zeroed. But anyway, we will move along because I think it is important we stay on schedule.

This morning the committee holds its second hearing to receive testimony from the unified and regional commanders on the status and requirements of their commands and the degree to which the Fiscal Year 2001 Defense Budget Request and the future years program meets the requirements for their AOR in their professional and personal opinions. It is very important that we get both views. You recall during the confirmation process we obtained that commitment, the committee did, from you.

General Wilhelm will soon be I will skip over him for a moment. Now, we will go right then-I think we will wait until General Wilhelm gets here for me to cover much of this material, because I think it is important. [Pause.]

I think what I will do is defer this until the General arrives, Senator Levin, so that we can have a composite opening statement from me. If you wish to make yours

Senator LEVIN. No, I will hold off on mine.

Chairman WARNER. All right. In that case, Admiral Blair, why do we not get under way.

STATEMENT OF ADM. DENNIS C. BLAIR, U.S. NAVY, COMMANDER-IN-CHIEF (CINC), UNITED STATES PACIFIC COM

MAND

Admiral BLAIR. Thank you, Mr. Chairman. On behalf of the men and women of the United States Pacific Command, thank you for the opportunity to give you my perspective on security and the Asia Pacific region. I have submitted a written statement and I would like to just highlight a few points from that if I may, sir.

Chairman WARNER. The complete statements of all the witnesses will be placed into the record.

ORAL STATEMENT

Admiral BLAIR. Sir, let me begin with readiness, and readiness begins with people. First I would like to thank the Chairman and the members of this committee for the pay and compensation increases which were voted last year. They are beginning to make a difference. To recruit and retain our top people, we need to continue to take care of them the way we have been, and that is one of our most important jobs.

Chairman WARNER. The committee will undertake this year to look at the medical aspects of the active duty and the retired military personnel. I mention the retired because that is the more difficult challenge. But someone pointed out to me, and I certainly agree, that the best recruiters in the world are retired military, and if they are treated properly they are very cost effective recruiters for the military. Each of you know that from your own personal experience.

Admiral BLAIR. Yes, sir, absolutely.

The decline in our system readiness which we have seen over the last couple of years has been arrested in the Pacific Command. We are deploying ready forward forces. When we sent a communications group to East Timor last year, they were communicating within hours of arrival. The U.S.S. Constitution Battle Group, the

U.S.S. Peleliu Amphibious Ready Group and its embarked Marine Expeditionary Unit had readiness rates during their deployments which were above the standards which we set for deployed units. The Air Force wings which we deployed to Korea when we moved the U.S.S. Kitty Hawk to the Persian Gulf as a result of the Kosovo crisis, were ready on arrival.

However, when you go to our forces in the rear, the readiness has not improved over the last couple of years. Our carrier air wing readiness between deployments is not improving. To maintain our Marine Corps equipment takes more money and more manpower within fixed budgets. We had to cancel an exercise just last week to cover shortfalls in strategic lift.

As my written statement shows, my component commanders are not receiving significant increases in Operation and Maintenance (O&M) funding and therefore the readiness of the forces is staying steady. Where I most notice these shortfalls in readiness are in maintenance funding for our camps, posts, and stations. In these areas the backlog of deferred maintenance continues to grow and we are continuing to patch, not to repair the way we should.

Let me turn to regional issues that have occupied us over the past year. First, the Australian-led INTERFET, or International Force for East Timor, established what I think is a new model for U.S. participation in international operations. The Australians did a great job and we provided unique support, the sort of things that we alone can provide, and the overall operation was a success.

We are making progress on strengthening our alliance with traditional partner Japan. The Japanese Diet passed the defense guidelines. We are cooperating on theater missile defense research and on satellite reconnaissance systems, and we are continuing to work those issues that are associated with our presence in Japan, the Shinkampo incinerator at Atsugi, relocation of facilities within Okinawa, and we are beginning to start the negotiations on the special measures agreement, the host nation support which Japan provides.

Our relations with China hit a new low after NATO's accidental bombing of the Chinese embassy in Belgrade and then the Chinese mob violence against our embassy and consulates in China. We are resuming military to military relations, observing the National Defense Authorization Act reporting provisions.

My trip to China 2 weeks ago allowed me to emphasize the importance of a peaceful resolution of this issue directly with Chinese military leaders and to talk to them about the white paper that they recently published, a very unhelpful document in reaching that peaceful resolution.

Chairman WARNER. Could you give us your timing on your trip with that of Deputy Secretary of State Strobe Talbott, or the Under Secretary?

Admiral BLAIR. Certainly. That group left about 3 days later. The white paper was published and about 3 days later I arrived, and I got home about a week ago.

Chairman WARNER. So we have the Strobe Talbott mission, the white paper, and then your visit?

