Media Conference Call: Obama's Defense Strategy

OPERATOR: It is now my pleasure to introduce today's first speaker, Mr. Jonathan Masters.

JONATHAN MASTERS: Good afternoon, everyone. This is Jon Masters. I'm a staff writer with the Council on Foreign Relations, and I'm very pleased to be joined by two CFR colleagues today for this media conference call on Obama's defense strategy. I'm joined by senior fellows Richard Betts and Max Boot.

So last Wednesday the Pentagon released its long-awaited strategic review that sets the stage for U.S. military spending over the next few years, particularly as the Defense Department looks to present its 2013 budget request in the next two or three weeks.

Dick Betts is an adjunct senior fellow for national security studies at CFR and author of the new book "American Force: Dangers, Delusions, and Dilemmas in National Security."

And Max Boot is the Jeane J. Kirkpatrick senior fellow for national security studies at CFR. Thank you both for being with us.

And Dick, if I could start with you, I'd like to get your initial reaction to this strategic guidance from DOD. Obviously, its broad outlines speak toward a greater emphasis on the Asia-Pacific region, ongoing commitments in the Mideast and what seems like a reduction in ground forces that are commensurate with shrinking counterinsurgency operations. What are your initial thoughts on this, and -- especially as the process gets moving?

RICHARD BETTS: Well, it's a move in the right direction and, I think, a chance to do more of what we should have done after the Cold War and before the second war against Iraq, and that is to recognize the significance of the victory in the Cold War and to reduce overall short-term efforts in military spending and capabilities with more of a focus on planning for the long term.

I think it's a move towards a more modest definition of national security that doesn't confuse it with the more ambitious missions of shaping world order that I think got us into trouble in the last dozen years. And by keeping a lot of emphasis on counterterrorism, which really involves comparatively small-ticket expenditures, and focusing on the Pacific, where the long-term significant potential threats exist, that is -- that -- involving a great power, which we don't face now, it's a chance to move at least more in a direction of a mobilization strategy of focusing on readiness to get ready rather than trying to do a lot of things militarily in the near term.

So I think the cuts envisioned are about right, maybe not quite as large as might be desirable although I think if cuts went as far as those that would happen with the sequester, that would be too much and damaging. But it's a move in the right direction and, to the extent that we can couple it with burden shifting, getting the allies to do more, it's a good thing.

MASTERS: OK, thanks. And speaking of allies, Max, this process is obviously being gauged by both our allies and adversaries alike, particularly China, North Korea, but of course Iran and others. What are some of the concerns that you see coming away from this review?

BOOT: I think this review sounds a very dangerous message to the world of American retreat, and there is no other comparable force in the world that can take our place as a guarantor of order and stability, as a champion of freedom and democracy. And so by cutting our defense spending at a time when we face multiple threats -- indeed our troops are still in combat every day in Afghanistan -- I think we send a very dangerous mission -- a very dangerous message that will dishearten our allies and encourage our enemies or would-be enemies.

You know, I don't blame Leon Panetta and the Joint Chiefs, the leadership at the Pentagon for this strategy. I think they've tried to make the best of a bad hand that they were dealt by the president and by Congress. But I do think it's irresponsible to slash defense spending by $487 billion over the course of the next decade, and it's doubly irresponsible and indeed potentially catastrophic to slash defense spending by roughly a trillion dollars, which is what would happen if the sequestration were to hit in full.

You know, we're -- when you look at the specifics, it -- it's hard not to be concerned about how we can possibly -- how our armed forces, which are already overstretched by multiple missions around the world, how they can possibly continue safeguarding our interests when we're cutting something like a hundred thousand soldiers and Marines from our ground forces, taking them back to the pre-9/11 levels, which were revealed to be inadequate by the wars of the past decade.

When we look at the fact that China, for example, is in the midst of a major naval buildup and yet our fleet is down to 280 ships, the smallest level it's been since 1930, when you look at the fact that our Air Force is reliant on aging aircraft, which are -- some of which are literally falling out of the sky, decades-old aircraft which have to be replaced -- all of that will be very, very costly do.

But if we don't do it, and if we lose -- if we lose our military primacy -- and I think history suggests that the costs of that in the long term will be far greater than the short-term costs of adequate readiness.

MASTERS: OK, thanks, Max.

And for those of you who may have joined us late, this is a CFR media conference call with Richard Betts and Max Boot. And I would also like to note that we have a number of resources on our newly redesigned website, cfr.org.

So at this point, Operator, I think we can open it up to questions.

OPERATOR: Well, ladies and gentlemen, at this time the floor is now open for your questions. (Gives queueing instructions.)

Our first question comes from Jenlargen Ventrili (ph) with Overseas India Weekly.

MASTERS: OK, hi there. Please proceed with your question.

QUESTIONER: Hi. Good morning. Can you please tell us as to what type of threats we are expecting in Pacific region? And because of the economic situation we have now, we have to cut the budget, but we can increase it later on. And what problems we will have when we increase it?

And secondly, the technical advances that we have can -- is helping us to reduce the ground forces, isn't it?

MASTERS: OK, thank you, caller.

Max, do you want to field that? What threats are we specifically facing in the region? And is technology a replacement for ground forces?

BOOT: Well, we are facing great and growing threats in the Pacific region, the most obvious of which are North Korea, which is a danger of nuclear proliferation, and then, of course, as well as implosion, what happens if North Korea implodes.

