Secretary Peters, Doyle Larson, Tom McKee, General Shaud, all the distinguished ladies and gentlemen in the audience. Lots of old friends and former warriors. I want to do a couple things this morning to set the stage for some of the other speakers who will come forward today. I’d like to do this as a two-part piece, first to talk about a general state of the Air Force right now with a focus primarily on people and where we are in our readiness state and where I think we’ll end up. And also look at some of our core competencies across the Air Force and set the stage for the use of those core competencies in future air campaigns, the basis of this symposium.

I have to tell you that we have just been at our Corona meeting, where we trap all of the general officers and senior civilian leadership in a room, duke it out for about three days and come out of there pretty tired. We’ve hit some of the toughest issues this time around at our Air Force bases, and I am so proud of the team that we have with Secretary Peters and all the rest of our Air Force leadership -- that they are so willing to step up to the problems we have in the Air Force and so willing to bring forward the solutions to those problems. We’ll talk a little bit about that as we go through the first part of this discussion and then we’ll open up for questions.

Let me take you back to last year when we had a discussion about the draw-down in the Air Force and the state of the readiness of the Air Force. If you look on this slide over here, you can see some bars and graphs that show that our manpower and end-state in the Air Force, our funding in the Air Force, and the total equipping of our Air Force as far as force structure, has dropped 40 percent in the last 12 years. And it didn’t bottom out until about the 1996 time frame. For the first time in almost a decade and a half, funding for the Air Force projected in the budgets that we have today will begin to increase at a rate of about one percent real growth. That is dearly needed, because during this time, I believe, we undershot very badly the needs of the Air Force. I don’t think any of us realized how very fragile readiness was in our Air Force and how very small changes in funding and equipage and spare parts could affect the total force, not just from an equipment standpoint, but from a personnel standpoint. And then having to compete in this, the best economy this nation has seen, is a very difficult proposition for us right now.

During all that, though, what happened to us is, coming out of the Cold War, we had planned to be located in only a dozen or so overseas bases in our drawdown, and that is what we funded. We had events that occurred after the Cold War. One occurred when we went to the desert and didn’t come back. We had a war in the Balkans called “Deliberate Force,” which upped the number of locations that we had never planned to be at. Then we had an even bigger war in the Balkans in Kosovo, where we opened many detachments, and by the time we had finished with that we had 21 other bases open. During that, we closed Howard Air Force Base [in Panama], but then opened a whole group of bases and locations in the Caribbean. We had never planned to open these bases. We had never planned to have these locations as part of our force. It was the events of the moment that forced us into this, and part of it was a change in the paradigm of the world, with the loss of a very reliable enemy and into a very challenging time where it was the unknown, the unpredictable, that we had to react to.

We’ve been able to decrease this down to about 44 locations right now, and we’d like to decrease it even further. This graph shows fairly graphically what happened to us in optempo over that time with a quarter reduction in our force, one-third less end strength, and an increasing optempo that grew four times, culminating this last year in “Allied Force.”

That was a big deal for us. We were able to do it fairly seamlessly, and it didn’t look that hard but when we deployed over 500 aircraft and 20,000 people plus, all of Europe engaged, and did it over a 78-day period, and then reconstituted the forces very rapidly. I think it looked too easy. But I can tell you that we have wonderful people out there who are able to do this kind of business and do it very well for us and for this nation, and those are the people that we want to keep. If we continue at this optempo we would have, I think, lost many of our valuable experienced people. I’ll talk a little bit about that in a moment.

One of the issues that faces us is recapitalization of our force. When you look at the average age of U.S. Air Force aircraft today, it is 21 years of age. In the next 15 years it will age out for another 10 years. The average age of U.S. Air Force aircraft if we execute every one of the modernization programs we have on the books today will be 30 years old. We have never been there before but we know several things are happening to us and that is, increased workload on our folks and increased costs in keeping these forces viable.

It shows itself very much in the decline of our mission-capable rates on our aircraft, for several reasons: one, the optempo; two, the aging of that fleet; and, three, underfunding of spares that went on as part of the QDR [Quadrennial Defense Review] and taking risks with readiness. We underfunded in the early years, living off the drawdown, and underfunded in the mid-1990s because of a need to take money - because of budget caps - and move it from our readiness accounts to our procurement accounts so we could have a force that was ready in the future.

