REED: Thank you, Roger, for that kind introduction.  It is a privilege to be able to join you today, and I thank the Reagan Institute for hosting this conversation. 


On the Armed Services Committee, we are looking at a considerable array of challenges to our national security.  As the Chairman of the Committee, where I enjoy a close working relationship with Ranking Member Jim Inhofe, we are working in a bipartisan manner to give the Department effective tools to address these challenges. 



I think it is important to understand the Fiscal Year 2022 NDAA in the context of this year’s defense budget.  We are still awaiting the detailed budget request from the Biden Administration, but the budget outline released last month recommended that the Defense Department’s topline be $715 billion, which is essentially a flat budget. 

In addition, as many of you know, Fiscal Year 2022 is the first year in many that we will not be constrained by the Budget Control Act, which creates inherent tensions in Congress.  Some of my colleagues will argue that the $715 billion topline is too low, while others will argue for more significant reductions.  We will have to see the details of the budget before we begin to understand our path forward.


Now Belt tightening in any department is always a challenge, but also provides an opportunity to evaluate what is necessary.  This budget will present an opportunity to focus on the critical technologies we need to modernize our forces and maintain our competitive advantage – like AI, quantum computing, and hypersonics.  It should also push us into finding ways to retire legacy systems and excess infrastructure that are using up limited resources without providing an added edge.  Both the Defense Department and Congress will need to make tough choices this year.


Threat Environment

In order to determine priorities, we must first look at the challenges we face.  We are engaged in a strategic competition with China and Russia, near-peer rivals that do not accept U.S. global leadership or the international norms that have helped keep the peace since before Ronald Reagan’s presidency.  Director of National Intelligence Avril Haines has assessed that this strategic competition is likely to intensify due to, among other things, shifts in the military balance of power and diverging visions of governance models between China and Russia and the West.  This strategic competition is unfolding amidst a global pandemic, environmental degradation and climate change, and disruptive technologies.  The interconnected nature of these threats will drive how we resource and transform our tools of national power—not only military, but also diplomatic, economic, and informational—to respond to these complex security challenges.  And we will.



The Department of Defense has appropriately identified the Indo-Pacific as its “priority theater” and China as the “pacing threat” for the United States military.  In the next 10 years, the Indo-Pacific region is projected to generate 2/3 of the global economy and be home to 2/3 of the global population.

For the past several decades, China has studied the United States' way of war and focused its efforts on offsetting our advantages.  This strategy has been successful, largely because China began without any significant legacy systems to maintain and built from the ground up, investing in disruptive technologies like AI, quantum computing, hypersonics, and biotechnology, and stealing enormous amounts of intellectual property from other countries.


But despite its impressive military buildup, we must not assume that China is "ten feet tall.”  In the coming years, China faces a number of challenges both at home and abroad – including a significantly aging population, a push by Chinese minority groups for humane treatment by the government, and growing distrust and hostility toward China's predatory behavior all around the world. 


In order to boost our military advantage, the Armed Services Committee created the Pacific Deterrence Initiative, or PDI, to better align DOD resources in support of military-to-military partnerships to address the challenges posed by China.  PDI will remain a priority for the Committee as we seek to provide additional funding for required military capabilities; strategic forward-based military posture; and enhanced training infrastructure and opportunities.


I want to emphasize, however, that our nation’s edge over China cannot be based on military might alone.  We must strengthen our network of partners and allies which will be central to any strategy for the Indo-Pacific region – I think a doctrine Reagan would endorse wholeheartedly. Furthermore, we must use our economic strength and financial levers to compete with China’s Belt and Road Initiative in regions like Africa and South America.  Near-peer competition will require a whole-of-government approach.


