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March 2 2013

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Obama’s Five-Point Plan to Fight Cyber-Crime

Forbes.com

2/25/2013 @ 6:00AM |317 views

Derek Klobucher, SAP

Continued cyber-attacks on the United States may soon be met with trade or diplomatic punishment against the nations of origin. The Obama administration last week listed more than a dozen instances of international assaults against U.S. businesses, resulting in stolen trade secrets, blunted competitive edge and lost American jobs.

“There are only two categories of companies affected by trade-secret theft: those that know they’ve been compromised and those that don’t know it yet,” U.S. Attorney General Eric Holder said Wednesday during a conference at the White House. “A hacker in China can acquire source code from a software company in Virginia without leaving his or her desk.”

Five-Point Plan

China again denied involvement in cyber-attacks this week, according to The Wall Street Journal, but experts believe that strikes against DuPont, defense contractor Lockheed Martin and many more U.S. firms originated on Chinese soil. “The new push comes on the heels of fresh allegations of Chinese cyberspying … and represents an effort by Washington to respond to growing complaints about theft of military and corporate secrets,” WSJ stated Thursday.

The White House summed up much of that effort in the pragmatically named report “Administration Strategy on Mitigation the Theft of U.S. Trade Secrets.” It is a five-point plan to:

  • Focus Diplomatic Efforts to Protect Trade Secrets Overseas
  • Promote Voluntary Best Practices by Private Industry to Protect Trade Secrets
  • Enhance Domestic Law Enforcement Operations
  • Improve Domestic Legislation
  • Public Awareness and Stakeholder Outreach

The report also follows a revelation weeks ago of executive powers allowing the U.S. to launch preemptive cyber-attacks, and President Obama’s mention of cyber-warfare in his State of the Union Address. And the plot continues to thicken.

Making the Case

The Hill noted Thursday that U.S. Congress is juicy and easy prey for cyber-attacks by hacker group Anonymous, as well as foreign intelligence agencies. Military, budget, policy and other sensitive dat are on congressional networks, which aren’t protected by adequate defenses against sophisticated hacking.

And Washington D.C.-based cyber-security firm Mandiant released a report last week about a Chinese military unit with English-speaking hackers that has pilfered data from at least 115 companies across major industries in the U.S. since 2006. “APT1: Exposing One of China’s Cyber Espionage Units” describes the People’s Liberation Army Unit 61398 and its status as an Advanced Persistent Threat (APT).

Beijing has spoken out against these types of assertions, saying that the shadowy nature of cyber-attacks makes it difficult to point fingers. But the Obama administration’s strategy report got pretty specific.

“Of the 19 cases that had resulted in charges and convictions detailed in the strategy document,” WSJ noted, “16 involve theft aimed to benefit entities in China, such as stolen hybrid technology from GM and military secrets from defense contractor L-3 Communications Holdings Inc., among others.”

Stealing know-how from a company, such as GM, negatively impacts is ability to compete in the global marketplace. Spying on defense contractors, such as L-3, compromises national security.

And both of these adversely affect jobs.

 
 

Most businesses — especially technology companies — can understand the importance of intellectual property, so the White House is right to portray this as an economic and a national security issue.

 

U.S. Budget Cuts Could Shift COCOM Requirements
DefenseNews
By MARCUS WEISGERBER

WASHINGTON — The U.S. Navy has had two aircraft carriers steaming in Middle Eastern waters for most of the past three years.

And despite warnings from the Navy that maintaining the two-carrier presence there over an extended period could have drastic effects on the fleet, they stayed for one simple reason: a general believed they were necessary.

U.S. Central Command (CENTCOM), which oversees combat operations in the Middle East and Southwest Asia, said it needed the extra aircraft carrier year round to help support and carry out strikes against the Taliban and other insurgent fighters in Afghanistan.

The Navy said it could deliver the two carriers, but only for nine months out of the year — one carrier would be present for the remaining three months. Even as combat operations in Iraq came to a close, the requirement remained, until this month.

Facing an uncertain future budget, the Pentagon in February announced it would delay the deployment of the Harry S. Truman Carrier Strike Group, which would have been the second carrier in the Middle East.

Experts say that budget uncertainty combined with a refocused military strategy could further play a role in the prioritization of regional combatant commands’ (COCOMs’) operational requirements and lead to more constraints when senior military leaders make these requests, experts say.

“Combatant commands don’t have to fund these capabilities … so they don’t have a natural constraint on their ‘requirements,'” said Mark Gunzinger, an analyst with the Center for Strategic and Budgetary Assessments think tank in Washington.

The Army, Navy and Air Force are responsible for funding the troops, equipment and weapons that combatant commanders deem essential.

As the Pentagon prepares to shrink its budget $487 billion from planned spending levels over 10 years — and perhaps an additional $500 billion over that same period should across-the-board spending cuts known as sequestration begin next month — the Defense Department’s January 2012 announced military strategy is expected to play a critical role in requirements allotment.

For more than a decade, CENTCOM has received the largest portion of U.S. military assets due to combat in Afghanistan and Iraq. Other commands, such as U.S. Southern Command (SOUTHCOM), which oversees operations in South America and Latin America, and more recently U.S. European Command (EUCOM), have received fewer.

The Pentagon’s year-old military strategy, which puts more emphasis on the Asia-Pacific region, is expected to elevate U.S. Pacific Command (PACOM), SOUTHCOM and U.S. Africa Command (AFRICOM) requirements, experts say.

The new military strategy could elevate the requirement requests from combatant commands that have historically ranked lower in priority over the past decade.

“I think you’ll see a waning of effort in the CENTCOM area,” said retired Air Force Gen. Charles Wald, a former EUCOM deputy commander. “You’ll see a growing attention being paid to AFRICOM and SOUTHCOM. I think [U.S. Northern Command] will remain important. I don’t think we’re ever going to get away from the fact that we actually have to have a combat capability to protect America now.”

In the coming years, much of the focus in South America, Africa and Southeast Asia will likely center on training local forces through partner building efforts and intelligence, surveillance and reconnaissance (ISR).

The vast majority of the Pentagon’s expansive unmanned aircraft inventory — key tools in ISR operations — has been in Central Asia, the Middle East and Africa.

The Cost of Presence

Scaling back COCOM requirements could in fact lead to a trimmer force. Defense Secretary Leon Panetta has often said the size of the U.S. military — as laid out in the Pentagon’s military strategy — will get smaller, but remain agile and flexible.

“To an extent, all of the services can justify their force structure and so forth based on the presence requests of the combatant commands,” Gunzinger said.

With defense spending already set to decline in the coming years, and the deeper cuts looming, some analysts believe throttling back on requirements could help the Pentagon save billions of dollars without major capability losses.

“I think given the chance to do it right … DoD could afford to take some more cuts and they will,” Wald said. “I don’t get real nervous if they’re given a chance to do the right planning. I think the COCOMs will follow that eventually if that kind of guidance and leadership comes out of the Pentagon.”

Presence, or forward basing troops, ships or aircraft in a particular region, is a major cost driver.

“Everything is on the table and that means our global presence is certainly on the table, not just how many, but how we do it,” Gunzinger said.

For example, a Navy presence reduction could mean reducing the number of aircraft carriers, which in turn reduces the number of carrier air wings and other assets that support the ship.

“The calculus driven by presence requirements are pretty significant and justifies keeping more carriers around,” Gunzinger said. “If that presence policy changes, then that can have implications on the size of the carrier fleet.”

Gunzinger — a former deputy assistant defense secretary and a retired Air Force colonel — said the COCOMs could do a better job addressing particular requirements by mixing and matching different weapons and forces to deliver a certain capability.

“Don’t ask me for a carrier battle group, ask me for what is it you want me to do,” he said. “These are the kind of things that could be managed through the joint process and could mitigate some of the strains on the force, especially for our capabilities and units that are in high demand.”

Traditionally, urgent battlefield requirements, which have been extremely prevalent in Iraq and Afghanistan, are for weapons or equipment already in production. Historically, experts say, an urgent battlefield request is given higher priority based on the rank of the person requesting it.

The Threat

A classified document called the guidance for the employment of the force establishes priorities and makeup of U.S. assets in different regions of the world. Based on that document, the combatant commanders develop war plans and create a force posture that seeks to deter conflict.

Combatant command requirements are overseen by members of the Joint Staff through the Global Force Management process. The combatant commanders provide a list of requirements to the chairman of the Joint Chiefs of Staff once per year. Those requirements — the majority of which are classified — are then adjudicated through this process.

“Usually, the demand for presence, forces and so forth exceeds the supply, so you have to have an adjudication process that allocates forces and so forth across the COCOMs,” Gunzinger said.

At the same time, urgent requirements are reviewed every few weeks, most often to address requests from the battlefield.