And of course, the greatest potential danger we face is from China, which is increasing its defense budget at double-digit rates, is building new stealth aircraft, new cyberweapons, new ballistic missiles designed to target American aircraft carriers, and so on and so forth. All these Chinese actions are shifting the balance of power in the Western Pacific in ways that undermine stability and could potentially set off a very destabilizing dynamic if America does not present a credible deterrent to Chinese power.

Now, the notion that we can substitute technology for ground forces is not new. It's something that Don Rumsfeld, for example, believed and acted upon very early on in his tenure. That notion has been consistently exploded by the lessons of history. We certainly learned in Iraq and Afghanistan that there are limits to what technology can achieve. And there is no question that in the Pacific region, that is primarily an air and naval theater.

But there are other places around the world where it's not hard to imagine American troops getting involved, considering the multiplicity of threats we face, from a -- from an unstable Pakistan, from an Iran about to go nuclear, from states like Yemen and Somalia, where al-Qaida affiliates might be on the verge of takeovers. The risks are great.

And what history suggests, as Bob Gates mentioned in a speech at West Point last year or the year before, is that if there is one consistent theme of American history, it's that we never get it right. We're always wrong about where the next is going to come from. And just because we're now expecting another war in the Pacific -- and we ought to be ready for action in the Pacific, but just because we're expecting that doesn't mean that's what's going to come. And if we don't have an adequate ground force, history suggests that we're in for some very nasty and unpleasant surprises.

MASTERS: OK. Thank you. Can we have the next question, please?

OPERATOR: Our next question comes from James Kitfield with the National Journal magazine.

QUESTIONER: Thank you, gentlemen, for doing this.

You know, it seems to me that part and parcel of the strategic review is the assumption that if we had another 9/11, we wouldn't go about reacting to it the same way we did after 9/11, i.e., wars of regime change and nation-building that, you know, last a decade. Isn't that a fair assumption? Do you -- I mean, I'm sure you might disagree, Max. I'd like to hear both speakers talk about, you know, is this -- I mean, isn't it sort of a rational assumption that for the foreseeable future -- say, a decade -- we are not going to be very anxious to go in and react to whatever happens in Iran or whatever happens in Yemen by sending ground forces in there to topple the regime -- and then be responsible for building that nation back up?

MASTERS: OK. Max, you want to take that?

BOOT: Sure.

MASTERS: And then, Dick if you want to follow up --

BOOT: Well, I mean, this kind of reminds me of the rhetoric about World War I being the war to end all wars. We tend to think that every war is the last one, and because it's so nasty and brutal and unpleasant, we emerge from it saying: Never again.

Unfortunately, as you know, our enemies get a vote. And the more that we show ourselves incapable of fighting or preparing for ground wars, the more likely it is that we are going to face precisely those kinds of wars.

I mean, it's -- and again, I would just stress the unpredictability of history here, because who, on September 10th of 2001, could have possibly predicted that American ground forces would shortly be engaged in combat in Afghanistan, of all places in the world? And yet after 9/11 they were dispatched to Afghanistan with almost unanimous approval and support.

And of course we're going to be wary of doing another major war like that in the next few years, but we just don't know what's going to happen. And it's quite conceivable that the -- that a future president, perhaps even this president, will judge that the costs of inaction will be greater than the risks of action. And so we need to have a ground force which is prepared for all contingencies and one that can also be large enough to deter potential adversaries and convince them not to challenge us in -- on the ground.

MASTERS: And Dick, you do want to follow up with that? You know, preparing for the unexpected, what is reasonable going forward?

BETTS: Well, first of all, for the most part, the reaction to September 11th was quite appropriate: an emphasis on counterterrorism, intelligence, special operations, pursuit of al-Qaida and so on. The biggest mistake was when the Bush administration confused counterterrorism with war against Iraq, and that was, in my view, a totally self-inflicted wound, an unnecessary war.

The more difficult and tragic case is Afghanistan, because that was certainly a legitimate war, a war of self-defense, but one that we've found hard to resolve. We'll never know whether the premature shift of resources to Afghanistan to Iraq in the run-up to war in 2002 made a difference or not. Maybe we would have wound up with the same difficulties we've had in recent years. But I think we need to distinguish which elements of response to major terrorist incidents are appropriate and which are expensive and not necessarily connected.

As far as getting involved in similar sorts of projects like Iraq and Afghanistan, I think it's pretty obvious that that's not likely to happen soon. We're undergoing the sobering experience, on a lesser scale, that we did after Vietnam.

But one never knows about the future. Max is quite right. We have a very bad record of predicting where military challenges are going to come, and that's why it's necessary to maintain a varied set of capabilities and preferably, in my view, ones which are organized for rapid expansion when the situation in the world changes.

So the idea that now we've been disillusioned with counterinsurgency and are not going to want to experiment with it again -- I think it's important that we don't make the mistake that the Army did after Vietnam, and that is writing off the mission entirely. While it would be a mistake to get involved in many sorts of counterinsurgency projects, it's necessary to keep at least the nucleus of the capability for unknown and unforeseen possibilities in the future.

So that's why I put emphasis on a mobilization strategy, one that's oriented towards, in large part, organizing the military for a rapid readjustment if things in the world go really bad.