Turning to Russia

In the post-Cold War era, Russia followed a similar approach to China, heavily investing in emerging technologies like autonomous weapons, hypersonics, and cutting-edge cyber warfare tools, while largely abandoning their arsenal of legacy systems from the Soviet regime.  But while Russia’s military remains very capable, the country faces enormous difficulties.  It is also faced with an aging population, an increasingly authoritarian government, and a struggling economy estimated to have shrunk by 4.3 percent in 2020.  And, as more of the world’s economy moves from hydrocarbons to alternative fuels, Russia’s economic foundation will be further threatened.  Russia is not in a position to directly confront the United States militarily.


The Kremlin knows this, however, and has therefore focused on continuing to harass the United States and other countries with hybrid warfare.  This warfare, which stays just below the threshold of provoking a military response, includes disinformation campaigns targeting democratic processes, cyber espionage, and the continued use of proxy groups to further Russian interests in numerous countries around the world.  Such “grey zone” activities are unfortunately here to stay, and will also require a whole-of-government effort to counteract.


DOD Transformation

The Defense Department knows the challenges before it, and needs to have the right tools and processes to meet those challenges.  There are several areas that, if transformed, could allow Department of Defense  to use its funds more effectively and prepare more efficiently for near-peer competition. 



I believe the one key factor that makes the United States military the greatest in the world is that it is a volunteer force.  We need to ensure that our uniformed personnel know how much we appreciate what they do.  Congress has tried done a good job in providing benefits for the military and their families – and we will continue to do that.  But a recent trip I took to Fort Hood with Senator Inhofe deepened my concern about the cohesion of our force.  Our military is showing the strain of two decades of continuous deployments.  As a Sargent Major indicated to me the commanders do not know their troops and the troops do not trust their commanders.  And issues such as racism, extremism, sexual harassment and sexual assault have been allowed to fester and create friction and division.  Secretary Austin is tackling these issues head on, and I will work to see that the Committee helps him in these areas.


Supporting the military are thousands of civilian personnel who have been demoralized over the past several years by a lack of leaders in key roles, lack of opportunity for professional growth, hiring caps and pay freezes.  The Committee needs to find ways to restore the health of the civilian workforce which is critical to the Defense Department’s success.

PPBE Transformation


Now One of the less glamorous subjects the Committee has been looking at is the PPBE, or Planning, Programming, Budgeting, and Execution process, If you can find a more boring please contact me immediately which focuses on financial management and resource allocation for current and future defense acquisition programs.  As many of you know this process is largely a process unchanged from when Secretary McNamara and the wiz kids put it in place in 1961 – when it was a cutting-edge planning tool.  Today, however, it is likely too slow and cumbersome to meet many of DOD’s requirements to adopt new technologies in a rapid, agile manner, and needs to be updated. Again it is one of those aspects that gets little attention but has extraordinary impact on our ability to be competitive in this very challenging world.


DOD Management Transformation

Another issue the Committee has been looking at is management transformation within one of the largest bureaucracies in the world.  The Government Accountability Office has put DOD’s approach to business transformation on its “high-risk list,” citing its vulnerability to waste, fraud, and abuse, inability to pass a financial audit, and a culture that remains resistant to change.  We need to transform these management practices by growing cultural buy-in from senior leaders, hiring personnel with the right skill sets, investing in IT modernization, and encouraging innovation in the bureaucracy.  We also need to do better at collecting and analyzing data to improve business and management decisions.  At the end of the day, we should think about management as a defense capability like any other.


Acquisition Transformation

Another continuing task of the Committee is to oversee the ongoing reforms of the DOD acquisition process.  The Pentagon's procurement processes must adapt to move at the speed of changing technologies and threats.  We should continue to streamline the procurement process to be less complex and allow smaller companies and agile businesses to better compete and offer new ideas and technologies.  Congress and DOD must work to find the right balance of speed, technical rigor, and oversight in acquisition processes.  Recent NDAAs and new DOD policies have created many new, faster acquisition pathways.  We need to continue to work with the Pentagon to use and refine these processes and  procedures, and to create incentives for big DOD programs to embrace and adopt disruptive technologies. 


