undermine the purpose of the fund, which I guess is
flexibility.
It seems to me that we would have some basic knowledge of
knowing what our needs are going to be for the next 3 months, 6
months, or 12 months. And let me come to the--in the last
year's Defense appropriations bill, we said this, section 8139,
it is the sense of the Senate that, one, any requests for funds
for a fiscal year for an ongoing overseas military operation,
including operations in Afghanistan and Iraq, should be
included in the annual budget of the President for such fiscal
year as submitted to Congress under section 1105 of the U.S.
Code.
ESTIMATING FISCAL YEAR 2005 INCREMENTAL COSTS
I still do not understand why we do not have some better
notion of what the expenditure needs are going to be for the
coming fiscal year, and perhaps we can talk just a bit about
that. Can you respond to that question? Obviously you have
not--you have ignored the sense of the Senate provision that
was in last year's appropriations bill, but explain to me why
there's not some basic attempt to try to tell us and the
American people what this cost will be in the coming fiscal
year.
Mr. Lanzillotta. Senator, let me try. What the attempt was,
and what I meant on that statement was, we are using this
reserve fund to pay for our operational costs associated with
operations in Iraq and Afghanistan. If that money is diverted
toward other things outside of those operational costs, then
that undermines the purpose of trying to mitigate the risk
associated with cash flow and the services and the commanders'
need to cash flow these accounts.
We fully intend to address these other issues as far as
wear and tear and equipment, other requirements associated, in
a full supplemental, in which case we would submit that to the
administration and up to the Hill for consideration. As far as
being able to, last February, include the cost of the
operations in this year's budget, we're in this situation that
we had an early supplemental this year in 2004 and the service
budgets for fiscal year 2006 would be due to us in August. To
project the costs for 2006 would be difficult because the
situation on the ground changes and the reality changes on the
ground. And so what we are here for with this reserve fund is
to be able to address that changing situation.
Some of the changes over the last couple of months have
been forced deployment. We've added--or the combatant
commanders have needed for additional troops. We have had to
put those additional troops on the ground to meet those needs.
That was an assumption that wasn't in the supplemental and
that's why we're basically here today.
Senator Dorgan. You make a fair point with respect to 2006,
but what do you expect our costs to be in 2005? I mean, do you
just anticipate that we'll just keep going along and every time
money is needed we'll just do an emergency supplemental? I'm
just asking if we have some basis for understanding what our
costs will be in the coming fiscal year for these operations?
Mr. Lanzillotta. I think that we've been forthcoming as to
what the current operation costs, as far as what our burn rates
have been. The problem that we have right now is the
unforecasted things that happen on the ground to be able to
adjust to meet those. Even when we finished 2004, we found
significant problems in trying to get our arms around what the
requirements on the ground versus the assets that were made
available in 2004 on an early supplemental. What we----
Senator Dorgan. I'm sorry, I don't mean to interrupt you.
Go ahead.
Mr. Lanzillotta. We don't have the data or the accuracy to
be able to project that far ahead as to what possibly could
happen. And then we get into a situation where we need to come
back and ask for additional general transfer authority, we need
to ask for reserve funds.
Senator Dorgan. But it seems to me it's a function of
planning. If our so-called burn rate is now roughly $5 billion
a month, that's $60 billion a year and you're asking for $25
billion as a contingency fund. Does that mean that next spring
we'll be asked for $35 billion in emergency supplemental monies
or more?
Senator Stevens. This is the Senator's last question.
Senator Dorgan. I wonder if the witness could answer.
Mr. Kaplan. Senator, if I may, our expectation is we would
like not to have to ask for a contingent supplemental in 2005--
that's why we've planned to come to the Congress at the
beginning of calendar year 2005 when we actually do have more
reliable and precise estimates and the best sense of how things
have developed in the intervening months. Calendar year 2005
obviously is many months away, and as we've seen just in the
last couple months, circumstances on the ground in Iraq do
continue to evolve. Obviously they've evolved in a more violent
fashion in the last couple months. The hope is, as our military
engages with Iraqi forces and continues the acceleration of the
training, equipping, and enlisting the Iraqis in providing
their own security, the hope is that the needs as we get into
2005 will diminish. Obviously the contingent emergency reserve
fund is there until we get to calendar year 2005 and the
supplemental to provide the insurance if operations don't
diminish or if they continue at the increased operational rate
that we've experienced in the last couple months and that
General Pace has spoken about.
