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Director of Undersea Warfare, Office of the CNO

Well, good afternoon. I know my work is cut out for me, after lunch, warm afternoon, with a message that’s going to sound eerily familiar. And General Welch, sir, I give you all the credit for this because he gave us the charge last night to stay on message. And so a lot of the points that I’m going to cover tonight, if you look at the title in my program, it almost directly reflects what General Welch shared with us last night.

But what my hope is, is that years from now, even decades from now, we’ll hear people talk about hey, do you remember that Kings Bay conference, the Kings Bay conference of 2013, and how that moment changed everything? And we’ II speak to it in those kind of hallowed terms- some of these other things we’ve spoken of with years next to them, up on the screen with different treaties and agreements- the Kings Bay conference of 2013. I feel it.

I feel it here in the room. There’s this certain gravitas just with the speakers, a certain clarity of message, a sanity, a soundness to it that just sort of resonates in my heart, just to see these like-minded people awaken and recognize what’s really at stake here. And the stakes are very high.

And yet with that, an alarm, a concern, are we postured right? Are we putting our money where our mouth is? Or, have we neglected the very thing that has given us the peace and the prosperity that we’ve enjoyed as a nation, and the globe has enjoyed throughout?

So the grassroots effort that Frank Miller spoke of can start here, as we fan out, as we talk to five people we’ve never talked to before about strategic deterrence, a riveting subject, that we get their hearts and minds. And then that fans out and ripples out and we begin to have this national debate and dialogue.

Sheila, I do want to thank you so much for your leadership here and in Georgia and the southeast and for your delightful Camden County Partnership, the great team that’s here with the white badges sprinkled in the midst of us- not a big large group, but just enough. You know, it’s that salt that seasons these types of events, the real people, the real Americans from our hometowns that are trying to grapple with some of our military acronyms and say, how do I make this real for my neighborhood, for my church, for my schools? And so I’m very excited that you ‘re here.

And I’ ll tell you, unlike General Welch, I’m going to dial this down a couple of notches because I’m a blue collar kid, lobsterman’s son, from Massachusetts. And I’m going to try to talk to the 15 Camden County partners that are here, sort of at your level – there you go. There you go.

So in simple terms, you know, I learned budgeting when I was a young kid. I was the sternman on my dad’s lobster boat fishing out of Green Harbor, Massachusetts on the south shore of Boston.

And my allowance was pretty straightforward. It was directly proportional to the week’s catch. That’s it. It was a very simple rule. You could calculate it. You could sort of see how the week was going with the number of lobsters you got how much money you were going to get in your allowance.

If I wanted to spend more money than my allowance, I had to work harder. I had to talk my dad into going back to the first trawl we picked up at the beginning of the day and take another look to see if there may be a few more lobsters there. Or, I had to go get a second job to have more money to spend.

I learned the value of saving and prosperity, because winter is coming and winters are lean years for a lobstennan and a lobsterman’s son. So in the summer when the bounty was full, you had to put a lot of that away to make sure you can endure and pass through the winter. And honestly, if I wanted to take out my high school sweetheart for dinner, I’d have to forego a needed pair of running shoes. You can’t have both. You know, it’s either the running shoes or the sweetheart. Well, you know, love prevailed.

As a lobstennan’s son I also learned of deterrence. And I’d love to tell you some of the stories of how we deter out on the high seas as lobster fisherman. But let me just say there are weekend warriors in their motorboats who take great pleasure in pulling up our lines and stealing from our traps. And we’d have some rather cruel and dastardly things that we do to inhibit and deter that type of bad behavior, and I’ll leave it at that.

Let’s start off with a sea story.

Imagine with me for a moment that it is night-time and we’re at sea and in the reaches of the mid-Atlantic. The sky is overcast and a thick blanket of fog surfaces the ocean. We hear a skiff off in the distance, the prow surging through the rolling waves. We strain our eyes and just make out a small dingy with three large men huddled at mid-ship.

As we look closer we recognize that they are the renowned corps of the king’s protective service, the most feared bodyguards the world has ever known. Their names: Bomber the Fearsome; Boomer the Threatening; and IC the Defender. But on this night, they appear far from intimidating. They look beat and tired, weak and rundown and hungry – very hungry.