And, perhaps most importantly, we need to give DOD time to absorb the large number of acquisition changes recently made and adjust its practices as we discover what does and does not work. Now some of the specific threats we face are in the realm of cyber security


Emerging Threats Resilience



As the recent SolarWinds, Microsoft Exchange, and Colonial Pipeline server breaches painfully illustrate, traditional “perimeter-based” defenses are simply inadequate to deal with sophisticated threats.  Our adversaries are clearly advantaged in the cyber domain, and are likely to succeed in penetrating static defenses. 

Experts in cybersecurity have been urging leaders in industry and government to augment perimeter defenses with what is called a “zero trust” model.  Zero trust means what the name implies – we must assume that adversaries are inside our networks at all times and that no one moving around in our networks should be trusted.  In practice, this means checking on the behavior of every person and device on the network, constantly challenging them to authenticate their identity and accesses.  DOD has been working on elements of the zero trust model for some time.  Now, we need to accelerate and expand these activities.


Energy and Climate

Also among the Emerging threats in addition to cyber or other aspects of cyber.  Climate change and extreme weather have already cost DOD billions of dollars in installation damages and will increasingly impact readiness and geopolitical tensions around the world.  Just like any other threat, DOD must better prepare for the impacts of environmental degradation.

A reasonable first step would be the adoption of distributed and renewable energy sources.  Not only do these energy sources enhance the combat capability of warfighters, they save DOD money that can be spent on training and readiness.


Nuclear Modernization

This year There will most certainly be a debate this year about the modernization of the nuclear triad, because of the cost and a genuine disagreement about our nation’s nuclear policy.  From my perspective, nuclear deterrence is the bedrock of our national defense.  For our nuclear deterrent to be credible and to ensure these weapons never need to be used, they must always be capable and ready for use.  Our allies and partners depend on the U.S. nuclear umbrella, and modernization of our strategic forces is needed to reassure them of our dependability.  Doubt about the reliability of the U.S. nuclear umbrella could contribute to greater proliferation.


One thing I think everyone would agree on, and I think often gets lost in the discussion, is the fact that arms control and the modernization of our nuclear forces are inherently linked together.  Even as we modernize, we should seek ways to promote strategic stability, like the extension of the New START agreement and follow-on talks to cover new strategic weapons and further reduce nuclear stockpiles.  The best way to reduce nuclear weapons is through negotiated arms control.



Finally, while I have spent most of my time speaking about future challenges and how we transform the Department to face them, the Department and the Committee cannot lose sight of present challenges – the key one being the withdrawal from Afghanistan. 


As you know, President Biden recently announced the departure of all forces from Afghanistan by September.  The President’s decision should be seen as a transition, not closure.  We still have vital security issues in the region, and the United States must continue to ensure that Afghanistan will not become a safe haven for terrorism, and do all we can to empower the legitimate government of Afghanistan.  We must learn from the past and maintain an agile posture in the region to prevent a scenario similar to the rise of ISIS following our exit in Iraq.


In Closing

When I was growing up, and I am still trying to “grow up” the conclusion that the Soviet Union would reach its full military and economic potential appeared all but certain.  Armed conflict seemed to be not a question of “if,” but “when.” But, because of the resolute, careful decisions by the leaders of both political parties—including President Reagan himself—coming together in the interests of the nation and the world, we prevailed, and the Soviet Union ceased to exist.  We currently live in a global security environment even more complex than that of the Cold War, but I am confident that we have the resources and abilities we need to not only outlast this long-term strategic competition, but to be better for it. 


Thank you, again, to the Reagan Institute for allowing me the opportunity to speak with you today.




Q: Senator, thank you so much for those comprehensive remarks.  You’re really making this conversation easy. You covered a lot of ground and I guess I’ll just start with you as Chairman of the Senate Armed Services Committee. The budget -- the full budget hasn’t arrived, as you mentioned, the so-called skinny budget which is somewhat ironic when you’re dealing with $715 billion to call it skinny.  How is that impacting the work of the Senate Armed Services Committee in particular?  Is this going to force us into another continuing resolution?  Do you think you can get a conference report finished before the end of the fiscal year -- you want to mark up sometime in July?