The main problem I have with defense policy of the last 20 years is, I think, a failure to appreciate the difference between the challenges of the 20th century and the ones we faced after the Cold War. And excessive emphasis on dealing with minor current challenges, I think, can detract from the resources we'll have available in the future, when we may face big ones again, such as a more difficult China.

MASTERS: OK. Thank you. Can we proceed with the next question, please?

OPERATOR: Our next question comes from Gary Rosen with The Wall Street Journal.

QUESTIONER: Hi. I'm wondering if Max and Dick can just set out very succinctly their strategic doctrines. I guess for some time we've said our armed forces should be able to handle two major conflicts at the same time. Then we decided at some point that one and a half would do. Now, in its most recent form, though I know it isn't sticking, the idea is to fight one and to spoil the intentions of another adversary. What sort of summary would you assign to your strategic view of where we need to be going?

MASTERS: Thank you. Dick, do you want to start with that and, Max, follow up?

BETTS: OK. If you're looking for a strategic doctrine in some grand sense, the sort of bumper sticker terms I use are soft primacy and burden shifting; that is, maintaining and appreciating the importance of the primacy of the United States militarily, but regarding it more as a cushion against challenges to come, rather than something to be exploited and manipulated in lots of places at present, and burden shifting in the sense of getting our rich allies to do more, since they make roughly half the effort, at best, that we do.

As far as guidance for the number and types of contingencies we should be ready to handle, I think a realistic sort of bumper sticker is what they talk about now as winning and spoiling, what back in the '90s was talked about as the win-hold-win alternative. I think that's plenty ambitious for the present because it's really all we've ever had the capability for since the Cold War. Even though there was a lot of talk about a two-war doctrine, we've never really done it in a serious way. Afghanistan and Iraq was the closest we came to it, but we were not making a maximum effort in both at the same time. So I think that sort of win one, spoil in the second is a quite prudent and reasonable sort of guidance for capabilities at present.

MASTERS: Max?

BOOT: Well, my doctrine I would describe as the -- as defending the pax Americana, preserving American primacy around the world and not allowing serious challenges to our ability to dominate the world's oceans, to dominate the world's skies, to keep space and cyberspace free of serious disruptions and to intervene decisively when we face threats on the ground, whether from genocidal-type human rights violations, from cross-border incursions such as the Iraqi invasion into -- into Kuwait, or from dangerous developments, such as the Taliban rule in Afghanistan which allowed it to be used as a launching pad for attack on United States.

And I think we have to keep the ability to fight and win two conflicts at the same time, because again, our enemies are not necessarily going to be obliging enough to fight us in sequence. And it's not hard to imagine that, for example, the crises in Iran and North Korea could come to a head simultaneously and we would have to be able to exert decisive influence in both theaters at once. And if we can't, that will be an invitation, I fear, for aggression.

MASTERS: OK, thank you. Can we have the next question, please.

OPERATOR: The next question comes from Obia Chin (ph) with China Daily.

QUESTIONER: Hi. Yeah. I want to know how counterproductive you think it is to single out China in the defense strategy review. Because you guys are sending a message to the Chinese military or people in China with nationalistic sentiment that China should spend more on military instead of less. So that is not helpful to the situation. And also, I mean, people like Henry Kissinger, I think that Jonathan also mentioned in his article, that are quoting generals about this danger of self-fulfilled prophecy. So how real do you think that is?

I am worried about Max Boot's comment. You seem to argue that, you know, only the U.S. can spend unlimited military, and the Chinese should not. I mean, the U.S. should dominate air, land, everywhere, sea; other countries should not do so. Could you respond to that?

Thank you.

MASTERS: Max, do you want to try to take that?

BOOT: I don't think that the growing Chinese threat is a figment of my imagination, nor do I think it's a response to American bellicosity. It's, I think, basically fundamentally a product of the fact that China has an illiberal, undemocratic regime whose credibility increasingly depends on a nationalist appeal to its own people, and that regime has been increasing its defense spending and expanding its military capabilities, and also acting in ways that are aggressive against neighboring states; for example, in the South China Sea, where the Chinese navy has become very aggressive in trying to push out the navies of the Philippines, Japan and other local powers to claim more -- to extend Chinese sovereignty beyond what international law would allow.

So I think all of the states which border China -- even a state like Vietnam, which is communist -- are very concerned about the growing power of China and look to the United States as an ally to check Chinese expansionism and to keep China growing peacefully, which I think everybody is perfectly happy with. Everybody would like to see China have a peaceful rise. But there are also very strong militarist and nationalist tendencies that we see in China, with a lot of bloodcurdling rhetoric coming from the People's Liberation Army about making war against the United States.

And I think we have to simply deter that from occurring and convince the Chinese leadership that aggressive action would not be in its own self-interest. And to do that, I think we have to preserve the balance of power in the Pacific. But unfortunately, right now, I see the balance of power tilting against us. And I see a further tilt unless we actually increase our defense spending, and expand the size of our Navy, in particular, which I think is at a dangerously low level.

MASTERS: Dick, did you want to -- did you want jump on that?

BETTS: Yeah. Yeah, I think, first of all, it's important to distinguish between rhetoric and real policy. And I'm not sure that the administration's publicity about the reasons for the shift towards the Pacific is necessarily the most prudent way to go about this. But in terms of real governments' policies and what they do, China is doing as much of this as the United States, in terms of planning militarily for the contingency of conflict with the other. But I think it's important to do as much as we can for as long as we can to avoid making conflict between the United States and China a self-fulfilling prophecy. A new Cold War could happen, but I don't think it's inevitable. And if we can prevent it, it would be a good idea.

