Speaker: Thomas Barnett, Professor and Senior Strategic Researcher, United States Naval War College
Presider: Mitzi Wertheim, Senior Manager, The C.N.A. Corporation

Washington, D.C.
February 11, 2003

Mitzi Wertheim [MW]: (In Progress) ... a Harvard-trained political scientist and a Russian linguist. He is at the Naval War College and is presently with Defense Transformations, assisting in something we call "Strategic Futures." The brief you're going to see today is the result of five years of conversation Tom has had with Art Zabrowski(?), the former president of the Naval War College, and now the Director of Defense Transformation; and a multi-year collaboration with Cantor Fitzgerald, of World Trade Center fame. It all began, at least from my perspective, back when we started talking about Y2K, and has grown into a conversation about globalization. With others, including Frank Gaffney, who is sitting here on my right. Tom has identified something called the "New Rule Sets", drawing new maps of influence and power in the world economy.

The goal of the brief you're going to see is an expansion of this conversation. And the idea is to get you to expand your own conversations and thinking about the world of defense, beyond how Tom would put it, what gets whacked and what gets bought. By the way, the March issue of Esquire, right here, has an article called "The Pentagon's New Maps," which is an article by Tom. It's a great read. Tom, the floor is yours.

Tom Barnett [TB]: I'm Tom Barnett, and I'm not a former anything. (Laughter) I would describe my eight years at CNA though as sort of my post-doc residency. And I would cite Hank's influence as being more than just a little bit strong for me, in effect my chief resident. So the bottom line come up on the screen tends to reflect the conversation I've had with him for 12 years.

I've given this brief now about 70 times to about 2,200 people within the U.S. government. I've given this talk about 70 times now to about 2,200 people inside DOD and the intelligence community. Most notably, within OST, all...senior personal aides last March. And then the senior executive council last June. And then Art himself has briefed all the major concepts to the Deputy Secretary, Secretary, and all the Joint Chiefs. And we've found good...with all of this.

As Mitzi said, this is a conversation that began a long time ago, it started with the Y2K project, which was Art Zabrowski's idea. He wanted to look at the year 2000 problem, really using it as a heuristic device to examine the question of what would happen to our globalized economy, interconnected world, if something really bad hit the system. What would be the perturbation? We developed a series of models about that. And our worst case model seemed pretty fantastic. We got quite a write up in the press as being kind of apocalyptic, X-Files, types who worried excessively about Y2K. But when you go back and read the report today, that worst case analysis looks amazingly like the days and weeks following 9/11. It wasn't that we predicted 9/11. We weren't really that interested in the trigger, we were interested in what that kind of crisis would look and feel like, how it would unfold.

As Mitzi mentioned, we had a multi-year project with Cantor Fitzgerald. It was called "The New Rule Sets" Project. It was an exploration of how globalization alters definitions of national and international security. That project, naturally, gets wiped off the board on 9/11, as so many people connected with it were killed. At that point, Art Zabrowski asked me to become the Assistant for Strategic Futures, he names it himself. I loved the title immediately, specifically the pluralization of the last word, strategic futures. And I said, Art, I'll do this if I can tie in this new explanation for transformation to the changed security environment that we think was really crystallized on 9/11. And I'll make it very specific to that point of departure. I want to treat 9/11 in effect as a tipping point, historically.

I'd like to start off the brief with a little joke that works in most places in the world. I always get a big laugh with this one out in California, it's a little tougher on the East Coast. The only place I got stone silence was Mumbai, India. (Laughter) I learned something about...It's a joke that Phil Hartman made up on his way to the "Tonight Show," a late comedian, made up, on the "Tonight Show" the last time he appeared with Jay Leno. He asked the question, what did Buddha say to the hot dog vendor? (Music) It captures the unbridled ambition of this brief. I've been accused of giving briefs that look like a farmer trying to stuff 20 pounds of horse manure into a ten pound bag, and that's a fairly apt description. We're going to try to cover a lot of ground. (Music)

The first thing we like to talk about, locate ourselves in history. I call this my 20th century in 60 seconds slide. I'm going to talk about globalization roughly from 1875, I'll take it all the way up to 1929, when I can say somewhat facetiously, we (Inaudible) one afternoon out of Wall Street, we engender a systemic stress that we later call the Great Depression. From the Great Depression, we get World War II, I'm going to argue, in an economically determinist fashion.

At the end of World War II, the United States decides it's going to firewall us all off from that horrible experience, not just the Holocaust, never again, but the economic nationalism of the 1930s, which kills the first coming together of global economy. It erases about 70 years of growth and integration. So we're not going to repeat the mistakes we made after World War I.

And we institute what we like to call a New Rule Set. We're talking about the strategies, foreign policy strategies, where resource flows, like the Marshall Plan. The internal reorganization, like the DOD Act of 1947. The international organizations we create. The rule sets we put in place to keep the western democracies talking to one another, and not allow the Soviet bloc, which at that point, seemed like a competitive economic threat, to divide and conquer us. Sub rosa, the real goal here was to recreate globalization, explicitly on three key pillars: Japan, Europe and the United States. And we succeed beyond our wildest dreams, because around 1980 it moves beyond that initial triad and begins to incorporate 22 crucial emerging markets, which doesn't sound like a lot of countries out of a 100 plus, but it's roughly half the world's population, because it includes India and China, most importantly.

Now around 1989, the wall comes down. Seemingly everybody on the same rule set page. And the history, possibly clash of civilizations. We begin to ask, what can come along? What new stresses can we imagine or experience that call into question what was a new rule set for the late 1940s, early 1950s, now starts to look a little long in the tooth, because that rule set was really put together to prevent the collapse of this sort of globalization, not necessarily to advance this sort of globalization, which I'll argue qualitatively, quantitatively different. And it was also about preventing this sort of great power war paradigm, not necessarily to deal with the kind of threat we find out here.

Now, when we first drew this slide, you can see why people thought we were a little apocalyptic. We drew up a question mark over here, we're suggesting some symmetry. And the argument we got, the argument we're really working off of, we got from Cantor Fitzgerald, who said we look at the 90s like the 20s. We see rule set misalignment, big time. We see economics way ahead of politics. We see technology way ahead of security. We see integration way ahead of society's ability to handle that kind of content flow.

Now, when we first drew this, we were interested in Y2K as a potential triggering event. That comes and goes. When a tech crash comes, we could see the change, the rule set alignment that was going to occur inside the financial sector. But frankly, that happens every ten to 15 years anyway. The average lifespan of your average trader. And when you get enough of them who can't remember what the last crash looked and felt like, they start talking about new rules, new ways to make money, new ways to count profit. And it usually comes down to basically cheating and then we catch them and then we institute new rules.

With 9/11, I have no trouble drawing a line I've been drawing on this slide for the last four years. I made this slide back in 1998. And saying I can't pick up a New York Times, a Washington Post, a Wall Street Journal, and not see some amazing new rule set put out there every single day since 9/11. Defining the nature of privacy, security, the way we're going to wage war, the nature of business, the nature of how we interact with one another. But it's not just a matter of closing the door on the hazy, crazy 1990s, which go down historically, I would argue, a lot like the 20s, rule set misalignment. So we're playing rule set catch-up now.