REED: Roger, that’s our intention. Both Sen. Inhofe and I are determined to get our bill to the floor and get the conference done and get a bill to the President’s desk. I think what we found is there are some, many would like to see an increase in the budget along lines of 3 and a half percent. And then there are others who would like to see reductions. We have hit a point I think, that I think we can manage.  It’s going to be difficult as I mentioned. We are going to have to make some hard choices.  Our intention is to get the bill on and to do so in a way that enhances our security.


Q: I want to go to the budget in a second, but we had Chairman Smith here, your counterpart on the House Armed Services Committee -- one that you know I have some allegiance to given my own past.  He said that they’re pushing the White House to provide the budget.  He said they’re not answering his calls.  He really wants to press the urgency of getting this full budget on them so that his committee and your committee can really weigh the full requests and incorporate them in the NDA. Is the White House answering your calls?


REED: Adam is such a great advocate that I delegated responsibility.


Q: Is he the offensive lineman here?


REED: He is.  I’m just sitting in the back with a sort of sinister smile (laughing). The problem… you grasp, the longer we’re delayed, the less opportunity we have two work out very complicated issues there.  More complicated because there is not the same growth that we saw the last few years.  I mean, ironically, last year by several years the money has not been the issue.  The issue has been other factors.  The irony of all this is the Budget Control Act started off, really imposing significant cost to DoD.  Sequestration was a disaster -- as it evolved it pushed up both the defense and the domestic spending and one side was competing against the other and that is less of a factor today.  We don’t have that anymore.


Q: Let’s move to strategy which you hit on throughout your remarks.  As I imagine, the big four -- the chairs of the Armed Services Committee and ranking members come together -- you have a couple different perspectives here. Sen. Inhofe wrote an op-ed that our budget must match our strategy that’s budgeting 101 and his assumption about the strategies he likes to wave, you seen him wave it on occasion, and it’s actually the Defense Strategy Commission, some of which I like.  That’s his view.  Then we have Adam Smith’s view, who was sitting where you are not too long ago.  Our current national defense strategy -- the one that Sen. Inhofe likes to wave -- is too big, too ambitious, and too unrealistic in terms of what our needs are.  What is your view in terms of the defense strategy as it stands today: do you have interim guidance from the administration?  …is not a full treatment of national defense… is it your thinking that the previous defense strategy was too ambitious and therefore resources too much?


REED: First of all, I think the strategy has evolved.  I think, as it always does.  Based on changes in threats, changes in the environment, that’s happening constantly. I think the other factor though, we need a national security strategy which would embrace the national defense strategy.  We were not relying on a national security strategy, we were not relying on diplomacy, we were not relying on economic engagement, we weren’t relying upon a lot of things.  And it was just simply saying: we’re going to build a military force that will handle all of our problems.  That’s not, I think, appropriate.  It’s unrealistic also.  So now I think looking to see with this budget is: what is necessary?  I think we’re going to have to make difficult choices.  Every year the Pentagon will send up requests to cut funding.  In fact, sometimes Congress doesn’t respond to those requests -- the professional saying ‘we don’t need this.’ I think in this context we’re going to have to pay more attention to their advice.


Q: I want to get to that in a second.  That is kind of a euphemism for legacy systems.  But one thing you know on the defense strategy, which seems where Chairman Smith was going, was a strategy that seeks the United States to really lean in and provide security in three regions of the world: Asia, Europe and the Middle East.  May be too much to ask. The previous national security strategy of course the national defense strategy held to the view we the United States needed to be able to deter and ensure in those three regions of the world as well as elsewhere. Do you feel that the Middle East in particular is a region that the United States military is too focused on or do you think we have the balance right?