Because combatant commanders strive to reduce risk, the practice could lead to “requests for capabilities that can be a little unrealistic at times,” Gunzinger said.

“If your responsibility is to do this in your [area of responsibility] and you think you need that to do it, then you’re going to ask for it, probably without concern for other theaters,” he said.

Combatant commanders are “attempting to minimize risk, and that can drive a significant request for force structure and capabilities and presence, and you’re not required to pay for those, the services are,” Gunzinger said. “There’s no governor on those requests due to resources, and that’s why you have that centralized Global Force Management process.”

But military officials and many lawmakers argue that combatant commanders’ requests are justified due to threats, such as terrorism.

“[T]here’s this big suggestion that somehow our combatant commanders are coming up with all of these wish lists of everything they want,” said Rep. Randy Forbes, R-Va., chairman of the House Armed Services seapower subcommittee. “When you really do the analysis, when you peel that onion back, they’re not. You know, they’re making requests that we truly need and they truly need.”

Despite the looming defense spending cuts, the Global Force Management oversight process is not expected to change, said a spokeswoman for the Joint Staff.

The only way to inject more constraint in the requirements process is though strong leadership, experts say.

Pentagon brass needs to send a blunt message to the COCOMs as yearly budgets shrink: “Think a little smarter about how you’re going to spend,” said Todd Harrison, also with the Center for Strategic and Budgetary Assessments.

“You need a strong set of leaders in the Pentagon who are willing to say: ‘OK we get it. That’s what you would like, but you need to support that as a requirement,'” Gunzinger said.

 

Chinese hackers: Professional cyberspies?

 

ArmyTimes

By Christopher Bodeen – The Associated Press

Posted : Monday Feb 25, 2013 21:07:18 EST

 

 

BEIJING — Beijing hotly denies accusations of official involvement in massive cyberattacks against foreign targets, insinuating such activity is the work of rogues. But at least one piece of evidence cited by experts points to professional cyberspies: China’s hackers don’t work weekends.

 

Accusations of state-sanctioned hacking took center stage this past week following a detailed report by a U.S.-based Internet security firm Mandiant. It added to growing suspicions that the Chinese military is not only stealing national defense secrets and harassing dissidents but also pilfering information from foreign companies that could be worth millions or even billions of dollars.

 

Experts say Chinese hacking attacks are characterized not only by their brazenness, but by their persistence.

 

“China conducts at least an order of magnitude more than the next country,” said Martin Libicki, a specialist on cyber warfare at the Rand Corporation, based in Santa Monica, California. The fact that hackers take weekends off suggests they are paid, and that would belie “the notion that the hackers are private,” he said.

 

Libicki and other cyber warfare experts have long noted a Monday-through-Friday pattern in the intensity of attacks believed to come from Chinese sources, though there has been little evidence released publicly directly linking the Chinese military to the attacks.

 

Mandiant went a step further in its report Tuesday saying that it had traced hacking activities against 141 foreign entities in the U.S. Canada, Britain and elsewhere to a group of operators known as the “Comment Crew” or “APT1,” for “Advanced Persistent Threat 1,” which it traced back to the People’s Liberation Army Unit 61398. The unit is headquartered in a nondescript 12-story building inside a military compound in a crowded suburb of China’s financial hub of Shanghai.

 

Attackers stole information about pricing, contract negotiations, manufacturing, product testing and corporate acquisitions, the company said.

 

Hacker teams regularly began work, for the most part, at 8 a.m. Beijing time. Usually they continued for a standard work day, but sometimes the hacking persisted until midnight. Occasionally, the attacks stopped for two-week periods, Mandiant said, though the reason was not clear.

 

China denies any official involvement, calling such accusations “groundless” and insisting that Beijing is itself a major victim of hacking attacks, the largest number of which originate in the U.S. While not denying hacking attacks originated in China, Foreign Ministry spokesman Hong Lei said Thursday that it was flat out wrong to accuse the Chinese government or military of being behind them.

 

Mandiant and other experts believe Unit 61398 to be a branch of the PLA General Staff’s Third Department responsible for collection and analysis of electronic signals such as e-mails and phone calls. It and the Fourth Department, responsible for electronic warfare, are believed to be the PLA units mainly responsible for infiltrating and manipulating computer networks.

 

China acknowledges pursuing these strategies as a key to delivering an initial blow to an opponent’s communications and other infrastructure during wartime — but the techniques are often the same as those used to steal information for commercial use.

 

China has consistently denied state-sponsored hacking, but experts say the office hours that the cyberspies keep point to a professional army rather than mere hobbyists or so-called “hacktivists” inspired by patriotic passions.

 

Mandiant noticed that pattern while monitoring attacks on the New York Times last year blamed on another Chinese hacking group it labeled APT12. Hacker activity began at around 8:00 a.m. Beijing time and usually lasted through a standard workday.

 

The Rand Corporation’s Libicki said he wasn’t aware of any comprehensive studies, but that in such cases, most activity between malware embedded in a compromised system and the malware’s controllers takes place during business hours in Beijing’s time zone.

 

Richard Forno, director of the University of Maryland Baltimore County’s graduate cybersecurity program, and David Clemente, a cybersecurity expert with independent analysis center Chatham House in London, said that observation has been widely noted among cybersecurity specialists.

 

“It would reflect the idea that this is becoming a more routine activity and that they are quite methodical,” Clemente said.

 

The PLA’s Third Department is brimming with resources, according to studies commissioned by the U.S. government, with 12 operation bureaus, three research institutes, and an estimated 13,000 linguists, technicians and researchers on staff. It’s further reinforced by technical teams from China’s seven military regions spread across the country, and by the military’s vast academic resources, especially the PLA University of Information Engineering and the Academy of Military Sciences.

 

The PLA is believed to have made cyber warfare a key priority in its war-fighting capabilities more than a decade ago. Among the few public announcements of its development came in a May 25, 2011 news conference by Defense Ministry spokesman Geng Yansheng, in which he spoke of developing China’s “online” army.

 

“Currently, China’s network protection is comparatively weak,” Geng told reporters, adding that enhancing information technology and “strengthening network security protection are important components of military training for an army.”

 

Unit 61398 is considered just one of many such units under the Third Department responsible for hacking, according to experts.

 

Greg Walton, a cyber-security researcher who has tracked Chinese hacking campaigns, said he’s observed the “Comment Crew” at work, but cites as equally active another Third Department unit operating out of the southwestern city of Chengdu. It is tasked with stealing secrets from Indian government security agencies and think tanks, together with the India-based Tibetan Government in Exile, Walton said.

 

Another hacking outfit believed by some to have PLA links, the “Elderwood Group,” has targeted defense contractors, human rights groups, non-governmental organizations, and service providers, according to computer security company Symantec.

 

It’s believed to have compromised Amnesty International’s Hong Kong website in May 2012, although other attacks have gone after targets as diverse as the Council on Foreign Relations and Capstone Turbine Corporation, which makes gas microturbines for power plants.

 

Civilian departments believed to be involved in hacking include those under the Ministry of Public Security, which commands the police, and the Ministry of State Security, one of the leading clandestine intelligence agencies. The MSS is especially suspected in attacks on foreign academics studying Chinese social issues and unrest in the western regions of Tibet and Xinjiang.

 

Below them on the hacking hierarchy are private actors, including civilian universities and research institutes, state industries in key sectors such as information technology and resources, and college students and other individuals acting alone or in groups, according to analysts, University of Maryland’s Forno said.

 

China’s government isn’t alone in being accused of cyber espionage, but observers say it has outpaced its rivals in using military assets to steal commercial secrets.

 

“Stealing secrets is stealing secrets regardless of the medium,” Forno said. “The key difference is that you can’t easily arrest such electronic thieves since they’re most likely not even in the country, which differs from how the game was played during the Cold War.”

 

 

 

BRAC Again

AF Magazine

Feb 26, 2013

 

With the sequestration deadline just days away, Air Force officials are once again urging Congress to consider more base realignments and closures.

 

Air Force Secretary Michael Donley said last week the Pentagon’s forthcoming Fiscal 2014 budget request, which is set to go to Congress in a few weeks, would include a request for more BRAC. “We continue to believe BRAC authority is a tool we urgently need to allow [the Defense Department] to divest excess infrastructure and meet other needs, including modernization,” said Donley on Feb. 22 at AFA’s Air Warfare Symposium in Orlando, Fla. “Given sequestration, it’s even more important for Congress to give DOD BRAC authority to pursue health care reforms that will help us control costs,” he added.

 

Air Combat Command boss Gen. Mike Hostage said he realizes BRAC is a “touchy topic,” but said it could be critical to ensuring that the command remains mission capable in light of the steep budget cuts that sequestration would bring. ACC is set to transition to a state of tiered readiness, which means that the command will place any unit not deployed or preparing to deploy in “dormant status,” said Hostage during a Feb. 21 interview with the Daily Report at the symposium.