If this was globalization one, if this was globalization two, what we ask is what do we want globalization three to be about? We're the biggest player in the global economy. We take the biggest benefits from this globalization process. We live a privileged position. We spend half of the world's treasure on security. There's got to be a reason why all of this comes together.

Now back here we had the wise men who structured the future. They looked around and saw a lot of debt in the first half of the 20th century. And they blamed it on three key problems: Japanese imperialism, German militarism, Russian expansionism. So they put together a package, a strategy to deal with all three. Co-op two, buy out the third over time. And the dream was maybe by the end of the century, everybody is on the same rule set page. So they imagined a future worth creating and they structured for it. Along the way, a transforming event, moved to the all-volunteer force. We shift from an era in which stuff is expensive and people are cheap, to one today, when you think about, it's people who are incredibly expensive. We value them so much more than anything else we spend our money, politically and otherwise. And it's the stuff that's cheap.

Now DHS is obviously going to be a transforming event. That's an inside job. We want to locate transformation in some sort of larger vision. Now one key definition you hear all the time that transformation is. We're going to whack off five percent each year of today's military capability to kind of free new capabilities on the far end. And over a 20 year period, tomorrow's military will merge. Just kind of a five percent solution.

But, of course, the direction is implied. We've got to know what's the tail and what's the teeth. You've got to know where to cut and where to add. And inside the Beltway, that's what it's all about, the programs on record. And what we have from a service to so far road maps, and I like to joke, their vision extends about two inches beyond their nose, about a degree to either eye socket. Rumsfeld's complaint, in response to the service road maps was in effect, where's my joint (Inaudible). And I heard it directly from the service secretaries, they said, where is a vision we can wrap it around? If you don't give us a centralizing, ordering principle the way defense is going to be used, we're going to sub-optimize the whole by optimizing the parts, which is what we've always done.

So we say we need a bigger vision, something that encompasses this future called globalization. Something that explains where we are in the world. We believe all these things are obviously on the table. And I threw this up a year ago and people said, you're getting ahead of yourself. But not anymore. Everybody understands these are all on the table.

In many ways, what we're arguing for, what we're trying to comprehend is the American way of war. Our argument is, this country's been exporting security in a systematic fashion around the planet since 1945. For the bulk of that time period, we had a competitor in this market. We exported too much, he got pissed off. He exports too much, we got pissed off. He goes away around 1990. I'm going to show data later that suggests that global demand for our service, for our exporting of security sky rockets at that point. And I'm not talking about bombs drop, not talking about foreign sales, I'm talking about the hours we put in, the time our troops, our forces spend out there dealing with international instability and worrying about any region's potential for mass violence.

(Music) Now, I'm going to give you the argument in the Esquire piece. And this all began with some work I did with Frank Gaffney and we were looking at military crisis response over the last 20, 30 years. And I'm going to make a long stretching argument here. I'm going to say if you go back to the 50s and 60s, where we had our stuff, and where we did our business was largely in synch. Where we had our stuff was Europe and where we did our business was Europe. Where we had our stuff was Northeast Asia, and where we did our business was Northeast Asia, and extending down to Southeast Asia.

By the 70s, though, we begin to shift. And there begins to become a misalignment between where we have our stuff and where we do our business. Foreign key events drive this process. In other words, the European detente settles the question of superpower rivalry in Europe, pushes that rivalry south. And that rivalry picks up (Inaudible) fall of the Portuguese empire. It gets you countries with socialist orientation on their side, it gets you the Reagan Doctrine on our side.

Then there's the '73 war, which wakes us up to oil as a weapon. It wakes up to oil as an important, integral part of a global economy. And I can show you the crisis response data from (Inaudible), it shifts from one side of the map to the other over the 1970s. The Vietnam War ends. Absolutely pivotal event, the fall of Shah of Iran. I can show you the crisis response data from (Inaudible), how it shifts from one end of Asia to the other. The first big hint from Hank and I when we're looking at this data, we stopped responding to typhoons in the Pacific in the 80s. And we checked the weather data, and we said, are there still typhoons in the Pacific? Of course there were. We just weren't around to respond to them as much.

By the time we get to the creation of SENTCOMP(?) in the early 1980s, this is over 50 percent of all our crisis response data, all four services combined. It's roughly 75 percent of naval crisis response data, Navy and Marines. Bush Administration comes in, they want a rebalance on the big pieces, a focus on the near...capacity of a rising China. That gets wipe off the board with 9/11. And I say, good riddance on many levels.

Now I'll draw you a different map, based on what we think we saw crystallize with 9/11, but in reality we think has been emerging since 1980s. And remember, those 22 emerging markets begin to be integrated into a global economy. I'm talking about regions or countries in the world that are functioning within globalizing. By functioning, I mean they basically exhibit several of these characteristics. First, they welcome both connectivity and a content flow associated with globalization. And everybody likes connectivity. Bin Laden likes connectivity. Not everybody can handle the content flow. My favorite example, Barbie the doll was tossed out of Iran about a few months ago. Barbie the doll has infiltrated retail stores in Iran, through all that connectivity. She began appearing on toy store shelves, little Iranian girls started buying her. The mullahs didn't like it. They created an anti-Barbie doll, basically a Barbie covered head to toe in black cloth. She did not sell like hot cakes, Barbie got the boot. A good example of content flow that you can't handle. Another good example. When they tried to hold the Miss World competition in Nigeria, that was a classic.

When we come to a region which is functioning within globalization, if it's trying to harmonize its internal rule set into an emerging global rule set. And I say that to an American audience, it doesn't sound too hard, because it looks very much like an American-lead rule set. But for the rest of the world, it's a tough sell. We admit that global rule sets are always evolving. It's not just...man. It's Seattle...man. And increasingly, it's Osama man.

The direction is critical, not the degree. So China, yeah, still ruled by a communist party, whose ideological makeup is roughly 30 percent Marxist-Leninist, about 70 percent Sopranos, as far as I can figure out. (Laughter) Largely a job patronage correction team, which is the Sopranos. But the key thing is, they join the WTO, and that forces a certain harmonization of internal to external rule set. And in fact, they're importing rules. The Chinese leadership will tell you that straight up. We can't create these rules internally, so we're going to import them. And functioning doesn't mean bad things can't happen to you. Dropping out is always a possibility. Functioning parts of the world, North America, obviously the E.U., Russia under Putin's dictatorship of the law... China, definitely; ... India (Inaudible). I'll say Japan, I'll say Australia, I'll say South Africa, the country; I'll say the ABC's down here, although I'll note that Argentina is experiencing a bit of an Enron moment. Brazil, flirting once again with Leftism.

But the key thing is they're still both talking to the IMF. As long as you're still talking to the IMF, you can skip a payment now and then. And as long as you're still talking to the IMF, you're functioning, as far as I'm concerned, because you recognize the rule set.