Senator Stevens. Thank you, Senator. For the Senator's
information, I would oppose the Senator's amendment. We have
operated during this period in Afghanistan and Iraq under the
concept that we do receive supplementals. To my knowledge, the
administration has not used the food and forage fund concept
yet in these two actions. We have used supplementals as they've
been presented.
The Iraqi Freedom Fund, which was created in 2003 as a
supplemental and was again used in the 2004 supplemental, it
really has financial flexibility and congressional oversight. I
asked for some rundown of what has happened. Seventeen billion
dollars has been provided in the IFF in the past, and about
$944 million remains available to the Department of Defense,
and we expect that to be spent during the balance of 2004. The
IFF has a 5-day advance notification requirement before DOD can
transfer funds. To date, DOD has sent us 33 IFF notifications
accounting for every dollar that's been spent. In a couple of
cases, the DOD sought prior approval where required for a
procurement new start. As allowed by law and to prudently
manage funds, DOD also transferred money back into the IFF in
order to keep the excess funds from lapsing at the end of the
last fiscal year.
Now, I have some general questions to ask Mr. Lanzillotta
about this. How has the----
Senator Dorgan. Mr. Chairman, might I clarify, I was not
suggesting an amendment, and all I did was read current law
that was in the 2004 Defense Appropriations Act, so I'm not
proposing an amendment. I was just reading the sense of the
Senate that was in the appropriations act last year.
Senator Stevens. That's the sense of the Senate, but I
misunderstood. I thought the Senator was going to present that
as an amendment.
HOW HAS FISCAL YEAR 2003 AND 2004 SUPPLEMENTALS BEEN SPENT?
I asked Mr. Lanzillotta, how has the fiscal year 2003/2004
Iraqi Freedom Fund been spent in your opinion?
Mr. Lanzillotta. Mr. Chairman, out of the $65 billion that
was made available in 2004, we've obligated $32.1 billion, $25
billion in Iraq, $4.5 billion in Afghanistan, and $2.1 billion
in Noble Eagle, which is stateside mobilization of Guard and
Reserve. In 2003, we had two pieces of the supplemental. We had
the $9.97 billion that was provided in an omnibus
appropriations in January and the $62.5 billion that was
provided in the supplemental for a total of $72 billion. Of
that, we've spent $45.6 billion in Iraq, $12.7 billion in
Afghanistan, and $6.5 billion in Operation Noble Eagle. That's
for $64.8 billion. It doesn't include the intel numbers.
Senator Stevens. Do you believe that the flexibility
provided by the IFF has been important to the operations of
your Department from a financial point of view?
Mr. Lanzillotta. Yes, Mr. Chairman, I do. What it has
allowed us to do, and it has been mentioned already, is it
allowed us to react to some force protection requirements. When
we submitted the supplemental, we had force protection
requirements in there for up-armored Humvees. Since then, that
requirement has changed about three times, in which case the
flexibility in the IFF has allowed us to meet that requirement
to transfer money into Other Procurement, Army for the Army to
continue to build up-armored Humvees at a rate sufficient to
meet their requirements.
Senator Stevens. General Pace, in response to a request for
information how this fund was, for examples of how it was spent
for force protection equipment like the body armor, I was also
informed that it was used to up-armor Humvees and it was used
to augment the monies that we provided to destroy captured
Iraqi ammunition, to deal with the ammunition dumps. Can you
tell us how important it is to have this fund available for
commanders in the field so they can respond quickly to changes
and not have to go back through the process of budget approval
right through the Department over to OMB and to Congress?