With damaged eyes they glance at a basket sitting between them: a quarter loaf of soggy bread and a small apple is all that remains. The grave reality has been slowly building these past few weeks that they have rationed their meager provisions to the leanest of the lean. The reality is there is insufficient sustenance for all three. One must die for the other two to live.

And as they prepare to draw lots, they once again wonder how did it ever come to this since their glory days of service in the presence of the king? The fog lifts and we look ahead of the skiff and we see that it is being towed by a luxurious cruise liner, the most decadent and magnificent in all the world. The cruise ship journeys at slow speed, half-ahead.

And now, we hear music and laughter and festive dancing. In the banquet hall there is lavish food, tables overflowing. And the king orders another casket of fine wine opened and glasses refilled. He presents a toast, a toast to prosperity. The kingdom has indeed been blessed beyond measure this past half-century and the world has enjoyed unprecedented peace.

This was not always the case. There was a time when the very life of the kingdom was constantly threatened. The threat had become so intense that the king formed a triad of protection-protection around him and his kingdom.

But as the days of safety abounded into months and years, the king’s protective service became a bit of a bother. They were always sort of underfoot and in the way. And they were disposed of to the outer reaches of the castle, and eventually, over time, became forgotten.

And then the king began to contemplate, I wonder whatever happened to IC and Boomer and Bomber. He was jarred back into the present as his court cheered back in a shout, to prosperity- to prosperity. Long Jive the king.

So this afternoon I would like to touch on three themes: the first, the problem with the blind and relentless drive to cost reductions and affordability; second, the inherent instability of an overly optimized and under-damped system; and third, how to lose at chess when you play against two grand masters. Point number one, our strategic forces are the nation’s model of cost efficiency and effectiveness bar none. We have optimized each leg of the triad to incredible limits. And limits, some may say and I might add, to a fault.

And I just want to-I’m the expert on the sea-based leg. SAC, thanks so much for the other two legs that you presented. But I’m going to talk for a second about the sea-based leg. And just to make sure that each and every person here knows how much risk that we’ve taken as a nation with regard to this one leg of the triad.

We have optimized our model. At one time at the height of the Cold War we had 41 SSBNs–41 for freedom- that conducted this vitally important strategic deterrent mission. Again, you think of The Boomer, the Fearless–41 for freedom.

Well we were able to dial that down to a much smaller number with this recapitalization. With a longer-range missile, the C-4 and then D-5 we were able to go from 41 to 18 and then to 14 SSBNs. This is that case study of optimization that you all learned in calculus in school, as we ‘re asymptotically approaching the absolute minimum, the leanest that you can possibly do two-ocean strategic deterrence effectively and successfully.

And we are at that limit. The limit is 10 operational submarines. And to achieve that with our force today, the Ohio-class today, we need 14 SSBNs based on the mid-life overhaul when those are refueled and taken out of strategic service.

The good news, and this gets back to another point I think Peter made about cost avoidance, is that we’re going to be able to do with 12 SSBNs what we’ve done for the last 30-plus years with 14 SSBNs. Saving two SSBNs out of the budget, and about a rough order of magnitude about $5 billion a piece, it adds up. Well 41 to 18 to 14 to 12, that’s sort of crazy. I mean, we’re sort of at crazy talk right now as how lean can you go before the engine begins to knock and you begin to have a little bit of problem maintaining that momentum.

But get this, we’re not content with that. Let’s go ahead and do this. Let’s throw in a bonus 12-year extension to the life of the submarine. The submarine of the Ohio-class designed in the ’70s and built in the ’80s with a 30-year outlook, we’re going to go ahead and do this magic wand waving and extend that to 42 years.

You know, what’s the threat going to be like in that timeframe as these things reach end of life? What’s the material condition going to be? We don’t have much experience operating submarines underwater, at pressure, in corrosive environments as was mentioned earlier today, much beyond 35 years. And the two submarines that we operated for that enormous stretch of time period were sucking chest wounds with regard to how we had to pay to maintain and keep them at sea. And that’s what we have backed ourselves into with one slippery decision after another with regard to our sea-based strategic deterrent leg.

