 Ladies and gentlemen, first, let me thank you very much for coming this morning. We obviously are not going to be giving you the election results if any of you thought we had a sort of premature report. With luck we may get those by the 26th of this month. But I thought that it might be useful to talk about a very different set of subjects, which is what happens. After the election produces a result, and that may be a substantial time in the future. With most of the polling data that has not been made public, the end result is a runoff. And the runoff may or may not move all that smoothly. As I think many of you know, the challenge has then become, how does this interface in transition. And so, Stephanie and I, and you have seen the description of our background and the sheet you've been given in case any of you have missed this. I'm the old guy and she is a charming young analyst. But we both have been working on this issue. And been in Afghanistan and had the experience that many of you have shared in watching this develop and move toward this point of transition. And if I may move to the first of these issues. I think part of the problem we sometimes have in the United States is we focus on the election and not the aftermath. We see legitimacy in terms of the election result and not the quality of leadership and not the quality of governance and not the end results. We tend to forget that in many parts of the world democracy is essentially an extension of civil conflict by other means. It is a way of resolving problems and tensions, hopefully with a minimum of violence. And this is going to be a very difficult transition for obvious reasons. You look at political unity and you wonder what the post-Karzai political unity will be in ethnic, regional, sectarian and many other terms. One of your great problems is this is an extremely centralized government in terms of appointments down to the district level and not simply the district level in governance, but the district level in security. So that includes things like the police chief. The question is going to be when this election comes, has a result, and people take office, what's actually going to happen? How will you divide up power and behind the structure of democracy as a reality that this is essentially a country governed by power brokers and not governed by the electoral result? Revenue collection, budget planning, all of these are critical issues. And while we tend to try to ignore this, there are very good reasons why transparency international describes Afghanistan as ranking 175th worst in terms of corruption out of the 177 countries it ranks. A ranking shared by the World Bank and other outsiders. We all know that this will be a country at war and a country that will be at war long after the end of this year. And the transition to the Afghan national security forces is not simply one of doing something on a map. It actually has to work in the field and it has to work over time. For those of us who live through this in Vietnam, we realize how difficult that can be. For those of you who have seen what happened in Iraq, you realize how difficult it can be. We have to do something we have not yet had any public transparent image on. What are the security forces going to be after the end of this year? What will they cost? How will they be structured? What kind of advisory presence will actually exist then? We've seen recommendations from military leaders including General Dunford talking about figures of some 10,000 to 13,000, but there's been no public indication of what that will be, how we will restructure ISAF, how we will restructure the training centers, and how any of this will really be funded. You are looking at economic issues which I'm going to let Stephanie focus on. You are looking with critical problems that sound rather strange to raise, but some of you may have seen various rather interesting claims about the increase in GDP in Afghanistan and how it rose by some 12% in one year. But you may not realize where that came from and I'll let Stephanie explain that. And then the other critical issue here I think is neighbors and above all Pakistan and what's going to happen there. I think for us in particular one of the great problems we face is this is not a popular war in the United States anymore. It has not been a popular war among our allies for nearly half a decade. There is no clear pattern of support for where we're going. And we have no plan. We have not actually debated whether we should stay in Afghanistan and why we should stay in Afghanistan and how the resources to do that compared to other strategic obligations. And in today's era of competing areas in security and budget that's a critical problem. We have said economic reform is necessary but we have not set conditions or made it clear we have a plan for that. I think one of the things I found when I was working with General McChrystal was even then the general conclusion was the real strategic center of gravity in this war was not Afghanistan but Pakistan. But there is a constant effort to try to separate the two or perhaps focus on Afghanistan without looking at Pakistan. And I think some of you have seen the reviews of a recent book in the New York Times which I'm afraid in many ways is all too accurate that we will face a major ongoing problem with Pakistan well beyond this period of transition. One issue that we face just within the United States remember where we are. We probably will not see a real Afghan government till some point between July and September. And it will be very unclear how much of that government will work in all of the ministries in all of the regions that are required. But we too have a problem and one is we have no clear plan and therefore we have no clear budget request. We put placeholder money into the defense budget but there is no actual analysis behind those figures and no actual cost modeling. And the same is true of the aid being provided by the United States State Department and if you look at that 2.6 billion it's a major cut from the past. It's also almost exactly the revenue earning of all of Afghanistan in terms of its domestic budget earnings for last year. And that gives you an idea just how critical outside support will be. Layered defense is an idea that