 

“I need to close one out of every three” ACC bases, he said. In its Fiscal 2013 budget request, DOD asked for two new rounds of BRAC—one in 2013 and one in 2015—but Congress turned down the proposal.

 

—Amy McCullough

 

 

 

The sequester? Never heard of it.

 

Washington Post

Posted by Chris Cillizza and Aaron Blake on February 26, 2013 at 6:30 am

 

 

Just one in four Americans are following the debate over the $1.2 trillion in automatic spending cuts set to kick in on Friday very closely, according to a new Washington Post-Pew poll, numbers that serve as a reminder that although talk of the sequester is dominating the nation’s capitol, it has yet to permeate into the public at large.

 

Most Americans are clueless about the sequester.

 

Not only are most people paying very little attention to the sequester, they also have only the faintest sense of what it would do. Less than one in five (18 percent) say they understand “very well” what would happen if the sequester went into effect in the Post-Pew poll.

 

Those remarkably low numbers come despite the fact that the debate over the sequester has dominated Washington for much of the last month and, in the past week or so, President Obama has cranked up the direness of his warning about what it could do to the economy.

 

The lack of interest and knowledge about the sequester stands in contrast to the level of engagement the public showed in the last crisis — the fiscal cliff. In Pew polling done in the run-up to the cliff, 40 percent of people said they were following the negotiations “very” closely while roughly three in ten said they had a very strong understanding of what it would mean for themselves and the country if we went off the cliff.

 

What explains the difference between sequester and the cliff? At first glance, it appears to be the fact that, without tax increases included in the sequester, most people don’t think it will really affect them. Just 30 percent of those tested say sequestration would have a “major effect” on their own financial situation — a contrast to 43 percent who said the same about the fiscal cliff. The lack of a tax increase component in sequestration (Democrats do want some increases in revenue, but mostly through closing loopholes) is see most clearly among Republicans — with just one in five following news about the automatic cuts “very closely.” Twice as many Republicans followed the fiscal cliff battle in December very closely.

 

(While impossible to document via polling, we believe strongly that people have less of a sense for sequestration than they did for the fiscal cliff because it lacks a catchy name. Never underestimate the shallowness of the American public’s news consumption habits.)

 

The sea of numbers above should serve as a reminder that, for most Americans, the sequester doesn’t exist. All of the talk about it coming out of Washington about who to blame is lost on these people — another fight in the nation’s capitol that they don’t believe will have any actual impact in their lives.

 

(For what it’s worth, the poll shows that 45 percent say Republicans in Congress should be blamed for the sequester, while 32 percent blame President Obama; that’s a far less sizable edge than the 26-point blame game advantage that Obama enjoyed over congressional GOPers on the fiscal cliff.)

 

Whether the lack of interest and knowledge regarding the sequester will change once it actually hits later this week remains to be seen, although these numbers suggest it’s got a long way to go to even be a relevant issue for most people in the country. A very long way.

 

 

 

 

Thin Snowpack in West Signals Summer of Drought

 

NY Times

By JACK HEALY

February 22, 2013

 

DENVER — After enduring last summer’s destructive drought, farmers, ranchers and officials across the parched Western states had hoped that plentiful winter snows would replenish the ground and refill their rivers, breaking the grip of one of the worst dry spells in American history. No such luck.

 

Lakes are half full and mountain snows are thin, omens of another summer of drought and wildfire. Complicating matters, many of the worst-hit states have even less water on hand than a year ago, raising the specter of shortages and rationing that could inflict another year of losses on struggling farms.

 

Reservoir levels have fallen sharply in Arizona, Colorado, New Mexico and Nevada. The soil is drier than normal. And while a few recent snowstorms have cheered skiers, the snowpack is so thin in parts of Colorado that the government has declared an “extreme drought” around the ski havens of Vail and Aspen.

 

“We’re worse off than we were a year ago,” said Brian Fuchs, a climatologist at the National Drought Mitigation Center.

 

This week’s blizzard brought a measure of relief to the Plains when it dumped more than a foot of snow. But it did not change the basic calculus for forecasters and officials in the drought-scarred West. Ranchers are straining to find hay — it is scarce and expensive — to feed cattle. And farmers are fretting about whether they will have enough water to irrigate their fields.

 

“It’s approaching a critical situation,” said Mike Hungenberg, who grows carrots and cabbage on a 3,000-acre farm in Northern Colorado. There is so little water available this year, he said, that he may scale back his planting by a third, and sow less thirsty crops, like beans.

 

“A year ago we went into the spring season with most of the reservoirs full,” Mr. Hungenberg said. “This year, you’re going in with basically everything empty.”

 

National and state forecasters — some of whom now end phone calls by saying, “Pray for snow” — do have some hope. An especially wet springtime could still spare the Western plains and mountains and prime the soil for planting. But forecasts are murky: They predict warmer weather and less precipitation across the West over the next three months but say the Midwest could see more rain than usual.

 

Water experts get more nervous with each passing day.

 

“We’re running out of time,” said Andy Pineda of the Northern Colorado Water Conservancy District. “We only have a month or two, and we are so far behind it’s going to take storms of epic amounts just to get us back to what we would think of as normal.”

 

Parts of Montana, the Pacific Northwest and Utah have benefited from a snowy winter. But across Colorado, the snowpack was just 72 percent of average as of Feb. 1, which means less water to dampen hillsides and mountains vulnerable to fire, less water for farms to use on early season crops, and less to fill lakes and reservoirs that ultimately trickle down into millions of toilets, taps and swimming pools across the state.

 

Heavy rains and snow have recently brought some hope to the parched states of Iowa, Minnesota and Missouri, where the drought is easing. But 55.8 percent of the United States remains locked in drought, according to the government’s latest assessments. And states like Nebraska and Oklahoma are facing precipitation deficits of as much as 16 inches.

 

Without damp soil, many wheat crops will have trouble growing come March and April when they should be in full bloom, and corn and soybeans could be stunted after they are planted this spring. In a year when farmers are planning another record planting, some might be forced to sow fewer seeds because there is not enough soil moisture to go around.

 

In southwestern Kansas, Gary Millershaski said the wheat on his 3,000 acres was as dry as it had ever been after two years of drought. But as snow fell around him, he was smiling, a guarded optimist for this year’s planting. “If we get above average rainfall from here on, we’re going to raise a wheat crop,” he said. “But what are the odds of that?”

 

Senator Mark Udall, Democrat of Colorado, put it this way: “Mother Nature is testing us.”

 

But Washington is also posing a challenge.

 

Mr. Udall, Senator Michael Bennet, a Democrat, and other members of Colorado’s Congressional delegation are seeking $20 million in emergency funds to help restore watersheds in Colorado ravaged by last year’s wildfires. So far, there has been little action on the measure. Western politicians are also urging the Forest Service to move more quickly to modernize the shrinking and aging fleet of tanker planes it uses to douse wildfires.

 

If Congress does not head off the looming across-the-board budget cuts set to take effect March 1, financing for the Forest Service’s Wildland Fire Management program will be cut by $134 million. As many as 200,000 acres — an area about the size of Kansas City, Mo. — would not be treated to remove dry brush, dead wood and other tinder for wildfires.

 

In dry states like Colorado, officials are already preparing for the worst. Wildfires did $538 million in damage last year, burning hundreds of homes and driving away summer tourists. As late as December, when the high country should be blanketed by snow, a 4,000-acre fire continued to burn in Rocky Mountain National Park. To some officials, it was a harbinger of longer, fiercer fire seasons that may come with climate change. “It’s just so dry here,” said Tom Grady, the emergency manager in Aspen and the surrounding county, which is already meeting to fine-tune its fire plans for the summer.

 

Denver Water, which serves 1.3 million people, depleted many of its reservoirs after last year’s dry winter and an unrelenting spree of 90- and 100-degree summer days. Those basins never fully recovered, and are now an average of 63 percent full. The agency has already idled one water treatment plant to conserve its reservoir supplies, and officials say they are likely to declare a Stage 2 drought, limiting when people can water their lawns.

 

In Northern Colorado, a combination of drought and wildfire is shutting off the spigot for scores of farmers. Cities are worried about ash and sediment flowing from the burn areas into the rivers that supply their water, so they are holding onto every drop possible this year and not selling any water to local farmers.

 

In 2011, the Northern Colorado city of Greeley alone leased enough water to irrigate 13,000 acres of farmland — representing millions of dollars in wages for farmhands, seed money, fertilizer sales and profits for farmers. Every year, just after midnight on Jan. 1, farmers start calling the city to sign up to lease the surplus water. This year, Greeley had to call them all back to say there was none to be had.