REED: No, I think since our invasion in Afghanistan and particularly since the invasion of Iraq we have been into an area which has been very costly to us both in lives and in resources and we have to move out.  It’s not physically and completely, but we have to redirect our focus.  The president did that in his decision, which was previewed by President Trump, of pulling forces out of Afghanistan.  I think we’d like to see and we are seeing some progress in Iraq.  But typically the military looks at threats.  We like to be able to handle every threat possible.  But in practice, from my experience, that essentially you pick a priority and the rest is economy of force. This is exactly what we did in Iraq and Afghanistan.  Once they decided to go into Iraq, Afghanistan’s economy of force -- we lost a lot of momentum.  In fact it might be one of the major factors contributing to our lack of success in many dimensions over there.  But that’s been, I think, history so we understand that they were like “okay, I want to be able to fight two war concept,” and that was sort of dropped when we realized we don’t do that anyway.  Take the most serious threat and you focus your attention on that…


Q: Prevail on one and then deterrence and the other…


REED: Right.


Q: Just to put a finer point on this Middle East point because it keeps on surfacing in many respects because in people’s minds: if were pulling out of Iraq and out of Afghanistan does that mean were going to be out of the Middle East and the greater Middle East?  You’ve said in your remarks that we need to maintain an agile posture by that I mean okay our 5th Fleet -- our airbases in the region -- become more pivotal in the Middle East in order to carry out the counterterrorism and intelligence missions we otherwise would do if we had a presence in Afghanistan?


REED: As I suggested in my comments regarding Afghanistan, it’s not closure -- it’s not “we’re coming back,” etc. It’s transitional. You’re right, we have to have presence there but presence is more overwatch than engagement with troops on the ground in many locations.


Q: Sure, certainly hostilities or active operations


REED: And also we also have to supplement that again with a national strategy with diplomacy.  You know, you’re beginning to hear things where Saudis are considering discussions with the Iranians and maybe that’s a function of they understood that we are not there to be the buffer between the two, so I have to work things out. We have to encourage that type of dialogue.


Q: Since you mentioned Iran: what are your, what is your view in terms of how the military ought to posture itself as the Biden administration seeks to resurrect the JCPOA or come up with some sort of new deal and address the Iranian nuclear program through diplomacy?


REED: No, I think one we have to, you mentioned the 5th Fleet in Bahrain, one of the key factors is the rights of international navigation through international waters and that is something we cannot ignore. We have to be the probably the strongest protector of those rights.  That gives us not only a rationale but a compelling reason to be there.  Then, I think we have to make it clear that we will not tolerate malign activities of the Iranians at the same time it’s not unusual to have a dual track we’re talking about seriously.  Basically, an arms control agreement again with establishing the JCPOA.


Q: Okay, let’s go back to the NDAA.  You went through a bunch of priorities.  Super interesting.  Let’s start with, only just mentioned a moment ago, legacy systems.  The administration’s interim national security guidance is perhaps a preface to their national security strategy -- didn’t have a lot of treatment on defense, but did call out legacy systems as something they will want to see the Pentagon taking on and removing.  A moment ago you said the Congress often has been the hurdle in realizing that.  Is there any low hanging fruit that as you look at your professional staff and say: okay, that’s a legacy system we can all agree that should go?


REED: I think that frankly, we’re waiting to see what the Pentagon sends over because we want to give them not only the deference they deserve, but also what we might think for other reasons they don’t think of.  It’s nice to begin at least their imprimatur that this is something we can look at and then we get into significant issues with the politics of ending anything regardless of defense go to any federal agency to terminate a program.  It is tough.


Q: Chairman Smith said the same thing.  Oftentimes, one person’s view of a legacy system depending on strategy or theater become something that is of critical importance and there’s no other replacement capability.


REED: You’ve got a pretty good legacy system in the B-52 and no one’s thinking about taking that out and frankly we’re extending its life.  Thank God for those engineers in the 1950s that thought about it. I am told they started on a napkin ‘let’s build that thing.’  And generations later it is still being used. So again, you know, we have to look very carefully and your point is very well taken: what’s the threat, what’s the strategy?  One example for this is when we went into Afghanistan we didn’t have the kind of protection for our troops against IEDs that we needed and Bob Gates is credited with ‘let’s build up all of these up armored vehicles, MRAPs, etc.’ We don’t need those in a fight in the Pacific like we did in Afghanistan.  But those systems, because it was so obvious they weren’t needed, are no longer getting purchased.