REGIONAL ENGAGEMENT STRATEGY

Admiral BLAIR. That was the order, at about 3-day intervals, sir. I would like to talk about two general issues which affect our regional engagement strategy. First is our military relations with other countries. Over this past year our military relations have gone up and down with countries and our specific military engagement activities have been either increased or decreased based on that, and that is the right thing to do.

But I strongly believe that there are two forms of engagement that should persevere through changes in our relations. One is education of foreign officers in our higher military education schools and the second is attendance at international conferences, many of which we sponsor at the Pacific Command. These are long-term investments in the U.S. interest in these countries, in educating officers and opening their eyes to the world for eventual changes within their governments, and I think we need to preserve these.

SECURITY COMMUNITIES

The second point I would like to talk about is security communities. Security communities is a term I use for our long-term vision of security relationships within the Asia Pacific region. We are working to take our very excellent bilateral relations and knit them together into an international framework in which we can support common interests of all countries who think the way we do in the region.

A key is our ability to work together on military operations, taking off of our common experience. In East Timor we are building facilities that would enable us to communicate better with our other friends and partners within the region. We are focusing our military sales in order to improve interoperability. We are getting together to write common tactics, techniques, and procedures, and we are in general building this network that we think can provide international military forces to do common objectives out there.

This is going to be a long process. There is a long tradition of bilateralism and historical mistrust, but I think we have made a good start.

REVOLUTIONS IN MILITARY AFFAIRS

Finally, let me finish by talking about the future, the revolution in military affairs. The present preoccupies us, but we have to continue to look to the future. We need to keep funding our future platforms in all of the services. We especially need to fund joint command, control, communications, and intelligence, which is the key to speeding up our speed of command within our joint operations.

We need to continue joint experimentation. We are cooperating with Joint Forces Command, who has the lead for the Department of Defense, to do some experimenting in the Pacific. We are trying to find out what the Pacific Command of 2010 will need and to work our way through there, and this is very important work.

So let me just finish up, Mr. Chairman, by saying that my past years experience has confirmed my belief that the Pacific is a dynamic region and its development is just vital to the interests of

the United States. We have to maintain forward, ready forces and we have to keep those forces getting better in their operational skills, and we have to continue to work on regional cooperation so that we can build security and peaceful development.

Subject to your questions, thank you.

[The prepared statement of Admiral Blair follows:]

PREPARED STATEMENT BY ADM. DENNIS C. BLAIR, U.S. NAVY

INTRODUCTION

as

Mr. Chairman and members of this Committee, on behalf of the men and women of the United States Pacific Command, thank you for this opportunity to present my perspective on security in the Asia-Pacific region. Having served USCINCPAC for just over a year, I believe that steady and focused efforts are required to ensure the region develops in ways favorable to American interests. A secure and peaceful Asia-Pacific region presents tremendous opportunities for greater prosperity in America, and in the world, as we enter into this century. Alternatively, an Asia poised for armed conflict, uncertain of the intentions of neighbors and regional powers, and subject to a rising wave of nationalism as a new generation of leaders comes to power, will present only crises and dangers. As the principal guarantor of global peace, the United States, by its actions and omissions, will strongly influence, if not determine, the outcome.

The economic, political, and military contours of the Asian landscape are evolving rapidly. Most Asian economies are now enjoying economic recovery. But one of the lessons learned from Asia's financial turbulence in 1997 and 1998 is that we cannot take Asia's economic prosperity for granted. A durable recovery and economic security in the region can only come when the financial and corporate restructuring process is complete. We also see reasons for economic concern in a number of key Asian countries. For instance, Japan remains trapped in slow growth. China's economy is also struggling with weak demand and severe price deflation. We are hopeful Jakarta's promising new budget and the recent agreement with IMF will help President Wahid turn Indonesia's economy around. But this will be no easy task. Similarly, fractious Indian politics make it difficult for Prime Minister Vajpayee's new Indian government to implement the kind of bold economic reforms needed to reduce high levels of poverty. Sustainable economic growth in the region is in the interest of all. It provides a favorable setting for diplomatic and military initiatives to build a security framework for the region.

There are many flashpoints in the region. Long-standing tensions threaten serious conflict in places such as Korea, the Taiwan Strait, and Kashmir. Violent separatist movements and ethnic disputes in Burma, China, India, Indonesia, the Philippines, and Sri Lanka set up vicious cycles of terrorism and repression within countries and threaten the region with refugee flows, export of terrorism, and crises between neighboring nations. Rapid economic development has created huge gaps in the distribution of wealth within many countries in the region. Combined with corruption and privilege, this development has caused citizens to challenge the legitimacy of ruling political regimes and has further inflamed violence between ethnic and religious groups.