General Dunford has advanced. He builds on ideas General Allen and General Mattis raised. But we have no idea as yet what the administration really plans. We don't know and we have not seen any real reporting on what is actually happening in the war since some very limited public statistics issued last September. Almost every metric that used to be publicly reported on the Afghan war has not been reported for more than a year. And that is not because of outstanding success in the conflict. It is quite frankly because ISAF had to stop reporting when it found that its focus on enemy initiated attacks when I think a number of people would find, shall we say, ingenuous turned out to be wrong. And as Stephanie may comment we have seen exactly the same thing happen in terms of reporting on the impact of economic aid and economic development. There is a real question of not only how many advisors we will have but what they will actually do. Whether we really have enablers. What kind of coin capability we retain and what our allies will do. And I'm not going to talk in great depth about these numbers but there is one problem at the bottom that is not really critical. It isn't just a matter of people. One of our key problems has been that we often have not had advisors who are real advisors. You have to have the right people with the right background and the right skill. You have to give them facilities and you have to give them money and you have to plan for it in terms of time. And you need a stable force development plan. Having made more trips now to Afghanistan than I really care to remember let me note we have absolutely none of those things at the moment and we have a set of cost figures for which people claim there is a justification. Let me note having talked to the people who generate them that four billion figure has no justification and they directly disagree with it and feel it's going to take substantially larger funds. These aren't casual issues. I think that I'm not going to walk you through all of these I'm going to turn it over to Stephanie to deal with the economic side but just look as we go through this at some of the numbers remember that behind all of this is the issue of not simply election but governance. We will be out of the field we will not have people in the provinces we will be relying on contractors to the extent we rely on anyone. We'll have three US facilities left we don't know how many allies will have an aid presence or an advisory presence. We will be dealing with a UN facility or group called UNAMA. Those of you who are familiar with this may realize the war has been on for more than ten years and UNAMA has never issued one report on its efforts to coordinate aid or its effectiveness and we in the United States have not been able to issue reports on our effectiveness in issuing aid. With that let me turn it over to Stephanie. It's always nice to follow Tony giving him his rosy outlook on things in general but normally when you see two CSIs panelists up on a dais one is the good cop and one is the bad cop one is the one who says the hard news that needs to be told and the other one says on the other hand look at all the goodness that's happening. That's not going to occur at this panel session. I apologize for that because when Tony approached me about doing something together on this and the way we split it up as obviously you've heard he discussed a little bit about the security situation that the transition is not just about the security agreement and all of that and then I get the goal the great opportunity to talk about the economics of the situation and development. If we could go to the next slide let's talk a little bit about budget execution. This is not a good news story. As you can see from the slide measured in Afghanis budget execution rates remain really low particularly for the development budget. As Tony mentioned earlier transparency international has rated Afghanistan 175th out of 177. The World Bank calls them bad according to their corruption index and when you look at development expenditures you start to think okay what is this country living on and what will it live on after troops leave after the international presence leaves and we've all known from experience take Bosnia for example or Kosovo for example the reliance on international aid and the international presence in a country can be very very difficult to wean yourself off from if I can use that dangling participle. I can mention him just nudging me here but what you'll see from the next slide is that customs we don't have that next slide well I'll tell you about the next slide it shows that there has been a drop or decrease of 1 billion Afghanis in customs and in tax revenues in non-tax revenues it's down almost 4 billion Afghanis we'll get there eventually there we go so revenues are down budget execution is down ministries with development budgets of more than 50 million dollars only three of them health finance and rural development have executed more than 20% in the first half of 2013 that's an amazing figure only three ministries have had a budget execution rate of more than 20% in the first half of the year can I have you go back so aside from budget execution let's look a little bit at Afghanistan's demographics and this is not a new new story for any of you I just want to put this up there to show the diversity within Afghanistan and the reliance on such a young population if you add the numbers up it's over 60 well it's almost two thirds of the population is under 24 years old when you have low budget execution a poor employment situation what are you going to do with all of those people is that a recipe for stability absolutely not the urban population is growing men and women reaching employment age annually is also growing given the bulge of the youth coming up and then now we can talk a little bit about the economic challenges this situation causes this first couple of phrases strikes fear into the heart of the state department official but the new silk road is in fact dead the ring road is uncertain mineral wealth which was highly touted just three years ago is no miracle solution we all know sort of the tender process and the development process that mineral wealth requires not only speaking of those things but the