Address to The Foreign Correspondents Club of Japan: "The Price of Security in a Changing World"

Ambassador J. Thomas Schieffer
May 20, 2008
Tokyo, Japan

AMBASSADOR SCHIEFFER: Well, thank you very much. It's always a great pleasure to be here at the Foreign Correspondents Club. The chance to address you is one that I enjoy, because so many distinguished people have had the opportunity over the years to use this platform to address some of the major issues facing Japan, and I'd like to do the same thing today, and to share some thoughts with you on one, I think, very important issue, and that's the price of security in a changing world. In particular, I would like to discuss with you the financial burdens both Japan and the United States will have to carry in order to support their security needs in the future.

Let me begin with this proposition. No potential adversary on earth can stand toe to toe with the United States in a conventional or nuclear confrontation and expect to prevail. This is not to say that America cannot be slowed or even defeated on the battlefield - the lessons of Iraq and Vietnam are painful reminders that conventional and nuclear superiority do not necessarily guarantee victory. But on the whole, the American military has sufficient firepower to defeat any conventional military force in the world.

When it comes to nuclear weapons, the American military has sufficient power to ensure that no potential adversary could prevail in a first strike or realistically believe that they could escape retaliation without unacceptable losses. What gives American forces such power is - in a word - technology. American weapons are the most sophisticated, the most lethal and the most effective on earth. We have spent more on military research and development than any other nation in the world and it has given us a tremendous advantage.

The result has been a revolution in the way war is made. David Halberstam, in a fascinating book called War in a Time of Peace talks about the effect precision-guided weapons have had on the battlefield. At the beginning of World War II, American bombers considered their bombs to be on target if they landed within a twenty mile circle. Today's weapons are accurate within a circle of six feet or less. That means you could actually decide whether you wanted munitions to come in through that window, or that window, or that window.

This gives American forces the chance to destroy less and preserve more. Utilities, sewage and water can now be effectively disabled without being totally destroyed so as to preserve them for post-war reconstruction. That is a huge advantage over old military paradigms that required total destruction rather than disablement of an enemy's capacity to make war. Modern weapons can also make war less dangerous to civilians because the ability to pinpoint targets reduces the chance for collateral damage. But don't get me wrong. War is still a ghastly business that should be avoided at all costs. It should only be undertaken as a last resort. But, modern war is more efficient, more precise, more technological and the weapons more lethal than ever before. It is also more expensive because all that technology costs a lot of money.

Earlier this year an American B-2 bomber crashed. That one airplane alone cost almost $1.2 billion dollars to build. An American Aegis destroyer capable of firing SM-3 missiles as part of our missile defense capabilities will cost more than $1.2 billion dollars to build. The USS George Washington which will be coming to Japan later this summer cost almost $5 billion dollars and that is without the more than $1 billion dollars that will be the cost of the planes that will fly from it. The total cost of ship and planes together will exceed $6 billion dollars which approaches 15% of the total Japanese military budget. The new Ford class aircraft carriers that will hit the water in 2012 will cost an estimated $8 to $11 billion dollars, which could be in excess of one quarter of the entire Japanese defense budget today. These are staggering numbers.

They present a challenge to military and civilian leaders alike. While these armaments can give a country an advantage on the battlefield, they can also significantly impact the ability of any government to deliver the level of services demanded by citizens - especially citizens who elect those governments. Striking a balance between what might be wanted and what is needed will not be easy.

Governments, be they American, Japanese, or other will struggle in the years ahead to fund weapons systems that can do more but also cost more than ever before. Everyone will have to make hard choices because no nation - not even the United States - can afford every weapons system that will be available.

General Douglas MacArthur famously told cadets at West Point that their mission was simple, "... to win our wars." Never has that simplicity cost more. Today, the modern military must become proficient not only in the strategy of conflict but in the economics of armaments.

History teaches us that greater prosperity in a country will likely increase its defense budget. Here in Asia the effects of that phenomenon are being felt right now.

Over the last ten years, China averaged annual economic growth of 9.3%. But during that same period Chinese military spending increased on an average annual basis of 14.2%. And even that may be an underreporting of what really happened because the Chinese have such an opaque accounting process. Nor have the Chinese been alone in increasing their military spending.

On the Korean peninsula, during that same ten year period, the gross domestic product of the Republic of Korea grew by more than $250 billion dollars. Their military budget increased by 73% during the same period. Russia has also been reasserting itself as a military power in Europe and Asia. Largely as a result of increased revenues derived from oil and gas, then Russian Defense Minister Ivanov announced, on February 8th of last year, a $189 billion dollar program to overhaul and modernize Russian forces.

American defense spending has also been increasing at dramatic levels. From 1998 to 2007 the American economy grew by almost $2.5 trillion dollars. Our defense budget nearly doubled. We went from spending $252 billion dollars a year on defense in 1998 to $481 billion dollars last year and that does not even count the $142 billion dollars that we spent for operations in Afghanistan and Iraq.