We have tried to recover that by putting back into the force large amounts of spares, and this is one indicator that they are on the leading edge of what happens with spares, and that is that back in October 1998, we had almost 600,000 empty bins. People would go, try and find a spare part for our aircraft, and it was not there. This is the leading indicator that the funding we put in for spares over the last three years at the 100 percent level should start paying off to our force. We have not seen it in readiness turnaround yet. We have not seen it in mission capability turnaround yet, but this leading indicator tells us that we at least put our money where our mouth was, and we should be able to turn the force around, particularly in the mission-capable rates for our aircraft.

Personnel is another thing. We have worked very, very hard -- the Secretary, myself, all the Joint Chiefs, the Secretary of Defense, the President and Congress--to make sure that we present to our force the kind of pay and compensation and the things that we feel will keep them in the service, remembering that the U.S. Air Force is and will be for as long as I can see into the future, a retention force. We want 55 percent of our first-term airmen to stay with us. We want 75 percent of the second and 95 percent of the third. But they could not continue to do that in this booming economy and with the pay gap that approached 13 percent - and for the Air Force it was probably even more than that. These with the check marks are the things that have been accomplished so far, and these with boxes are things we are working on right now with legislation for the future. It is not just the active duty force; we are trying to do this also for our retirees. We have a commitment to our retirees. I believe there is an implicit promise that has to do with medical care for retirees. We will follow through on that.

However, our first-and second-term and career airmen statistics are not that good. We are about 5 percent overall below the retention rates that we would want. That translates itself into shortages in the field as we try to crank out the younger folks to come in and then you lose the experience of the older folks who are leaving us. We think pay and compensation, retirement and medical benefits and housing and quality of life kinds of issues that we are working on today will start to turn around this retention, and we are starting to see it in this first quarter -- although I won’t bet on it yet; when the goods are delivered, not just promised -- that we are seeing a first term-airman turnaround from 49 percent back up to 50 and a leveling off of the other two. That will have long-term consequences even when we do that, because we will have to continue to work on the recruitment of younger folks to take the place of those who have left us already, and those people will come obviously without the appropriate depth of experience that we’ve had in the past.

Pilots. We have some good news, we think, but we are not betting on it yet. I’ll give you the bad news first. If every pilot - and this represents the pilots who are available to leave the service after initial pilot commitment, normally at the nine-year point - if every one of them left -- (Army, Navy, Air Force, Marine Corps)--that would not have filled up the demand of the 14 major airlines and not even a quarter the demand out there for the domestics. The people who do these had predicted that this would fall off some but it would still be double. That has not happened in the last two years. In fact, that prediction has been missed almost by half again the number for the 14 major airlines. This is a real draw on our people.

What we did was come forward with a pay package for our pilots that allowed them to stay on to the 20- and 25-year point, just not to the 15-year point, and that appears to be paying some big-time dividends, not just for those who are initially available, who have their initial commitment finished, but those throughout their careers out to 20 and 25 years. If our first quarter returns on this are accurate, we think that we should be able to start closing the pilot requirements, the inventory gap, with this new program. I am not going to bet on it. Things could change out there dramatically, but the initial indications are that is the glide slope we are on if we continue at the rate we were at for the first quarter of this year.

This last year was a very busy one. John [General John Jumper] and Mike [Lt. Gen. Michael C. Short] and others will talk about the operation that went on in Allied Force. We had a preview to that in “Desert Fox” in the December timeframe, and we built up the force fairly substantially. We had a little problem with the F-22, a little drive-by shooting, that we were able to recover from. We think we’ll be able to work out the family arrangements so that in the future, we won’t have that kind of surprise. We have instituted our Expeditionary Aerospace Force concept across the Air Force, and I’ll talk a little bit about that just for a few moments because that is the one piece that attempts to give stability to the lives of our folks while making sure we have trained-to-task forces for our CINCs [Commanders-in-Chief].