 

Eldon Ackerman, who grows sugar beets, pinto beans and alfalfa on his farm in Wellington, said he had water supplies for only about one-third of his fields. He was praying the spring snow and rains would come to save him. If they do not, he said he might have to let 1,000 acres lie fallow this year.

 

“There isn’t any more water to get,” Mr. Ackerman said.

 

John Eligon contributed reporting from Kansas City, Mo.

 

 

 

The coming R&D crash

Washington Post

By Brad Plumer , Updated: February 26, 2013

One of the few things Republicans and Democrats have been able to agree on in recent years is that the government should be spending more on basic scientific research — the sort of research that, in the past, has played a role in everything from mapping the human genome to laying the groundwork for the Internet.


Should the government be funding this sort of work? (AP)

“Government funding for basic science has been declining for years,” Mitt Romney wrote in his 2010 book No Apology. “It needs to grow instead.” In his most recent State of the Union address, President Obama sounded a similar note: “Now is the time to reach a level of research and development not seen since the height of the space race.”

So it’s notable that the exact opposite is, in fact, about to occur. Thanks to budget pressures and the looming sequester cuts, federal R&D spending is set to stagnate in the coming decade. The National Institutes of Health’s budget is scheduled to drop 7.6 percent in the next five years. Research programs in energy, agriculture and defense will decline by similar amounts. NASA’s research budget is on pace to drop to its lowest level since 1988.

As a result, scientists and other technology analysts are warning that the United States could soon lose its edge in scientific research — and that the private sector won’t necessarily be able to pick up the slack.

“If you look at total R&D growth, including the corporate and government side, the U.S. is now at the low end,” says Rob Atkinson, president of the Information Technology and Innovation Foundation (ITIF). “We’re seeing other countries, from Germany to Korea to China, make much bigger bets. And if that persists for long enough, it’s going to have an impact.”

So how dire is the situation, really?

Let’s start with some basic charts. Over the past decade, federal spending on R&D has grown in real terms, according to the American Association for the Advancement of Science (although it’s shrinking as a percentage of GDP). That’s been driven largely by Bush-era increases in defense and life-sciences spending:

 



USDA = U.S. Department of Agriculture, NSF = National Science Foundation, DOE = Department of Energy, NIH = National Institutes of Health, DOD = Department of Defense. ARRA Funding includes 2009 stimulus money for research.

At its peak in 2009, the federal government funded some 31 percent of all R&D in the country, with private firms and universities financing the rest. The array of federal programs is staggering, from semiconductor work at the Pentagon to climate-change research at NOAA to clinical trials for cancer at the National Institutes for Health. About half of the spending here is “basic” research and half “applied” research.

Yet as a recent report from ITIF explains, this landscape is set to shift now that Congress is putting strict limits on discretionary spending. If the sequester spending cuts take effect on Mar. 1, total spending on research and development will drop to 2007 levels and grow only slowly thereafter (below, black line). Federal R&D spending will decline sharply as a share of GDP:


How worrisome is this projected stagnation in federal R&D spending? A lot depends on how valuable you think government research actually is — and on that point, the debate can get surprisingly contentious.

There’s a long, long list of world-changing innovations that can be traced back to federally funded R&D over the years. The Department of Energy’s research labs spawned digital recording technology, communications satellites, and water-purification techniques. Pentagon research laid the groundwork for the Internet and GPS. The current shale-gas fracking boom couldn’t have happened without microseismic imaging techniques that were developed at Sandia National Laboratories.

But that’s not necessarily the best way to look at things. The key question here is how much of this innovation might have happened without government involvement. And as Stanford’s Roger Noll explains in this NBER essay, economists have fairly nuanced views on this.

Many economists agree that private companies tend to under-invest in very basic scientific research, since it’s hard for one firm to reap the full benefits from those discoveries. So the federal government, which now funds 60 percent of all basic research in the United States, is likely irreplaceable here. What’s more, studies have found that many types of government R&D spur private companies to conduct their own additional research. That is, the two are complementary, not substitutes.

But the situation is murkier for other forms of public R&D. Many government programs are focused on advancing commercial technologies in specific industries — and those could well be crowding out private-sector activities. What’s more, some government R&D programs are so focused on demonstrating their usefulness to Congress that they stick with “safe” research that the private sector would have done anyway.

When the Congressional Budget Office reviewed the evidence in 2007, it concluded that government-funded basic research generated “substantially positive returns.” And it found that, on the whole, government R&D helped spur additional private-sector R&D rather than displace it. Yet the CBO also noted that some types of government programs may very well be crowding out private research. Likewise, a 2007 survey by the Bureau of Labor Statistics found that the social returns for many public R&D programs were “near zero.”

“It’s not always cut-and-dried,” says Scott Wallsten, president of the Technology Policy Institute. “In theory there are certainly things that are good for society that aren’t profitable for private companies to do. Basic research especially. But when you move out from that, it sometimes becomes more questionable.”

Indeed, this is one area that has recently divided Republicans and Democrats. During the 2012 campaign, Romney heaped praise on basic research programs like ARPA-E, which funds long-shot energy research. But he criticized Obama’s support for programs that try to commercialize new technologies — such as loan guarantees for mature solar firms.

In the near future, however, this debate is moot: When the sequester takes effect on March 1, it will affect all types of R&D, regardless of type or value. In the National Institutes of Health, because of the way grants are structured, the immediate 5.3 percent sequester cuts for 2013 will mean that little new research of any type will get funded this year, explains former NIH director Elias Zahouni.

Meanwhile, there’s the international context to consider. Atkinson points out that United States is in danger of losing its spot as the undisputed world leader on R&D — both public and private. Not only is the federal government paring back its research budget, but the corporate sector isn’t making up the gap either. “In most countries,” he says, “corporate R&D is up over the past decade. Ours didn’t, it stayed stagnant.”

The causes for America’s private-sector R&D stagnation are complex, Atkinson says, ranging from impatient investors to unfavorable tax policies. But ITIF projects that the United States will soon spend less on all types of R&D as a percentage of its economy in the coming decade than countries like Australia and South Korea (though we’ll still spend a lot more in absolute terms, since our economy’s much bigger). Even China is catching up:


There are a few ways to interpret this chart. The sanguine view is that other countries are tossing more money at scientific research that will have positive spillover benefits for the entire world — including us. If China invents a cure for cancer, we all benefit.

Others worry, however, that the U.S. economy could suffer from the fact that a greater share of research is happening elsewhere. A 2012 report by the National Science Foundation, for instance, found that U.S. firms were now shifting much of their R&D work overseas. And the United States has recently developed a trade deficit in high-technology goods, after surpluses during the 1990s.

Many lawmakers seem to take the alarmist view. President Obama in particular has insisted that the United States can’t fall behind on R&D. A sample line: “We’ve got to make sure that we’ve got the best science and research in the world.”

Finding the money to do that will be difficult in an era when Congress is insisting on tight budgets. Some policymakers have tried to put forward novel approaches to R&D — like Sen. Lisa Murkowski’s (R-Alaska) idea for an “Advanced Energy Trust Fund” that would dedicate a portion of revenues from oil and gas drilling to energy research. (Obama embraced a similar idea in his State of the Union.) Other economists have suggested that the government should lean more heavily on prizes or tax credits as a way of funding innovation.

Yet many of those ideas are fairly small-bore. Getting R&D back to where it was at the height of the space race, as Obama has suggested, will either take a hefty portion of policy creativity — or a big shift in budget politics in the years ahead.

Further reading:

–The Congressional Budget Office has a good overview (pdf) of the economics of federally funded R&D, including a discussion of what works and what doesn’t.

–Elias Zahouni, who directed NIH during the Bush years, explained in this interview how the sequester would likely affect research in that agency.

–Over at Slate, Konstantin Kakaes disputed the idea that the U.S. is in a “research arms race” with China or anyone else. Worth reading as a counterpoint

 

 

GovExec

 

Furlough Watch: Potential Agency-by-Agency Impacts of Sequestration

February 26, 2013

 

The across-the-board budget cuts known as sequestration now scheduled to hit in two days would have serious implications for federal workers, including mandatory unpaid furloughs for hundreds of thousands of employees, beginning in April. We have compiled a list of possible agency-by-agency effects, should Congress and President Obama fail to reach a deficit reduction agreement in time to avoid the cuts. We will update the list as more information becomes available. Please use the comment section below to let us know if you have additional information about your agency.

 

Agriculture Department: Food Safety and Inspection Service employees would be furloughed for approximately two weeks, the White House said in a Feb. 8 fact sheet.

 

Defense Department: Secretary Leon Panetta on Feb. 20 informed lawmakers that sequestration would force the Pentagon to put the “vast majority” of its 800,000 civilian workers on administrative furlough. The furloughs would begin in late April and would occur one day a week for up to 22 discontinuous work days.