The exception to increased spending on defense in Northeast Asia is Japan where roughly the same amount is spent today as was spent in 1998. Some may say that difference can be attributed to the fact that the Japanese economy was largely stagnant during that period. While there is no doubt some validity to that argument, it is troubling to note that the ratio of defense spending to gross domestic product has been steadily shrinking. This year that number will be less than 1%, 0.89% to be precise, a ratio lower than any NATO or developed country in the OECD. In fact, Japan will spend less percentage of its GDP on national defense than Switzerland.

Yet in a time when the Japanese people are increasingly apprehensive about military threats emanating from adversaries or potential adversaries in the region, Japanese citizens do not have to worry about their safety because those adversaries know that an attack upon Japan would be met by the full force and effect of American military power. Under those circumstances it should not be surprising that Americans wonder why some Japanese politicians argue so strongly against programs like the Special Measures Agreement for Host Nation Support.

We believe that Japan benefits from being in alliance with the United States, a partner whose military capabilities have increased over the last ten years. And we believe that Japan should consider the benefits of increasing its own defense spending to make a greater not lesser contribution to its own security.

Regardless of the size of our respective defense budgets, however, all of us can do a better job of procuring the weapons we buy. Too often, defense spending is treated like a public works project instead of a means to make our citizens safer. In America we have gone through the $400 hammers and the $600 toilet seats so we don't hold ourselves out as the perfect models for attaining taxpayer value. But, we have over the last few years instituted a number of reforms that can reduce waste and increase capability. Reforming the defense procurement process is not just an American goal or a Japanese goal. It is just plain old common sense. If we can do it, we will all be winners. So what do we need to do? In my judgment, we need to strategize, analyze, maximize, build and deploy together. There are tremendous economies of scale when the two largest economies in the world approach a problem from the same perspective. Let me explain what I mean.

The United States and Japan share a common set of beliefs - that democracy works, that tolerance matters, that free speech counts, that free markets deliver. We also share common interests in Asia and around the world, namely that the sea lanes need to be protected, the rule of law encouraged, and the benefits of trade expanded. Does it not make sense, in that case, that we discuss at length what each of us needs in our defense postures to provide for the security of our citizens? If you look out ten, twenty or even thirty years, do either the United States or Japan see their interests diverging wildly? I think the answer is "no." If that's the case, should we not approach challenges in a concurrent manner?

As an example, Japan is studying the acquisition of its next generation of fighter. It is hard to imagine a situation in which Japan would be at war without the United States being at its side. If that is so, does it not make sense for Japan and the United States to work together to make sure their respective air assets as complementary as possible? Japan's new fighter should be a force multiplier for each country. That's why we think it is so important for us to look at capabilities and strategies for acquiring that fighter together and not apart. Your decision will have consequences for us and our decisions in return will have consequences for you.

We need to look together at the needs of our respective air assets. Japan will achieve greater defense capability if would-be aggressors must contemplate Japanese and American forces that are completely interoperable. In that situation, whether Japanese or American pilots are flying airplanes like F-22s makes little difference so long as they are part of the equation and are being complemented by pilots from both countries who are flying brand new F-35s or F-18s. This mixing and matching of joint capabilities is ultimately more important than the flag that is painted on the side of each plane.

To get that result, we must regularly engage in strategic dialogue to define our mutual goals. From there we must analyze our respective strengths and maximize productivity and savings. No one benefits when we take separate paths to reach the same point. Creativity and innovation are the byproducts of collaboration and teamwork.

Once we know what it is that we need to do and who it is that we need to do it, then all we have to do is work together to build it. That means that every part of every weapon need not come from our respective countries. The concept that we in America are using to build the Joint Strike Fighter is a good one. Multiple partners from multiple countries are joining together to build a plane with multiple capabilities. Defense contractors from around the world will be able to participate on the first and last plane built - not just the planes sold to a particular country.

As we have strategized, analyzed, maximized and built together so should we deploy together. Systems that are complementary to one another are systems that are force multipliers, and not budget busters. The agreement we recently reached on force transformation goes a long way toward increasing what we do together. We should build on it. The more joint operational we become, the better off we will be.

What we must not do - and it is as true in Washington as it is in Tokyo - is look upon defense spending as the ultimate trough for pork barrel politics. We should never sacrifice the strategic to satisfy the political. The consequences of what we do in defense are just too important to the safety of our citizens to go down that road. Neither should we pay more than we need to for the weapons we ultimately develop. Every dollar and every yen wasted is a dollar and a yen that could have bought more security for our citizens.

As we go forward, both our governments must pursue better procurement practices. We should encourage greater transparency and competitiveness in awarding contracts. Open and clear systems build public confidence that hard-earned taxpayer monies will be spent wisely.