So here’s the Ohio replacement. Dave Johnson and Terry Benedict gave you a great report of the momentum we have there in this austere time- very positive. I think Matt asked the question, hey, I’m not following. Frank is over here saying this and you’re saying that.

Well I’m going to answer your question. I’m not as optimistic. You know, a lot of this is PowerPoint. A lot of this is budget in the out-years. I know how much of a struggle it is each year, right now, just to maintain the current, the essential minimum investment to maintain that momentum. And we have so thinned ourselves out with regard to this turnover between this 42-year old Ohio class and the Ohio replacement that there is no margin. Everything has to work right. Not just everything in the bubble, not just every subsystem of that space shuttle complex replacement SSBN with e-drive and life of ship core, but we have to make sure that it’s not pertubated by things outside of our control like the budget process.

You know, I don’t think I’ve ever seen, you know, a time like now where we need everything to click right to be able to do this without a gap. Get this, we’re so bold as Americans that the first Ohio replacement does not come on service until the current fifth Ohio-class goes off service. You know, that’s sort of crazy. I would like it to be the third, or maybe the first.

When the first Ohio goes off, the first Ohio replacement comes on. Then we ‘d have a little bit of margin. But no, no, we’ve stretched it all the way out so that we’re going to go to 10 SSBNs running over a decade period, the absolute minimum number that you can possibly have to make two ocean sea-based strategic deterrence work.

And that’s where we are as a nation. And the average American has no idea. They sleep in peace each night.

So, you know, it’s a daunting task we face with this lean optimization, this optimizing that we’ve done for the God of affordability. But it doesn’t end here. And I just want to bring up this other very important point, and you can quote me on this and you can spell it Rick Breckenridge.

I am a lover of the triad, okay? I am a zealot for three legs. Why? Because if we did the preposterously absurd thing of going to a dyad, I don ‘t have enough SSBNs. And if we go to a dyad, I need more SSBNs to do strategic deterrence right.

And we have simply passed that off ramp about three states ago. There is no way I can ramp up faster than what l already am, which is already – you know, just to achieve 10. So we, by default, have ended up in a triad.

So although there’s been quotes misattributed to me in the paper as I had my testimony, as Amy mentioned, let’s get the money from the Air Force and move it to the Navy so we can pay for the shipbuilding account, that’s not exactly what I said – just for the record.

So we’ve done our part to save costs. This is the key story, alright? We’re not oblivious to the fiscal crisis our nation is under. We paid. We paid for the last two-plus decades with regard to shifting the bill forward by extending the Ohio-class and not having to recapitalize during two land wars in Asia. You know, we were able to save our country’s checkbook with the decisions- the hard decisions that we made to meter out the strategic deterrent for this lean point.

Point number two, we are a prosperous nation that can well afford the small fraction of investment. The return on investment is so great and the risk of failure so disastrous. And l have to admit, and again this is for my Camden County blue-collar friends, I am also a closet budgeteer- not quite Peter and Amy level budgeteers, but I’ve dabbled in the budget. So I’m going to go ahead and slice and dice the numbers- same numbers- that Peter showed, slightly different perspective as we look at them. These are OMB table number 2005 constant year dollars for those that want all the asterisks.

But here you go, in the 45 years since 1965 to 20 I 0, the gross domestic product of the United States has gone up by a factor of 3.7 in constant year dollars. And in fact it has gone up every year- virtually every year consistently over that time period. There’s no inflation at work here. This is about wealth creation.

We, as a country, produce 3.7 times as much value in goods and services as we did in 1965. The federal budget has grown at about the same rate. In these same 45 years, the sum total of all federal spending on education, training, employment, social services, health, medical care, income security, disability, social security and veterans benefits, went from $184 billion to $2.137-third decimal point is significant – trillion dollars.

Okay, this is an increase of over 11 times. So this portion of our budget during this era of prosperity has increased 11 times since 1965. Every sub-category I listed went up virtually every single year.