 

Education Department: Secretary Arne Duncan testified Feb. 14 before the Senate Appropriations Committee that he expected furloughs. “The sequester would … likely require the department to furlough many of its own employees for multiple days,” he wrote in a Feb. 1 letter to the committee.” The letter did not provide an exact number of employees who would be affected.

 

Environmental Protection Agency: Employees would be furloughed a total of six days between April and September, according to a union official. The furlough days would break down as follows: from April 21 to June 15, each EPA employee would have to take one day of leave without pay per paid period, for four pay periods. From July 5 through Sept. 30, each employee would be required to take two furlough days.

 

Federal Aviation Administration: Almost all 47,000 workers would be furloughed for one-to-two days per pay period, according to Transportation Secretary Ray LaHood and FAA head Michael Huerta. Air traffic control towers at 100 airports would be closed, and midnight shifts at many smaller airports would be dropped. This could lead to 90-minute delays during peak travel times for flights to major cities, LaHood and Huerta said in their Feb. 22 letter to airline industry groups and unions.

 

Federal courts: 20,000 employees could be furloughed for 16 days.

 

Government Accountability Office: Plans to avoid furloughs, according to The Washington Post. But, the sequester would affect hiring, employee benefits and travel and contract spending, according to Feb. 26 testimony from Comptroller General Gene Dodaro.

 

Government Printing Office: Will save money by scaling back technology and other investments, but “if necessary, a furlough of GPO’s workforce may also be implemented,” acting Public Printer Davita Vance-Cook testified before a House subcommittee on Feb. 26.

 

Homeland Security Department: Law enforcement personnel would face furloughs of up to 14 days, DHS Secretary Janet Napolitano said in a Feb. 13 letter to House lawmakers. She did not provide a specific number of employees affected but said it would be a “significant portion” of the department’s front-line law enforcement staff.

 

Housing and Urban Development: Secretary Shaun Donovan told the Senate Appropriations Committee furloughs could be necessary. “Specific plans are still being reviewed and finalized, but we believe that furloughs or other personnel actions may well be required to comply with cuts mandated by sequestration,” he said in Feb. 14 testimony.

 

Interior Department: Secretary Ken Salazar has warned about furloughs of thousands of employees. The National Parks Service plans to furlough permanent staff if other cost-savings measures fail.

 

Justice Department: Would furlough hundreds of federal prosecutors, according to the White House. FBI Director Robert Mueller has said $550 million in cuts to the bureau “would have the net effect of cutting 2,285 employees — including 775 agents — through furloughs and a hiring freeze,” according to the FBI Agents Association.

 

NASA: 20,500 contractors could lose their jobs. The agency has not notified federal employees of any furlough possibility, but a spokesman told Government Executive on Feb. 25 that “all possible effects” of sequestration are “still being assessed.”

 

Nuclear Regulatory Commission: Has ruled out furloughs or salary cuts.

 

Small Business Administration: No furloughs; will rely on an anticipated reduction in a certain type of loan to cut costs, according to an Associated Press report.

 

Smithsonian: Does not anticipate furloughs.

 

Social Security Administration: Remains “uncertain” about reducing its employees’ hours, which would save about $25 million per furlough day, according to a Feb. 1 letter to Congress. It will instead try to reach the reduced budget level through attrition.

 

Veterans Affairs Department: Mostly exempt from sequestration.

 

 

 

 

 

GSNMagazine

NIST formally asks for Cyber security ideas

Tue, 2013-02-26 01:33 PM

By: Mark Rockwell

 
 

The National Institute of Standards and Technology (NIST) formally issued a Request for Information (RFI) on developing voluntary industry standards to protect against Cyber attacks and intrusions.

NIST issued the RFI in the Federal Register on Feb. 26, marking its first step in a year-long process that will develop a Cyber security framework, mandated by president Obama’s Executive Order on Cyber security. The president issued the order on Feb. 12 aiming to protect critical infrastructure such as power plants and financial, transportation and communications systems. Congress is also pushing for legislation that would extend more protections, but those rules are still being hammered out.

The president’s framework will set voluntary standards and best practices to guide critical infrastructure and other industries in reducing cyber risks to vital networks and computers.

NIST has also set its first public meeting and workshop on the issue at its Gaithersburg, MD, headquarters on April 3.

In its formal announcement, NIST requested ideas, recommendations and other input from critical infrastructure owners and operators, federal agencies, state and local governments, standards-setting organizations, and other interested parties about current risk management practices; use of frameworks, standards, guidelines and best practices; specific industry practices and more. Specific questions are included in the RFI.

NIST said comments are due by 5 p.m., April 8, and should be sent to cyberframework@nist.gov with the subject line: “Developing a Framework to Improve Critical Infrastructure Cybersecurity.”

 

 

 

Pentagon F-35 program chief lashes Lockheed, Pratt

Reuters

 

Feb 27, 2013 5:24am EST

 

By Jane Wardell

 

AVALON, Australia (Reuters) – The Pentagon program chief for the F-35 warplane slammed its commercial partners Lockheed Martin (LMT.N: Quote, Profile, Research, Stock Buzz) and Pratt & Whitney on Wednesday, accusing them of trying to “squeeze every nickel” out of the U.S. government and failing to see the long-term benefits of the project.

 

U.S. Lieutenant-General Christopher Bogdan made the comments during a visit to Australia, where he has sought to convince lawmakers and generals to stick to a plan to buy 100 of the jets, an exercise complicated by the second grounding of the plane this year and looming U.S. defense cuts.

 

Pratt & Whitney, a unit of United Technologies Corp (UTX.N: Quote, Profile, Research, Stock Buzz), is sole supplier of engines to the $396 billion F-35, or Joint Strike Fighter. Lockheed Martin provides the body of the radar-evading jet, the most expensive combat aircraft in history.

 

“What I see Lockheed Martin and Pratt & Whitney doing today is behaving as if they are getting ready to sell me the very last F-35 and the very last engine and are trying to squeeze every nickel out of that last F-35 and that last engine,” Bogdan told reporters at the Australian International Airshow in southern Victoria state.

 

“I want them both to start behaving like they want to be around for 40 years,” he added. “I want them to take on some of the risk of this program, I want them to invest in cost reductions, I want them to do the things that will build a better relationship. I’m not getting all that love yet.”

 

A Lockheed Martin executive at the airshow declined to comment when reached by Reuters, saying he was unaware of Bogdan’s comments. Executives from Pratt & Whitney could not immediately be reached for comment.

 

Bogdan caused a stir shortly after joining the F-35 program last August when he described the relationship between the government and Lockheed Martin as the worst he’d ever seen. There had been little improvement since then, he said.

 

“Are they getting better? A little bit,” he said. “Are they getting better at a rate I want to see them getting better? No, not yet.”

 

If the project stays on track, Pratt & Whitney will eventually provide 4,000 engines and Lockheed Martin 3,000 planes.

 

The Pentagon plans to buy 2,443 of the warplanes in the coming decades, although many analysts believe U.S. budget constraints and deficits will reduce that number.

 

Australia, a close American ally, is considering doubling its fleet of 24 Boeing Co (BA.N: Quote, Profile, Research, Stock Buzz) F/A-18 Super Hornets amid delays and setbacks in the F-35 project. That means Canberra could buy far fewer F-35s than initially planned.

 

LEAKS

 

Bogdan was also critical of what he suggested were leaks from Pratt & Whitney’s camp about the engine issue, which led the Pentagon to suspend F-35 flights last Friday.

 

Two sources told Reuters that Pratt & Whitney is 99 percent sure the fan blade problem that grounded the jets was not caused by high-cycle fatigue, which could force a costly design change, and the aircraft could be flying again within the week.

 

“Until all those tests are done and I see the results, I don’t know what’s going on,” Bogdan said. “However … my gut would tell me it’s on the spectrum of the minor side – 99 percent is bold, flying next week is bold.”

 

Bogdan also gave the example of taking six months to close a deal with Pratt & Whitney for engines on its fifth bloc of jets, shortly after General Electric Co (GE.N: Quote, Profile, Research, Stock Buzz) had been dropped as a second supplier of engines for the program, leaving Pratt & Whitney as sole supplier for the next 40 years.

 

“Now, you would think a company like Pratt & Whitney that was just given the greatest Christmas gift you could ever, ever get for a company would act a little differently,” Bogdan said.

 

Bogdan is flying back to the United States this weekend, just in time to hear about the future of U.S. military budgets, which are slated to be cut by nearly $500 billion over the next decade, an amount which could double unless Congress acts in the next week to avert spending reductions known as “sequestration”.

 

Bogdan said he was confident the F-35 program would remain on track and on budget if he was given the discretion to deal with any cuts.

 

The risk is that money is cut from the $6 billion set aside for the development program by the end of October next year.