Draw a circle around this, four billion people. Like all this functioning core of globalization. I'm going to describe the middle, when we use data, historical data, compiled by the services, put together by CNA, looking at where we've gone in the last 12 years. This is where we've gone. And I did a very simple thing, I drew a line around 95 percent of it, and it looked like that. And what was interesting about that chunk of a world, which I started to label the non-integrating gap, is that this basically globalization's ozone hole. This is where it's been. This is where all that connectivity is, associated with globalization is thin. And many places, getting thinner over time.

So it was interesting. If you're fighting against or losing out to globalization, you can't attract a foreign direct investment, you don't have the rule sets in place, abject poverty, whatever, you're just not making it with globalization, you tend to be where we send U.S. military forces in the last 12 years. You're looking for a paradigm in the post-Cold War world, I think you're staring at it. Meanwhile, if you're not fighting against globalization, you're basically working with it, lo and behold, you're the countries that raise your hand when George Bush says after 9/11, "Who is with us and who is against us?" And it shouldn't be surprising, because it's basically Tom Friedman's choice between the Lexus world and the olive tree world.

Well, the problem for the Bush Administration, I would argue, is increasingly they're arguing new strategies, new national security strategies, which sound like reversals of long-held policies, like the policy of (Inaudible). My response to that is to show that in effect, this is still the world of assurance up here. Nobody is talking about preemption in the core. This is where Mutual Assured Destruction, this is where deterrence still works. Where we're talking preemption is inside the gap. And increasingly, we're beginning to define the theme of deterrence or suppression, for bad things coming out of the gap. Think about all those bilateral security relationships we've been working on since 9/11, they tend to run, along what I call "seam states." Because if you look at maps of terrorist networks, they tend to be in the red. They want to do their major mischief in the blue. How they get at us is over that white line. This is why we're concerned about Thailand right now. This is why we're concerned about South Africa. This is why we're helping to put all those listening posts in the Amazon in Brazil. This is ungovernable areas, where stuff slips through.

So it's not one rule set for the United States and another for the world. It's understanding that globalization is not a binary outcome. Show me where it is, and I'll show you lots of good stuff. And they get above 3,000 per capital GDP annual, they get out of the violence business. They get about 6,000, they get out of the authoritarian government business. They get over 8,000, they get out of the raping their environment business. So good things happen with that kind of integration. Those 22 emerging markets that were pulled into the global economy in the last 20 years? Twenty years ago, only 25 percent of their exports were manufactured goods. That number is now up to 80 percent. This is real development.

So my argument is it's not when unilateralism makes sense, it's where unilateralism makes sense. The core is still the world of multilateralism, run more by a Secretary of Treasury than Defense or State. To me, this is Colin Powell's world, trying to bring up security practices of seam states. This is what Wolfowitz talks about when he says we're going to make bridges to moderate Muslim states, where he gets really focused on an Indonesia or a Philippines. And it's down here where we get left holding the bag with British friends, and the (Inaudible).

So again, it's not the U.S. flaunting the rule sets, it's admitting that when we step into the gap and try to play not global policeman, but simply to walk that beat, we enter a different rule set arena. And it's lot like asking a cop in Los Angeles you behave the same way in Brentwood as you do in East South Central. And they'll tell you straight out, not exactly. And the reason why is they want to go home at the end of the day. And that's why we go to the ICP frankly, and ask for an exemption for our peacekeepers. We're not worried about what our peacekeepers may do up and around here. We're worried what we may be held responsible for having done here.

Now this job of leviathan, which I limit to just the gap, it's a very big job. It's a traditional projection. I'll give you a different one, a better one. (Inaudible)'s projection. It's the one the U.N. likes. It's good because it's accurate left to right, and it's accurate north to south. You can actually see how things line up. The key thing is, you won't confuse Greenland with Africa, because Africa is actually much larger. This is what the gap looks like on this projection. And our argument is, this is the expeditionary theatre for the U.S. military in the 21st century. The evidence is already there. And I dare people to argue we're going to operate outside of this realm much.

Now the problem with this for the military right off, when you notice this, with the global war on terrorism, you've got various military commands spread across. Just like Rumsfeld basically says in response to the service road maps, transformation road maps, where is my joint cops(?). What he asked from the service ... sorry, I guess we call them Co-Coms now, which is kind of a weird recycling or words or acronyms ... is where is my standing joint task force? And in the global war on terrorism, he's basically designated one. To solve the difficulty of operating against across all those different AORs, he's basically designated SOCOG, Special Operations Command, as in charge of the global war on terrorism. And increasingly, we're seeing a definition of STRATCOM as the global strike command. These are the global commands now that are emerging. This is the transformation they're looking for. They're going around the current setup and they're creating new things. They're creating cannibalizing agents.

Some of the implications we draw from this. First, this is my (Inaudible). Disconnectedness defines danger. Okay, our operating principle for the longest time has been we assume somebody is going to pose a real threat to us, is going to look and act and sound like us. They're going to be a big country, roughly same level of technology, roughly same military. This is a different perspective that says where we find disconnectedness is where we locate danger. A shrink in the gap of the military strategy means first and foremost destroying their networks across this and replacing with our own. Their security relationships, which, for example, with terrorists, we begin to discover more and more after 9/11. The connectivity across states. The way Al-Qaeda is able to move their money through gold into various locations, the way they're able to buy from Colonel John Taylor something like ten, 15 weeks of sanctuary for a mere million dollars, because that's the rule set there.

We know of the advantages of an exterior position here. This is a positive view of the world. We're talking four billion on the outside, we're talking most of the wealth, most of the communication networks, most of the transportation and the flow of goods. A premium on forward deterrence and strike. Security remains an outside, over there concept. Focus on prevention, rather than retaliation. As Art likes to say, we've got to move on ambiguous warning to the left. We've got to recognize it earlier. So more surveillance, more sensors.

In terms of how we transform the military in a broad sense. We use this phrase, "our super empowered individuals versus their super empower individuals." If we live in a threatened environment populated by these Bin Ladens and what-not, then eventually we're going to morph into a mirror image to a certain degree. That means more special operations like forces. But it also means empowering all our service men and women, whenever we put them on the ground, to be as absolutely networked and connected as possible. We need to avoid a (Inaudible) posture, which we are lapsing into year after year after year.

And finally, speaking to a naval audience, this is where sea basing will matter, inside of here. Sea basing has to become increasingly agnostic. Anybody should be able to come off the decks. Which I know is a very threatening concept for the Marines, who already feel pretty threatened the rise of Special Operations. The commandant only recently acknowledging that there is such a thing as Special Operations Command. So then Nixon goes to China. (Music) (Inaudible) the Special Operations.

That's the map of the world we draw. Now we point to a different kind of way of thinking about crisis in the world. I'm going to explain this different kind of crisis model by referring to my education as a young CNA analyst. When I first came to CNA, I learned the classic Cold War vertical scenario. That's how they taught us to think about danger in the future. The classic Cold War vertical scenario, it always unfolds with lightning speed. The opponents conveniently were known beforehand. Allies conveniently known beforehand. Strategy, packaged and thick volumes up on the shelf. We practiced it night and day. We write novels about how it would turn out.

