 I appreciate it having the cats. I don't ever disagree with somebody like Admiral Katz. The only thing I want to point out is that I'm old enough. I was in the Navy before the swathes. I don't know what I'm talking about. Maybe the Air Force had their wings. Submariners had their dolphins. We had black shoes. In fact, and then I'll quit telling sea stories, but my last job on Little Rock was one of my collateral duties. I was put in charge of the closed circuit television station. And our theme song was, Mothers of Invention Brown Shoes Don't Make It. Which really endeared me to the Hilo debt. A little rock. So I want to thank y'all. Thank y'all for having me. I'm glad to be back with my fellow surface warriors. I want to thank the cats, the members of this association. Thank you for what you do. Thank you for making sure that we stay apprised of the issues that are facing our surface fleet. And we've got to have strong support from organizations like you. We're going to continue to develop the creative solutions that we've got to have as we face an ever changing, ever more complex world. We face, as you know, a national, international security environment that's full of complexities and uncertainties. Social disorder, political change. Dancing technology around the world continue to drive our foreign policy and global engagement. Now our Navy and our Marine Corps, our America's first line of defense, deployed worldwide. We're America's way team. Uniquely what we provide the Navy and Marine Corps is presence. That constant presence, ready for any challenge that may come over the horizon. Now, I talk about presence a lot, but what does it really mean? First it means that we deploy pretty much the same in times of war and in times of peace. In order to provide that presence that we need, today we have more than 100 ships deployed and more than 30,000 Marines deployed around the world. And they're doing this myriad of missions from airstrikes against ISIL to fighting Ebola, to exercising with our partners and our friends to protect freedom of navigation in the Pacific. And as we've drawn down from two land wars, our sister services talk about reset and coming home. Well, there are no permanent homecomings for sailors and Marines. For 239 years we've deployed continually to keep America adversaries far from our own shores. We deploy not only to fight and win our nation's wars, but also to act as a powerful deterrent to potential adversaries. Second presence means where it matters, when it matters. Because we're forward deployed, we're usually there when a crisis begins to develop. Coming from the sea, we can get any place quicker. We can stay as long as we need to. We bring everything we need and we don't have to ask anybody's permission to operate. Those are pretty significant attributes. When you think about some of the distances involved and some of the time needed to react. Being there, providing that presence, gives our nation's leaders an array of options. And those options range from the humanitarian assistance calls that we get on a very regular basis, including things like Japan, the Philippines, Haiti, to delivering first strikes against ISIL off the deck of the USS George H.W. Bush. And that last one is a great example. When the President decided that we would strike ISIL, the Bush was in the Northern Arabian Sea doing combat air over Afghanistan. Within 30 hours, she was in the Northern Arabian Gulf on station, ready to launch strikes. She was our only option for 54 days. 54 days. And it wasn't because we didn't have other assets in the region. It was because we couldn't get permission to take off armed to do those strikes. We didn't have to ask anybody whether we could take off from the Bush. I think that's one example of just how vital Navy Marine Corps are to our national security. And it goes back through history from the victories over the British frigates 200 years ago, from Manila Bay, Battle of the Atlantic in World War I, the vast reaches of the Pacific in World War II. It isn't only our physical security, as important as that is, that we defend. It's also our economic well-being. The Navy and Marine Corps contribute to our security in a way that's felt by every single American. And the shelves of stores across this country, they're just in time deliveries. And so what we do has a direct impact on the availability of goods and all the prices. I can make a pretty good argument and do a lot that the United States Navy has been the primary reason for the success of the international economic system by protecting the sea lanes and keeping those sea lanes open for everybody involved in peaceful commerce. And the other thing I'm talking about is jobs. In the United States, over 40 million people have jobs directly typed to international seafloor trade, more than one in four working Americans. That's because we live in such an age of globalization and world trade, 90% of all commerce goes by sea. 95% of all our telecommunications and data go under the sea. Our commercial, our economic success is tied to the sea in so many ways and to the rest of the world. And it's not just people who work on imports or on shelves. From farming to fashion, from electronics to energy, manufacturing of all kinds are dependent on the imports and the exports over the world's oceans. So the security that we provide is tied directly to main streets all across this country. And leaving a conquest at great universities have told us about the link between