OPENING STATEMENT OF SENATOR SAM NUNN, CHAIRMAN Chairman NUNN. The committee will come to order. The Armed Services Committee convenes this morning to begin its annual series of hearings with the commanders in chief of the unified commands. Each year our committee hears directly from our senior commanders in the field on the military strategy and the operational requirements in their areas of responsibility.

We have asked each of the unified commanders to describe the security environment in which their forces are operating and the military strategy they have formulated to achieve their command's goals. The committee will be especially interested in determining whether the forces and capabilities assigned to the commands as a result of the Bottom-Up Review are sufficient to accomplish the objectives.

We would also appreciate our witnesses' views on the defense budget request for fiscal year 1995 and the associated 5-year defense program. Do they adequately fund the unified commanders' operational requirements? If they do not, what requirements are underfunded and what are their significance for the ability of the commanders to achieve the goals?

Today, we are very pleased to welcome the following senior military officers to our hearing: Adm. Charles Larson, the Commander in Chief of the United States Pacific Command; Gen. Barry McCaffrey, Commander in Chief of the U.S. Southern Command; Gen. Gary Luck, the Commander of U.S. Forces in Korea; and Rear Adm. Irve LeMoyne, the Deputy Commander in Chief of the U.S. Special Operations Command.

Admiral LeMoyne is testifying on behalf of General Wayne Downing, the Commander in Chief of the U.S. Special Operations Command, who was unavoidably required to be out of the country for a longstanding commitment that could not be rescheduled.

I would like to mention that today's hearing could be-we are not sure since we never know what is going to come up but it could be Admiral Larson's last appearance before this committee as an active duty officer.

I understand, Admiral, you will be retiring in May after more than 3 years as Commander in Chief of the U.S. Pacific Command. We deeply appreciate your outstanding service to the Nation and to the committee and our deliberations over the years. You have been an outstanding leader, and we appreciate your splendid ca

reer.

This is the first time I have seen General Luck since Senator Lugar and I visited Korea in early January of this year. General Luck and his excellent staff went above and beyond the call of duty to give us all the information that we could digest, and all of the information we needed to be able to try to assess that situation. General Luck, I again express my appreciation to you, and I hope you will convey the same to your staff.

Before I complete my opening remarks, let me mention the committee will continue our hearings with other unified commanders at 9:30 a.m. tomorrow morning. At that time, our witnesses will be General Hoar, General Joulwan, and Admiral Miller, Commanders in Chief of the U.S. Central, European, and Atlantic Commands respectively.

Senator Thurmond, I believe, stepped out briefly. He asked that his prepared statement be inserted into the record. It is so ordered. [The prepared statement of Senator Thurmond follows:]

PREPARED STATEMENT BY SENATOR STROM THURMOND

Mr. Chairman, it is always a pleasure for me to participate in these hearings where we receive testimony from our Unified Commanders. These are the Commanders to whom we entrust the lives of our young men and women in uniform when hostilities commence. I welcome each of you here today.

Admiral Larson, all of us recognize the importance of the Pacific region where economies are exploding with new growth. As governments and cultures change as a result of this expansion, there is always the possibility of friction which can evolve into hostility. The United States will continue to have great interest in the Pacific region and we will have to maintain sufficient military presence there to protect those interests.

General Luck, we are acutely aware of the tension that hangs over the Korean Peninsula today. The unpredictable North Korean Government's pursuit of nuclear weapons and ballistic missile technologies mandates that the presence and readiness of our forces remain critical to stability on the peninsula. We are anxious to hear your testimony today.

General McCaffrey, I know that you have only recently taken command of Southern Command and we questioned you at length only weeks ago at your nomination hearing regarding the situation in Central and South America. I know that you have been busy getting acquainted with the situation in your area of operations and we look forward to hearing from you.

Since General Downing could not be here today, I am happy to join the Chairman in welcoming the Deputy Commander-in-Chief of the Special Operations Command, Admiral LeMoyne. Our Special Operations forces are committed today throughout the world. We are all aware of their heroism and skills in battle which were recently tested in Somalia. Admiral LeMoyne, welcome to the committee. We are eager to hear your testimony.