Single hand of poker. You couldn't change sides in the middle of it. No evolutions or change. You're going to fight this thing out in a static time frame, and then you're going to figure out how to divide up the spoils. This is what we learned across the 20th century. We fought World War I, we divided up the empires of the losers. We fought World War II, we drew a line through Europe. We struggled our way through the Cold War. And then basically we went into East Central Europe and Russia and looted them for everything we could. The classics of this (Inaudible) and the mini-me version (Inaudible).

The problem with this model is I experienced cognitive dissonance almost from the start. I never saw this thing ever unfold. Across the 1990s, I saw very different things. And I got this image from Hank. And we draw these wonderful charts of peaks and valleys (Inaudible). And it's only when it gets above a certain level that we look at it and go, my God, a crisis, send the troops. It's a bolt from the blue.

The Cold War scenario (Inaudible). No clear beginning or end. Drags on forever. Can anybody name the year the Balkans crisis began? I think it was 1390 ... (Laughter). The definition of who the enemy is changes over time. When we went into Somalia, first it was famine, then it was the lack of governance, then it was the war lords, then it was that one war lord. And after we got 18 dead, we decided it was really the U.N. that was the problem, so we go the hell out of there.

Allies come and go, not just the French, strategy evolves. Strikes, not battles. The definition of a problem depends on what op-ed you're reading that morning. How many out there that you read about Afghanistan and a real problem there? The world goes on, meanwhile you babysit some crappy situation on the margin. Think about the 1990s. Milosevic, Monty Python's Black Knight, fighting on as we lopped off chunks of his country. He sits in the docket, limbless now, spitting at us, daring us to fight on. This trial will go on another couple of years.

Then there's Saddam, and keeping him in the box. This is two-thirds of our billable hours in the 1990s. Two-thirds. Nothing for central Africa. Three million dead. About a dozen countries involved in some way or another. Why? Because nothing comes out of there that we value, either positively or negatively, unless you're smart enough to figure in the AIDS (Inaudible), which isn't a direct tie-in, but it certainly is enabled by this kind of conflict.

We put these two together and we come up with this definition we call "system perturbation." This is a term we used when we were doing the Y2K work. When we did the Y2K work, we said we think we've discovered the new crisis model. And we think we're going to see it proven some time. We didn't have that kind of (Inaudible) vision of the future, and we could actually almost pick the date. We just said sometime in the future.

We're going to talk pain, we're going to talk times, or the meaning of life. And I must say, system perturbation begins with a vertical shock, followed by any number of horizontal tails. Vertical shock is easy, that's 9/11. Or correct this model, Y2K, we called that the Ice Storm. That's the day the world stands still.

The horizontal tail model from Y2K, we call that the hurricane, sectorially limited, but not temporally limited. Pathway of destruction created through a sector. Maybe it would begin to spill over into another sector over time. So the one horizontal tail that came off of 9/11, obviously what happened to the airlines, the financial markets. Anthrax (Inaudible) and I don't care, pathway to (Inaudible) because it comes in the aftermath of this. Otherwise, it could have been another Oklahoma City. But this was the chosen trauma, so this became really important. A billion dollars for the U.S. Government to hospital for the last 12 months because of this.

And then down here, the tail is Afghanistan, which we should wrap up in a couple of years, a couple of decades, a couple of centuries. The little tails that come off the original tails. What happens to the airline industry happens to the tourism industry, it happens to the Egyptian economy which tanks within weeks, it happens in the Israeli economy, which tanks, it happens to the West Bank economy because a lot of those day trippers over the line backfield in the tourism industry. So the violence goes up in the West Bank.

What happens to financial markets happens to the insurance industry, it happens to the reinsurance industry, spills over into the airline insurance industry. What happens with Amtrak leads to an interesting breakthrough patent release for AIDS drugs, it helps launch the (Inaudible) development round. You say all part of Bin Laden's master plan. Yes. Perhaps not. But it's an interesting chain of events. 9/11 happens. The anthrax scare occurs, five dead, 17 sick. Canada freaks out. Canada spurts out to Bayer, the German pharmaceutical giant, that they're basically going to break their patent and go to a generic producer of Cypro without even declaring a national emergency. Bayer gets really upset with this. Understands it's blackmail, caves in quickly. Gives them a batch of free vaccinations, gives them cut-rate deals for a long flow of Cipro. The U.S. makes similar noises. Bayer does similar things for the United States.

At this point, figuratively, in the back of the room, sub-Saharan African nations raise their hand, and they say, well, that is a hell of a trick. How do you people do that? Talk out of one side of your mouth and then just totally break the rules on only five dead and 17 sick. Your previous administration called AIDS a national and international security issue. I've got millions dead, 30 million infected, something like ten million orphans. Why can't we get this relief for Brazilians, in Indian pharmaceutical companies? They threatened to derail the launching of the (Inaudible) development round, to a meeting in Qatar, December 2001. The world was very eager not to have a repeat of Seattle. Bob Zoellick comes to the rescue, cuts the deal. The rest of the story is even more interesting. Since then, the emerging markets in developing countries in the world have sought to abuse that deal and expand it to include basically every drug in the world.

Down here in Afghanistan, some of the tails that come off that. Pakistan, on its way to being declared a rogue nation. We were just waiting for the paperwork to come through. Now we happen to be one of their best friends again. India and Pakistan, the close call on the war after 12/13, the bombing of the New Delhi Parliament, which comes in the wake of 9/11 under very different circumstances, because both these guys are pointing at the other one and saying you have no idea how much trouble you're in. I have a new big friend called the United States. And this could end very badly for you.

And finally, as I like to call them, the Stans in general, where we have military bases now. The former Soviet Union, where we have a number of military bases, I think they're going to be as familiar to us 20 years from now as (Inaudible), because I don't think we're leaving. The Russians have just moved back into Kirghizstan. We have a base just across the way. We can kind of wave at the Russians. Just absolutely amazing.

Now some of these things stay and other things come on top. Of course, we make this happen. This is our old horizontal scenario, which triggers all sorts of, you could argue, right wing responses, kind of around the world. Crackdowns under all sorts of guises. Some of them legitimate, some of them not. A lot of law changes around the planet, mostly in the core. I've got a great map that shows that one, from Amnesty International.

About a year ago, it seemed like Israel and the P.A. was going to be the big subject, the big segue we were going to go to next. That got superseded by design. About the question of going into Iraq. And then almost like a mental patient, Kim Il Jong says, hey, don't forget about me. I can still do dangerous things. Look, I've kidnapped people. Opening a special economic zone. Someone stop me. (Laughter)

Now you show this kind of slide to complexity theorists, they'll tell you two things. One, a lot of green lines going into this. This did not come out of the blue. And two, if you get enough of these lines on the right side, eventually something is going to release the pressure. And what's interesting about the question about the war in Iraq is, are we going to be the system perturber? Are we going to design ourselves as the force that systematically and periodically perturbs the system, because we prefer to have the change on our terms, on our schedule, as opposed to letting Bin Laden or somebody else determine the timing of those changes.