But there's no alternative for great powers to planning for the possibility of conflict with other great powers that share some conflicting interests. I think China's behavior is simply normal great-power behavior. And while some would see it as threatening, most great powers are seen in one way or another as threatening by any countries whose interests are not completely aligned.

So I think it's important to try to strike a delicate balance, and that's hard for governments to do. Delicate -- delicate policies are very difficult to manage. But it's important to strike a delicate balance between the necessity to hedge against the possibility of future conflict and efforts to avoid it diplomatically and through the use of other instruments.

MASTERS: OK. Great.

Can we have the next question, please?

OPERATOR: Our next question comes from Stewart Powell with the Houston Chronicle.

QUESTIONER: Good morning. Thanks very much for doing this. I just wanted to drive this down to the local level, if I could. A lot of states see these upcoming cuts and readjustments as a threat to bases and jobs and weapon systems production in their states. I wondered if you could take a look at Texas for me, where we have Fort Hood, a home of many conventional forces that have been very active in Afghanistan and Iraq but may not be so active in the next evolution of the strategy. And also, the F-35: You know, it's built in Fort Worth and, obviously, that would be under potential threat as a result of some of these cuts.

MASTERS: OK, thank you.

Max, do you want to take that one?

BOOT: Well, it's certainly an important part of these defense cutbacks that we ought to be cognizant of; which is, it's not only a blow to our -- to our military capacity, but it's also a blow to our economy. At a time when unemployment is at 8.6 percent, we're going to be throwing roughly 100,000 veterans of the ground forces out of work. Men and women who have risked their lives to defend America over the past decade will now be given pink slips.

Now, aside from what that does for our defense capability, which is that we're going to lose a lot of tremendous experience that we may very well need in the future, it also is going to have an economic impact on many states, including Texas, certainly, with -- as the questioner pointed out, with its large military installations -- in particular, Fort Hood -- with the F-35 production line, with talk about the F-35 being further delayed and cut back. I think all of that is going to further hurt the economy.

And it's -- and it's kind of mystifying to me that Congress and the White House, after spending trillions of dollars on economic stimulus -- a lot of which doesn't seem to have worked very well -- are now willing to throw out of work skilled production workers and skilled military veterans, and throw them into an economy where unemployment is already very high. That's a matter of great concern to me.

BETTS: Can I say something on this?

MASTERS: Sure.

BETTS: Yeah. I don't think military expenditures should be a welfare program. And we need to decide what's necessary strategically and for policy, and then let the chips fall where they may.

Now, of course, as a practical matter, that's difficult. It causes problems politically and it leads to suffering for some individuals who have benefited from programs that will be cut. But that's true of all expenditure cuts: All the beneficiaries of expenditure cuts suffer. And we're in an era where, for better or worse, that's what's in the cards.

So as much as it's a difficult situation for certain localities in the United States that have benefited from the defense budget, we need to focus on what defense capabilities we need and what needs to be procured and spent for them, and then go from there, rather than trying to define our defense needs in terms of what Americans who depend on the defense budget in the past would like.

MASTERS: OK, thanks, Dick.

And Operator, if you could just give another reminder about how to get in the queue, and then we'll go ahead and take our next question.

OPERATOR: Absolutely. (Gives queuing instructions.)

The next question comes from KT McFarland with Fox News.

QUESTIONER: Hi. This is for both of you, for the different angles I think you both bring to it. If you look at the cutbacks, either the first tranche or the upcoming tranche with the sequestration cuts, how does it affect the ability to respond -- have the Navy respond to a crisis in the Strait of Hormuz at the same time as, say, in the South China Sea? I mean, do we need more ships to do -- deal with both of those contingencies, or is the one-war strategy one war, whether it's a ground war or a naval war?

MASTERS: Max, do you want to start?

BOOT: Yeah. No, I think KT raises an excellent point, which is that we do have to have the capability to respond simultaneously to different emergencies on different -- on different sides of the globe. And I fear that we may be losing that capability even now, even before these defense cuts have taken effect. Because, again, the Navy, as I mentioned before, is down to 280 ships -- the smallest level since 1930.

Now, obviously, the 280 ships we have today are much more capable than the -- than the fleet that we had in 1930, but at some point, you know, you cannot endless substitute quality for quantity. You have to have a certain mass; you have to have ships that can respond to different emergencies. And right now, our Navy is very over-stressed; which I've noticed on my visits over the last year to the -- both the 5th Fleet in the Persian Gulf and to the 7th Fleet in the Pacific. Both of them are operating at very high operational tempos, with ships constantly at sea.

And in the case of the Persian Gulf, it's a very tense situation, with the 5th Fleet being on a -- almost a war footing with Iran, on a day-to-day basis, expecting that hostilities could break out at any minute. And if we do that, we would have to surge more forces into the area. If we have to respond, for example, to Iran's threats to close the Strait of Hormuz, we would have to surge more forces into the area. But we're already very, very thin in the Western Pacific, and so it's not clear to me where those forces would come from.

That's why we need a naval buildup, which will cost more money; rather than cutting the defense budget, which will lead to a further shrinkage of our already inadequate naval forces.