Mr. Chairman, our annual series of hearings with our Unified Commanders are among the most important hearings we have. It is critical that we understand the effect of the reductions in our defense budget on the combat readiness of our forces and our preparedness for war if it should come again. I look forward to the testimony of our distinguished witnesses today.

Thank you, Mr. Chairman.

Senator NUNN. Senator Warner.

Senator WARNER. I pass, Mr. Chairman.

Chairman NUNN. Okay. Admiral Larson, I think we will start with you this morning and work across left to right. Glad to have you.

STATEMENT OF ADM. CHARLES R. LARSON, U.S. NAVY,
COMMANDER IN CHIEF, U.S. PACIFIC COMMAND

Admiral LARSON. Thank you, Mr. Chairman, and thank you very much for your kind remarks.

I have, of course, a written statement I would like to submit for the record, and I would like to give a brief opening statement. I have a handout, Mr. Chairman, entitled "Key Judgments," that I placed at each location. I think that may be useful in following quickly through my oral statement here.

Chairman NUNN. I do not want you to feel pressed for time. We are going to take as much of the morning and thereafter as we need, so I hope all of you will not feel pressed. Whatever you think we need to hear, we want you to give us the information.

Admiral LARSON. Mr. Chairman, as I complete my fourth_year out in the Pacific region, 3 as CINCPAC and 1 as CINCPAC Fleet, I would like to look back and ahead and cover six key judgments that I think highlight my statement and our posture out there.

The first key judgment noted in the handout is that the Pacific area is now the leader in economic growth of all the areas of the world. Some of the areas of the Pacific are growing six times faster than the global average.

The second key judgment that I would make is that there still are potential hot spots in the Asia-Pacific region that I think have security implications for the United States. Certainly the Korean Peninsula is my number one concern, and I know we will get into that in a lot more detail with General Luck's statement and also with your questions. Let there be no doubt, in Korea, if conflict occurs we do not debate whether we are going to get involved. We have treaty obligations, we have troops on the ground, and when the war starts, we are in it-and it will be a very high intensity action. This is an area of concern and an area where we have to work hard to maintain stability.

India and Pakistan are also areas of concern. They are far from settling their longstanding differences. They have fought three wars in the last 45 years. So we have two countries with severe differences and with mature nuclear programs. This situation has regional and global implications.

The Spratley Islands, although not immediately so, are certainly a concern to the United States. There are six nations that contest rights in the Spratley Islands. The People's Republic of China has asserted, very strongly, their rights and their sovereignty there. This is another area we must work to defuse.

And finally, the Russian Far East. Russia is a Pacific power as well as a European power. The country is fragile right now in its transition to democracy, and the Far East is no exception. The Far East has always been somewhat independent-minded. So, we have to watch carefully that transition in the entire country and the impact on the Pacific.

The third key judgment that I would make is that there is no area, I believe, more important to United States interests than the Pacific is today. The Pacific economic opportunities are essential to our future security and prosperity. We cannot disengage out there. We are totally linked economically. Two and one-half million U.S. jobs depend upon our exports to the Pacific. Our economic future is directly linked to our continued engagement out there.

And democracy there is advancing in scope and in sophistication. In my written statement I have highlighted a number of the positive things that occur when democracy comes to a nation. We have a much better time dealing with democracies than with other types of government. The Pacific welcomes our continued engagement. All of the nations there trust us. I hear the plea everywhere I go, "stay." "Stay engaged, and allow us to continue with stability which allows economic progress."

We are not there for altruistic reasons. We are not there to protect them or help them in their prosperity. We are there because it is in the best interest of the United States to be there so we can share in that economic opportunity. I think, in the United States, that the awareness of the Pacific and the importance of the Pacific is really growing. This is a big change over the last 4 years. When I compare the emphasis on the Pacific now and the emphasis on Europe, we are seeing much more of a balance.

The President has been personally involved. He made his first foreign trip out there. He articulated his New Pacific Community and conducted an historic meeting with the Asian Pacific Economic Cooperation (APEC) leaders. The President focused our efforts and articulated our new strategy toward the Pacific.