Now this is a word slide, because I'm accused of never having slides with just words. And this is kind of our dictionary definition (Inaudible). Again, I like to talk about this one the most, the potential for conflict maximized when diverging rule sets are forced into collision. China had a rule set for Central Asia. They had the Shanghai Cooperation Council. They were going to kind of run Central Asia along a certain line. And they had all the major players involved. When 9/11 happens, we basically come in and say, thank you very much China, you've done a wonderful job up to now. But we're going to run this show.

It was under that circumstance that you get the 12/13 following the 9/11. And you get a million Indian troops on the border and a big number of Pakistani troops on the border. And I actually got to spend some time with senior leadership in India about a year ago, where after all the day's festivities and scotch would start flowing, they'd put a finger in your chest and they'd say, you have no idea how bad these people are. Some day, a street car is coming down and we're going to ride on it and show you exactly how bad they are. And there is just too much thinking that I read in India about having a billion people and what's 50 million in a war, when you've got that many left over. It sounds a little bit like Mao about 30 years ago. So it gets to be pretty frightening.

So China and United States going at it out of the blue is a load of phooey in my mind. China and the United States stumbling into some conflict because they have very different visions for Central Asia, following a lighting up of nukes between India and Pakistan, following the 12/13, following a 9/11. That's a causal chain I can't dismiss casually. (Music)

So how we put this map of the world and this definition of new crisis, and start thinking about an ordering principle. The ordering principle, pretty simple concept, we don't talk about it much, because it's been such an inherent truth for us for so long. It's a core conflict model around which everything is planned, procured, organized, trained, operated, most importantly, and (Inaudible). We've had an ordering principle since 1947. It is called Great (Inaudible). And the assumption is they're going to look and act and fight like us.

Our argument is the transformation to really get beyond just the...list and what we buy, beyond the program of records, we need a new ordering principle. Now some people will call this revolution in military affairs, or call it fourth generation warfare, they'll call it an (Inaudible) warfare. Call it whatever you want. All these things are really thinking about the future of war within the context of war. I was asked by a Singaporean defense minister, what is the difference between what you do and Andy Marshall does? I said Andy Marshall thinks about the future of war within the context of war, which I think is really important. What I do is I think about the future of war within the context of everything else, which is what I think is also very important.

So we argue you need something larger than warfare, because we think warfare serves a much bigger purpose. We're flipping Clausewitz on his head, in effect. How we got to this point. I'm going to talk about three levels of perspective. This is Ken Walsh "Man's Stake in War." Think about the system, think about the state, think about the level of individuals. In the Cold War, we had a system level threat. It was World War III. It was going to be a nuclear exchange in its core. So we ordered ourselves on that principle. On the level of nation states, we were careful not to fight the Soviets directly, and they were careful not to fight us directly. Down here, the so-called lessor included. You organize yourself for that. These fall in. Not a problem.

We get to the 1990s, the Soviets come along with us. We try to backfield. In effect, we replace the old ten foot tall Soviet threat with two foot tall threats stacked on each other's shoulders, Iraq and North Korea. And we say two major theatre wars equal a great power war. And the joke was sort of when we got that first enunciation was, where have I seen these two major theatre wars happening before? Oh, yeah, it was called World War II.

Down here, everybody got a promotion. I'm not just a terrorist, I'm a transnational actor. (Laughter) Up here, we backfield with fantasy. We didn't have anybody here, so we dreamed somebody up for the future, sort of a to-be-determined. Or as I like to call it, China all grown up. (Laughter). This was the orient principle we sold, less (Inaudible) bottom up review. Abstract for sizing principle, immediately identify Iraq and North Korea, because it was all about Iraq and North Korea. And it's still all about Iraq and North Korea.

Now, what do we have? Some people would argue we should be about keeping Americans alive. (Inaudible) to whack Afghanistan six weeks later just doesn't do it. Some people will look at that and say look at what happened over the last 30 years. Look at this downshifting. Thirty years ago, we were going to fight the Soviets, then we got downshifted to rogue. Now we're going to fight individuals. We're going to assassinate people individually. What is going on? We reject that comparison and offer a different one.

First, Homeland Security is covered by the new department. Some people would argue on the level of state, what we should do is kill their leaders and turn them all into Christians. That was Ann Coltrane. I don't like to repeat that one (Inaudible). We say that's a little too narrow, it's a little too much (Inaudible). We say we're a system level power. We have to think system level. That's our phrase for it. And what we're arguing here is look at the expansion, look at the growth in our reach. This is not a problem of failure. This is not an overload I'm talking about here. I'm talking about a problem of success. Thirty years ago, we were basically about wars against blocs. There is not the great threat of global nuclear war right now. I would argue we've mastered that one pretty well. We are so good at doing wars against rogue, we can actually schedule them in advance. Offer you a budget in advance. There's that joke inside the Pentagon, we have good enough ratings, we may be picked up for next season. (Laughter)

But the funny stuff aside, it's amazing, to be a hyperpower in the French perspective, what kind of hyperpower goes around and asks everybody in the world if we could please, pretty please, invade this country with a terrible leader and take him down? And ask for everybody's approval beforehand. What kind of imperial power does that in history? I'm going to ask you. So it's a success in this. It's our success in obviating, or obsolescing state-on-state war. The last good state-on-state war, Ethiopia and Eritrea. But we're all the way down now to stopping bad people from doing bad things. And that's a problem of success.

What this means in terms of forces and our capabilities, how much do we eventually mirror the environment we're living in? This is the argument we make. Our legacy is that of the diamond in this perspective. We tended to be very thick on the state-on-state stuff, and we have a certain security hedge up here called Strategic Forces. A certain capability down here, SoCom or Special Affairs, Civil Affairs, that kind of stuff. We didn't really have much down there. This is a rogue, density high use stuff that we're kind of backed up.

Well, the Bush Administration comes in with a very particular vision, I would argue, of where force capabilities should be spread. And my argument is, they wanted to be very much system level, they wanted to have national missile defense. They wanted to be able to fight wars in space. They wanted to keep a certain hedge against kind of rogues and state-on-state powers. They wanted nothing to do with that stuff on the bottom. As Condi Rice said, no Special Operations Forces escorting kids to kindergarten, which I think they're doing in Afghanistan right now. So the global war on terrorism added this part. So I'm not sure we go from the diamond to the hourglass. And the trick here is to figure out what gets cut out of here and what gets added in.

When I talk to people, Navy commanders, or Navy captains, for example, who are running OPs to try to catch people in the Indian Ocean. And they said I've got a ship and I've got these capabilities, but you know what, I have so many capabilities in here and what I needed were capabilities up here and down here, because I was working across the system and I was trying to catch individuals. And I didn't really have the tools for it.