General Pace. Sir, it is very important for all the reasons
you mentioned. We have about 178,000 new sets of body armor out
there, one for each person in theater. You have building
toward--almost 4,000 up-armored Humvees have been paid for out
of this fund. You have about another 8,000 sets of armor that's
hung on the sides of other vehicles and these were made
possible because of the flexibilities inherent in the Iraqi
Freedom Fund. Further, flexibilities like contingency emergency
responds program (CERP) where you have the ability for
commanders to use that money in the field, they do not have to
come back to the Army, for example, asking Army to reprogram
some money, which means that Army then can continue to train
the soldiers back here and repair the equipment back here that
needs to go back on the next rotation. So all these things help
provide stability across the force.
Senator Stevens. The committee knows I publicly apologized
to Senator Feinstein for the actions that I recommended in
limiting the monies available to deal with the ammunition
dumps. When we discovered how serious they were, I was very
pleased to see that you had used the reserve fund to deal with
those ammunition dumps. If we approve this reserve fund, is
that the type of action that you would use the money for in the
event we discover some more of those dumps? By the way, I don't
know if you know, we've discovered some 8,500 dumps so far.
There's more ammunition, I think, in Iraq than the rest of the
world stacked up in the ground openly. I really support any
activity that will deal with those, although I understand it's
almost an impossible task right now with the terrorism that's
going on. Could you comment on that, General?
General Pace. Sir, it is the exact kind of thing that we
would do with this money. The numbers today are, we have
discovered over 300,000 short tons of ammunition in today over
9,500 locations. They have been compressed now down to 63
locations. We've destroyed about 150,000 short tons, but
there's another 150,000 short tons to go. But that 300,000 tons
that we found is estimated to be about one-half of the 600,000
tons that was believed to be in the country when we began the
war.
Senator Stevens. It could be out there buried, hidden.
There's still stuff that may be found that you would need money
immediately to deal with, right?
General Pace. Absolutely, yes, sir.
Senator Stevens. So I commend you for that and I commend
this committee. The concept of a reserve fund to deal with
issues, emergencies issues, Mr. Lanzillotta, these are
emergency funds, right? You don't use them for routine
activities of any one of the services in Iraq?
Mr. Lanzillotta. Correct, Mr. Chairman.
Senator Stevens. Senator Inouye.
LIKELY CHANGES IN FUNDING REQUIREMENT
Senator Inouye. With the recent United Nations' involvement
in the establishment of this interim government, and with the
selection of a president, prime minister, et cetera, are you
sufficiently optimistic that the funding requirement may come
down in the next 18 months?
Mr. Lanzillotta. Senator, to tell you the truth, I don't
know in the next 18 months what will happen.
Senator Stevens. When you sat here, I'm assuming you're
telling the truth all the time.
Mr. Lanzillotta. I stand corrected. In the next 18 months,
my personal opinion is I have no idea what this requirement
will do. I've watched this requirement change on a dime, and
that is what makes a prediction of a supplemental in 2005 so
hard, because just finishing 2004 the requirements have changed
so dramatically. So I am not optimistic that I know what that
number is in 2005 and that the requirement will come down.
Senator Inouye. But do you look upon the new developments
with optimism?
Mr. Lanzillotta. Senator, I certainly do. I certainly think
that the transition to the Iraqi people eventually will
stabilize and is the only way to stabilize that country.
Senator Inouye. Thank you.
Senator Stevens. Senator Byrd.
Senator Byrd. Thank you. What about those who have said,
hell no, we won't go? How much confidence can we have in the
Iraqis to fight Iraqis in order to bring security and stability
to the country? Hell no, we won't go. Does the witness
understand my question? General Pace.
IRAQI GOVERNMENT
General Pace. I understand it. I don't know how it's said
in Arabic, but I understand what you just said in English. I
believe that Iraqi young men led by Iraqi leaders serving an
Iraqi Government that is selected, elected by the Iraqi people,
that those young men will serve that government, will rally
around their flag, will do the right thing for their
government. So I am optimistic about the announcements that
have been made over the last couple of days about the progress
in standing up a new government.