And this was not a selective list. It’s basically true of every other non-defense major area in the budget. Non-defense federal spending grew 11 times in the past 45 years.

Let’s take a look at defense spending. In the same 45 year period the U.S. defense budget went from $364 billion to $614 billion, an increase of 1.7 times. Unlike all the categories of the budget I mentioned, there was no gradual, continuous ramp here, no upward trend.

The defense budget varies significantly, up and down, up and down for the forty-five years. Over that period of time, it averaged about $423 billion, again in constant year FY ‘2005 dollars. Can you see how very different this is from the rest of the budget?

Finally, similar to what Peter had, look at the OMB projected 2015 budget data, and the picture gets much gloomier. The disparity grows even more significantly. So over this 50-year window GDP grows by a factor of 4.3, federal outlays by a factor of 4.5, education, health, Medicare and Social Security, etcetera, grows by a factor of 12. Defense spending grows by a factor of 1.3, or about one-tenth the growth rate of education, health, Medicare, income security, Social Security and veteran’s benefits.

You may wonder, what happened to the population during this 50-year window? Well, it went up by a factor 1.5 times. Let me translate this for you back into lobsterman’s son terms. This means because of that population growth, in the statistics I just gave you, today we are paying less for defense per capita in constant dollars than we did in 1960, even though our per capital wealth has gone up over the same period of time by over threefold. Did you get that? We are more wealthy by greater than three times, and yet per American we are spending less on defense today than we did in 1960. As Peter mentioned, we’re too busy going to the movies and buying our I-Pads.

In sum, the crystal chandeliers are lit in all their glory on each and every deck of the cruise ship. It is time to push out a little bit more bread into the basket for our warriors trailing in the skiff behind us. And if I may stretch the metaphor to highlight one other false dichotomy- and this Amy mentioned- the lunacy of using our general purpose Navy shipbuilding as the bill payer for sea-based strategic deterrence. That’s two men in a life raft with, you know, only the apple. And that’s where we are. That is as absurd as this has become.

Navy, stay within your topline. Figure out how to recapitalize this vitally important sea-based strategic deterrent that the CNO has made his number one priority. And, if necessary, you’re going to have to tighten your belt and decimate your general purpose force ships, which has another conventional deterrence value of its own. These are the times that we live in.

Okay, number three- let me see if I can find my spot here. My third and final point, when I look forward I don’t see good things. The threat- 1 ‘m also here to talk about the threat- I see an emergent China, resurgent Russia and assertive Iran, and the looming potential of large-scale Islamic sectarian warfare in the Middle East.

As a national security professional, I just cannot look at this data and say it is time for defense cuts, let alone defense cuts as proportionally large compared to the other cuts to our federal budget. However, politicians and polls will say there is no stomach for sustaining defense spending. It must be cut, either at the same rate or at a higher rate than other categories of spending.

And my gut tells me that the politicians are probably right. Sadly, there is no popular will to sustain defense spending. And therein lies the problem.

This is where we in the national security business are failing the American people and failing our civilian leadership. We cannot allow our professional military judgment to be pushed around by polls and popular will. Any objective reading of history indicates that we are shrinking our forces and undermining our national will just as threats are marshaling in at least three important geographic regions.

It is crystal clear what is going on. Our potential adversaries are arming themselves to increase their ability to intimidate. And our allies and friends are trying to make up for what we are no longer providing.

This cycle has been played out a dozen times in the last 100 years. History tells us that it will lead to regional instability and miscalculation. Flat out, it will lead to aggressive opportunism by our adversaries. We in the United States will watch for a while, sipping lemonade, and then regain the national will to intercede.

But this time, this time, it’s different. This time is the first time the scenario includes assertive nuclear-capable regional powers that are beating their chests. This new dynamic will change the manner in which the scenario plays out and should be of intense personal interest to everyone in this room and to every American. This is not just going to be another nap cycle for America. This time, while we sleep, there will be mischief afoot and it may be impossible to undo the damage done while we slept.

My final word picture is that of chess. Ladies and gentlemen, today we are in a chess match and the game is already underway. This is not about a potential future chess match with Russia, China or Iran. This game is already going on.