So this makes things clear for me. Again, my education is a CNA analyst. I'm going to talk about the difference between reality and desire, which is always a tricky concept (Inaudible) building. I'm going to talk about time, over the 1990s, as a young CNA analyst, we had just seen the Berlin Wall come down. We had just seen Desert Storm. We amassed a bunch of the best and brightest from around the world, navy commanders and captains, colonels and lieutenant colonels, Marines. They put them into the fifth floor at the Center for Naval Analyses, told them to dream up the Navy White Paper of the future. It became (Inaudible). I was a young CNA analyst, I was Girl Friday to Tom Wilkerson, who eventually ran the show, Brigadier General selected the title...

And what the discussion was all about really presaged a bifurcation of vision in DOD. Because as we talked about the future, some in the room saw nothing for themselves. Others saw plenty.... evolution of military affairs, fourth generation warfare, transformation, non-centric operations. All of these fabulous things requiring, frankly, a fabulous enemy to use them all against. And that was the problem. Meanwhile, other people in the room saw plenty for them to do, like the brown shoes guys around the surface fleet, because they saw a future for what we eventually called Military Operations on the War(?), which is Pentagon code for "I don't wanna do this." (Laughter) And eventually we began to understand that what we were doing was working an... in between the globalizing parts of the world and the non-globalizing parts. But nobody wanted to do admit that. The Clinton Administration basically left us to run wild, as young children do. And we wasted an entire eight years. Because what we did across those eight years was we bought one military and we operated another. And it's like the guy who goes to the doctor and says, "Doctor, it hurts when I do this." And the doctor says "Stop doing it." I would give this brief every year and (Inaudible) to the...in the Navy. And I would stand up there and I would say, you guys in the Navy buy in one Navy and operate in another. And that is wrong. And they'd say, Dr. Barnett, you're right, you're right, you're absolutely right. Can you come back next year and tell us the same thing? (Laughter) I'd come back the next year and I'd say, you're buying one Navy and you're operating another. And they'd say Dr. Barnett, same time next year. (Laughter) Therapy was just not working. (Laughter) 9/11 does us a huge favor. Honesty back from the system is a gift. 9/11 was a gift. It ripped us out of this long-term fantasization of we're up here way in the future that was going to make all these weapons worthwhile. And said if it's transformational, it should be important now, not for some abstract future. And it elevated this messy business into something more important, because this was really dealing with the (Inaudible). Now you put those two together, some people draw out the word "empire." Steven Peter Rosen(?), for example, makes an interesting case. And the argument is, the danger is that you manage the empire and you forget how to fight the big wars. Or you did what England did at the end of the 19th century, you fixate on empire, you don't see the German (Inaudible). This is the way to ruin an empire.

Our argument is, we've got to think more like a system administrator. We pulled this term purposely from the world of IT. The system administrator cannot become fixated on any one flat scenario. The system administrator is first and foremost about keeping the system up and running. To deal with threats, you can't be simply to leave smoking holes. Because to bring down the net is to ruin your purpose. (Music) So when we talk about system administration, we have to think about what we think globalization is (Inaudible). I'm going to give you a simple four block analysis here. This is classic...analogy. Consultants make a lot of money doing this. Two simple questions, the last question, this is what you read in The Atlantic Monthly, either the rest versus the west, or the west versus the rest. Tom Friedman up on top, Robert Kaplan down on the bottom. Tom Barnett up on top...down on the bottom. A division by competency, a division by culture.

How this comes about. We're talking about that rule set misalignment. Does it persist? Or is it dealt with? Worst case, a division by culture, we don't deal with this character flaw. We'll call that one globalization traumatized. The problem here is the old core can fracture. Can you believe it? A tariff here, a tariff there, and all of a sudden, people don't like us anymore. (Inaudible) Rumsfeld here (Inaudible). Old Europe, a new Europe, the gap can only grow. This is Bob Kaplan territory. He's been to West Africa, he's seen the future of the world. (Laughter) He went to Los Angeles too and that scared him even more. (Laughter) Well, what I say is get out and travel more widely.

Division by culture, new rule sets emerge, but only among, in effect, the old core, the people who are already Americanizing. So it's Japan, it's Europe, it's the United States, maybe Russia pulls along. The concern is do cores emerge with their own rule set? The big concern here obviously would be China. China is going to dominate Asia because it's going to have the biggest domestic market there, just like we dominate the Western hemisphere. And if they start saying, hey, money behaves differently here, banking behaves differently here, war is different here, then we have a problem. Better outcomes. A division by competency, but we don't deal with the character flaw. Here is the real temptation, we try to firewall ourselves off in the gap. When the going gets tough, the slimy start to scapegoat. This is basically what Arianna Huffington does, she tries to reduce the whole damn thing to SUVs. It's not that we drive a lot of cars. It's not that we use a lot of gas. It's not like we're integrated with the global economy because we import a lot of oil. None of those things matter, it's just those SUV drivers. But ask yourselves, if you ruin what little connectivity the Middle East has with the global economy right now, what stops you from turning that place into Central Africa? People say it's about oil, I say, thank God it's about oil. Thank God there's a reason to care about that part of the world. Because there are parts of the world where there is no oil and people just don't care.

We don't have any transnational terrorists we can site from Central Africa. Eventually, we will, because you can't have all of that pain contained there forever. So this is the temptation to be avoided. Best possible outcome, division by competency, new rules emerge. Old and new core come together, master 9/11s and we shrink the gap progressively. (Music)

I'm going to wrap this all up in what we call a global transaction strategy, which is the piece Hank and I wrote. The way we like to think about the major flows, we got this from workshops we did with Cantor Fitzgerald. Four major flows we've got to keep in balance, when you think about the gap in the core. First flow, people got to go from the gap to the core. That's a demographics argument. We want somebody there to turn you over in your bed, actually. Security has got to flow from the one country in the world that can really export it in a sustained fashion, to the part where the security deficit is the most important in terms of potential damage to globalization. This is globalization's Achilles heel and it will be. We've got Royal Dutch Shell right now predicting the topping off of global oil demand in 2020. We have two global scenarios right now. Both of them predict that. That tells me the clock is running on the Middle East. We've got to get some broadband economic connectivity or we're just going to see that part of the world fall off, eventually.

And the way you do it first and foremost is you decrease the security deficit there. And it's a long-term job, absolutely. For the (Inaudible) the energy that comes out of there is crucial for developing nations. We're just going to double with energy use in the next 20 years. They already take half the oil comes out of there, they're going to take two-thirds to three-quarters over the next ten to 15 years. That's two billion people we're integrating.

And finally, a lot of money has got to flow from the old core, Europe and the United States, to the new core, developing nations to make all this development occur. If any of those four flows are really disrupted, our argument is globalization three is imperiled. So when we talk about a global war on terrorism, we talk about the defenses we're going to take in order to achieve that war, we've got to worry about these four things here.