Security relations among the states in the region are fluid. Fifty years after the end of World War II, the victory of Mao in China, and the beginning of independence from colonial rule, a new generation of national leaders is coming to power in Asia. Many of these leaders are reviewing the premises of their international security relations. Many bring a new nationalism based upon culture, ethnicity, and religion rather than anti-colonialism. The teachings of Marx, Lenin, and Mao no longer guide the Chinese. India has turned its attentions outward and expects to play a greater role in international politics in the coming years. Indonesia is emerging from almost four decades of authoritarian rule. Globalization increases wealth, but often offends ethnic sensitivities. Balance of power and nationalism will compete against the more enlightened views of greater security and economic cooperation to drive the future of Asia. The role the United States plays is critical to the future of Asia. In the 20th Century, America fought three major wars and lost more lives in Asia than in any other theater of conflict. We need to do better in the 21st Century.

U.S. PACIFIC COMMAND MISSION

Ready today and preparing for tomorrow, the U.S. Pacific Command enhances security and promotes peaceful development in the Asia-Pacific region by deterring aggression, responding to crises and fighting to win.

Over the past year, the men and women of the Pacific Command have been carrying out our mission. To deepen your appreciation for the region and our efforts to promote security, I would like to summarize key events from the past year and highlight the progress we made toward the priorities I described in my testimony last year.

EVENTS THAT SHAPED THE REGION OVER THE PAST YEAR

Since I last testified to you, numerous events have shaped security developments in the region. Let me begin with a key ally, Japan.

Japan

Despite recent setbacks, Japan remains the second largest economy in the world with a level of technology comparable to the United States. It is the country with the greatest economic impact on the Asia-Pacific region. Japan enjoys a thriving democratic system, with strict civilian control of the Self-Defense Forces and a tradition of close security cooperation with America. About half of American forces forward deployed in the Western Pacific operate from bases in Japan. Without these bases, it would be much more difficult for the U.S. to meet commitments and defend American interests throughout the Asia-Pacific region.

Over the past year, we made important progress in deepening and strengthening our alliance with Japan. Shortly after I testified to you last year, Japanese Self-Defense Forces chased two North Korean boats from Japanese territorial waters across the Sea of Japan. This was the first time in 46 years Japanese forces have ever fired even warning shots at a foreign flagged vessel. This provocation, combined with North Korea's launch of the Taepo-Dong missile over Japan the previous summer, added urgency for the Japanese Diet to pass new Defense Guidelines legislation. These guidelines will help formalize cooperation for logistical support of U.S. operations and other support to U.S. forces in response to situations in areas surrounding Japan that have an important impact on Japan's security. Additionally, this Taepo Dong launch stimulated greater Japanese cooperation with the U.S. in developing missile defense and satellite surveillance capabilities. North Korean provocations have resulted in close trilateral consultation and policy coordination among the U.S., Japan, and South Korea beginning under the leadership of former Secretary of Defense Perry. This coordination aligned our nations' policies regarding North Korea and is contributing to unprecedented security cooperation between Japan and South Korea, establishing a pattern for future cooperation and policy coordination.

The focus with our most important ally Japan must always be on advancing and promoting the future security of the region. We must continue to tackle the tough issues that could impede strengthening this essential alliance. Over the last year, we have made progress in resolving a number of these issues. We are working with the GOJ to eliminate pollution from the Shinkampo waste disposal incinerator that affects Americans stationed at the Atsugi Naval Air Station and Japanese baseworkers and citizens, although progress is slower than both sides would wish. We also are making progress on agreements to relocate bases in Okinawa from the populated southern part of the island to the north. Other issues we are working include negotiations this month on the new Special Measures Agreement that expires March 2001, a key element of Japan's Host Nation Support. Because of Japan's economic problems, funds spent by the Government of Japan to support U.S. Forces have come under increased scrutiny. We have urged the Japanese to think in terms of the strategic importance of Host Nation Support to the security and prosperity of Japan and the entire region. We will continue to work with the Japanese so the alliance emerges as strong in the future as it has been in the past.

North and South Korea

President Kim Dae-jung's forward-looking, visionary approach exemplifies a clear path to regional security. While unwavering in his commitment to deter North Korean aggression, President Kim has reached out to current and historical enemies to build a more secure future for Korea. He strongly supported U.S. efforts led by Dr. Perry and shares responsibility for successful trilateral consultations. His government has increased security dialog and cooperation with Japan and high level defense-related visits with China. Under President Kim's leadership, Korea is coming to peace with the past in the expectation of a more prosperous future. Recognizing the obligation of all nations to contribute to collective security, his government provided substantial forces to peace operations in East Timor.

The coordinated approach to North Korea has resulted for the moment in improved behavior by that regime. The inspection of the suspected nuclear production site at Kumchangni has allayed concern over that particular facility. The most dan