technical and then also the policy implications for that and there's very little real growth other than aid and military spending so once that tapers off what's going to happen and you'll see this word rainfall here which seems odd in the context of this slide but we'll get back to it in a moment as Tony mentioned they're still at war highly aid dependent unclear who's going to plan and manage aid and revenues in government he actually seems a little bit more optimistic than me he said a government he said the government might be seated as soon as July to September about that I'm a little bit more pessimistic and thinking that it's going to take a little bit longer to actually see the government and then determining whether or not that government has the capability to actually execute a budget and manage aid and revenues is a huge question for me he mentioned the failure of Yunama the uncertain world bank going forward the service sector may leave exporting capital and brain drain leading to collapse told you this is not a good news story major barriers to private development Tony also mentioned the increasing reliance on contractors once the U.S. and allied presence tapers off one thing about the security agreement is that it is very uncertain how contractors will be treated under the security agreement and we'll have to see once a government is seated whether they're willing to negotiate anything with the United States government and other governments and then the question of contractors who will be left holding the bag it remains very very uncertain now the next slide talks a little bit about the rainfall the reason why this is important is that you see that second bullet the real GDP growth was 14.4% in 2012 a very sharp uptick what you'll notice in the chart to the left is that was highly you know if you look at the upswing again it's highly dependent on rainfall good crops not just opium crops you take them out of the equation you have a very much agriculture based society this is not a recipe for growth in the future as we all know having some manufacturing base can kind of leap you can leapfrog you over some of the hurdles that you face as a developing nation being primarily agriculture based is not a way to do that but it is highly dependent on agriculture and therefore healthy growing seasons and I believe we have two more slides the trade balance which I'm going to skip over for the most part but you can see our numbers there if I may just for a moment one thing you need to why did I put this in it wasn't because I was trying to be an economist we have no indication in the US government and aid budgets that have been spent on Afghanistan have actually been spent in Afghanistan there's no estimate whatsoever that has ever been made public and part of it is we simply don't have the data what we do have however is a very clear indication if you look at these numbers why are they so important because if this country is importing at that ratio relative to its exports and it has no real market sector generating hard currency this is a rough indication of the flow and impact of outside money and it's practical impact on the economy and the level of dependence very rough but then almost all the numbers are there and with that I'd like to conclude this formal part of the presentation from our perspective we were a little bit selfish in wanting to leave lots of time for questions and answers because I'm mostly curious about what you all are thinking what you all thought of the elections what you all think of the transition in a post-election period transition meaning for the Afghan government and we can also talk a little bit more about the transition for the US let's do that let me just note we did to the extent we can put together a presentation that tries to deal with all of these issues as much in quantitative terms as possible it's available on the web we gave you that nice sheet it probably takes you about 35 seconds to get it but a caution behind all of these numbers you often see very precise data on things like the number of people at school what you may not realize it has absolutely nothing to do with the number of people at school it is the requirement in theory for the number of people at school so the average requirement is nine years or the formal requirement is nine years and the average actual schooling is three you have percentages being given on population and the Afghan Central Statistics Office has a figure of 27 million which includes people outside the country and generally the international organizations put it at 31 to 34 million depending on how you're dealing with this and again there's been so little reporting over the last year the minute any number became somewhat negative it tended to disappear from official reports and official reports tended to disappear the challenge for all of us is not that this situation if I may say so is all that negative this is a very poor developing country the standards aren't that high and the opposition the Taliban isn't that strong but we have no clear plans no transparency no meaningful data and we have basically well under a year to get this done now let me just ask one favor please do wait for the microphone when the microphone does come after I recognize you please do introduce yourself and I would appreciate it if in general questions could kind of end in a question mark with that one set of caveats please to begin please I'm Harlan Oldman and thanks again for your presentations which were splendid two related questions first speculate where do you think Afghanistan and Pakistan may be in a couple of years and you can pick the time frame and second Tony what is your autopsy on how we got to where we did because these problems go back since we were into Afghanistan planning it's been going on almost as long as we've been in Afghanistan so how do you both analyze why we have failed to do basic things that should have been done when we first went in I think it is very very difficult to make an estimate here of where we are going because we don't have meaningful tests as yet of the Taliban national security forces the Taliban has had a very strong incentive basically not to waste forces attacking ISAF while ISAF was strong the Afghan forces are much more active than they