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so it's almost four to five times fold the difference in cost. why is that? that ceramic body armor that he wears or she wears on the front and the back and on the site. that itself cost some were probably around $4000. heaven help us if our families find out that we don't have the right body armor and they lose their son or daughter. so some of this is just effective where we are. stuff costs more. now, a couple of things with regards to acquisition. i agree with you. i think we, i used the term constipated the acquisition process. i think the service chiefs need to get back and be in charge of the acquisition process. i remind everybody as often as i can, congress doesn't give the program manager a dime. congress gives the service chiefs the money. the allocated in the service budget every year through the appropriation process.
it's our money. these are our programs. and so my sense is the service chiefs need to get back in as john talked about the kind of rain down this requirements growth, rain down all the different things that we are being told we do have to do or the testing that we have to have. so there's plenty of blame to go round with regard to the acquisition process, let me give you a sense of magnitude. when i took this job to a half years ago, i had been the assistant, taught for 27 months and i was head of requirements down at quantico so i watched the fighting vehicle as it was moving along in and out of issues and breaches and reprogrammed and all that. so i made the decision when i took the job that we could not afford it in its current state. so tal i talked to secretary ofe navy and secretary of defense, and the program was canceled. before i did that i sat with my
team and i said, okay, this does not meet the requirement for surface born vehicle goes away. that is part of our character. it's a core competency for our nation. so we have to have that. so let's look at how we would design it and when it will come in. this was 2010, ladies and gentlemen. i was told by the acquisition field that it would be 2023 before i would have a vehicle that would be what we call ioc, initial operation capable. think about that, 13 years to design a vehicle, do all the stuff you've got to do and then have it standard where you have a half a dozen of them say you can say i'm an ioc. we need to fix that. the last point i would make is, you said what do we do. i actually take that, i coined this phrase from the chairman, chairman dempsey. he says never allow a good
crisis to pass that you can get in there and change bad behavior. and i think that's where we are. i think that's what you're alluding to. in other words, we are in a crisis. we are a fiscal crisis. so let's look at this thing and capitalize it and force ourselves, industry and us, to actually begin to make good decisions, and decisions that are in line with our fiscal resources. i'll give you an example. in our service we said okay, we are in this period of austerity i think will be in it for probably the next six to seven years, maybe longer. just look at the historical signage. i said okay, looks good enough. in other words, today -- the days of being flush with cash are gone. what are good enough? the vehicles we're going to take and send to the bone yard, but someplace else, we're actually sitting to the depot right now.
we are going to live with equipment that we have. the balance, of course is you cannot just turn your back for seven years on modernization. there has to be a balance between what's good enough and modernization. so that's where we are right now. that's will be our with 44 year-old helicopters that are turning into in the 20 choose. that's will be our with f-18s, prowlers inheritors that we have continued to schlep and continue their service life and be replaced with the f-35. we have to do a balance of modernization. so for us that's where we are. we're trying to balance our books, what's good enough, making those are decisions. i've told the marine corps you're not going to be driving around in some of this new stuff. you are going to be driving around in what we have but we are going, we're in the process of rebalancing the modernizati modernization. >> thank you, mr. secretary. i have a little bit different take on this respect to my to seniors here. i look at acquisition as a
system that was built probably sense the civil war based on abuses. every time there was an abuse, it was highly visible and resulted in another procedure or another regulation, or more oversight, or all of these things that can be described as overhead. i think there is a compelling need to act because of the resource base that we find ourselves in, the detriment budgets that we're going to be in. and the need for re-capitalizing this hardware. it's going to take a lot of courage. it's going to take a rethinking of how we buy things. if you adhere to the dod 5000 series, which we do, and i use that as a general term of art, then really what it does is it forces through process the management of risk. and cost, and until we come up with a streamlined system that
doesn't just look at a major systems acquisition, that breaks the threshold and becomes project x. but looks at each one of them in isolation for the real requirements, the real areas of cost growth, their real areas of risk, and we have the disappointment, the control requirements and we have the ability to go to congress and get predictable funding that i don't think we will succeed at this. there some basic elements and acquisition that must be addressed and it's going to take significant courage on the part of not only government but industry. but until we can come to a wakeup methodology were costs and risk exposure can be shared, we go into the acquisition was stable requirements, full well knowing that we may not come out with everything we want, but we come out with most of what we want. and that's good enough. until we come to that understanding we are going to be
just chasing our tails. it just won't happen. the processes are so ingrained, so institutionalized that we are going to have to break some china to change it is. i think the way forward is to look at a couple of pilot acquisitions, push them through, do an assessment, not a steady, not an academic study, an actual systems acquisition, and then reframe how we do this is based on that experience. thank you, sir. >> outstanding. so now we go to the questions from the floor. and do we have the first question? >> vse is the navy's foreign military seals, ship transfer contractor. my question is really for admiral greenert. do you think the navy will postpone decommissioning any frigates until the new ship
transfer legislation is passed? >> no, i don't. i think those ships, regrettably, you know, they would need modernizing. so i think your question, the only reason i could imagine postponing ship retirement would be through assurance as we have a hot transfer. i would tell you that that can be done on a case-by-case basis if we have a clear way ahead to a hot transfer, meaning you transfer it while it is still active. is that the essence of your question? >> yes, sir. very much. >> case by case, but as a policy to say fundamentally we will extend all the ships this year while we wait for the transfer legislation, that's really not good business. but again, case-by-case. >> next question.