My fourth key judgment is to realize these interests we have got to adjust to certain challenges, and the North Korean nuclear program is certainly our number one challenge. I know we will have a chance for a good dialogue on that this morning.

We also have competing human rights and security concerns out there. We need China to help us with the North Korean nuclear problem. We need them critically in the U.N. We need them if sanctions are considered. In my view we need them in many ways in this cooperative effort. We also have human rights concerns with China. Some of these interests may end up on a collision course by midsummer as we determine how to look at those two vital interests. How we measure and how we approach them without having that train derail.

We also have many trade frustrations. You know, we have trade deficits. We have to continue to work hard with the more developed countries in order to have a level playing field for our people to compete on the basis of the quality of our goods. I believe we are competitive if we can compete on a level field.

Last year, when I came before this committee, I said we are standing on the brink of a degradation in readiness. A lot has happened since then. There has been a tremendously high level readiness focus by the administration. There has been a reallocation of resources into Operation and Maintenance (O&M) accounts. There have been a number of high level committees. There have been a number of efforts to find new ways to measure readiness. I think we are certainly heading in the right direction.

But, as I put in my handout, the devil is in the execution. This is where the tough part is going to come. As an example, we have been living off excess spare parts from decommissionings and things like that. In time, the excesses will be gone and we will be living on the budget line. We need to watch out for three things: when our operation tempo increases beyond our limits for routine operations, when we have to transfer funds from one O&M account to another because of shortages, or when we have to cancel training opportunities because of a lack of funds. You cannot recoup lost training opportunities. Those will be the danger signals that I look for. The execution is going to be tough. There will be tough choices to be made this year.

My fifth key judgment is that to address those challenges, we have got to match resources to strategy. What I have done in the Pacific Command is highlight five major areas that I need in order to execute my strategy. My integrated priority list is founded on these five areas of strategic interest: trained and ready forces; high quality people; forward mobile forces; effective command, control, communications and intelligence; technological edge; and low-cost, high-payoff peacetime programs, like the International Military Education and Training (IMET) program and security assistance. My final strategic observation, my final key judgment, is that I believe we are poised to shape the future to seize a great strategic

opportunity. We can work hard now to shape our future, or we can react to it later. I think we are poised to shape it. We have a vision for a New Pacific Community that the President has defined, and it is based on shared strength, shared prosperity, and a shared commitment to democratic values.

We have an effective military strategy of cooperative engagement in place, and it has been in place for 2 years of the post-Cold War environment. It is based on forward presence, strong alliances, and in-theater, crisis response capability. I think we are poised, now, to realize the benefits of four decades of U.S. involvement in the Pacific region. Our investment out there will pay off.

So I would join the nations of Asia and say, "stay the course, stay engaged, continue to participate as a partner and you will be able to shape the future."

Finally, Mr. Chairman, I would also like to thank this committee for your outstanding support during my 4 years in the Pacific, and during my entire military career your support has been invaluable. You have helped us look out for our people.

We have the finest young men and women out there that I have ever seen in my entire military career serving with us. It is up to us jointly to continue to take care of them and keep the quality of the force, and keep the contract that we have made with them. Thank you very much.

[The prepared statement of Admiral Larson follows:]

PREPARED STATEMENT BY ADM. CHARLES R. LARSON, U.S. NAVY, COMMANDER IN CHIEF, UNITEd States PaciFIC COMMAND

INTRODUCTION

Mr. Chairman and members of the committee: I offer my final Pacific Command Posture Statement from the vantage point of four years in the Asia-Pacific theater. I view the events of this period with tremendous satisfaction. The United States is a Pacific power, with enduring economic, political and security interests in the Asia-Pacific region. To secure those interests, the United States must remain

engaged.

There is no doubt we are resolved to do so.

That resolution is nowhere more evident than in the events of the last year. President Clinton made his first overseas crip to the Pacific, affirming America's stake in this vital region in his vision of a New Pacific Community, built on "shared strength, shared prosperity, and a shared