The centerpiece of the U.S. Air Force, I think, going into the 21^st Century, is this Expeditionary Aerospace Force concept which takes the pieces of our United States security strategy and our military strategy and pushes it into shaping, preparing and responding. What we’ve done with our Air Force is take the deployable part of our Air Force and turn it into 10 different force packages. Those force packages are represented by the AEFs [Aerospace Expeditionary Forces] 1,2,3, etc... And we have deployed two of those Air Expeditionary Forces forward and put them on alert to all the locations I showed you on the previous charts. We are currently in our rotation five and six, and so far it has gone fairly smoothly. We have some bumps to work out in this. We had previously done our expeditionary combat support by onesies and twosies, and this time around we are doing it with teams. We think that teams are the way to go, but it gives you a whole big turnover all at once, and you lose the experience that you had at a particular expeditionary base. But we think it is the way to go, and we’ll get through this one. It probably won’t be as pretty as it should be, but we’ll get better and better at it as we roll through.

If that is the structure that sets us for the future, it is also the structure that we would like to describe the Air Force’s capability in. That is, when you go to the planning documents, we would like to talk about force packages, not fighter wings or bombers or other ISR [Intelligence, Surveillance and Reconnaissance] assets. We would like to talk about our Air Force as an expeditionary Air Force composed of 10 AEFs for our deployable Air Force. We will work that into the planning cycle in the future, not just for the description, but actually for the employment of our forces.

Where are we in this 21^st Century? Where do we want to position ourselves with respect to the jobs that we think will be demanded of us as an aerospace force? I think it is to defend the United States and protect its worldwide interests through aerospace power. We talk about aerospace power, and we are talking about the totality of that sphere that surrounds this globe, to the outer reaches where our spacecraft go, all the way to the surface of the earth. That is the aerospace regime, without regard to whether it is orbital or flies through the atmosphere or actually is landbased. We think that we need to be able to dominate in that operational realm. That is where the Air Force is focusing its attention, using as a mechanism the Expeditionary Aerospace Force concept.

I’ll walk through each of our core competencies, those things which are not necessarily unique to the U.S. Air Force -- (others do some of this business) --but we do all of these things and string them together in a way that we bring aerospace power to bear. I’ll hit them fairly quickly.

Information superiority. In this last operation, information superiority was absolutely essential. We had to be able to use information in warfare and use information as a warfare piece. That is, to gain and exploit it and defend it and to attack using it. For us into the future it will be a critical enabler of all our other core competencies. We have to have assured access. We have to have assured defense and offense, and we must link every node of our Air Force and every one of our platforms together so that we can come up with precision dominance, the ability to get inside the cycle of whatever kind of adversary we are fighting, whether it is a famine or a foe.

Aerospace superiority. It is the first step in any war that we do. We must have it. We never ever want to have happen to our forces, either on the surface, maritime or air, what we have done to others over the last three wars that we fought. That allows joint forces freedom from attack and freedom to attack. And so what is it? It is aerospace control, where and when it is needed, to give us that full spectrum of maneuver freedom.

Rapid global mobility gets us there. It is such an important part of our aerospace force. It allows us to move and sustain our expeditionary forces wherever they go. It is complete visibility into what is being moved and assured delivery and making sure that it gets there. It is any time in any place, and that is not just on the surface of the earth. That has to do with our ability to lift things into orbit to assure delivery of information to feed the warfighter.

Agile combat support. We can’t go forward with huge mounds of supplies any more. We just cannot do that. We have to go forward and be lean and light and agile, and that is why we are putting a lot of emphasis in our procurement on being able to do, for instance, two-level maintenance so we don’t have to bring intermediate packages forward, so that we can have just-on-time supply from our mobility forces. That means full force protection when they are forward with the smallest footprint that we can stand and the capability to reach back and bring things forward electronically rather than have the people forward doing business and putting them in jeopardy.

Precision engagement. In this last war we used a lot of precision engagement. We are talking about targets per aircraft now and not number of aircraft per target. What we want to do is move to a force that is all-weather, day-night, precision-engagement with precision capability on every aircraft that goes to fight.

Last is global attack. Our bombers in this last fight provided a huge, huge advantage, not just in the stealthiness of the B-2 but in the carrying power of the B-1 and the B-52. They did a marvelous job. We want to make sure that throughout this world we can get there in hours, and even measure it in minutes when we need to, and that there is no sanctuary anyplace, even if there isn’t forward basing. Those are the core competencies that the U.S. Air Force is pushing for the future. Those are some of the goals we’ve set for ourselves in this business.

That is why we want to become and are becoming a full-spectrum aerospace force, America’s Air Force, bringing you global vigilance, global reach and global power to this nation.