Senator Byrd. General Pace, my office has recently begun to
hear reports from my constituents that our troops in Iraq will
soon have their rest and relaxation (R&R) leaves substantially
reduced. This R&R leave, which allows troops to return home for
up to 2 weeks, has been critical to military families who have
been forced to deal with the deployment of a family member to
Iraq for 1 year or more. Are these reports accurate? Is there
now or will there soon be a cutback in the R&R leave for our
troops in Iraq?
General Pace. Those reports are not accurate. There will
not be a cutback, sir.
Senator Byrd. So there's--there will not be a cutback in
the R&R leave for our troops in Iraq?
General Pace. That is correct, sir. A soldier who gets
assigned to Iraq for 1 year is given the opportunity to take a
R&R about midway through his or her tour.
Senator Byrd. When can our troops expect their leave to be
restored?
General Pace. Yesterday, sir, because it wasn't taken away.
Senator Byrd. I beg the witness to pardon.
General Pace. I'm sorry, sir. You said when could it be
restored. Because I believe that it never was taken away, sir,
the answer is yesterday or the day before, because it never was
taken away.
Senator Byrd. In other words then, my office has been
incorrectly informed with respect to the report that I earlier
alluded to, namely that our troops in Iraq will soon have their
rest and relaxation leaves substantially reduced?
General Pace. They will not have their rest and leave
reduced, sir.
Senator Byrd. Are our troops also able to visit recreation
centers in Iraq and neighboring countries for shorter periods.
What's going to happen, if anything, with respect to this?
General Pace. Sir, to my knowledge, those programs are on
solid ground. Each of the neighboring countries, of course,
reviews their own programs over time. I will double check on
the neighboring countries, but I'm not aware of any reduction
in any of the programs in the neighboring countries.
Senator Byrd. I thank you, General Pace. Now, if I may have
a question for Mr. Kaplan. Is there not a need--let me back
this up just a little bit--last week, DOD asked the Coast Guard
to increase the number of personnel in Iraq from 300 to 400 and
to increase the number of ships. Prior to that request, the
Coast Guard had estimated their fiscal year 2005 costs for the
mission in Iraq at $95 to $105 million. Is there not a need to
include specific language in the supplemental authorization and
appropriation that transfers funds from DOD to the Coast Guard?
The current version, as I understand it, of the Warner-Stevens
language makes no reference to the Coast Guard. Perhaps, Mr.
Chairman, I could ask you if I may do so timidly to answer that
question.
Senator Stevens. Yes, $400 million has been transferred
from this fund to the Coast Guard so far. Because of our great
interest in Alaska, having half the coastline of the United
States, we maintained a little contact with the Coast Guard to
see how much of their funds are being spent. But since they are
technically an arm of the Department of Defense, when mobilized
by the President, they will be able to have portions of this
fund to carry out their activities as I understand it, and they
have had parts of the fund that has previously been made
available to the Department of Defense, as I said, $400 million
has already been transferred to them in the past.
Senator Byrd. Then, Mr. Chairman, is it not--where there is
no vision, the people perish. Would it not be well to exercise
our vision to include specific language in the supplemental
authorization and appropriations that transfers funds from DOD
to the Coast Guard?
Senator Stevens. I would see no problem with that because I
think it's implied already, and they have used the fund in the
past. It's the same fund we're putting this money into. But I'd
see no problem. As a matter of fact, I'd welcome the
opportunity to sponsor with you a provision that says that to
the extent necessary these funds may be used for the activities
of the Coast Guard carrying out the activities in Iraq. I don't
think they're necessary for Afghanistan. I don't think they'll
be necessary there.
Senator Byrd. No West Virginia for the same reason. We have
no coastline.
Senator Stevens. We'd welcome them back in Alaska whenever
they can come back, Senator.
Senator Byrd. Senator, I'm one Senator who voted to bring
Alaska and Hawaii into the union.
Senator Stevens. We honor you for that continually, sir.