and approved the link between the far presence of the Navy and Marine Corps and the stability of this globalized economy. And while we benefit economically, we also benefit from the way some of this shared economic success helps limit conflict and potential wars. When you look around the world where you see unrest and violence, a lot of times you also find employment, stagnant economies, financial storms, by helping to secure the world's oceans, protect free trade, respond to crisis early, prevent escalation, U.S. Navy, Marine Corps, or Biden to the American people to our security. Providing that presence falls on the surface fleet, the foundation of our Navy. This is sort of a truism, which I have to explain from time to time. The foundation of our Navy is ships. That's what we are. That's why we're the Navy. We have to have right-sized fleet to do what we need to do. Now, I've lost track of the number of times people have come up to me and explained to me how our fleet is shrinking. And so, y'all have heard these numbers before, but I'm going to do it again until nobody comes up and says, fleet shrinking. On September 11th, 2001, the U.S. Navy had 316 ships. By 2008, after one of the great military build-ups in our nation's history, our fleet was down to 278 ships. In the five years before I came into this office, the U.S. Navy put 27 ships under contract. That was not enough to halt the decline in the size of the fleet, and it was also not enough to protect our industrial base. In the first five years I've been in office, we have built, we have put under contract, 70 ships. A smaller-type line. For Navy, in 2014, we launched nine ships. And by the end of the decade, our fleet's going to be back over 300 ships. And so, when you say that, the next criticism you get is, well, yeah, that's great, but you've done it at the cost of aviation. Long. In five years, first five years I've been secretary, we have bought 1,300 naval aircraft. That's 40% more than we've bought in the five years. We're not neglecting ships or planes. And even as we deal with possible impacts of sequester, now it's not the time to give up on the progress that we've made in our shipbuilding. I don't believe y'all to pay for one navy ship with another navy ship. Shipbuilding takes a long time. It's a long lead tax. It takes a long time to get a ship from drawings to commission. It's the least reversible thing we do. If you miss a year, if you cancel a ship, you can't get it back because our industrial base can't happen twice what we had if we miss a year and we try to push it in to the next year. We have to have those gray halls on the horizon. So we're building a battles fleet. First example is a bad example for this audience, but two Virginia-class attack submarines. I know what submariners call us, targets, but we've got to command the undersea as well as the surface. We're building two DDGs. We commissioned a big deck and filled in October. Another one is under construction. In Congress, in the 2015 budget, it's put in money for an additional LPD. We're building other support ships like mobile landing platforms and a four-form staging basis. All of these programs are on schedule and either on or under budget. We also have two carriers under construction. CVN-78 and CVN-79. Now, you've heard as I have about the cost of this carrier program. And it's pretty clear that CVN-78 before is a prime example of how not to build a ship. We started designing it while we were building it. Too much technology that was not mature, not proven, tried to be pushed into this first ship. And it's a cost-plus contract. But since I've come into this office, we've started some very strict oversight. And we're driving down the cost of CVN-78 and, perhaps more importantly, CVN-79. Taking the lessons learned from CVN-78 and applying them to CVN-79 and the Kennedy. And at this point, and I believe going forward, too, I believe that we're strong both ships are under and will remain under the congressional cost cap. So we've made some real progress there. And finally, I want to talk to you about our small services and battles. Today in the shipyard in Marinette, Wisconsin, we've got five freedom class ships currently under construction, including the next USS Little Rock. It's an amazing thing to be able to name Navy ships. And in Mobile, alongside the high-speed vessels that are in serial production, we have five independence class ships under construction. Four in the fleet, and in 2015, the shipyards are going to deliver four more. Now, there's also been a lot of stories about LCS. And usually the facts are at least a couple of years, and usually more than that. The facts cited are usually 34 years behind the reality. There's based on bad data. Because we're in serial production on both places of ship. The costs keep coming down. We're launching on schedule. And when this program started, it did it. But they've been turned around. And this program, in a lot of ways, is an acquisition, a success story, and a model program. And they're coming in well, well, these ships are going to be critical We have a demonstrated need for 52 of them. Last week, we saw the final deployment of the USS Kauffman, our last Perry class fleet. For decades, Perry class has done an outstanding job. Been a central part of our work with our partners in theater security missions, providing lower cost, small footprint approaches to operations. These roles are going to be filled by the Freedom and Independence class of ships. And