 

“I need every penny of that $6 billion to get over the finish line,” Bogdan said. “If they take money out of development something’s going to have to give. I’m either going to have to push the program out or I’m going to have to shed capability.”

 

Budget cuts aside, Bogdan said he was confident of bringing the cost of each plane down to around $90 million by 2013, compared to around $120 million now.

 

Budget cuts have already forced Italy to scale back its F-35 orders, and Turkey has delayed its purchases by two years. Orders from Japan and Israel have buoyed the project, and additional Israeli orders are expected in 2013.

 

Lockheed is building three different models of the F-35 for the U.S. military and eight countries that helped pay for its development: Britain, Canada, Italy, Turkey, Denmark, the Netherlands, Australia and Norway.

 

 

Message to the Department from Secretary of Defense Chuck Hagel

As Delivered by Secretary of Defense Chuck Hagel, The Pentagon, Wednesday, February 27, 2013

 

 

To all Department of Defense personnel:

 

Earlier today I was privileged to take the oath of office to become the 24th Secretary of Defense. I am humbled by and grateful for the opportunity that President Obama and the Congress have given me to once again serve our nation.

 

I am most especially grateful for the opportunity to work with all of you. Every day you work to defend America. The noble cause of your profession, your individual sacrifices, and your service inspire us all.

 

As your leader, I will always do my best for our country and for all of you – and your families. As with my friends and predecessors Leon Panetta and Bob Gates, your safety, success, and welfare will always be at the forefront of my decisions. I will build on the strong foundation of teamwork built by Secretaries Gates and Panetta, as we work together. Leadership is a team business.

 

I have long believed that America must maintain the strongest military on earth; we must lead the international community, with a steady and sure hand to confront threats and challenges together as we work closely with our allies and partners to advance our common interests and build a more hopeful world. We must use all tools of American power to protect our citizens and our interests; and America must engage – not retreat – in the world, but engage wisely.

 

This is a defining time for the United States military and for our nation. We are emerging from more than a decade of war, yet the threats facing us are no less dangerous or complicated.

 

Despite these challenges, I believe an historic opportunity exists to help build a safer, more prosperous, and more secure world. But to achieve this goal we must ensure that we are ready, trained and equipped to fulfill our role of protecting the country and standing firm against aggression. To that end, the strength, well-being and readiness of our all-volunteer force will be my top priority. This will require 21st century agility and flexibility. We must take care of our people, and working with the VA and other institutions, I will ensure that you and your families get the health care, job opportunities, benefits, and education you have all earned and deserve. My life and career have been about helping our service members, veterans and their families. One of my proudest accomplishments in the U.S. Senate was coauthoring with my fellow Vietnam veteran and friend, Jim Webb, the Post-9/11 G.I. Bill.

 

As I assume this office, I am mindful of the sacrifices that you and your families have made for more than a decade, and continue to make every day. In Afghanistan, where 66,000 of our troops remain in a tough fight, we have a clear and achievable objective to fully transition security responsibility to the Afghan National Security Forces by the end of 2014. As you know, Afghan forces will step into the lead for security operations across the country this spring, and over the next year another 34,000 of our troops will come home.

 

As we turn the page on more than a decade of grinding conflict, we must broaden our attention to future threats and challenges. That means continuing to increase our focus on the Asia-Pacific region, reinvigorating historic Alliances like NATO, and making new investments in critical capabilities like cyber.

 

In order to accomplish our mission, we also must make wise budget decisions prioritizing our interests and requirements. Like each of you, I am greatly concerned about the impact that the looming round of automatic budget cuts will have on you and your families, and on military readiness. As someone who has run businesses, I know that severe budget uncertainty limits our ability and flexibility to manage and plan and use taxpayer dollars in the most efficient manner possible. I will work within the Administration and with Congress to help resolve this uncertainty in a way that does not break America’s commitment to you, your families, and our veterans.

 

As I begin my time here at the Department I want you to know that I recognize the immense responsibility that I have, and will work hard every day to fulfill my duties as Secretary of Defense as honestly and effectively as I know how. You are the greatest force for good in the world. It is the highest honor to serve alongside you. I am proud to be part of your team. Thank you for your commitment and dedication to our country.

 

 

Sequestration break for Defense?

Washington Post

By Walter Pincus

Feb 20, 2013

 

The Defense Department could have some wiggle room to avoid major cuts in readiness as the sequester looms, according to a recent Congressional Research Service analysis by Amy Belasco, a specialist in U.S. defense policy and budgets.

 

Congress also could soften the impact of the $46 billion in military spending cuts required over the next seven months if lawmakers agree on legislation that expands the amount of funds that can be transferred among Defense accounts. In addition, Congress could allow new procurement starts and increases in weapon production rates.

 

About $22 billion would have to come from the military services’ operations and maintenance (O&M) account, which pays for readiness-related activities such as training.

 

Because cuts would have to be applied in the last seven months of the fiscal year, it would require an average reduction of 17.5 percent to each O&M program. Such cuts, the Joint Chiefs of Staff wrote to Congress, could put the United States “on the brink of creating a hollow force.”

 

The sequester deadline, March 1, is eight days away, but Congress appears unable to make the compromises needed for a realistic solution to the nation’s fiscal problems. Yet, President Obama and House and Senate Republicans seem to agree that the Pentagon, if not the rest of the government, ought to get some immediate relief.

 

If there’s no remedy approved before March 1, there certainly could be one worked out before March 27, when the fiscal 2013 continuing appropriations resolution (fiscal 2013 CR) runs out. Before that date, Congress can pass a full-year fiscal 2013 defense appropriations bill, which appears unlikely, or a new fiscal 2013 CR that would keep the government running through Sept. 30, the end of the fiscal year.

 

So far, however, Democrats and Republicans are far apart on how to make up any major funding relief provided to the Defense Department, whether by cutting more non-defense spending or providing additional revenue.

 

What’s possible, however, is at least giving the Pentagon authority to shift funds, which Defense Secretary Leon E. Panetta has sought for more than a year.

 

To understand Belasco’s analysis, you must realize that the fiscal 2013 CR for the most part linked this year’s current spending levels to those of the fiscal 2012 appropriations law.

 

According to Belasco, the fiscal 2012 appropriations law specified that in the personnel and operations and maintenance accounts, “there would be considerable more flexibility to allocate O&M sequester reductions applied at the account level” than the program-specific reductions for procurement and research and development.

 

Applying that approach to the fiscal 2013 CR, Belasco says, gives the Defense Department — and the individual services — “discretion to allocate funding within O&M accounts.” That is important because some O&M funding accounts in fiscal 2012 were lower than funds originally sought for fiscal 2013.

 

She writes that the Army has the greatest mismatch, a gap this year of $6 billion, because of the reset costs of forces returning from Afghanistan. However, Belasco says, that may be softened because the Army may have overestimated the funds needed to cover inflation and a requirement for a civilian pay increase that has not taken place. The Army may gain another $2.6 billion with the transfer of funds from the overseas war account to the base budget that also took place in fiscal 2012.

 

Overall, Belasco suggested that the Pentagon can limit “cuts to readiness-related O&M operating forces to 10 percent to 12 percent, about half the level that the Joint Chiefs warned would be dangerous in its January letter to Sen. Carl Levin (D-Mich.), chairman of the Senate Armed Services Committee.”

 

Her analysis is based on Defense implementing a hiring freeze, furloughing civilian workers for 22 days over seven months, and cutting recruiting, administrative and servicewide base support, including contractors, which could reach 20 percent.

 

Procurement offers another opportunity. Under the fiscal 2013 CR, new starts and increases in production rates other than those provided for in fiscal 2012 are prohibited. Funding mismatches also have been created because of how major weapons systems were handled last year.

 

For example, Belasco notes that there was $581 million more in fiscal 2012 for Army weapons and tracked vehicles such as tanks than the Army wanted in this year’s budget. Under the fiscal 2013 CR, that large amount of money is available, but only for those kinds of weapons. On the other hand, the Army is short some $481 million for its fiscal 2013 aircraft request because its fiscal 2012 amount was that much lower than what the Army wanted for this year. The Air Force has $1.9 billion more for aircraft this year than it wanted because its fiscal 2012 amount was that much greater than this year’s request.

 

Sequester would cut these excesses: the Army’s down to $404 million, the Air Force to $829 million.

 

The services would benefit if Congress granted authority to transfer those funds, and permit new starts or increasing production numbers.

 

The Army, for example, cannot go ahead this year with planned procurement of 17 upgraded Paladin howitzers for $206 million because none were purchased in fiscal 2012. Under the fiscal 2013 CR, the Air Force, if authorized, could use some of its excess to increase funding of the new KC-46 tanker development program. It has $877 million, the amount it got in fiscal 2012 but had planned to increase to $1.8 billion in fiscal 2013. If it doesn’t get additional funds, the Air Force will delay this high-priority program for months.