were a year ago but their activity has not had anything like the activity in the field that you saw when ISAF were actively patrolling we know enough to realize the Taliban is not popular but we also know enough that very often local Afghan government is no more popular and we have major problems because the Afghan forces have gone through a whole set of constant shifts in their composition structure timing and it is not clear where they're headed and all the issues Stephanie raised are the background because we have to remember this is not a matter of how strong the insurgency is it is essentially the balance the balance of popularity and capability of the government on a civil military level relative to a series of insurgents with a sanctuary and ongoing support at least at some level from within the Pakistani security services I suspect we will not know for at least a year the history has been that usually it takes time to find out how a host country's forces actually operate when you shift the advisory phase historically it's about two to three years if you keep the money up if you don't keep the money up the answer is usually pretty quick they collapse what you can say is that there are no indications that there will be rapid development in Afghanistan there is no indication that the Afghan forces can operate on their own before sometime around 2018 at the earliest and those are estimates that are somewhat official when it comes down to Pakistan I think one of the problems we have there is Pakistan is not a failed state it has just lived for decades on the edge of being one and one of the problems is that it may or may not be able to cope with what is a serious internal challenge from its own version of the Taliban but that is a challenge which is now compounded by violence in Baluchistan and by other problems in the Punjab and the figures which for a while were reasonably positive on internal violence in Pakistan according to Pakistani analysts have become much more negative but frankly Harlan is to your other question very quickly we couldn't make or put a civil military plan together in Iraq either we have what claims to be a plan and what it usually is is about an hour's worth of power point and there are vectors and lines and very interesting diagrams a plan consists of a budget a plan consists of tangible activities a plan exists of how you actually execute a combined strategy and we have not developed that for either war and the efforts for example to have public transparency come out of our aid effort or part of Secretary Clinton's QDDR there has been zero real world practice and success in providing meaningful effectiveness measures on the civil side and on the military side we have had to withdraw our measures we never could force a practical planning structure there has never been an element within the National Security Council that forced that to take place I'm sure Stephanie who has lived through the other side of this has a few views as well as Tony mentioned I have a different perspective on it I think I agree that there is no U.S. plan it's the level at which we're talking where I think we disagree if you go to the Pentagon they're planning daily if you go into Afghanistan they're planning hour by hour there is no strategic plan he mentioned that I might have a different perspective I was at U.S. Embassy Baghdad in Iraq helping the State Department and then MNFI complete a joint campaign plan that had ends ways and means the problem is is that in the absence of a strategic plan and your two questions actually sort of dovetail together nicely which is you're asking not only about the lack of planning but you're asking about the future of Afghanistan and Pakistan I have yet to understand what the U.S. government or other governments want to see in five years so how do you know what your planning target is from a strategy perspective the lack of a strategic plan under which all of the other kinds of plans can nest and you can put resources against something and you can put actual boots on the ground for a purpose and you know that you've achieved it and you can stop the lack of that strategic plan is what worries me the most and that plan could tell you what your target is what you're looking for Pakistan to look like I agree with Tony Pakistan has been on the edge of being an ungoverned state it has ungoverned territories within its state and those are the ones that scare us the most but again absent a strategic plan to come up with a budget ends ways and means as we would call them depending on so my perspective the gentleman back there please wait for the mic sorry thanks Irving Rosenthal formally aid now a professor at American University you've used the word no plan no plan two or three years ago when Kerry was head of the Senate Foreign Relations Committee his committee issued a report saying that AID the development agency was doing a lousy job Rob Shaw came back with an answer that went around and around and around and around it appears to me there's a larger issue on the role of aid around the world but AID is a US development agency Rob Shaw is the head of AID when is Kerry going to bang Shaw on the head and say come up with a plan for Afghanistan development we the aid people failed in Vietnam when it was run by the military aid has failed in Afghanistan of course the military is there the military is out it seems to me from a management point of view I know who to put my finger on and who's going to tell them to do it I'm not sure that there is a clear question but let me make a couple of comments in fairness to aid Jesse Helms was not the easiest person to live with and one of the other problems is when you try to figure out the formal structure of responsibility for aid between state and USAID it's never really been particularly clarified one other thing is I'm old enough to remember that we decided in forming the World Bank that a lot of the functions which were originally designed to do that kind of planning would no longer be needed now that was a long long time ago I think you might ask how collectively we could have left the structure that developed in the course of creating international institutions we didn't really allow to function in Afghanistan letting Senator Helms create what he did out of USAID