>> i'm from the navy league conference of england. my question is primarily for general amos but i would be interested in admiral greenert's take on. to you -- you spoke about new platforms for the u.s. marine corps, but you did not mention the montford point and hopefully have fellow three class of ships. i would be really interested in your take on how you visualize the capability of the buyback classic ship which is pretty unusual and different. >> i want to make sure i after you correctly, or at least i think i understand the question. the issue is the mlb and what do we think of it speak to him what plan doing with that, sir? >> okay. i'll tell you, i was there at the christening of a montford point about a month and a half ago.
and as i sat and looked at that, it's a strange looking ship but don't be concerned by that. i've had the finish of looking at all the powerpoint greece, the cartoons, slides to talk about different capabilities, how we pull alongside and bring -- their dues and do sea basing offload within articulating ramp that can be stabilized. and be able to take tanks and seven-ton trucks and all our combat vehicles off, offload that stuff on a ramp and put it down on that ship down in the center part where it looks like it's missing part of the ship. that rascal will sink using ballast and will drive up and take those things ashore. this will be the very first time that we've had the ability to
really do at sea, sea-based logistics. and a combating climate. we would need a port with this she. so i sat there next to it during the christening. my imagination kind of ran away with me and i was think about all the different things that you could do with this ship. and my sense is that we're probably only 10% of their with all the great original thought. you put original thought. it with his enhance of sailors and marines and our merchant men, i think we're going over the next five to six use, whether it be some type of natural disaster, some type of actual combat operation, we are going to uncover ways we're going to be able to use this chip in a future that they are actually going to be stunning. so i'm really bullish on this, and i think we're only about 10% imaginative lives where we can use that she. it's going to be a heck of a combat multiplier. >> next question. and please speak distinctly and
slowly, because it's very difficult to hear with the acoustics in the room. >> david isby. sir, the f-35 despite progress towards ioc, problems remain, and considering its importance is it time now to start looking toward investment in alternatives as well as the continued commitment to the f-35 program? >> the question is, what's your support for the f-35. and as a time to look otherwise because it's having problems. speaking for the navy, i need the fifth generation strike fighter. and that provide. we are all in, but it has to perform. it has problems. it is making progress. i believe it will come in at an
acceptable amount of time on the track it is currently on. when you say should loo we lookr alternatives, i'm always looking for alternatives payload that i can put on any strike fighter to enhance making the entire air wing an entire package better. but i do not at this point believe that it is time to look for an exit ramp, if you will, in the navy for the f-35. >> can i follow on that for a second? there's an alternative for the united states marine corps. want to make the point christopher to everybody in the audience. that airplane is performing well. i think it's important everybody to remember we are in what they call developmental testing. so you do as you bring a new, whether a ship or an airplane, you bring that vehicle or that capability in and you develop, you go through bp. you can do all the modeling and
simulation and everything that you've done prior to that, but you're not going to discover 100% of everything. there will be cracks, there will be issues, and he would deal with them. it's been that way with every single platform with ever built. name some of the greatest airplanes will fly, even to today, those airplanes going through had issues and we worked our way through them. we are in development to testing. we'll start operational testing here sometime soon. i think airplane is performing well for us, and i'm actually very bullish on it. >> next question. >> dave o'hern with ground combat technology. you refer to the difficult fiscal situation that we're in right now, and the reduction that we had that have affected
procurement. but as well we've also had some reductions that are intending as far as in the strength of the marines and the army and others. and you could have somebody who has 18 years in who suddenly finds he is out of the service, and he also loses his retirement. i was wondering how these realities of the fiscal difficulties are impacting your ability to support the force and the family to encourage people to re- up, to stay in, and to continue making the military their career? >> the question is, concerning the targeting i think throughout congress and executive branch of the runaway growth and cost of