Now we put it together. We're basically trading useful opportunity, because we're going to get over it. And there is going to be a certain amount of fire-walling. It's not our energy in the first instance, but it is our prosperity. And finally, it's important to buy off the long-term threat in the only part of the world that really offers it. Integration of India and China is absolutely essential. China is the prize of globalization. How we connect the military to this? It's a humanitarian system that's mostly about mitigating the suffering inside the gap. Crisis response is mostly about containing anger inside the gap. Power projection is about deterring aggression inside the gap. Why I see (Inaudible) in presence, still I focus more on developing nations, because that's a winning hand that has worked for a long time. And the integration of that half of the world's population mostly there is the crucial victory. It's globalization three. It's what can't be sacrificed in the global war on terrorism.

Now I made that comment about a booming export market. When you take away the Soviet competitors, what do you see in terms of demand? Simple stuff. We use this from the CNA data. All I'm doing is adding up crisis response service data, adding the four of these guys cumulatively. So if the Army, Navy, Air Force, Marines all go into Somalia for 100 days each, I call that 400 billable days. Here is something...we did about 7,000 in the 1970s, not including (Inaudible). We toss up to about 17,000 in the 1980s. Then the limits come off the market. Skyrocket up to almost 70,000. This is what the military means when they say "We were really stressed in the 1990s." It's not bombs dropped, it's not platforms running around, it's the hours we've put in. And we draw a line across here and we see everything under this is cut and gone, an Ivory Coast here, a hurricane there, you're going to do that ever decade no matter what. But the concentrations emerge with globalization. And it begins to get a lot bigger around 1980. The Middle East, Iran/Iraq, Israel into Lebanon, terrorism. Look what it took to do Saddam. Look what it took to do Milosevic. Here is our master of so-called nation building...I don't know what the demand is out there, it could be 250,00 for all I know. This is what we could muster. The question is, how strategically did we apply this? Because this in the end is our most important asset, it's the time and attention we spend.

So we put it all together. The reason why we are here, that we need to broadly, more broadly than we do now, let's get beyond this great power war paradigm, is that we live in a system that we need to protect. So this argument, again, the U.S. as system administrator. Three key colors here, why? Strengthen the core's ability to withstand system perturbation, a very multi-lateral affair. Two, firewall at the core from the gap's worst exports. Pandemic drugs, terror, this is the bilateral focus on seam states. (Inaudible). Goal number three, shrink the gap. We believe exporting security is a key enabler. I say show me places where there is plenty of stability, and I'll show you long-term (Inaudible) relationships between the United States and that part of the world. Show me parts of the world with great power wars, I will show you long-term U.S. military bases and long-term U.S. military alliances. Show me the two best investment relationships in the world, and I will show you the two key postwar economies that we rebuild, Europe and Japan.

Now how we tie this all back to transformation? That's the best way I can say, three pillars of transformation. Inside the Beltway, it's all about buying equipment. A certain fixation on this, that much interest (Inaudible) it's considered just RBA... business affairs. This is the key to it, though. And I got this great question from the Esquire people. If your vision of future comes about, what changes more, which I thought was a great question. My argument is this, the world is going to change more than the United States. The private sector is going to change more than the public sector, because we think about this collective good more. The rest of the U.S. government is going to change a whole more than DOD, that's already happening. And our agency is going to be the new joint (Inaudible).

And finally, military operations are going to change a whole lot more in the stuff we buy, what we buy, or how we buy it. Now some very smart people have written some very interesting arguments that say 9/11 killed transformation, and that's because they take a Soneslav(?) view of the world, and they say, I don't see a lot of transformation here. My point is, they're not looking in the right place. There is all sorts of transformation going on. It's like walking into the hospital today and say, I don't see hospital behaving much differently than they did ten years ago, and missing the revolution in medical care in the entire system. And that's the beef. (Applause)

MW: Well, are there any questions? Are you all just overwhelmed? Alton?

Audience: Tom, it was a remarkably stimulating and conceptually very rich presentation. I have two questions. One, the serious one if you will, is do you own an SUV?

TB: I do own an SUV. (Laughter) I just bought one. And you know what? I waited until Honda put one out. I waited until the SUV that I bought gets 25 miles to the gallon. It's called the Honda Pilot and credited in all 50 states as a low emission vehicle. And I (Overlapping Conversation) to my place of business, something I didn't do in Washington, where I spent an average of three hours in the car every day.

Audience: I actually do have a serious question, which is ...

MW: But that was a good one. (Laughter)

Audience: In talking about the latter points, your grand finale, and making the point that there's been too much focus on the (Inaudible) acquisitions. Don't you have to say something rather more specific about the need for specific acquisitions that do facilitate the increased military operation to which you refer on the left side of that next slide? I just mean there has to be some relationship, so it seems to me you're a bit too dismissive on the problem of defining relevant functional acquisitions for distributing (Inaudible).

TB: Right, and I'll immediately backtrack and respond to a good question. And say, I think there ... I'm not the weapons guy. Art is going to be here in a couple of meetings and he'll give you all those examples. I have a hard time keeping track between the JDAMs(?) and the JSTARs because it's complex stuff. But I think there are plenty of acquisitions that are going on and defeating this process, of in effect empowering, super-empowering our individual servicemen and women. And I think that's occurring. I think what people fixate too much on is the fact that we're not cutting off certain legacy systems completely. So that when we still buy two or three of these things, people say, well, then obviously you're not moving beyond. I agree with those who say the notion that we're going to get $500 billion for defense in five or six years from now, is probably damn near possible. So there are going to have to be tougher cuts in what we've engaged in. But the argument that I get back from people who say it's still transformative to buy these new things while not necessarily cutting off the old is, and Arnold well tell you this, I see no reason, he says, to cut off any little capability. If I can keep it in small numbers, then it's just another tool in the tool kit. And I don't want to get rid of those, because I find myself constantly in this situation, and I want to rely on the ingenuity of my people to be able to take advantage of whatever I've got in the arsenal as quickly as possible. That's probably not a very satisfactory answer, but that's where it sits right now without the budgetary pressure.

Audience: Tom, Dan Crissman, great (Inaudible). I used to work for Bill Kraus(?) some years ago. He always described one who goes into submarines and under the surface as a submariner. A submariner was a substandard (Inaudible) (Laughter). And they call it that in the U.K., but not in the U.S. Seriously, to follow on...to take us one stage further in specificity, Tom, when the Army that they've issued now and for the next 15 years will be forward station, if you talk about the exploiting of security as one the important assets here, give us in light of all this, what that suggests. With what we do with our forward deployed forces now is still fundamentally aligned in the old Cold War paradigm, Europe and Saudi Arabia. How must that evolve to reflect your vision?

TB: Well, I see what some people would call kind of the hollow presence, or a rudimentary sort of presence. And you saw that coming out of even Lieberman and whomever who came back from those discussions we just had in Europe. And I think you're going to have to see that. You're going to see kind of the hollowing out of the long-term presence in Europe, and you're going to see much sort of what we have in Kuwait. And you're going to see the infrastructure, you're going to see the stuff. You may not see the people connected with it. So kind of a prepositioning model. I think you're going to see us spread that model increasingly through the gap with people that we find as friends, which is going to resurrect some feeling of the old Nixon doctrine, which was find your good friend for the region, and have that become a pillar. I think you're going to see that repeated in.