like every ship we're introducing, these new ships are far more capable than the ones they're replacing. They're operating unmanned systems. They've got a wealth of new innovative technology. And they're going to be far deployed a whole lot more. As Kauffman leaves on her last voyage, USS Fort Worth is in Singapore on her first voyage. She's testing the lessons that we learned from freedoms deployment to Singapore in the last two years. The upgrade we've made to both the hardware and the operating concepts that we based on those lessons, from the systems experience, we've made 400 individual changes to Fort Worth before she deployed. Now, this class of ship and both were variants of equally at home in blue water and brown, Fort Worth is tailor made for the broad expanses of the Pacific, which she crossed to get to Singapore with more or less fuel than had been anticipated. But flexible and agile enough to work in the Latorals and coastal waters Southeast Asia. She's going to be in Singapore for 16 months and we're going to rotate three crews in ship stays where it is. The crews come and join the ship. And immediately after arriving in Singapore she went back to sea part in the search operations for the Air Asia flight. These ships are a test case of the Air Normal part of our fleet. And based on the results of the small surface combatant task force we're improving both variants making them more lethal making them more survival. Ensuring that they are multi-mission. And by improving these we're also doing the constant incremental improvements that we do on every ship class. And even with the additional expense of putting in this increased mortality increased survivability, these ships are still going to come in under the map that was set for them before they had this these improvements. Some of the things we put in is a new over the horizon missile, surface to surface missile, upgraded improved combat systems, a dedicated towed array, sonar and we're hardening certain parts of the ship to make it more survival. And because of the efficiency of the arms and the way we've been able to reduce cost, this ship is still going to be the most affordable in our arsenal. I've talked to everyone, cats talked about my ship for Little Rock. We had a thousand people on that ship. She was an old ship. She was built during World War II and after the war she was laid out putting moth bombs. As a cold war heated up in the fifties, she was pulled out put through a refit that lasted three years. Weapons taken out, new ones put on new sensors added, the entire back of the ship, the stern I guess, the superstructure was taken out and replaced in about as ugly a configuration as you can imagine. But the biggest challenge was the addition of the then revolutionary new weapon the Talos, guided missile. And Little Rock went through that one big conversion of several small ones and served until the past and middle of the 70s. And the history of that ship is one of the hallmarks of the constant drive in the naval profession in the surface community for improvement adaptation. The Navy tore that ship apart inside out and rebuilt it to make it a viable platform for a new age. And we've done that over and over again from the model to the first in power armoured ships during the Civil War to the gunnery revolution led by some junior officers in the last century. Marine Corps development of amphibious warfare between the two war wars by sailors. Our Marines have always looked to be on the cutting edge. And I think we need to embrace a couple of things. One is the tradition of the Navy, a long tradition. And it's a tradition of innovation, developing new ideas. When Little Rock was put into the shipyard and rebuilt as a new kind of cruiser she was redesivated. She started out as a CL light cruiser because that's what the nation needed at the end of World War II. Once she was refitted, recommissioned she was changed to CLG light guided missile cruiser. And it's changed connected to a new and innovative weapon system with a long naval history and tradition. And we've a little bit gotten away from that today. We started naming ships or designating ships with some interesting acronyms that seem to have come out of the Pentagon instead of our naval traditions. And I'm thinking about things like A-F-S-B M-L-P-J-H-S-B and of course L-C-S. It's not an L-class ship. I hear L I think M-Fee. Everybody else does. I hear Latoral and I have to tell you I've spent a good bit of my time explaining what a Latoral is. So I think it's time that we reconnect our tradition of innovation and creative thinking with what we're doing today. Talk with CNO Assistant Secretary for Acquisition Sean Stacklin. We got input from this community and so we're going to start with the L-C-S. One of the requirements that the small service patent task force had was to have a ship with frigate light capabilities. It's a frigate. We're going to call it one. We're going to change the hull designation from L-C-S to F-F-4 for L-C-S. It's going to be the same ship same program of record just with an appropriate and a traditional name. And in coming weeks we're going to announce new hull designations for the other types of ships that I have mentioned. As a former CNO George Anderson once said the Navy has both a tradition and a future and we look with pride and confidence in both directions. For 239 years our Navy and Marine Corps have been agile, innovative, and adaptive. They are deployed. They remain the most