Q: And that really gets at a critical point you mentioned throughout your speech how China is the pacing threat. How we’re in this period of competition. Truly a mark of bipartisanship and nonpartisan issue of consensus around that you also mentioned PDI the Pacific Deterrence Initiative which the Congress led on to really charge the previous administration to take on. Do you feel that military and the Pentagon more broadly has a clear set of the types of platforms and capabilities that are required to really carry out the concept of operations that we can feel confident we can prevail in a hot scenario or deter effectively?


REED: Well first of all, I think what they’re doing is tailoring their existing systems to be capable in that fight and then looking ahead to what better systems we can have. I think the key linkage is the communications. Uninterrupted encrypted communications so that we can command these elements. When I was in the Army back in the ‘70s, basically, it was ‘shoot, move, and communicate.’ I think right now it’s ‘communicate so you can shoot and move.’ I think our adversaries, the Chinese particularly, understand this.  So one of the big platforms we need is not necessarily a fighter aircraft, carrier, troop carrier -- what we need is complete uninterruptible connectivity.  That involves space, it involves technology, it involves adapting. My sense is: the first stages of any fight against any serious opponent will be trying to take out our comms or space.  We have to have a way to get around that and we have to start thinking of that.


Q: Have the communication at the edge right now so you’re drawing back to the base or elsewhere?


REED: The way we outmaneuver and out fight the opponent is to be able to be one or two steps ahead of them. That implies that you can instantaneously communicate, move, shoot, move, shoot, etc.


Q: That technology you are describing is an example of the type of technology referenced in your speech is cutting edge technology, perhaps disruptive technologies. One thing that caught my ear in your remarks is that America’s acquisition processes to have kind of a pathway for integrating that made me think of a much coveted program of record.  Do you think our programs of record -- is this what you mean in your remarks? -- are agile enough, are responding enough to incorporate the types of technologies that you’ve outlined today as a key policy priority for the Senate Armed Services Committee?


JFR: I frankly don’t think so and that’s not because of the misjudgment or inertia of the Department of Defense.  It’s as much cultural and as much institutional as anything else.  Again, the system became basically PPBE in the 1960’s when industrial society was the most efficient way to manage a big organization.  McNamara was a young guy with his whiz kids.  They transformed the Department of Defense. We were able to leap ahead of the Soviets because of it. I think now when you have a situation where computer technology software is probably more decisive than hardware in many cases, it quickly adapts.  We have to move to a new model, a post-Industrial Age model.  That’s why we’re looking seriously at PPBE.  We want expert opinion and we want to make sure that the changes we make are consistent with this new technology.


Q: There’s definitely one viewer who was a friend of yours and is a family relation of mine who’s really enjoying your focus on the PPBE which is the one thing he would disagree with on your speech that you called the ‘most boring subject’ but a former comptroller is excited about that.


JFR: He added the “E.” Used to be PPB until your father added the E for execution. And he would like no surprise more – E, that’s all he wants.  He wants more E.


Q: On the execution side, do you think that the department has enough authority?  Has enough law to actually make sure that the future programs of record are incorporating the software as much as the hardware?  Or is it something that the NDAA needs to address in kind of black letter?


JFR: I think as Davy Crockett said, or at least Fess Parker said: “be sure you’re right - then go ahead.” I think we’re looking very closely to make sure where we are right.  There’s a lot I’m sure that can be done within the Department of Defense in the regular, as your father did with respect to putting the execution phase in. There’s a lot to be done.  What we’re doing is trying to focus this issue so that DOD says this is important to Congress, so maybe we’ll start looking clearly and then together we can hopefully come to a juncture in the future.


Q: A bit of oversight and focus can go a long way.


REED: Right.