and state and then going into two cases of massive armed nation building but I do have to say that quite frankly for us to never try to make Yanama work for us to do project aid as if we were not at war and to go on and on without having any meaningful measures of effectiveness other than how much money we can spend and actually disperse in the field and I come from Chicago and let me say the ability of governments to spend money has never been a measure of merit unless you could tie it to the outcome I agree with what Tony has said I will offer an example in my experience in a transition I understand Afghanistan is a very different situation from Iraq but if we talk about how USAID functions in both those situations I think you can draw some parallels and one parallel or one anecdote I will offer is when we were doing our joint campaign plan in Baghdad we asked USAID when the US military leaves taking its security forces funding away taking away its commander's emergency response program funding away how will USAID react and their response was we don't even consider those we just work on our programs so it will have no impact on us yeah I laughed too and I laughed still in talking to people operating in Afghanistan the military transition will have no impact on them whatsoever I agree that there needs to be a look at how state and particularly state F and USAID interact I want to take it away from personalities and talk about how we can better structure assistance but that's a conversation beyond just Afghanistan in my opinion the young lady over there hi this is a good segue I'm Katie Tillahan I work for DAI one of USAID's big partners in Afghanistan and I'm not going to go into a big defense of USAID I'm more curious about you talked a lot about how we shouldn't just be focusing on the election we should really be talking about governance and I'm curious about the election we talked so much about the executive office but actually part of these elections were the provincial councils which will have a large impact on the parliament also and I'm wondering if you are looking at that at all as part of your analysis of the elections and kind of what conclusions you're drawing from that I can also say as a USAID partner we are really freaked out about the military leaving so we're thinking about it one problem we really have here is that Karzai took the position that any public opinion poll once the campaign formerly began was could not be made public now in the process polls did go on but they have not been released and that I think it's also true that they did not get down to the level where you could actually figure out with any reliability because people who did the polling produced such different results but the most serious problem we really have is does it really matter what happens in the provincial election given the appointment powers of the new president and one of the things that you have to constantly ask yourself is exactly what is it that the Afghan legislature actually does because it can in some ways say no it can lobby but looking at the outside analysis of the dynamics of Afghanistan it focuses not on the legislature or even the ministers it focuses on power brokers and it focuses on the relationship between the president and the power brokers and it focuses on the appointment authority that will go down to the district police chief level on the part of the president and above all it focuses on money and remember that part of the goal here is governance would get to the point where it could allocate 50% of the aid money which is going to be really interesting in 2015 because an awful lot of NGOs have already begun to leave and we won't have any PRTs and they certainly cannot as yet execute 50% of the aid money now these are the kind of realities for a country at war as undeveloped as Afghanistan is in many ways which are critical and honestly until we see what happens if there is a runoff how many of the power brokers do or do not sort of accept the process versus going back to the more traditional election approach of 2009 how many accept the result once there is a government in place and as Stephanie points out that's itself a question what we do know is that yes there are still very serious regional leaders now a lot of them are not clearly elected in the normal sense there but it's going to be one of the most critical issues and in some ways as critical as what the Taliban and the insurgents do and we are going to find out by watching and seeing what happens over the next few months if I could just add briefly to that Tony and I have talked about you know did people really expect a lot of violence before the election or strongman tactics during the election and what we've seen is that there hasn't been much of that and that is because when you're developing a government you're electing new leadership the Afghan people have a choice there is the Taliban on one hand it's up to us mostly the Afghans but also us and other international partners of Afghanistan to figure out what the alternative is the Taliban has done a good job in helping to shape the election environment so I'm not particularly surprised there hasn't been a lot of violence relative to overall trends but I think as the government forms and as we see what happens on the provincial and district level as the power brokers sort of step up into and get ready to actually make a play in terms of influence and the use of violence as a tool is when we'll start to see sort of where the rubber meets the road in terms of what will happen down in the country people outside of Kabul who you know this is their government too but they mostly turn to the local leaders we also have a few troublesome indicators let me just note that we put an immense amount of effort into trying to secure Helmand and we've done it in some areas along the river the fact is that we have seen in spite of that military effort Helmand has sharply increased its narcotics output and most of that narcotics output is still tied to the Taliban so you have not been able to show that you have a stable pattern of control in the area where the US Marines fought a remarkably difficult battle along with their British allies we know that a lot of the polling places that were in areas which were Pashtun