personnel. and today the pentagon has to devote $484,000 per active duty person, blended rate. to fund the entitlements for retirement and pension and family services and so forth. and so this is clearly a major area that is being focused on for cuts. how do you protect the 18 year veteran, the family, the people that get cut? >> that's a very good question. last year, the service chiefs works pretty faithful with the secretary of defense and proposed some ways we could reduce the personnel costs overhead. let me give you a sense of the magnitude of what i'm talking
about. in my service for 60, i think 64%, 64 cents of every dollar is for personnel costs. 64 cents of every dollar i have is for personal calls. and it's not because marines cost more. actually, arenas, and i've got all the statistics, we are the cheapest per person because we are younger force. it costs less for lance corporal and a corporal but it does for a sergeant or a lieutenant colonel. but it's a function of the growth in health care. it's a function of the growth and a lot of the entitlements. so we've proposed last year a series of ways we could actually begin to kind of get that balanced again. and as you know, everything from pharmacy going online, taking a look at track your, try to hadn't been adjusted since 1996 as i recall, no other health
care program in america has been that way. so there were those kinds of initiatives. and quite honestly, many of them did not, in fact most of them did not see the light of day through congress. i think we're going to have to go back and do this again. but it's important to remember we've got an all-volunteer force. that all-volunteer force is actually an expensive force. and so there's a balance between caring for those that we are about to bring in that force, those that have served or are they serving. and there's no intention by any of the service chiefs are the chairman or anyone else to go in and take benefits away from folks that have served faithfully. i'll give you an example. one of the things, one of the recommendations was to take a look at the retirement system. the recommendation for all the joint chiefs was that if you go back in, you do that, then our recommendation, our position is
we ought to grandfather everybody that's on active duty. in other words, let's not go in and muck around with a retirement system for those of us that are currently on active duty, those at the seven-year mark or whatever. but there is recognition that whether it be retirement, health care, things like bachelor allowance for housing. this is a great example of the kind of misinformation. bachelor allowance for housing, what we get for housing gross add automatically two to 3% a year. automatically. so all we did as service chiefs last year, we said why do we just shall that ramp and maybe make it grow at 1%? or you could leave it, you could level off the growth for a year or two and then start that back up again. and that was not accepted. so you start taking a look at those kinds of things, and there's a lot of money tied up in there, and without breaking
faith with our service men and women, i think there's are things we can do think there are things are going to need to do as a look at sequestration. but quite frankly america has a military to do its bidding. to do its national defense bidding. and we just need to keep that in mind. >> one final brief question. the secretary asked me to field of the last question. >> good morning gentlemen. i'm a d.c. lawyer. i might add, in this town, what else? first of all i would like to applaud general amos for not only remembering correctly pronouncing the names of those strategic but small islands off the east coast of asia. bravo for that. my question is a very quick one, and if i remember correctly, nobody on the panel this morning has used or mentioned the name carrier battle group. is there any reason for that? thank you.
>> yeah, a carrier battle group, all of these things believe it or not have a definition. the ships that make up carrier battle group, if you will, they are called carrier strike group snow, and it's nothing more than a definitional. the context that i used then was deployment and what you deploy and where they need to be and how you rotate or not rotate. >> i would like to thank everyone for being with us this morning. and remind everyone that we have 46,000 members of navy league around the united states and some councils overseas. and these individuals are going to be made more aware than ever of the importance of the industrial phase as a component of defending the united states of america. my deepest thanks to the secretaries, to the service chiefs rather this morning for being with us. and joy see airspace.