Q: When we deal with top lines that are putting pressure on the Department of Defense, $715 billion is a lot of money, as you noted, is not real growth, is not keeping pace with inflation.  You set up the budget debate quite right: There are those who want 3 to 5 percent growth and some colleagues want to see significant cuts.  One thing that happens in this environment, real competition between military departments and between the services.  The Navy clearly has a very important mission as we shift to Asia and focus on China. What’s your reaction to the advocates of: ‘we need this many hundred ships,’ 355, or the previous administration wanted to get over 400.  Is that something you think is a good framework for approaching what’s required or would you take a different approach?


REED: I think in many cases it’s arbitrary.


Q: It’s arbitrary…


REED: It sends a signal that we are going to have so many aircraft or ships etc. rather than look at the threat or look at what capabilities that you need. Again, the more sophisticated the computer software on some ships might then make them more capable than adding an identical ship of an old design. We have to look that way.  I think also to in terms of these numbers, one of the things that Secretary Esper tried to emphasize this when he talked about his number, was we have to move more towards autonomous vehicles and particularly surface vehicles and subsurface vehicles.  I remember David Petraeus said ‘don’t send a soldier where you can send a bullet.’ Don’t send a manned vessel when you can send an autonomous one. I think that would actually be able to be cheaper in many respects and also be more destabilizing to our opponents who know to see not just one number but 10 times.


Q: Swarming vessels, swarming aircraft and the like, it goes back to something you were saying earlier when you were talking about the budget -- you want to see investment in these technologies. Do you have a metric for that?  Is that dollars you could look at the defense budget and you could say the following the amount of time people speak about AI and machine learning and robotics relative to the dollars is entirely disproportional?


REED: I know.  I think that first of all, we require a coordinated effort within the government, not just the Department of Defense.  It transcends all of government. A lot of it is going to be academic research because that’s where you find most of the scholars that are looking at these issues.  So we have to pull together, I think a comprehensive national program that would emphasize much more so AI, not just verbiage but actually putting resources there.  We’re going to be in a situation, I think, where some good ideas don’t pan out and others are breakthroughs.  One of the areas that that is somewhat relevant is that our Genome Project, we put resources at the NIH, we were looking for the breakthrough and then it came and now we’ve got this incredible genomic inventory of drugs and medical assistance that came from basically saying ‘this is a problem. We want to tackle it and we’ve got robust resources to do it.’


Q: And certainly the R&D is the basic key area of government spending that benefits the entire country.


REED: This is one of those things where it’s NSF spending, it’s even to some degree other agencies that might have research going on that contributes to this private enterprise in the United States.


Q: The challenge of course would get a few more where. I then want to hit on Taiwan and some of the measures going through Congress right now without pressure to pull out legacy systems, right, budget pressure, strategic pressure, strategic priorities, then you want to integrate new technologies but often times there’s a gap and I think the mistake we’ve made in the past is whether or not it’s good to be an issue front and center for you to remove the legacy system you have the capability gap and you’re waiting for some system to replace it with new technology, but you only see it on a piece of paper.  It’s not actually there.  How are you thinking about that?  Is that something that the Committee will look closely at so that we are not left with this period of competition with China where we have years without the capabilities as a result of cost-cutting measures?


REED: I think basically that’s why we just don’t want to do random cost-cutting.  You want a transition plan. The existing system to the next system. And that depends upon when the new platform is arriving, the life expectancy of the existing platform, if we have to have investment existing money to extend that life on that aspect.  There are other ways to cover it.  And again, I think thinking trying to break through is ‘let’s think more about autonomy rather than another system coming on a manned system.’


Q: A big emphasis on autonomy, I want to kind of move to the geopolitical challenges we find ourselves facing right now.  Admiral Davidson of course testified before the House Armed Services Committee in March saying that Taiwan is clearly one of China’s ambitions and I think that threat is manifested during this decade in fact in the next six years. I’m curious to get your view.  Are we postured in a fashion that can prevent a Taiwan flare up in the next six years and what else do we need to do here?