 

I expect Congress to continue kicking the can down the road when it comes to solving the nation’s basic fiscal problems, but I have no doubt that lawmakers are going to find a way to ease, if not erase, Defense’s sequester.

 

If they do so for no other reason, it would be a fitting and perfect going away gift for Panetta.

 

 

 

Kerry defends liberties, says Americans have “right to be stupid”

 

Tue, Feb 26 2013

 

BERLIN (Reuters) – Secretary of State John Kerry offered a defense of freedom of speech, religion and thought in the United States on Tuesday telling German students that in America “you have a right to be stupid if you want to be.”

 

“As a country, as a society, we live and breathe the idea of religious freedom and religious tolerance, whatever the religion, and political freedom and political tolerance, whatever the point of view,” Kerry told the students in Berlin, the second stop on his inaugural trip as secretary of state.

 

“People have sometimes wondered about why our Supreme Court allows one group or another to march in a parade even though it’s the most provocative thing in the world and they carry signs that are an insult to one group or another,” he added.

 

“The reason is, that’s freedom, freedom of speech. In America you have a right to be stupid – if you want to be,” he said, prompting laughter. “And you have a right to be disconnected to somebody else if you want to be.

 

“And we tolerate it. We somehow make it through that. Now, I think that’s a virtue. I think that’s something worth fighting for,” he added. “The important thing is to have the tolerance to say, you know, you can have a different point of view.”

 

Kerry made the comments on his first foreign trip since becoming secretary of state on February 1. After one-night stops in London and Berlin, he visits Paris, Rome, Ankara, Cairo, Riyadh, Abu Dhabi and Doha before returning to Washington on March 6.

 

While speaking to the students and earlier to U.S. diplomats, Kerry reminisced about the time he spent in Berlin in the 1950s as the intrepid son of an American diplomat and retold a story of sneaking across to East Berlin with his bike.

 

“I used to have great adventures. My bicycle and I were best friends. And I biked all around this city. I remember biking down Kurfuerstendamm and seeing nothing but rubble. This was in 1954 … the war was very much still on people’s minds,” he told the diplomats, referring to West Berlin’s main shopping avenue.

 

“One day, using my diplomatic passport, I biked through the checkpoint right into the east sector and noticed very quickly how dark and unpopulated (it was) and sort of unhappy people looked,” he added, saying it left an impression “that hit this 12-year-old kid.”

 

“I kind of felt a foreboding about it and I didn’t spend much time. I kind of skedaddled and got back out of there and went home and proudly announced to my parents what I had done and was promptly grounded and had my passport pulled,” he added.

 

“As a 12-year-old, I saw the difference between East and West,” he later told the students. “I never made another trip like that. But I have never forgotten it. And now, it’s vanished, vanished.”

 

 

 

(Reporting by Arshad Mohammed; Editing by Jon Hemming)

 

Budget Alert: ‘Peace Dividend’ Has Already Been Spent

 

By DAVID FRANCIS, The Fiscal Times

February 27, 2013

 

In numerous speeches, President Obama has tried to sell Americans on the idea that the peace dividend, or the amount saved by ending wars and cutting the Defense Department budget, would invigorate the American economy.

 

In his speech at the Democratic National Convention in Charlotte last year, Obama said the hundreds of billions of dollars spent to fight in Iraq and Afghanistan would now be used to rebuild American infrastructure and create new jobs. He’s repeated similar claims in speeches he’s made since the convention.

 

“I’ll use the money we’re no longer spending on war to pay down our debt and put more people back to work — rebuilding roads and bridges, schools and runways,” Obama said last September. “After two wars that have cost us thousands of lives and over a trillion dollars, it’s time to do some nation-building right here at home.”

 

 

President George H.W. Bush and British Prime Minister Margaret Thatcher first used the term peace dividend at the end of the Cold War, when the fall of the Berlin Wall allowed each nation to concentrate on making butter, not guns. In the United States, the dividend paid off, as the economy roared back in the late 1990s.

 

BUDGETARY SLIGHT OF HAND

The peace dividend anticipated from the most recent U.S. wars will be hard to find because of the way money was spent in Iraq and Afghanistan, and how the military is structured, experts say. Just because money is not being spent by the Pentagon does not mean that it can be spent by other agencies to create jobs or improve infrastructure.

 

“You can’t look at it from the point of view of the United States having more to spend,” said Jacob Stokes, a research associate at the Center for New American Security. “That’s just not true.”

 

It’s accurate to say that defense spending is going to be cut by nearly $500 billion in the coming years. But the money being cut did not originally come out of a U.S. savings account. The vast majority of what we spent to finance Iraq and Afghanistan was borrowed.

 

So unless the White House plans to continue to borrow money at the clip it did to finance two wars, there won’t be any new money to fund the infrastructure programs Obama is touting.

 

According to Linda Bilmes, a professor at Harvard’s Kennedy School of Government, some of the planned cuts simply will not be able to occur.

 

“THE PEACE DIVIDEND WON’T MATERIALIZE”

“We’ve made so many decisions over the last 10 years that have made structural changes in the defense budget,” she said. Costs related to those decisions are “rising very fast and will continue to grow so rapidly that the peace dividend won’t materialize.”

 

Military leaders told a Congressional subcommittee Tuesday that the spending cuts would put the country at risk because the Pentagon would be unable to combat all threats. But according to Bilmes, the areas where the Pentagon is most stressed deal with soldier benefits and deferred maintenance, not weapons systems or troop readiness.

 

It used to be, “join the Army and get a college education.” Now, it’s “get a deal on health insurance.” The cost of Tricare, DOD’s health plan, is expected to rise dramatically in the coming years. In 2001, military healthcare spending accounted for just $19 billion. By 2012 that number had increased to $52.2 billion. A report by the Center for American Progress estimates that the Pentagon will spend $63.9 billion by 2015.

 

 

 

These expenditures are occurring as Tricare’s insurance rates for retired military families have increased annually from $600 to $820. For enlisted men and women, annual fees increase from $230 to $269.28 for individuals, and to from $460 for $538.56 families. Given these dirt-cheap rates, it’s no surprise that the number of people the Defense Department insures is increasing.

 

“We saw Tricare membership accelerating as the Obamacare mandates kick in,” she said. Soldiers and their families “will take up Tricare as it turns out to be cheaper than getting health care through the open market or through state plans.”

 

CONGRESS HITS THE PAY WALL

There are also costs related to soldier pay. In 2004 and 2005, the Bush administration adjusted military pay scales higher as part of an effort to increase recruiting. The Congressional Budget Office found that military pay outpaced the income growth in the private sector by more than 25 percent in the last ten years. Because Congress approved these increases, lawmakers must repeal them as well.

 

“The Pentagon has tried to get [the pay increases] rolled back but Congress has not been willing and is unlikely to be willing,” she said.

 

Bilmes also said there is growing pressure to provide long-term care for war veterans that serve less than the 20 years required to receive health care as part of a retirement plan.

 

“There’s a lot of pressure to change the structure of the pension plan so that it benefits Afghan and Iraq vets,” she said. “This will add another layer of cost.”

 

Lastly, there are costs related to maintenance. Equipment used in the war needs to be repaired or replaced. Until this equipment is evaluated, there is no way to estimate how much this will cost.

 

Stokes added that there are procurement requirements looming. Many of the weapons used to fight in Iraq and Afghanistan are relics of the Reagan era, and will need to be replaced. And as the F-35 fighter program proves, acquiring new weapons can be a costly experience that lasts for decades.

 

“Too much of a peace dividend means you’re not investing in the future technologies that you need,” he said. “At the same time, if you do the spending cuts the right way, you can do it in a way that keeps the country safe.”

 

In numerous speeches, President Obama has tried to sell Americans on the idea that the peace dividend, or the amount saved by ending wars and cutting the Defense Department budget, would invigorate the American economy.

 

 

In his speech at the Democratic National Convention in Charlotte last year, Obama said the hundreds of billions of dollars spent to fight in Iraq and Afghanistan would now be used to rebuild American infrastructure and create new jobs. He’s repeated similar claims in speeches he’s made since the convention.

 

“I’ll use the money we’re no longer spending on war to pay down our debt and put more people back to work — rebuilding roads and bridges, schools and runways,” Obama said last September. “After two wars that have cost us thousands of lives and over a trillion dollars, it’s time to do some nation-building right here at home.”

 

 

The Fiscal Times FREE Newsletter

 

President George H.W. Bush and British Prime Minister Margaret Thatcher first used the term peace dividend at the end of the Cold War, when the fall of the Berlin Wall allowed each nation to concentrate on making butter, not guns. In the United States, the dividend paid off, as the economy roared back in the late 1990s.