MASTERS: Dick, do you want to add to that?

BETTS: Well, Max is right in one sense. If the mission of the United States is to run the world militarily, to be the global policeman and to control all conflictual areas in the world militarily, our defense budget is nowhere near big enough now. But I challenge that assumption.

As it is, our Navy, for all its difficulties, is astronomically greater and more capable than any other navy in the world. We have the ability to surge forces in times of crisis. And, yes, it creates operational problems and tensions and difficulties, but that's in large part in the nature of most important military operations. And we can do it far better and far more decisively than anyone else.

And if we are going to take on the mission of running the world militarily, then that has to be faced, the costs have to be faced. Anybody supporting that, as a matter of realism, has to support increases in taxes, rather than cuts in taxes, because there are economic pressures that (over ?) determine the constraints on defense efforts. And I don't think there's any political constituency for that at present, even in the Republican Party.

Now, you know, one can say as a matter of principle that's what ought to be done, but as a practical matter, what should be done given the realistic options, I think we need a more modest definition of what American responsibilities are. I think there's a --

QUESTIONER: So can I just -- can I just add a question, then? So what you're saying is that the United States should not have the mission of keeping open the sea lanes (sic) of communication and kind of --

BETTS: No. No, that's not what I'm saying. What I'm saying is we can do that pretty well now. If you want to define the mission as doing it everywhere decisively all at one time, yes, I would say that's unreasonable, and it's something we've never been able to do in the past either. This is a matter of degree.

I don't think there's much doubt that the United States Navy could clean the Iranian clock if it came to combat in that region. We could sink the Iranian navy. Now, whether we need to be able to do that at the same time we're taking on the Chinese, the Russians and any number of others is a different matter. But I think given our current capabilities, the issue is not our ability to engage Iran effectively in combat and to achieve a decisive outcome in conventional warfare. The issue with Iran involves a lot of other questions about what else would be going on, what other sorts of means Iran would use to attack us and so on.

And as far as the limitations of naval capability go, yes, they're limited, but they're just far less limited than anyone else's, and we should appreciate the significance of that edge.

BOOT: Can I just jump in with a -- with a counterpoint? Because you know, Dick talks about the strategy of global military superiority, which he says is not supported by anybody. In fact, I would argue --

BETTS: No, I didn't say that. I said the economic costs of doing it effectively are not.

BOOT: OK, but my -- from where I stand, I think that there is basically an implicit assumption by both parties in American politics that the United States will remain number one militarily around the world. And in fact, what I see is there's no decline in the number of missions which are being handed to the U.S. military. Just in the last two years they've had to respond to a tsunami in Japan, they've had to respond to a humanitarian and human rights crisis in Libya, they've had to respond to various counterterrorism missions, to counterpiracy, to deterrence of China, Iran, North Korea and various other threats. I'd -- and they've had to take on new missions such as cyberwar, dealing with access denials, weapons of various kinds and so on and so forth.

And this is happening at a time when we are sort of -- the administration is kind of retrenching internationally. And this is a pretty liberal administration that can hardly be accused of being run by warmongers. And yet they keep constantly finding new missions for the military to perform.

And I really don't see anybody -- or I don't see a lot of people willing to come forth and say that there are major missions the U.S. military is now performing that we shouldn't do, that we should, you know, give up policing the Strait of Malacca or we should give up policing the Strait of Hormuz or we should give up responding to genocide or we should give up dealing with the Iranian nuclear program or the North Korean program or terrorism and instability in Pakistan or all these other issues. I see pretty much a bipartisan consensus that we have to be able to address all those issues, but I don't see the money being spent to create the capabilities we need to address all of them, which is why the U.S. military has been overstretched over the course of the last decade and I think will become even more dangerously overstretched if the current budget trajectory holds.

BETTS: There's a big difference between being and remaining militarily number one in the world and being able to do everything everywhere all at once. We've never been able to do the latter. Exactly how much we do simultaneously or have the capability to do is a matter of degree, and that's fluctuated over time. But I think there's nothing wrong strategically with planning on sequential operations. Even in World War II, American strategy planned on sequential operations: Europe first, the Pacific second. And I think we are a long way from being in danger of being paralyzed or unable to do anything in more than one place at once.

And just finally, I'd say Max is quite right. If the requirement is going to be defined as being able to do all the sorts of things all at once that he's saying, we do need to spend a lot more rather than less. But I don't hear many voices that are not extreme outliers in any of the public discussion saying big increases in defense spending are in the cards.

MASTERS: OK. Let's move on to the next question, please.

OPERATOR: Our next question comes from Trudy Rubin with the Philadelphia Inquirer.

QUESTIONER: Thanks very much. I'd like to ask a couple things. First, I'd like to ask Max if we were to fund much more, as you would prefer, could you talk about where you see the money coming from? Because, as we know, the Iraq War was an unfunded war. There was never a new tax levied. And given the economic circumstances now, if Republicans don't want any new taxes, where would the funds come from?

The other thing that I wanted to ask is, counterinsurgency was raised in this discussion. Have we learned anything from Iraq and Afghanistan that says this is not something we can do? I mean, after all, Iraq's circumstances were very special. Is this something that was a strategy that blossomed and now should be cashiered?

MASTERS: OK, Max, you want to start with funding, and then maybe sort of our lessons of -- lessons of counterinsurgency in Iraq and Afghanistan?