and Taliban dominated could not open and there was no voting there we know that there is a lot more enthusiasm in urban and settled areas but these present critical problems for estimating how the provincial elections and the rest affect General Dunford's concept of layered defense if the president decides to man and fund it because the real question is how much of Afghanistan will be under de facto Taliban control and let me note for those of us who are actually old enough to have been in Vietnam one of the most striking things about this war is we went to an immense amount of trouble to actually map the areas under insurgent influence and control in various ways and what ISAF has done is to constantly map the number of tactical engagements hence the enemy initiated attacks let me say everything I have ever learned about counter insurgency indicates that this is a ridiculous measure of military effectiveness and it is the way people lose insurgency struggles let's see the gentleman on the aisle there thank you this has been a wonderfully rosy presentation I'm Doug Brooks with the Afghan American Chamber of Commerce I guess a couple of points questions I think the Afghan ambassador to the United States has made the point that the current agreement is still in place if the BSA is not signed and he says essentially that's even better for the forces if they decide to use it into the future is that true and of course I think every single candidate has basically said they will sign the BSA eventually and perhaps some of the planning that you can talk about can be sort of based on that idea and then finally I guess the one question is the massive turnout that was there despite the Taliban threats certainly seems to indicate an overwhelming popular desire to at least reject the Taliban and move towards some sort of democratic legitimacy I just wonder if you could comment on that thank you the BSA I think would have said it won't now whether we intend to stay with that position the critical problem is BSA to protect whom for what and until you actually have reached the point where the administration says whether we have a semi-zero option this sort of coin light or we come close to the goals set by General Allen General Mattis and General Dunford and I note that the history of U.S. military advisory efforts is to sharply underestimate the time and number of trainers required not overestimate we simply don't know I think on polling you have to be extremely careful first a lot of this vote is very much a matter of population centers not the areas where the Taliban has had impact or influence the second thing is public opinion polls that were done before the election and didn't focus on the election produced a result which said that the vast majority of Afghans wanted to see the Taliban included in the government under the conditions that if they were included in the government there wouldn't be any more military activity in the country in the country and that's what's going on with the Taliban that doesn't really tell you that you know what's going to happen next let's see the lady in back hi I'm Samantha from D3 systems you speak a lot about the economic and political effects after the transition period but I'm also wondering about participation in politics and even higher turnout rates with this transition period and changes in government where do we expect to see the direction of women's rights go now if you thought our story was rosy before what's unfortunate is because of the uncertainty in leadership of the government as well as the kinds of people who may be appointed I don't have a very rosy picture to offer you my last time in Afghanistan I was talking to women small women owned businesses we also talked to some that were run by men but our focus was really looking at the women owned businesses because as I mentioned before I'm looking beyond agriculture what are the key elements of development and how can you help the nation move forward from that every single small business we talked to women and men said that they are leaving sometime in 2014 that they've made the money that they would hope to make or what they've been able to make and that they do plan on fleeing the country this is not only just brain drain but it's also sort of a whole economic layer drain and whereas I agree that women have made vast improvements over the last years I don't see them necessarily as being sustained I would be pleasantly surprised if they were now representation in parliament any legal constraints notwithstanding of what quotas are looking like but generally I think the overall picture of women in Afghanistan is not a good one I don't know Tony do you have anything to add well I just wanted to show you yes there has been progress in human development one has to be a little careful because first a lot of these numbers back when I went to graduate school you were occasionally asked to justify your data and not merely your method that is a lost art within the United States government and it seems to be a lost art within the media if you recite almost any number of g&p teaching medical or so on people will accept it without asking exactly where it came from in Afghanistan's case the truth is you don't have any ability to measure a lot of these things and what pass for studies aren't studies the methodology simply doesn't track with anything that's professional that said this is positive but look at how this compares with the trends in two other incredibly poor countries in the region and the problem is that this is a country where the agricultural sector is not only water dependent it is so inefficient that it employs more than 70% of the labor force roughly for about 20% of the g&p now that is a massive disconnect in the country's future Stephanie showed you those figures for the service sector now what could be more boring than the service sector although I suspect everyone in this room works in it the problem is the service sector is in general supported by outside money and if that outside money isn't sustained as Stephanie pointed out you not only get people leaving but remember that this particular sector is the one that includes the people in the ANSF the people in the security services the people in governance and the question is going to be how