 

BUDGETARY SLIGHT OF HAND

The peace dividend anticipated from the most recent U.S. wars will be hard to find because of the way money was spent in Iraq and Afghanistan, and how the military is structured, experts say. Just because money is not being spent by the Pentagon does not mean that it can be spent by other agencies to create jobs or improve infrastructure.

 

“You can’t look at it from the point of view of the United States having more to spend,” said Jacob Stokes, a research associate at the Center for New American Security. “That’s just not true.”

 

It’s accurate to say that defense spending is going to be cut by nearly $500 billion in the coming years. But the money being cut did not originally come out of a U.S. savings account. The vast majority of what we spent to finance Iraq and Afghanistan was borrowed.

 

So unless the White House plans to continue to borrow money at the clip it did to finance two wars, there won’t be any new money to fund the infrastructure programs Obama is touting.

 

According to Linda Bilmes, a professor at Harvard’s Kennedy School of Government, some of the planned cuts simply will not be able to occur.

 

“THE PEACE DIVIDEND WON’T MATERIALIZE”

“We’ve made so many decisions over the last 10 years that have made structural changes in the defense budget,” she said. Costs related to those decisions are “rising very fast and will continue to grow so rapidly that the peace dividend won’t materialize.”

 

Military leaders told a Congressional subcommittee Tuesday that the spending cuts would put the country at risk because the Pentagon would be unable to combat all threats. But according to Bilmes, the areas where the Pentagon is most stressed deal with soldier benefits and deferred maintenance, not weapons systems or troop readiness.

 

It used to be, “join the Army and get a college education.” Now, it’s “get a deal on health insurance.” The cost of Tricare, DOD’s health plan, is expected to rise dramatically in the coming years. In 2001, military healthcare spending accounted for just $19 billion. By 2012 that number had increased to $52.2 billion. A report by the Center for American Progress estimates that the Pentagon will spend $63.9 billion by 2015.

 

 

 

These expenditures are occurring as Tricare’s insurance rates for retired military families have increased annually from $600 to $820. For enlisted men and women, annual fees increase from $230 to $269.28 for individuals, and to from $460 for $538.56 families. Given these dirt-cheap rates, it’s no surprise that the number of people the Defense Department insures is increasing.

 

“We saw Tricare membership accelerating as the Obamacare mandates kick in,” she said. Soldiers and their families “will take up Tricare as it turns out to be cheaper than getting health care through the open market or through state plans.”

 

CONGRESS HITS THE PAY WALL

There are also costs related to soldier pay. In 2004 and 2005, the Bush administration adjusted military pay scales higher as part of an effort to increase recruiting. The Congressional Budget Office found that military pay outpaced the income growth in the private sector by more than 25 percent in the last ten years. Because Congress approved these increases, lawmakers must repeal them as well.

 

“The Pentagon has tried to get [the pay increases] rolled back but Congress has not been willing and is unlikely to be willing,” she said.

 

Bilmes also said there is growing pressure to provide long-term care for war veterans that serve less than the 20 years required to receive health care as part of a retirement plan.

 

“There’s a lot of pressure to change the structure of the pension plan so that it benefits Afghan and Iraq vets,” she said. “This will add another layer of cost.”

 

Lastly, there are costs related to maintenance. Equipment used in the war needs to be repaired or replaced. Until this equipment is evaluated, there is no way to estimate how much this will cost.

 

Stokes added that there are procurement requirements looming. Many of the weapons used to fight in Iraq and Afghanistan are relics of the Reagan era, and will need to be replaced. And as the F-35 fighter program proves, acquiring new weapons can be a costly experience that lasts for decades.

 

“Too much of a peace dividend means you’re not investing in the future technologies that you need,” he said. “At the same time, if you do the spending cuts the right way, you can do it in a way that keeps the country safe.”

 

 

Read more at http://www.thefiscaltimes.com/Articles/2013/02/27/Budget-Alert-Peace-Dividend-Has-Already-Been-Spent.aspx#t2UkC1ubAOEk3hDa.99

 

 

Names Emerging for U.S. Service Secretary, OSD Positions

 

Defense News

February 27, 2013

By MARCUS WEISGERBER

 

Now that Chuck Hagel has been confirmed and sworn in as U.S. defense secretary, names are emerging for who might become his top lieutenants as service secretaries and undersecretaries.

 

Carol DiBattiste and Sheila Cheston, lawyers who served in senior Pentagon posts during the Clinton administration, have emerged as candidates to become Air Force secretary.

 

The two women have had their names come to light as President Obama has come under fire for a lack of diversity among his nominees and appointees for top administration posts.

 

The nomination and confirmation of a female service secretary would be significant. Sheila Widnall, who served as Air Force secretary from August 1993 to October 1997, is the only woman to serve as a secretary of a military service.

 

For months, F. Whitten “Whit” Peters had been the only person said to be a candidate for Air Force secretary. Peters served as the Air Force secretary in the Clinton administration.

 

In recent weeks, DiBattiste and Cheston have been mentioned in Air Force circles as strong candidates to replace Michael Donley, a George W. Bush administration holdover who has served as Air Force secretary since October 2008. Donley is expected to step down this spring, according to defense sources.

 

DiBattiste is general counsel and chief administrative officer of online retailer Geeknet. She served as Air Force undersecretary from 1999 to 2001.

 

Cheston is currently a corporate vice president and general counsel for Northrop Grumman and served as Air Force general counsel from 1995 to 1998.

 

In the other services, Navy Secretary Ray Mabus is expected to remain in his current position, as Obama begins his second term.

 

Army Secretary John McHugh is expected to step down at some point during Obama’s second term, according to defense sources. Joseph Westphal, the current Army undersecretary, has been mentioned as a candidate to become secretary.

 

There are also several high-profile vacancies within the Office of the Secretary of Defense.

 

The undersecretary of personnel and readiness will play a major role, particularly if the Obama administration puts forth widespread personnel and benefits reforms.

 

Jessica Wright has been filling this position in an acting capacity since January. Erin Conaton stepped down as the undersecretary billet in December, citing a desire to return to personal life.

 

DoD also needs a top lawyer. Jeh Johnson stepped down late last year after serving as DoD’s general counsel since 2009. Robert Taylor, the No. 2 lawyer at DoD, is currently Pentagon’s acting general counsel.

 

Another vacant position is the assistant secretary of defense for research and engineering. The position, which reports to the Pentagon’s acquisition chief, has been vacant since Zachary Lemnios stepped down in November 2012.

 

 

Google’s Sergey Brin rips smartphones, shows off Glass

Brin calls smartphones ’emasculating’ as company looks for thousands of ‘explorers’ to test the digitized eyewear

 

Sharon Gaudin

February 28, 2013 (Computerworld)

 

Sergey Brin, Google co-founder and head of the company’s Glass project, said the computerized eyeglasses are more masculine than smartphones.

 

 

Brin wore the Glass device as he spoke at a TED conference in Long Beach, Calif., on Wednesday. He made it clear that his vision for the future of search is that people won’t have to make queries or disconnect from personal interactions to get the information they need.

 

“When we started Google 15 years ago, my vision was that information would come to you as you need it,” said Brin, according to a TED blog. “You wouldn’t have to search query at all… But for now, we get information by disconnecting from other people, looking down into our smartphone.”

 

Brin isn’t comfortable with staring down into a smartphone screen.

 

“Is this the way you’re meant to interact with other people?” he asked conference attendees. “Is the future of connection just people walking around hunched up, looking down, rubbing a featureless piece of glass? It’s kind of emasculating. Is this what you’re meant to do with your body?”

 

Brin talked about Glass and the future of digital connectivity on the same day that Google closed the application period for testing the wearable computers. The company on Feb. 20 announced it was looking for Glass “explorers” and asked applicants to tell how they would use the computerized glasses in 50 words or less.

 

Google on Thursday declined to say how many people applied to be in the first test group. However, a Google spokesman said the company is looking for several thousand explorers. The spokesman did not comment on when the first explorers will be announced.

 

Brin, during his talk, referred to the first explorers as “a few early, bleeding-edge adopters.”

 

Those applicants, who must be over 18 and live in the U.S., need to be ready to pay up for being an early adopter. Google said the first explorers will need to pay $1,500 plus tax for the glasses, along with travel expenses to attend a special “pick-up experience” in New York, San Francisco or Los Angeles.

 

When Google called for explorer applications, the company also released a video showing people using the glasses while skydiving, dancing, playing with their children and riding a roller coaster.

 

The video also shows off the Glass interface, which is a translucent pane on the right eye glass that shows options for taking photos, shooting videos, getting directions, sharing, search and showing maps with graphic overlays.

 

The glasses, which Google noted are now called Glass instead of Google Glass, also are designed to enable users to activate all these options with voice control.

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