Our potential adversaries are moving pieces on the board and trying to secure territory and hearts and minds. They are building layers of deterrence to keep us from taking their pieces, and they’re good at this. And I want to give you two examples that have been mentioned at various times this morning. This is that summary lecture, so stick with me.

Chinese state run media this past week revealed for the first time that Beijing’s nuclear submarines can attack American cities as a means to counter-balance U.S. nuclear forces in the Pacific. Several communist news lines ran identical top headline reports about the awesomeness- I’m not sure how that translates- the awesomeness of the People’s Liberation Anny Navy strategic Submarine Force. The article features 30 photos and graphics detailing among other things damage projections from Seattle to Los Angeles after being hit by Chinese nuclear warheads, and the deadly radiation that will spread all the way to Chicago. That’s pretty scary stuff.

And you might wonder, what in the world is China doing? What, are they trying to pick a fight? What’s going on here? No, this is sophisticated posturing. This is that part of deterrence that we talked about earlier, the signaling of national will and broadcasting of possible future intent.

You may wonder, what was the top news story in American during this same time that the Chinese published these things? Certainly not many of our outlets covered this story. I’m not sure- I have a picture from one. This is a picture of the radioactive plume coming from Seattle and San Francisco reaching Chicago. The largest popular story in America, Bad Grandpa tops at the box office. We are too easily amused.

Meanwhile, our Russian friends, they’ve been conducting their own posturing. And as mentioned, this past week President Putin ordered a no-notice mass exercise of the strategic missile and Submarine Forces, combined with an air and missile defense exercise in the Kapustin Yar testing range. Two ICBMs and two submarine-launched missiles were near simultaneously launched, as were about 50 S-300 and S-400 air defense missiles, during this exercise, which Putin oversaw himself.

Now I’ll tell you, when I was CO of the MEMPHIS I took great pleasure in walking into the control room and saying, officer of the deck, torpedo in the water bearing 13 7, and forcing him to do snapshot exercises. How quickly could he get the fire control system, get a tube flooded, get a snapshot out, and counter-fire against the incoming threat? Those are water slugs- we always make sure that those tubes have no torpedoes whenever we run these snapshot drills.

This is President Putin, doing a snapshot exercise with pretty risky pieces of military apparatus. He has ordered at least four such no-notice snap drills this year and both he and the defense minister have indicated that there will be more.

So while the strategic forces exercises were taking place, and Frank Miller mentioned this morning, two TU-160 nuclear bombers were operating in South America. They arrived in Venezuela on October 28 after a 13-hour flight from their base in the Volga region. On October 30, they went at it in Nicaragua and are scheduled to carry out patrols over the region.

Where is the American outcry to this? You know, how is it that in our hemisphere, in the northern hemisphere, we have Russian nuclear-capable bombers operating and we are oblivious to it? We are caught up in Miley Cyrus news stories.

So while China and Russia posture and unambiguously broadcast their strategic war power to us, what are we doing to them? What are we broadcasting to them? We talked about, actually, a couple of good things during General Kehler’s remarks this morning, but by and large we are skipping our turn.

We need to realize that most Americans and American political leaders do not understand our military, and indeed our nuclear forces, what they’re even for. Why are they confused? They are confused because we do our best to confuse them, by focusing so often on kinetics and warfighting.

Many Americans say, as reported this morning, we’re not going to fight a nuclear war and therefore I don’t understand why I need nuclear weapons. Or, they say, we’re not going to fight a major war at sea so I don’t understand why I need such a big Navy.

We confuse people by focusing too much on kinetics. We teach people that the purpose of a military is to break things. But just like nuclear weapons, our military’s primary function is to deter aggression and to promote stability. Military forces achieve influence because of their latent ability to break things, and the strategy is about how do we employ that latent ability to serve our national interests.

So let’s think about chess.

When you first teach children to play chess what’s it like? It’s about kinetics. There are dead pieces everywhere. The board gets thinned out and pretty soon only one side has anyone left and we’re moving around the board trying to get them into check, let alone checkmate, and it’s impossible. It ends up in a very- usually a thrown board at the end.