BOOT: OK. Well, first off, I take issue with the argumentative tone of that question with, quote, "as much war as I'd like to fund." I don't want to fund any wars. I don't want to fight any wars. I want to have our strength be so unchallenged that our adversaries do not start wars that we have to wind up fighting.

In terms of how can we afford to do this, given that -- the state of our economy, the answer is, it's easy, because right now, even at the height of the wars in Afghanistan and Iraq, even if you count in all the supplemental appropriations on top of the core defense budget, we were still spending well under 5 percent of GDP on defense, and less than 20 percent of the federal budget going to defense. And both are very low numbers by historical standards, when during the course of the Cold War we were routinely spending 8, 9, 10 percent of GDP on defense.

So it is by no means unaffordable. In fact, I would argue that it is false economy to stint on military preparedness now, because we wind up getting into costly wars and losing the early battles and then having to spend far more later on.

The other question that Trudy Rubin asked was about the future of counterinsurgency, which I think has been fully vindicated in both Iraq and Afghanistan to the extent that it's been implemented. I mean, you know, there's this myth that Americans can't fight guerrilla wars, and I think what happened in Iraq from 2007 on, with the surge, showed that's not -- just not the case; that an effective doctrine can be implemented by our very skilled troopers and in fact was implemented to stage one of the biggest turnarounds of any counterinsurgency that I am familiar with.

Now, I'm concerned that we are throwing away the fruits of a potential victory now by prematurely withdrawing all of our forces from Iraq -- something we haven't done in countries like South Korea and Germany. But you know, that's another story.

In terms of whether counterinsurgency doctrine is sound, I think it is. And it has to be part of our arsenal because if we somehow eschew counterinsurgency, as we did after Vietnam, that is a guarantee that our enemies will fight us by starting insurgencies, because they know we are far more vulnerable to that form of warfare than we are to conventional force-on-force engagements.

MASTERS: Dick, you want to --

BETTS: Yeah. Well, I don't think Max answered the question about where the money should come from. Yes, you can talk about what level of effort is appropriate, but that still leaves the question of where you take the money from. And there's obviously a competition between defense expenditures we've been accustomed to and health care expenditures, which are constantly accelerating.

Also, the amount of effort the United States makes in defense is not low by historical standards. It's only a little lower compared to the Cold War, which is quite anomalous by historical standards. I think the situation in the Cold War, where we really worried about a global war between superpowers, with 175-plus Soviet divisions within striking distance of the English Channel and with thousands of nuclear weapons that we worried about more than we're worried today on the -- on the Russian side, is just a situation that's incomparably more challenging than the threats we face today.

So if we're going to spend much more money on defense, it's going to have to come from increased taxes and lower spending on health care and other domestic programs. Some Republicans would be quite willing to do that, but I don't think most Republicans are, and between that split there and views on the Democratic side of the aisle, I don't see any potential political constituency for higher expenditures.

As for counterinsurgency, counterinsurgency does work sometimes and not others. Depending on how you count, it probably has worked less often than it's failed. But we need to maintain some capacity to try to implement counterinsurgency programs effectively, simply because we can't be sure whether there will be some necessity for something like that in the future, but it's not something that we should take on if it's at all avoidable because it is very difficult.

I don't think we do it superbly. The verdict on Afghanistan and Iraq is still out in terms of what the outcomes of efforts there are. So while we have to hedge against the possibility of doing this in the future, we should beware of doing it in any cases where it's not absolutely necessary.

MASTERS: OK, thanks. And if the operator wants to give sort of one last reminder on how to get in the queue and then we'll take a few more questions.

OPERATOR: (Gives queuing instructions.)

Our next question comes from Raghubir Goyal, with India Globe and Asia Today.

QUESTIONER: Hi, yeah -- hi, thanks for doing this and thank you for taking my question. Raghubir Goyal from India Globe and Asia Today.

According to experts, the Chinese threat is real in the area, and it has been building up for the last 10 years. And also many experts are saying that China had been taking advantage of the U.S. defense cuts and all -- a lot of U.S. technology stealing by the Chinese -- (inaudible) -- last few months and few years. My question is -- also China doesn't like the recent U.S. defense strategy also (the view ?) India and U.S. defense strategies, also U.S.-India and China defense strategies, and also China didn't like the (recent ?) -- (inaudible) -- regions -- view of India and Japan regions.

My question is what role you think India is going to play in the -- this new U.S. defense strategy and also U.S.-India relations in the future, counting the Chinese threat to India? Thank you.

MASTERS: OK, Max, a little hard to hear the question, but I believe it was on India and sort of what are the implications of this -- the new direction of this strategy with U.S.-India relations and the Chinese and all the players in the region?

BOOT: Well, I hope that U.S.-India relations will be strong in the future and will be one of the cornerstones of 21st century security because I think that the U.S. and India have much in common and that we are both threatened by terrorism and we are both wary of the rise of China. We are both democracies that look very suspiciously upon undemocratic aggressive, rising states like China or questionably democratic and shaky-and-falling-apart states like Pakistan. So I think there is a great congruence of interest.

But, you know, so far, I have not seen -- it's going to take a long time to develop the U.S.-India partnership and, you know, as we see, even on issues such as getting India to stop purchasing Iranian oil, it's very tough to do.