The second thing I think you're going to see is you're going to see the Army and the Air Force and ... this is my argument, at least, and not just the Marines, get a whole lot more on ships, and new ships. And the concept of sea basing becoming completely agnostic. Which again, is pretty threatening to the Marines, because at the same time we're saying Special Operations, and the cannibalizing agent of transformation, and they have often ... long thought of themselves with that kind of function. So they're going to undergo one of their periodic who are we and what are we good for periods. But they survive those and have good things (Inaudible), so don't worry about them particularly. But I think you're going to see a lot more things coming off of decks, which is why it's imperative for the Navy, in my mind, to keep a kind of a high/low mix. I believe in a small...combat kind of ship, because I see enough activity that suggests and enough of a task (Inaudible) to suggest that we need those kinds of ships. But I see almost the Zumwalt high/low mix. You're going to see lots of little ships and behemoths. And behemoths are going to become incredibly joint.

And the little ships are going to do very Coast Guard-like business, which is bad news for the Coast Guard, but not bad news, because the Coast Guard is going to be really withdrawn from a lot of international...because they're going to be reduced to kind of just the FBI-like cooperation with other forces, and not so much the Coast Guard of the world, which the Navy is going to end up being. Which I know the Navy is not exactly excited about at some level, and it's heresy to say that, because in fact when most people still inside the Pentagon want to plan for a near peer competitor. And they're still...up scenarios like crazy. And they just have not caught on. But when you talk to guys who come back from ships doing stuff in the Indian Ocean lately, boy, they see this brief and they say, it's not coming, it's here. I did it for the last six months. It's really amazing, the change.

Audience: I was struck by the number of days that people were...crisis management and the fact that...numbers related to the military today. What does this say about the need for...operations the other poor countries? And...even having some of those people on our ships?

TB: Oh, I could see that. And I could see ... I have no problem with the kind of division of labor that comes about, where we tend to be the sharp edge and then other people back (Inaudible), as we kind of move through a situation. I believe in that. And I don't think it's just letting the Europeans hold the bag or be responsible for the financial undertakings with reconstruction. I see that as kind of a logical division of labor. I do see the requirements for more jointness. Art likes to talk about how jointness has to get down to the tactical level, and not just be at the operational and kind of strategic. It really has to get down there, because we have to do more with fewer people on the ground. We're going to have to super-empower every single body we put on the ground, so they get the most out of their time there. Because we are using people more extensively and we have to be able to pull them out as quickly as possible. Again, underline the notion that when we go out as quickly as possible, we've got to have good relations with allies who can step in and take this kind of back (Inaudible) because they're not really capable of doing the combat. But they are capable for the peacekeeping and for the reconstruction kind of stuff.

And then more broadly, I just feel an increasing breakdown, and I see this accelerated with 9/11 and the Department of Homeland Security, of the wall between what it is to be a military person under military law, and what it tends to be a first responder or a cop, or a foreign aid worker, all of these people who live under civilian law. I see a lowering of that wall and I see it increasingly we're going to use more part-time, more private security. And we're going to see the definition of military service radically revamped in 20 years. I don't think it's going to be ... I think posse comitas will disappear, I think military law will disappear. And I think when we see guys put on civilian trial, for hitting a couple of Canadians, in that situation in Afghanistan, I think that's a harbinger of really what we're up against. We're going to see more transforming. It all happens in personnel (Inaudible).

The flip side of that though, that the role of the military in nation building is broadly defined, continues to... and the role of the State Department in civilian agencies shrinks. And you have a kind of a new distribution of functions in the U.S. government. And I'm not sure I go that far. I think we're really going to have to go back and revisit a lot of the learning we did in Somalia. I think back to the work CNA did on measures of effectiveness, how can you tell when you're really improving the situation. And I think we're going to end up going back and rediscovering a lot of that...doing it more (Inaudible). I don't want to agree with what you're saying, maybe coming through a certain extent now, but I think that's a problem that needs to be addressed.

Audience: Now, I mean, Bill and I both had this experience when we were in government, that SINCS, as they were called then, often had more ... they had greater stature and greater authority in theatre than any (Inaudible) after. And they (Inaudible). And they had bigger budgets. And they wielded more power and it wasn't because of the stuff that they had, it was because of their presence and their ability to go into and invoke the full stature of the United States (Inaudible) and its power. And that's where the ... and the people who were out there doing the Ops, as you say, the inner agency stuff and the jointness, at the tactical level, the problem is we don't train and educate our people that way yet. Military or civilian. And the other problem, when you talk about this gap between what we buy and what we do, is the whole acquisition system is set up to focus on the big stuff. And that's where, and I was in that position for eight years, that's where my boss, the Under Secretary, spent all of his time, on the big stuff. And that's where the incentives are. So even if the small stuff matters more today to the kinds of military operations, oh, I don't want to do that kind of operation, that's not where ... that's now where the leaders are spending their time. And so the incentives are all wrong. And you have policies right in the State Department, instead of thinking the future, and you've got acquisitions fighting services about stuff we buy. And you've got the services fighting OSD about who is ... and the Joint Staff ... about who is going to control my people. And that's how they spend those time in those bureaucratic wars instead of thinking about most of the stuff that we've been talking about here today.

TB: Right, and in fact, we need...own and what's the interesting scenario for me is if we do Iraq, and it goes reasonably well, and Bush gets re-elected, then there is going to be an 18 to 24 month period in the first administration, where the Defense Act of 2005 is seriously possible. And of course, what will be interesting is whether (Inaudible) stay along for that ride. And if not, who the Secretary of Defense will be at that point, because that may be possibly very (Inaudible). And it's my hope that a lot of these issues get addressed because I think right now, what they're doing is they're working around things. They're setting up new examples and saying, there is my future, go look at it... still saying Joint Task Force is called functional slices of the universe instead of AORs(?), it's StatCom and what they're doing. And they're not really deconstructing the current reality, they're building new little side realities and hoping they're going to serve as leading examples in cannibalizing agents. And of course, that can only go so far. Eventually, they're going to need...

Audience: Right, but what's coming along with all of this also now is the beginnings of a...sort of...and what should be the future. And that is going to affect a lot of how transformation gets implemented. And ultimately, really what its vision is. Rumsfeld is not apparently opposed to...and they're (Inaudible).

Audience: No...from my understanding. I think it...back in June of last year, they...that we really surprised ... that got me. And I thought it was going to meet resistance. And...before...launched into this kind of information that that was coming and happening and they were fully prepared for it. And we were looking at it from a Homeland Security...which never really happened...Homeland Security (Overlapping Conversation). But that's compelling to me, and I think like I just said, I think it's going to happen after Bush gets re-elected...of course that can always fail. But it will be interesting to see how...because I think they're pinning so much on Iraq.

MW: Tom, thank you very much. The Council has very rigid rules about ending on time. And we're a little over. I thought you did a great job. Thank you. (Applause)