(Q&A Session)

General Shaud The first question relates to the reconstitution in Kosovo. Update us on the reconstitution following Kosovo and how that might be affecting other contingencies, such as “Operations Northern and Southern Watch.”

General Ryan The effects of Kosovo - we are about out of that, in fact in March we are going to declare victory and say we are out of the recovery for most of our assets. The ones that are not out are not out because of the Kosovo operation but because they were in a position when we went in, in fairly bad shape, such as our CSAR [Combat Search and Rescue] forces, who had been very heavily relied on in lots of operations and some of our LD/HDs, our Low-Density, High-Demand aircraft and systems, which were not in great shape when we walked in. They have gotten in better shape when we walked out because, with the help of the Joint Staff, we were able to suppress the appetite of some for the CINCs of some of these forces so we could recover them and get them back up to a level that we needed to. But we still, in our LD/HDs, have some very large challenges with respect to manning the force to the level we need for peace time operations.

General Shaud What is the plan for fixing that LD/HD problem?

General Ryan That was one of the issues we talked about at this last Corona. Part of it is to give some stability to the force, to give them the tools to be able to train without using the mission equipment, so that we can keep that mission equipment forward. It also has to do with making sure we get the right people into those systems so they can carry a greater load compared to the number of crews we have, vice the number of airframes we have. We are working both on the airframe side and the crew side. For instance, our U-2 force is very undermanned in crews. It is a demanding mission, we have run that force very hard, and it is very difficult and takes a long time to train the crews. We don’t have a large training base and therefore it takes us a while to re-catch up and make sure that force is fully manned. We will continue to work LD/HDs as long as there are LD/HDs.

General Shaud What are your plans to improve our ability to attack time critical and moving targets?

General Ryan That has a lot to do with our capability to net all our aircraft together--not just the attack aircraft, but the ISR aircraft and our air operations center--to our commander who makes that decision. This is a tough issue when we are not linked in ways that we can pass large volumes of information very rapidly to any of those nodes, including to reach back. This last operation we were able to turn the timelines fairly rapidly in terms of hours. We want to go to minutes, to be able to react in real time. It is like a football team that comes up to the line of scrimmage. Instead of calling the play in the huddle, we want to be able to call at the line of scrimmage. That will take netting of all of our resources, of all of our command nodes and our command and control network together. We are working very hard on that. I’d like to set a timeline of 05 [Fiscal Year 2005] to have that at least to all platforms. That is going to take a heavy investment in JTIDS [Joint Tactical Information Distribution System]-kinds of capabilities, Link 16, etc.

General Shaud We have cadets out here who are engineers, and the following question comes from them. Retention for uniformed engineers is not so hot. As compared to pilots, no attention seems to be paid to scientists and engineers. Do you think we can out-source or privatize this function or is it important really to have uniformed engineers and scientists?

General Ryan I think it is absolutely important to have uniformed engineers and scientists, and we are paying attention to that group. They are very much needed in our Air Force. One of the ways that we want to make sure that they understand the essence of what this Air Force does, is to make sure that every one of our new young engineers who comes into the Air Force attends our ABC course, our Aerospace Basic Course, which tries to bring together at the new lieutenant level the kinds of over-arching responses that the Air Force is capable of doing and, as much as we can, the intricacy of how much that is driven by young lieutenants and captains, that this is a team of teams. And surely the engineers are part of our team.

General Shaud Could you comment on the issue of interoperability with respect to our newest NATO allies?

General Ryan The Polish Air Force, of the three new NATO nations, the largest air force to come into the alliance; all of those air forces are working very hard to bring themselves up to a capability level where they can inter-operate with us. You can imagine the very difficult proposition they have of going from mostly Soviet equipment, which was not very compatible with us, to try to modify some of their airplanes and even buy new aircraft and systems to put on those aircraft to make them interoperable with NATO standards. The most important piece is not necessarily the compatibility of the aircraft and its munitions with NATO’s aircraft and munitions. The first thing is, compatibility in language and compatibility in communications. If we can get those two things done, and they are working very hard on that, integration of that force will be much, much easier.

General Shaud You and General Shelton [Gen. Henry H. Shelton, Chairman, Joint Chiefs of Staff] and others have said in very strong terms that TRICARE is not meeting the needs of the military community, especially retirees and their families. Comment on this.