And I would just -- I would take issue with the point that Dick made -- the -- how we can substitute burden sharing for American leadership around the world. I mean, I wish it were the case; but unfortunately, I just don't see a lot of allies willing to step up to the burdens of global leadership that we have on our shoulders. And I think it's almost impossible for many of them to do so, particularly our European allies, where the level of government spending is roughly 50 percent of GDP. They are being strangled by social welfare spending, which they cannot cut back for fear of riots in the streets, literally, and so they just have no money left over for defense.

And so we've seen European defense budgets shrinking over the course of the last decade rather than rising. The only states that are really rapidly -- other than the United States -- which have expanded defense spending over the last decade tend to be countries like China whose rise we have to be very concerned about. And I would certainly hope that India and other democratic states on China's periphery would take an active role in helping to check Chinese power, and I expect that they will. But even there, I think American leadership is still going to be vital, as it is around the world -- where allies can help. But we have to be able and prepared to take the lead. And we're -- unfortunately, I don't think we're going to have much success in shifting a lot of the defense burden onto allied nations.

BETTS: Well, on China --

MASTERS: (Dick ?), you want to -- go ahead.

BETTS: Yeah. On China, I think the question of U.S. relations with India is an important one, and there's a natural basis for collaboration between the United States and India, since we are the world's largest democracies and all of that.

But I think it's notable that China does not have any, at present, allies among the other -- the four other great powers, or emerging great powers, in the region: India, Japan, Russia and the United States. And one thing we should be careful about is anything we can do to avoid increasing incentives for China and Russia to form a more direct alliance against the West. At present, I think we are providing incentives, some of which we can't avoid, but we ought to be careful about that.

On American leadership, I think what Max is talking about, leadership is really a euphemism for control and running a liberal empire. An alternative is a balance-of-power strategy in which the United States may exert what's really leadership but which doesn't depend on unilateral American power to control all the situations.

I think Max lets our allies off the hook too easily. They're not going to step up and do more as long as we don't force the choice upon them, and I think excusing the Europeans because of their social welfare programs is no more sensible than excusing the United States because of our current political constraints on additional spending.

So I think an alternative that makes sense, especially given the comparatively limited nature of the threats we face now compared to the 20th century, is to focus more in a balance-of-power strategy. And to the extent that that can include India, we have to be fairly subtle and delicate about this too, since India is not unambiguously committed to a formal all-out alliance with the United States.

But to the extent that we can cultivate and develop strategic ties with India, that helps in regard to China as well as other interests. So that's a natural course that we are pursuing, and if we can do it carefully, can nurture in a bigger way.

MASTERS: And if I could just pop in with a question of my own -- we've talked about the -- you know, obviously the Navy and U.S. ground forces, but we haven't talked about the nuclear arsenal and -- as as a component of our deterrence. What should be the trajectory of our nuclear arsenal as we face, you know, increasing fiscal pressure? If, Max, you want to start with that, and then maybe Dick can hop on.

BOOT: I would -- we've already cut the nuclear arsenal substantially since the end of the Cold War. And I would be wary of further cuts at a time when Iran is on the verge of going nuclear, when North Korea has already gone nuclear, when there is the potential for nuclear arms races in both the Middle East and the Far East.

I think having a large and credible American deterrence posture is very much in our interests, and I don't think that we would gain that much, either fiscally or strategically, by major cutbacks in our level of nuclear forces. In fact, I would be concerned about whether we will be able to keep our nuclear deterrence at the level necessary, given the policy of not -- of not testing nuclear weapons. That makes it very hard to do. And I think we have to be very concerned about the erosion of our deterrent capabilities.

MASTERS: Dick, do you want to comment on --

BETTS: Well, when it comes to deterrence, again, I think we have to appreciate the significance of the end of the Cold War. And what matters most for our nuclear weapons inventory is how it compares to others.

And the countries that matter in that respect are Russia and China. If we can -- and it's a big if -- if we can reach accommodations with Russia and China, we're -- we all put reduced emphasis on our nuclear inventories, I think they can be reduced. The actual financial savings won't be tremendous, but they'll be something, and it also won't hurt our nonproliferation policy.

But in regard to Iran and North Korea, we have a long way to go in nuclear reductions before the potency of our deterrent comes into question. Yes, we've reduced a lot from the Cold War when we had over 30,000 nuclear weapons, but the idea that our deterrent -- our nuclear deterrent against Iran and North Korea would become questionable if we reduced further, I think, is a little alarmist. We could go down to a thousand nuclear weapons and that would still astronomically outclass anything Iran or North Korea has on the horizon.

So I think the challenge is to reach the proper modus vivendi with Russia and China in the nuclear area. And unless we were to get into the sort of utopian world of near disarmament, whatever is needed for significant deterrent of Iran and North Korea is going to fall out of what's left.

MASTERS: OK, maybe we can get one last question and then I'll ask all participants to sort of sum things. So one more question, operator.

OPERATOR: Our next question comes from Thanassis Cambanis from the Boston Globe.

QUESTIONER: Hi, this question is for Dick Betts. I'm -- it's a two part question and it's about how we actually implement the sort of off-shore balancing strategy that you've been advocating, among others, for quite a long time. And the question is have we learned anything useful in the 20 years since the Cold War about how to scale down our capabilities and then be able to flexibly ramp them up in response to new threats?