Senator Byrd. And may I thank you, Mr. Chairman, I thank
you for your suggestion that we might work together on such
language.
Senator Stevens. Thank you. Senator Inouye, do you have any
further questions? We expect to have this be the last hearing
for this subcommittee. We do appreciate your coming today. I
think it's a very important and productive hearing. I want to
assure you that we stand ready, as Senators here have stated
from both sides of the aisle, to respond at any time when
resources subject to our control are necessary to ensure the
troops in the field or preparing to go to the field being
trained for that, have the resources needed to get the job done
and get it done with as full protection as possible.
I'm constrained to say that the Senator from West
Virginia's questions about leave I think were of interest to
Senator Inouye and I. We got 4-day leave before we left to go
overseas and we got 1 week leave when we came back from
overseas. We didn't get R&R and we didn't get leave to go to
any rest center or any recreation center during the period of
World War II. So I'm pleased to see that these people have it,
don't misunderstand me, but it is something new in terms of the
cost of operations of the Department of Defense. That's an
enormous, enormous burden to ensure that those forces have at
least one trip home after, what, 6 months, General?
General Pace. Sir, sometime during the year, usually
between 4 to 8 months.
Senator Stevens. They've got a trip back to the place of
their choice as I understand it, to come home to the place of
their choice, or is it to home?
General Pace. Sir, it's a very generous--place of their
choice.
Senator Stevens. But it's needed and I hope we can talk
later sometime about the necessity to restore the confidence in
our system to increase the enlistment rates in the Air National
Guard and to restore the total enlistment rates for the whole
Department of Defense. We thank you for----
Senator Byrd. Mr. Chairman?
Senator Stevens. Yes, sir.
OPERATIONS IN AFGHANISTAN
Senator Byrd. Could I impose on the chairman and the
ranking member just briefly? What is the current monthly cost
of operations in Afghanistan, and how much of the $25 billion
in this budget request is for operations in Afghanistan?
Mr. Lanzillotta. Senator, we're currently spending about
$700 million a month in incremental costs for Afghanistan. This
fund is envisioned to be able to relieve stress on the service,
particularly the Army, for both operations in Afghanistan and
Iraq. I don't really have a breakout as to exactly how in the
future that it will come out.
Senator Byrd. Mr. Chairman, may we have some estimate of
this--of the needs? Do we have some estimate as to the monthly
costs of operations in Afghanistan and how much?
Senator Stevens. Senator, could you allow me to interrupt?
Senator Byrd. Yes.
Senator Stevens. This fund is for emergencies.
Senator Byrd. Yes.
Senator Stevens. The funds that are available for routine
activities are in the regular bill, but the emergencies, I
don't see how we could predict them.
Senator Byrd. I don't think this is an unimportant question
or an impossible one for the people who are in charge and who
use the pencil and so on by the minute. I don't think it's
something out of the order to have this question answered at
least as well as can be, how much of the $25 billion in this
budget request would Mr. Kaplan estimate to be for operations
in Afghanistan?
Mr. Kaplan. Senator, the best we can do as we sit here
today is to tell you what we're spending in Afghanistan today,
and that's as Mr. Lanzillotta reported, on the order of $700
million a month. As with Iraq and as is the purpose of this
contingent emergency reserve fund, we don't know what we'll be
spending in the future, for instance, in Iraq, as we move
toward democratic elections for that country.
Senator Byrd. But this fund is not for democratic
elections, is it?
Mr. Kaplan. No, Senator. This fund is for the military
operations in Iraq and Afghanistan. I only refer to the
elections to make the point that we don't know what precisely
the situation on the ground will be as we move into fiscal year
2005. The fund is there, as the chairman has indicated, to make
sure that the commanders on the ground in both Iraq and
Afghanistan have what they need and to relieve pressure on the
Department of Defense so that they don't have to go too far
into their accounts.
Senator Stevens. Senator, it would not be used for the
elections, but it would be used to assure that our troops in
Iraq have the funds in Iraq to react on a security basis to
assure that the elections were carried out openly and freely,
and we cannot estimate what that will be. I don't know what it
will be.