often and how long is it sustained I guess finally a caution too the world bank I think to the extent anyone has done some credible work in looking at the economic and social issues with numbers somebody actually tried to survey and they will tell you they never had the resources to do a meaningful data collection exercise in the field it concluded there would not be a major recession or crisis in Afghanistan because so few people had been impacted by economic aid and so few people were in the market sector the problem is if the people who make the modern economy and urban areas and have guns are in the market sector the fact that people in the rural agricultural areas aren't affected by funding cuts doesn't mean that much and we have never addressed that in any of the US policy books at what's going to happen in transition thank you my name is Natalie Nicholas just a couple questions directly pertaining to the election is there any one candidate that you think the US should be sort of gunning for and I know that were a few weeks out of any real results but do you speculate anyone coming out with over 50% to avoid a runoff you commented very briefly on the BSA but do you believe that those candidates are truly committed to signing a BSA even though they've told us that and the game sort of we played with Karzai but would you anticipate anything viable coming out of any of those candidates I'm still a little struck by the phrase of gunning for the candidate but I know that Stephanie began this I don't believe we can avoid a runoff at this point because I think even if the numbers come back with someone over 50% there will be charges of there will be allegations of activity that it will be challenged and there will be a runoff I believe Tony and I are in agreement about who will be in that runoff Ashraf Ghani and Abdullah Abdullah now whether the US should back one over the other I think because it's a runoff situation the US government would be better off publicly saying we will work with whoever wins the runoff election because at that point the uncertainty is higher the risk is greater for gunning for a candidate and your other question about the BSA I would like to invite statements that say whatever candidate will work with the United States I think any candidate would want to make the BSA have at least reflect what he wants to see in it so I think we will see some changes I don't think anyone will accept it completely I mean put yourself in their situation you would want to make your own mark on the first big international agreement that you have as president of our country how long that negotiation takes whether the US can find terms acceptable and the impact that has on withdrawal planning or redeployment planning I mean if you look at waterfall charts of who gets to come out when we are already collapsing a lot of the cops and the fobs or I can use that in this situation as we consolidate to the larger bases like Bagram and Kandahar at one point you are going to start moving people out you are going to be a point of no return and if there isn't a duly elected president sometime on the earlier side in Tony's window in July through September he actually declare a winner get him in place so he can start creating governance structures according to his model we are really going to pass that point of no return Tony? I think that I would certainly agree with Stephanie they are both decent men very Ashraf Ghani is certainly a competent economist I think he has done as much as anyone can as an Afghan to move towards some kind of planning structure what is a little frightening is that if he doesn't win the one economic planner in the country presumably is no longer in office but in Afghanistan anything can happen Abdullah Abdullah I think is a very pleasant man who has no background governing or administering anything and actually leading a country isn't all that easy particularly one this difficult and complex so we need to remember it isn't just a matter of candidates and as Stephanie points out we can't create that structure for them one way or another it will be a function of the power brokers how you deal with various ethnic and sectarian groups how you change the appointments these are realities we can't somehow dictate particularly at this point where we go the caution I would give you about the BSA is quite frankly about all it can do is set the terms for us staying now I find some of the commentary about what we would do there if we don't have the strategy that's been recommended by general Dunford and others sometimes layer defense and sometimes the so called four quarters or four corners strategy if we don't have a massive advisory presence that can reach down to the core level and has some enabling capability I don't know what lesser numbers do the whole history is this thing won't hold together unless you sustain that advisory presence it's equally true that's what's even more important that the advisory presence is the money because quite frankly if you don't push that money out into the Afghan local police the police in the Afghan national army this thing will not hold together either and it's not a matter if it's a choice between advisers or money it's a hard choice but I put the choice in terms of the money and now there are some things that really bother me because I have heard people talk about well we won't provide the advisory presence but we'll advise or we'll provide a very limited number of counter insurgency fighters sometimes it figures around 1000 sometimes it's around 3000 well I don't know if the senate arm services committee has had a screening of the expendables but it's short of Sylvester Stallone and the former governor of California if anybody can explain to me how in hell this would actually accomplish anything on a sustainable useful military level I'd like to hear it the other one is somehow we're going to be in Afghanistan to basically guard Pakistani nuclear weapons and that's even harder to understand than the idea we're going to do a coin operation this isn't a country that has only a few Pakistan's putting tactical nuclear weapons into the field we're going to go in and do what with what from Afghanistan this is going to be we're taking out bin Laden with nukes so I think we need to think an awful lot