JFR: Well, I think we are very conscious of, as Admiral Davidson expressed, the changing dynamic and it has been changing over the last decade or more with respect to Taiwan. I think one of the wake-up calls was what happened in Hong Kong -- which we, I assumed would be eventually included more decisively in the People’s Republic -- but was done so very dramatically that I think has got us all sort of very keen…


Q: …very brazen.


REED: We have to be much more concerned.  We are adapting.  I’m talking to Admiral Davidson and other commanders in the Pacific who are adapting new strategy, new requests for platforms that ten years ago, five years ago, we didn’t think we needed because we were involved in Iraq and Afghanistan.  We were building MRAPs, not vehicles for the Pacific or platforms for the Pacific.  So I think we are recognizing this.  The other factor too, and I think this goes back to the whole of government, national security not just defense issue is that engaging our neighbors. The Quad, for example, more actively and having them…


Q: India, Japan, Australia. . .


REED: Exactly. And South Korea. Having them engage with us in a very practical basis sends a signal to a Chinese -- who have very few if any allies -- that they’re not going to just confront the United States alone; they’re going to confront the unified group of countries.  Then there are other factors that we have to weigh and they have to weigh.  Their economy is based on trade with the United States and the European Union and everyone else.  What happens if they take a step that the whole world condemns and deems being beyond?


Q: Being an international pariah.  I mean, that is an important distinction perhaps between China and Russia. Russia is a sanctioned country and so they engage in land grabs in the like.  China certainly has trade there -- and the winter Olympics -- has to be mindful of how they’re perceived and has to be really concerned of their actions and human rights.


REED: Absolutely.  And with respect to Taiwan, part of our effort should be to enable them to be much more effective in defending themselves.  Again, there’s no comparison between PLA and the forces the Taiwanese can marshal.  But if the island is much more resilient on its own terms that is another deterrent to the Chinese doing something rash.


Q: Last question before we have to wrap up.  It deals with the domestic spending, but is tied to this discussion vis-à-vis China and Taiwan.  Taken all the COVID bills, the infrastructure bills, and other measures that the Biden Administration is putting forward it could add up to over $6 trillion of spending.  None of that would include defense. Is there an infrastructure component here that would actually benefit defense industrial base perhaps semiconductors if we appropriate for the CHIPS Act?


REED: I think the semiconductors would be an obvious benefit.  One less obvious but important thing that will contribute is that some of these programs the President is espousing -- I think recognizing we’ve passed the Industrial Age; we are now in the Information Age.  And more education and more training is going to be the decisive difference between our success and failure. So when you’re talking about things that seem to have no application to defense like preschool and childcare -- so that our most creative people can work because they’re not at home caring for children -- when you talk about two years of post-high school education which could lead and probably will lead to four years or more, we’re going to go back to a situation where like the good old days where America was the most highly educated country in the world and China was just struggling to come up out of the ‘century of shame’ and being overrun by foreign powers, that’s one of the factors that helps with STEM and that’s one of the factors that will help us. I think these programs particularly, he does recognize in his proposals that new capital is not just bricks and mortar, it’s human intellect.  It’s advancing AI.  The new economy if you look ahead ‘x’ number of years, robotics are going to take so many jobs, but not all the jobs. What we do in place, we get people so that their skills are not strictly manual but also intellectual so that they can provide context, operate the robots and create things. I think that’s absolutely critical.  A strong American economy with talented people is the bulwark of our defense.


Q: No doubt economic strength is a complement and goes hand-in-hand with our military strength.


REED: I mean your analogy with Russia and China, they were never really economically powerful. The Soviets, in fact, they ran an economy dysfunctional in many cases and finally collapsed.  One advantage that the Chinese have is that they are entrepreneurial.  They can do business very well.  They are very creative, innovative and very well educated.  That’s the source of their now military buildup.  They built up their economy now they’re building up their military.


Q: Going to have to leave it there.  Thank you so much, sir, for being with us today.  Perhaps we’ll see you out in California.


REED: Thank you.