On Afghanistan, we spent a substantial amount of time with
General Jones as he went through the proposed transition in
Afghanistan to a more peaceful circumstance, and that too has
some contingencies in it that means that there could be
emergencies develop in Afghanistan. But he could give us no
estimate of what would be required because he doesn't know what
the emergencies might be.
But we did have the amount that had been used in
Afghanistan for the funds that exist today, and that has been--
I don't have the total--but some of these funds that have been
used from the IFF in the past have been for Afghanistan. We
could get the Senator that figure, how much of the funds have
been used there in the past as compared to how much was used in
Iraq.
Senator Byrd. I think that would be good information for
the subcommittee and the committee. Perhaps General Pace might
have some view of how much of the $25 billion is expected to be
for operations in Afghanistan. I'm very interested in
Afghanistan. I was there 49 years ago and I have a great
admiration for those people, but I just don't believe that
we're giving enough attention to the war in Afghanistan. That's
the war I really have supported from the beginning. Does the
General have any idea as to how much of the $25 billion is for
operations in Afghanistan?
General Pace. Sir, I am no more prescient than the others
who have already spoken. We are spending about $700,000 a month
there.
Senator Stevens. $700 million.
ELECTIONS
General Pace. You could multiply that by month if you'd
like to to come up with an estimate. We have elections coming
up in September in Afghanistan. There will be additional
security needs there. There could be enemy activity because of
that, those elections, that would require us to do more than
we're doing day to day right now security-wise, so the number
could change, sir. But it would be a guess, and the math that
you would do based on $700,000 a month is the same that I would
do, sir.
Senator Stevens. Would the Senator yield just a moment?
Senator Byrd. Yes.
Senator Stevens. I'm told that the North Atlantic Treaty
Organization (NATO) participation now is increasing. When we
were there just a few weeks ago, there had been sort of a delay
in NATO fulfilling its commitments, but NATO is now coming into
Afghanistan in a way that it's not into Iraq, so as it comes
in, its participation will augment the funds that we are
spending there. The rate of expenditure now is decreasing as I
understand it, so the problem is, is there any kind of formal
resumption of real true hostilities from the remaining Taliban
enclaves and that's, I don't think anyone can predict it.
But the good news is that NATO forces are coming in and
that four districts of Afghanistan are becoming linked by a
road we are building, which is sort of like a beltway through
the whole country. I share the Senator's concern for
Afghanistan because I too went there years ago to Pakistan and
what we saw immediately after we reentered Afghanistan on the
trip there was a shocking, shocking situation. I told people
when I came back, having seen China destroyed by the Japanese,
the destruction in Afghanistan was far beyond the destruction
that was in China.
ADDITIONAL COMMITTEE QUESTIONS
Senator Byrd. Mr. Chairman, as the ranking member of the
Appropriations Committee, I wish to thank you and I want to
thank my friend from Hawaii, the ranking member of the
subcommittee, for the work you're doing. I want to thank you
for the hearing you're holding today. And I want to thank
General Pace and the other two witnesses for their
contributions to this effort. Thank you very much.
Senator Stevens. Thank you, sir.
[The following questions were not asked at the hearing, but
were submitted to the Department for response subsequent to the
hearing:]
Questions Submitted to Hon. Joel D. Kaplan
Questions Submitted by Senator Christopher S. Bond
Question. Recently I supported an effort calling for a $200 million
increase in the heavy truck recapitalization fund account. It is
reported that our heavy trucks in Iraq and Afghanistan are getting a
year's worth of use in two months. Does this supplemental adequately
factor in the costs associated with the Army's reset requirements for
its transportation fleet?
Answer. The Department of Defense (DOD) and the Army are closely
monitoring the wear on vehicles in Iraq. Based on current estimates of
vehicle use, the combination of the fiscal year 2005 President's
Budget, a planned fiscal year 2005 supplemental, and potential use of
the $25 billion fund will provide a flexible means to adequately cover
costs associated with the Army's transportation fleet requirements,
including recapitalization.