General Ryan As the Joint Chiefs, we went forward to the Administration and said there were some things we needed to fix in TRICARE. But there are huge bills associated with some of the fixes that need to be done. As most of you know, medical care in the United States, the escalation in costs of that are three or four times the normal escalation that is going in costs in other sectors of the economy. There are some very difficult decisions we have to make on how to fund some of the propositions we put forward, such as pharmacy for over 65, for Medicare subvention where we can do it. There are a lot of issues with this that are both sensitive to the perceptions of others in this nation about military health care and our own retirees and our own people in getting the kind of health care that I think they deserve. We will continue to push very hard, and I think you’ll see this year some very good legislation come out. The Secretary and I and all the Administration are working very hard with the Congress to come up with at least the first step in making sure that we take care of our active duty, dependents and our retirees. It will not be a one-time hit. It is going to be something that we are going to have to work on for awhile. But the commitment is there, and hopefully this year we’ll see some legislation there, and I think all of our folks deserve that and we--as uniformed military, the commanders in the field--have to ensure and insist that those care providers that we have brought on board in this scheme, that we can’t walk away from, that they are providing what contractually they said they would. That has to be at the insistence of commanders. Commanders are involved in this business very heavily.

General Shaud With an increase in budget, where will the Air Force put its money in space?

General Ryan We are working very hard to make sure that the current capability for warning, our ability to track incoming missiles, is of the highest quality because of the criticality of that mission, not just for national missile defense but also for theater missile defense where it is much more likely that we would have that kind of an attack. That issue of SBIRS Low and High [Space-Based InfraRed System low and high orbit] is one of the places we are heavily invested. The other place we are heavily investing is making sure our GPS [Global Positioning System] constellation becomes more robust in a jamming environment so we can continue to rely on it to guide our munitions and to deny it, if we need to, to others. Those are two of the major issues, but the one that is probably most important to us has to do with lift. We must be able to reliably, with almost 100 percent assurance, be able to lift our payloads into orbit. We’ve had some failures in that in the last several years, and we are working very, very hard to make sure that not only the legacy systems, but the new systems coming on - all the expendable vehicles work.

General Shaud Your view on the importance of Reserve forces in dealing with future mission requirements.

General Ryan We have always said we are one force. Over the last 10 years we have proved it. If you go back to “Desert Storm,” I think that is where we integrated our Reserve and Guard forces into an active mixture in ways that made us both stronger. And we rely on them today, day to day, to help us with our optempo. They are picking up about 10 percent of the optempo that we have worldwide. We are an integrated force. We are a total force. We will be that way in the future. We will assure that our Reserve and Guard components have the capability to be there first into the fight, along with the rest of the force, equipped and trained and ready just as the active force is, no separate standard.

General Shaud Comment on the change to the Air Force symbol and address the motto.

General Ryan First of all, does anybody know what the Air Force symbol is? That was the Army Air Corps emblem, but it was never the official Air Force emblem. We don’t have one that I can find. The historians say, some use this. If you go to an Air Force base and look on the front gate, the only standard thing you’ll see there to tell it is the U.S. Air Force is a sign that says “U.S. Air Force,” and it has all kinds of symbols all over it. We, the leadership, looked around for something that would take us into this 21^st Century and beyond that was a unifying thing for our force. We haven’t nailed down decisions on an emblem for the U.S. Air Force for uniforms or patches or anything else. What we are looking for is something that represents our heritage, back to the Arnold [General Henry H. Arnold] symbol and our future, which is aerospace. We looked at lots of symbols, and the one that we are looking at right now and which we will probably use in some of our advertisements to see how it goes, is the one you saw on the cover of the Air Force Times, if you saw it, and we collectively want to see how the force reacts to it. We will use it - the Secretary and I will use it in different places and see if there is a rebound on it. We will use it particularly in advertising, because it has some jazziness that I think will try to attract some of the younger folks. But it also has a lot of symbology in it both from our heritage and from those who fought and died for our country in the service of this Air Force. We are still going slow. We are not going to jump in and force this symbol down the throats of our folks or put it on patches or buttons or anything on the Air Force. You will see us using it in different places, both the Secretary and I, and we will be using it in some of our advertisements to see what rebounds out there.

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