And that is how many people and many leaders see the military. They think that the military is just about killing the other side’s pieces. But how do the grand masters play chess? They’re not playing war, they’re playing deterrence. Rarely do you see dead pieces everywhere.

As the skill of the players goes up, so does the likelihood that you will see a draw. The most likely outcome in high-level chess is a draw followed second by victory by white, only because white goes first. And the least likely outcome in grand master chess is victory by black.

So what does it mean to play to a draw? It means that each side has control of a certain area of the board with sufficient deterrent power to prevent the other side from trying to take more of it without risk of losing too much. In a draw, there are plenty of pieces that are held at risk by other pieces.

But there is a hidden escalation ladder behind each seemingly vulnerable piece. You take my piece, I take yours. It’s about deterrence. It is about the looming potential of escalation dominance preventing you from taking that bishop or that knight.

But chess teaches us even more. At the start of the chess game the two sides are about equal. They control an equal amount of space with the same potential power. In many ways the outcome of the game is determined by the way that each player moves to claim and secure space on the chessboard.

Again, it isn’t about killing the other guy’s pieces. It’s about arranging your own pieces in a manner that securely protects your part of the board and your own pieces. This is building your deterrent to protect your interests.

Remember, we are already playing chess with Jots of players: other players, some adversaries, some allies. We are engaged in a contest to stake out our interests and to protect them with strong, layered, deterrent forces. And I don’t mean just the military.

Even when we make decisions about the nature of our nuclear deterrent, we are making choices of where we put our chess pieces on the board. So Jet me emphasize that again. As we look at recapitalizing our strategic forces, that is a chess move. Do we have the fortitude, do we have the follow through, or do we imperil even critical pieces on the board like this with the vagaries of sequestration?

So when we cut our budgets or thin our deterrent forces, we are taking a few of our own pieces off the board, sometimes as a gesture of goodwill, and letting the other side make several moves in a row while we, in effect, skip a few turns. While we take this holiday, I assure you, the other side is more than happy to take more strategic territory and enhance the layered deterrent they use to defend it.

This brings us to our final key point. There are other players in this chess game. These key players on our side are the nonnuclear-capable allies that we protect with our strategic forces. And so we have to remember that this isn’t just about us and that they have strategic choices to make too.

And as truly as night follows day, if we don’t provide them the right overprotection, they will make decisions to protect their own interests. And our adversaries will seek to also fill strategic vacuums left by us

So the key point to remember is the sooner we re-engage the better. Even if we’re pessimistic about Americans quickly waking up, it doesn’t relieve us from starting now with the alarm clock or the horn or banging on some pots and pans. The sooner we send crystal clear messages about our resolve the better.

While we are napping, states caught in the middle will be faced with tough choices: selling out to red or crossing their fingers and hoping the bull wakes up. The longer we nap the more nations that will be compelled to throw in with red and the tougher the problem will become for us.

So in conclusion, your job is to teach. So arm yourself with what you’ve seen and heard at this conference, a rich conference that really does a pretty good job at comprehensively giving this clarion call of what’s at stake. And we need to go out and educate.

Here are the key points from my address. We are not self-optimized. We are over-optimized in our strategic forces, and the system is on the brink of instability. Number two, remember that while everything else has been growing three or four or I 0 times during the past 50 years, the defense budget has been basically flat, and in terms of constant dollars has actually gone down on a per capita basis. There is no other important area of government that this has happened to in our history.

In short, we should not feel too generous about giving away defense funding, and you should not feel guilty about feeling this way. And lastly, remember that deterrence is part of our international relations that is best thought of as a chess match that was already underway. There are no time outs. There are no naps. There are no rewards for good behavior or good intentions. The longer we signal to our friends and adversaries that we are distracted by affairs at home, the more likely the world will move irreversibly in directions we will surely regret.

So ladies and gentlemen, thank you very much for this opportunity. Thank you for coming and the importance you’ve given this event. Thank you for the courtesy of listening to my remarks. And with resolve, I pray and hope that we go forward from this point ready to be much more vocal as we advocate this important national security staple of our country.

Thank you.

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