Question. Once the CPA transfers authority to the Iraqi Interim
Government who will make the decision for the acquisition of military
related equipment for Iraqi forces? Has the DOD considered equipping
Iraqi forces with U.S. manufactured equipment (and replacing this
equipment with newly manufactured and upgraded American made
equipment)?
As U.S. Forces place a greater reliance on Iraqi forces throughout
Iraq it is important that the equipment Iraqi forces rely upon be
dependable and can be reliably repaired and kept up. Transferring U.S.
manufactured equipment to the Iraqi's will ensure that parts and
service is available to Iraqi's in keeping their military equipment in
good repair.
Answer. Decisions on the types and numbers of arms secured for the
Iraqi forces will be made, in consultation with appropriate officials
of the Iraqi Interim Government, by the Department of Defense and
General Petraeus, who is leading the effort to train, equip and
mobilize the Iraqi security forces.
______
Question Submitted to Lawrence J. Lanzillotta
Question Submitted by Senator Christopher S. Bond
Question. Recently I supported an effort calling for a $200 million
increase in the heavy truck recapitalization fund account. It is
reported that our heavy trucks in Iraq and Afghaniatan are getting a
year's worth of use in two months. Does this supplemental adequately
factor in the costs associated with the Army's reset requirements for
its transportation fleet?
Answer. No. This reserve fund is not meant to address all the
resetting of the force requirements that we are going to incur. This
fund is only to allow us to mitigate the problems and risks associated
with cash flowing our O&M accounts, specifically in the Army, until
fiscal year 2005 supplemental appropriations can be approved. The
resetting of the force or the wear and tear on the equipment is a
problem that the Department is addressing. Secretary Rumsfeld has
charged the director of PA&E to do a study as to what that requirement
actually is, because we are finding that this equipment ages
differently on wear and tear. We hope to address this truck
recapitalization issue when we prepare the fiscal year 2005
supplemental appropriations request.
______
Question Submitted to General Peter Pace
Question Submitted by Senator Christopher S. Bond
Question. Once the CPA transfers authority to the Iraqi Interim
Government who will make the decision for the acquisition of military
related equipment for Iraqi forces? Has the DOD considered equipping
Iraqi forces with U.S. manufactured equipment (and replacing this
equipment with newly manufactured and upgraded American made
equipment)? As U.S. Forces place a greater reliance on Iraqi forces
throughout Iraq it is important that the equipment Iraqi forces rely
upon be dependable and can be reliably repaired and kept up.
Transferring U.S. manufactured equipment to the Iraqi's will ensure
that parts and service is available to Iraqi's in keeping their
equipment in good repair.
Answer. Decisions regarding the types and quantity of equipment for
the Iraqi Armed Forces will be made by the Iraqi Ministry of Defence,
under the advice of Lieutenant General Petraeus's Multi-National
Security Transition Command--Iraq (MNSTC-I), formerly the Office of
Security Transition. Many factors will go into the recommendations
MNSTC-I provides, including equipment availability, production lead
times, interoperability with existing systems, procurement and
maintenance costs and training requirements. While the MNSTC-I analysis
may recommend a number of U.S.-produced items for the armed forces, the
Iraqis have the final say regarding what they believe best meets their
needs, what they can afford to buy and from whom it should be
purchased.
The Department of Defense has and will continue to consider U.S.
equipment for the Iraqi Security Forces. We are already providing
significant quantities of radios, field gear, vehicles and night vision
devices to the Iraqis, and as new requirements emerge we will continue
to assess if U.S. equipment will meet Iraq's needs.
CONCLUSION OF HEARING
Senator Stevens. If there's nothing further to come before
the subcommittee, this is the last meeting of this subcommittee
on the fiscal year 2005 budget. Thank you all very much.
[Whereupon, at 11:45 a.m., Wednesday, June 2, the hearing
was concluded, and the subcommittee was recessed, to reconvene
subject to the call of the Chair.]