responsive option to defend the United States. We have to make sure even through these certain times that it remains so. So from the Navy so for Fortis for every courageous from the Marines so for Fidelis always faithful. Thank you. I know this is a shy group but I've got one, sir. We have eight. Well number one we're driving down the cost of everything. Born in 1901 tree grower on the hardware store in Ackman, Mississippi. Also is one of the cheapest people God has ever seen fit in. Back when I was running for state auditor in Mississippi I met a guy at Wiggins, Mississippi who came up to me and said yes sir I am. He said I'm going to vote for you. If you're half as cheap as the state's money as your daddy is with his we'll be okay. Let me just say I am his son. So that's one way. A second way is don't fall into the trap of paying for one Navy ship with another Navy ship. The fact that big platforms are easy targets for budget cutters. Take a ship. Take a carrier. Take a destroyer. They'll save you X amount of money. Look at harder things. We're saving at least four billion dollars a year on service contracts today. And it's because now we can track the dollar from when Congress appropriates it to when we get a contract. A couple years ago we couldn't do that. It's hard. And it's not big and you can't say well we're taking that but there's real money there. And it's about setting some priorities and sticking with old protection bill. As long as I possibly can. Good morning. I wanted to ask you there were reports out this week that the Navy's now decided with the Marines to go ahead and opt for the V-22 to take care of the carrier onboard delivery. Can you walk us through that decision and explain what you'll get from the V-22 whether there's additional capabilities? And then I wanted to ask you real quickly I know that the budget is pretty seasonal but we do know that sequestration is due to take effect again in fiscal 16 and we've heard that the Pentagon is going to submit a budget that is over the sequestration limits. Can you just talk about what you think is going to happen with sequestration and whether you think you'll get it lifted. Thank you. Andrew I would have been so disappointed if you hadn't asked me to talk about some things I cannot talk about until the budget drops. And I can't about either one of those and I know that the memorandum has become public before the budget but I'm simply going to have to wait until the budget drops. On the V-22 the one thing I will say about the possible use of V-22 is that is a great example of the Navy Marine Corps team so a great example of using a proven a proven manufacturing process proven asset to get lower costs instead of starting over on a completely new system. So after I think it's still February 2nd after February 2nd I'll be happy to sit down and talk to you about all sorts of details. Well I mean regardless of what budget is put in finally the President's got a responsibility to put in a budget that he believes will protect the United States from there and he takes that very seriously and so do we. Well I've described sequestration using a technical term dumb it and it will have some pretty devastating impacts what my argument has been is that you won't necessarily have a smaller fleet because I'm going to protect sugar but it's going to have bad impact somewhere our bases we're already 70% sustained for our bases and we're looking at that it's going to have an impact not on the forward deployed forces but particularly this is a case of Marines they're going to have everything they need when we deploy the training the equipment but it's the next to go and it's the people at home and their training cycle and their access to equipment that they're going to be impacted and so part of I think part of our job is showing some of those impacts going forward if sequestration were to hit Congress has shown in 1450 we can we can avoid this and again I think it's our responsibility to put in a budget that we think does the job of meeting the missions that the country expects of us and to defend the country who else Mr. Secretary Martin Auto-Crosh with C-Po and magazine and a former Brown shoe I apologize Auto we like surface they take us where we need to go clarification the FF designation will be on the next 20 LCS and the first 32 will be named to be determined pretty much the only thing I will say about it will certainly be on the last 20 we're doing the detailed engineering work and design work right now to do the enhanced survivability enhanced fatality if we can fold those in earlier than 19 which is when we're we'll finish building 32 we can fold it in earlier those ships will be designated FF and one of the great things about the way the small surface combatant task force came out is we can retrofit either version with these upgrades and as ships get retrofitted their designation will change we're looking at what to call the first the first number of what is today and would you respond to the testing evaluation Mr. Gilmore is a criticism that the changes you're making to the next 20 really don't improve that survivability that much well I'll say two things number one Mr. Gilmore was we showed him and his folks the small surface combatant task force in the process we were going through we included them at every step of the way he was there when that decision was made and number two there is no way you can make any Navy ship 100% survival and what you have to look at is what's the role of that