[applause] >> [inaudible conversations] recent debate on a bill and expanding background checks for gun sales. posing tougher penalties for gun trafficking and school safety grants. senators are expected to vote thursday on a motion to advance the bill. 60 votes will be needed. live senate coverage at 9:30 a.m. eastern here on c-span2. >> you are watching c-span2 with politics and public affairs. weekdays featuring live coverage of the u.s. senate. on weeknights watch key public policy events. and every weekend at the latest nonfiction authors and books on booktv. you can see past programs and get our schedules at our website, ma and you can join in the conversation on social media
sites. >> president obama's nominee to lead the centers for medicare and medicaid services testified at a confirmation hearing before the senate on tuesday. marilyn tavenner is probably the acting medicare and medicaid administrator. she has worked as virginia's health and human services secretary. this is two hours. >> the hearing will come to order. douglas macarthur once said, a true leader has the confidence to stand alone, the courage to make tough decisions, and the compassion to listen to the needs of others.
testifying before today is marilyn tavenner, nominated to be the administrator of the centers for medicare and medicaid services, otherwise known as cms. ms. tavenner, you are being asked to draw on years of extensive expense to lead this agency and administer programs upon which millions of americans rely. you will surely need confidence, courage, and compassion in this role. ahead of cms has a great responsibility. cms administers health coverage to roughly one in three americans. that includes 50 million medicare patients, 56 million medicaid patients and more than 5.5.5 million children through the children's health insurance program. 167,000 seniors and 8300 no to retirees in montana rely on medicare, the largest program you will oversee at cms. these montanans are my
employers, and they are employers as well -- excuse me, they are my employers and they as well as millions more across the nation are your employers as well, this data. so i encourage you to never forget that. you were working for them. it's also important to remember who works for. the administrator of cms overseas 5800 employees. if confirmed, you must demand from these employees the utmost efficiency. spread throughout 10 regional offices across the country, see this -- cms employers are responsible for distributing more benefits than any other federal agency. benefit outlays for fiscal year 2012 totaled $819 billion. the agency administrative costs made up just one half of 1% of this amount. that is significantly less than most private health care payers spent, and this efficiency must continue.
there can be no room for error, no wasted time or effort of taxpayer dollars. ms. tavenner come you've spent your entire career providing care to people in need. you started as a nurse here in my opinion, one of the most important professions in the world. then he rose up through the ranks to become a hospital administrator and then virginia's secretary of health and human resource to be joined cms in 2010, and became the acting administrator the next year. you have the knowledge. you have the real-world experience. i believe you have proven yourself to officially take the reins of cms. some have pointed out that cms has not had a confirmed administrator in several years. i'm glad we're moving forward today to change the. with new affordable care act programs coming online, it is a critical time that someone with your knowledge in charge at cms. we need strong leadership for successful implementation of health insurance marketplaces
and other key provisions of the health law. as administrator you wil have to make sure these programs are ready to go on day one. and you need to ensure the health care loss programs work for the people they are intended to serve. there will be a lot of people watching you, myself included. the administration and cms data element health care reform the way congress intended. i was home in montana the past two weeks and i heard from small businesses that they need more clarity about rules. i heard this often. they need more information, more transparency. they are really quite concerned. i will be holding the administration's feet to the fire to ensure that this is all done correctly. you also need to make sure america's health care safety net is working. medicaid is going for a period of significant transformation. the program is changing everything from our income is counted, to how care is
delivered, tout eligibility determinations are made. millions of low income americans will have access to coverage for the first time starting next year. medicaid need strong, stable leadership overseeing these changes to ensure they go smoothly. health reform also vastly improve the way medicare delivers and pays for care. medicare continues to slow its spending by transforming from a system that pays for volume to one that rewards valley. cms needs a leader focus on repayment forms that incentivize providers to provide high quarter care in a cost-effective manner. one of the highest priority for the finance committee, and a responsibility i take very strictly, is protecting the integrity of federal health care programs by fighting fraud, waste, and abuse. the affordable care act included significant new authority and tools for cms to protect medicare and medicaid and save taxpayer dollars. a confirmed administrator is
necessary to oversee and use the new tools that will prevent and fight health care fraud. last april this committee held a hearing to examine what, at what time, was the biggest medicare fraud take down in history. thanks to tools and increased resources from the affordable care act, a joint hhs and justice task force recovered $295 million. the fraud involved 70 individuals across cities. we held a hearing to learn lessons to apply to future cases. we learned every dollar invested to fight fraud generates a 500% return. we need the next administered to continue making fighting fraud a top priority. your experience shows an ability to effectively administer health care programs, and also an appreciation for the crucial services they provide. you are known as a pragmatist with an understanding of the ins and outs of health care
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