beyond the BSA I think that let me just officially we're at the 1030 mark so we'll take a few more questions but we will not find it rude if you have to meet your calendar the gentleman here I think in the second row I'm Terry Murphy also with CSIS I'm the representative of the massive cheering section for Stephanie I have their vote I was a brilliant young man went bad but a brilliant young man and as a mere toddler I read the newspaper about the attack on Korea in on the 25th of June 1950 and reading the memoirs of the Korea war the principal emotion from the soldiers was the smell it was dung everywhere Korea was a absolute barnyard and after that period in Korea there was a tremendous amount of corruption people disappeared into jails they never were heard from again all sorts of dreadful things happen in Korea now we have Korean motor cars driving up the street here Korean computer companies leading Korean engineering companies with Bechtel et cetera et cetera I would ask you both of you combined wisdom to cast your eye not back to the Vietnam war but 65 years beyond everybody's time on earth and imagine what might be the case in Afghanistan you want to start a conflict of interest disclaimer my brother took a scenic walk south from a reservoir as a marine in Korea I'm not sure that he felt that dung was his major problem but quite seriously first in retrospect we know we kept up the aid money we also know that we kept up a massive military presence in Korea so basically we did none of the things that we did or we are planning to do in transition in Afghanistan and if you look at this briefing I think what is interesting in a different way somewhere in here is a slide that they put together that I think is very useful can we find that Stephanie? Yeah let's see this is neither Vietnam nor Korea but it is a warning the only thing I would have to add and thank you for your kind remarks Terry is that we are in such a I mean everyone knows this the budget situation that we are in not affecting not only DOD but state and USAID funding levels even if maintaining assistance and a presence at a really robust level were possible manpower wise otherwise the budget is just not there we have Afghanistan fatigue we have got other worries elsewhere in the world obviously you all know about the rebalance towards Asia and not the Afghanistan part of Asia and so with everything else that is going on I take your point that if we had a Marshall plan as everyone says for the region things might be different but that is just not the world we are facing right now and I am not just talking about the budget control act because we now have some relief from that but the sequestration that we are looking at and then also just the downsizing of all the services really taking up the planners time effort energy as opposed to continuing on in Afghanistan in a way that would lead to a situation like you described for Korea let me make this one last question the gentleman back there thank you for your excellent presentation I am Fred Chang from Chinese Academy of Social Sciences and I have two questions the first one is to what extent do you think the chaos going on in Afghanistan is due to the lack of collaboration between the different countries and nations sharing the restriction work in Afghanistan because you know the civilian part or the military part maybe shared by different countries can we move on to the second question my second question is you know there is always some kind of correlations between what is going on in Afghanistan and what is happening in China's Xinjiang province so I want to know from your perspective what is China's role during the transition period thank you in terms of international cooperation one of the great tragedies in a way is you created a structure that was supposed to coordinate this called Yanama and on fairness to some successful and very decent people at Yanama in other areas what was very clear is that countries would not coordinate their aid efforts they simply would not work with each other many of them would not actually work with the Afghan law and inform the Afghan government of where and how they were spending money much less work on a common plan in many cases people were on less than one year tours with zero background in countries like Afghanistan fortunately for us there were some very good people who stayed for years in a number of countries but at least one country surprised itself in Europe on being a lead aid donor the tour of duty in Afghanistan was eight months and I can tell you from talking to their foreign minister they went through the same drill every time the new person would come in find out the previous head of the aid effort was a disaster take eight months to claim success leave and be replaced now this isn't new we kept saying every year was a new year in Vietnam having both been in that part of China and having been to meetings in China on this the general reaction quite honestly from the Chinese government was a very wise one it is to try to stay out of this and hope that somewhere in the international community other people are going to take over the responsibility for this mess now that is not perhaps what would be said officially but it's fairly clear for everyone that at this point in time the problems China and others face with Islamist extremists go far beyond Afghanistan it isn't even a meaningful center of outside volunteers and training activity other parts of Central Asia and Pakistan are but there really is very little flow of fighters or influence out of Afghanistan into China and more than that one of the things that is really interesting about our time in Afghanistan is there is no country around Afghanistan which has a development plan for supporting Afghanistan after transition including Pakistan Iran is putting a road system that will largely bypass Afghanistan a few of the Central Asian states are basically exploring their own immediate ethnic interest areas but this is a country which at this point is going to be left very much on its own and as yet I have not heard anyone suggest anywhere in public what the replacement for Yunama will be I think ladies and gentlemen we have run over time I appreciate your staying let me ask you to thank Stephanie in the traditional manner