ship what survivability does it need to perform that role and there are different levels of survivability that you need and we are absolutely confident particularly with the upgrade but that this ship can do its mission and the C&O keeps pointing out that one of the way ships are survivable is they don't get hit and being fast having a knockout punch of your own to keep from getting hit is one of the best ways of best ways to survive good morning Mr. Secretary alright can you hear me now alright sir first let me be one of the sailors that says thank you for adding into our tradition thank you I didn't realize I was doing it but somebody told me otherwise I thought he was there we're proud of it sir so thank you to my question as I leave after 32 years in the Navy and we see the onset of women in submarines and you talked about building ships in submarines and where our future is going and traditions and so forth and blending all of that in where do you see us right now enlisted and officer females on submarines and when do you think that first one will launch fully integrated with both officer and enlisted great question we've got as you know women officers now SSBN's SSGN's first women officers are now reporting to Virginia class attack submarines in the next little while and I won't nail myself down but not very long we'll come out with the detail plan of integrating enlisted women into our submarine force and it's not going to be it will take a little while to do it but because we'll have to make a few changes here and there structural changes on the subs but it won't take that long we have to add to that question I want to say one more thing we don't have enough women in the Navy we just don't and we're working on it we're working on trying to increase the numbers because as we do we have a stronger we have a stronger force thank you and I'm proud to be your senior enlisted woman in the Navy me too and don't leave 32 years and I'm yours now you sing while she's the singer listening thank you good morning Mr. Secretary my name is Brian McGrath and I'd like to talk to you about fleet size early in the administration especially when Bob Work was your undersecretary the total number of ships seemed to be minimized in favorite discussion of networks in favor of discussion of networks and the networking power as time has gone on the total size the number of the fleet seems to have become more important can you explain that very positive thing sure well because of what you talked about the networking the increased capabilities sometimes dramatically increased capabilities of the ships the ships that are replacing the newer ships are just formal capable and so we don't need as many we don't need a 600 fleet Navy to do the jobs that a 600 fleet Navy would have done 30 years ago but the more we got into it and the more we looked at it and the more we saw the demands and the role that the Navy plays quantity has a quality all of a sudden and our fleet when we got here as I said was shrinking finding out why that was the case getting some of those programs under control driving down the costs so that we could afford the ships took us a while took us a year to get there to be confident that we could and I'm absolutely confident now that we're going to go past the 300 ship mark for the end of this decade and that we will stay at above 300 ships long into the future in order to do all the jobs that we need to do thank you Mr. Secretary thank you Mr. Secretary Mike Seifer well it's great that we're increasing ship numbers and ship building is on the rise on the horizon there's the Ohio replacement program that's going to pressurize all of that so how do you fit in funding Ohio replacement funding the new carriers and then still being able to afford anything else ship building was well I'll give you two big answers to that number one again ship with another Navy ship and two the CNO and I talked about this a lot we testified to this this should not be a Navy build if it is it will take up about half of what we've traditionally spent on ship building for 12 years if you do that the impact will be akin to a greater than sequester because you're going to impact the rest of the fleet or you're going to impact something somewhere else Congress is being very responsive we're beginning this conversation they've set up a fund for the Ohio class replacement now no money is in the fund but it's a great first step we start building these in 2021 we're already spending billions of dollars to do the engineering the R&D the design drawings this sort of stuff but either because this is a national program they pay for with national funds some way it's the most survivable leg of the triad it will be the most survivable leg of the triad is as far to the future as we can say and or maybe ship building needs to be plused up to a count point you you simply cannot gut the Navy for this one of course there's a quick follow up to that I mean I'm hearing from the Air Force that if if you were to get the Ohio replacement funded as a non-service funded program the Air Force would step in and say great idea we need that for the new strategic bomber we need that for Minuteman if the Air Force can make that case have at it to me that's not a good argument this is the most survivable leg of the triad this is one of our very top national priorities they can make that case for some of their programs they should but they shouldn't say don't do it for Navy because somebody else may do it