And have we figured out how to do this given the American proclivity, that I think Max represents pretty well, to view all threats at all times as equally existential and to -- and to sort of have zero tolerance for any short-term risk in exchange for long-term flexibility in our defense capabilities?

MASTERS: OK, thank you. Max, you want to start?

QUESTIONER: The question's for Dick.

MASTERS: Sorry, Dick, yeah.

BETTS: Well, as to how we implement this, I think essentially it's to, with care, reduce incrementally the forces we have, to organize the defense establishment more explicitly and carefully for remobilzation and to maintain a significant current standing force. So I'm not talking about radical cuts. That's why I said I think the cuts envisioned at present are about right, maybe a little on the low side, but that the cuts under sequestration would go too far.

As to what we've learned in 20 years about how to scale down and ramp up, I don't know that we've learned a lot in the last 20 years, but we've learned a lot since 1945 about how to maintain and surge forces. None of the wars we've fought, even in the best of times for defense budgets, have been neat, clean and perfectly executed. There are all sorts of problems we've faced, even in the sort of most splendid little war we've had in modern times, and that was the first war against Iraq in 1991. But that's why I would put heavy emphasis on planning and organization for adaptation in the future.

MASTERS: And Max?

BOOT: Well, I think the lesson of history is that we have traditionally cut our defense budget far too much in peacetime and we have paid a huge price for that when war comes in ways that we did not expect. I mean, most recently that was the case in Iraq and in Afghanistan, where our forces were not large enough to really fight and pacify two countries at once. But if you look back through history, that was also the case with the Korean War, it was also the case with World War II, it was the case with the Civil War and other conflicts in American history.

One of the few recent exceptions has been the one that Dick referred to, which was the first Gulf War in 1991 where, as a result of the 1980s defense buildup, we had a large, superb, well-trained military that was perfectly prepared for exactly the kind of war that Saddam Hussein started. And so, as a result of that, the war ended very quickly and with a minimal loss of life on the allied side.

But as soon as that occurred, we started demobilizing much of the military, so eager were we to spend the peace dividend. And our Army plunged from over 700,000 active-duty soldiers to 480,000 by 2001, and that was, you know, far too small to deal with the post-9/11 contingencies. Since then, the force has grown a little bit, although still not back to the 1991 level. The Army today is up to 569,000, for example, and the Marine Corps is up to 200,000. But now we're planning to slash another 100,000 from the Army and Marine Corps, and that, to me, suggests we have learned very little about the lessons of history.

BETTS: Well --

MASTERS: OK -- go ahead.

BETTS: I think 1950 is the real break point here. Max is quite correct about the historical norm before then of unpreparedness before war. But he's not correct after the remobilziation that followed the North Korean attack.

A problem, for example, in Iraq, in the second war against Iraq, that began in 2003, was not that our forces were not large enough. They were large enough, but the Bush administration, Secretary Rumsfeld in particular, insisted on using a smaller force than many in the Army and Marines felt was appropriate. And we'll never know how history might have been different, but if we had had a larger force, especially an occupation force of the size recommended by Army Chief of Staff Shinseki, for which he was rudely criticized by civilians in the Bush administration, we might have had a better chance to avoid the escalation of resistance after the fall of Baghdad.

We had the forces to do that. Yes, it would have been a strain. It wouldn't have been easy. But we had the forces to do that. And I think there's -- it's important to distinguish between choices made about how forces are used or not in approaching this question.

But Max is also right in the sense that there is an overstretch problem, and it's in large part a problem that's related to constant deployments and a situation we've had of what some have now come to call permanent war, where we've been at war now for over a decade. So, yes, if we are going to be constantly involved in major contingencies, especially more than one, our forces are not large enough. If we're going to be more selective and mobilize reserves temporarily rather than constantly and so on, I think that these strains are more manageable.

MASTERS: OK. And to wrap things up here, I'd just like to ask the two of you to sum up and then maybe speak to what we should be looking for in the forthcoming budget over the next couple weeks that will indicate or confirm some of the broad strategic outlines that were presented in last week's review.

Dick, why don't we start with you? And then Max, you can have the last word.

BETTS: Well, I think overall the directions indicated in the latest policy initiatives are about right. This is a question of degree, and there will be certain incremental nudges up or down from this general direction, but I think they're about right.

I personally, as I say, would move further towards consciously orienting the military more to a mobilization strategy, but as a practical matter, as things go in the American political process, this is heading in the right direction.

MASTERS: OK, thank you.

Max?

BOOT: I'm very concerned that this is a strategy for American decline. And I am very concerned that that decline will be accelerated if the next round of budget cuts, the sequestration hits, which could amount to, in total, a trillion dollars in cuts over the course of the next decade, that's something that we need to watch for to see how that plays out in Congress over the next year and on the presidential trail. I think that is something that can have very serious consequences for the future of American power.

I think already, with the cuts that have already been made, they are already a danger to our ability to project power around the world. But I think they are not yet a catastrophic danger, but I think the danger will become catastrophic if sequestration were to occur. And that's something that I'm very concerned about and something that I hope we will have a full debate about during the course of this presidential campaign.

MASTERS: OK, well, thank you both.

Again, this was a Council on Foreign Relations media conference call. Thank you all for joining us. Thank you to Dick Betts and Max Boot. And that concludes our call.

BOOT (?): OK.

MASTERS: All right, thank you both. Goodbye.