We should encourage the awarding of multi-year contracts. Governments can reduce their costs by reducing the risks to companies that their research and development costs must be amortized on a shorter term basis. Governments can justifiably demand better pricing from contractors whose financing risks are reduced by government guarantees that purchases will be made in out years of a contract.

Both Japan and the United States can reduce their defense costs by reducing the impediments that currently keep them from cooperating more. The United States could do more if Japan increased its ability to protect classified material and proprietary information. Japan could also engage in creative ways to use black box work arounds to do more work with American companies.

In return, Japan, as it did with missile defense, could relax its prohibitions on exporting defense-related products to the United States. This would greatly enhance the ability of Japanese companies to compete in the American defense industry just as they now compete in the civilian marketplace. The United States and Japan could also work to ensure that our accounting laws and financing methods for defense contracting incentivize rather than penalize companies in the procurement process. No one wins when regulatory or procurement practices add cost without benefit to the customers. American and Japanese governments alike will benefit when companies can be paid at the point that they reach milestones rather than completed contracts. Likewise, delivering a product on time and on budget should be monetarily rewarding to both government and contractor. Such a result is not mutually exclusive. It can be done.

Last December the United States and Japan agreed to conduct a comprehensive review of Host Nation Support. What does that mean? It means that we should look at all aspects of the cost sharing arrangements we have that maintain an American presence in Japan. The United States and Japan also entered into a force transformation agreement which was the most comprehensive revision of the Japanese American alliance since the Security Agreement was signed in 1960. Now we need to implement it. Both of those governments promise to update an alliance that has served the peace and security of America, Japan and Asia for decades. Now, it may also be time to review procurement practices that would better serve the people and industry of both our countries.

Asia is a region in transition. The old order is fading and a new order is emerging. But there is no need for this to be a time of conflict in Asia. The United States and Japan have worked hard over the years to keep the peace in this part of the world. We have largely been successful because we shared mutual interests and concerns. The U.S.-Japan alliance has been the linchpin of both of our foreign policies in the Pacific. Nothing has changed in the world to alter that. What has changed is the level of technology and the cost of modern weapons. If we work together to reform our procurement practices, we would both strengthen the contributions each of us makes to our alliance.

Japan wants an alliance of equals. The United States wants an alliance of equals. To attain that we must each get the maximum we can from the resources we bring to the table. We do not have to spend the same amount on the alliance to have an alliance of equals but we should do everything we can to eliminate waste and duplication wherever it occurs.

Almost fifty years ago, some very far-sighted statesmen on both sides of the Pacific realized that Japan and the United States would each be safer if we were allied together. Now, a different world order is emerging, but the strategic necessity of that alliance remains. We must never take it for granted. We must never let it be neglected. We must cherish it, nurture it and build on it because Japan and America in alliance is still the best formula for peace and stability in the Pacific.

QUESTION: (inaudible), Singapore Business Times. Mr. Ambassador, you've delivered a very strong message about the need for closer cooperation between the United States and Japan on defense spending, especially in the area of aerospace. The fact that you've delivered such a strong message suggests that America is not altogether confident that it's going to receive from Japan the kind of cooperation that you're looking for. Could you confirm that is the case, and if so, suggest reasons why that might be the case? And also, if I could add a second part to my question, you say that Asia is a region in transition; the old order is fading and the new order is emerging, which of course is true. Might not a part of that new order be the emergence of an Asian defense force, eventually, in which case can Japan really afford to make its defense policy - its procurement policy - so closely allied with those of the United States, as you suggest should be the case?

AMBASSADOR SCHIEFFER: First of all, I don't think that the reason that I would make this speech is because we don't have faith in Japan. I think we have great faith in Japan. We've been in alliance with Japan since the 1960s, and it is an alliance that has worked well for both of us. It is also an alliance that underpins the security and stability of the whole Asia-Pacific region, so I am confident that Japan will be prepared to revitalize that alliance and maintain it and see it grow as the time goes forward.

What I was trying to say in the speech was that I think that we can both do more in the areas of procurement. And Japan, I think, has the opportunity to do more in defense spending, and it is difficult for me to see Japan meeting its defense needs in the future, if it continues to maintain the levels of defense spending that it has today.

With regard to a new order emerging in Asia, I think Asia is an area that is in transition, and you have seen a different security dynamic being talked about here. I don't think that the U.S.-Japan alliance is close to being outmoded. I think it will continue to be the foundation of both of our foreign policies in this part of the world, and I think that a strong U.S.-Japan alliance makes all things possible in Asia. I think on the other hand, if you weaken that alliance and somehow Japan lost faith in the United States or in our ability to stand with Japan in all circumstances, then I think - and Japan in that situation decided to go its own way - I think Asia would become more unstable and much more dangerous very quickly. So I don't think that's going to happen. We don't want it to happen, from an American perspective, and I don't think the Japanese people want it to happen, and for that reason I'm confident that we will continue to work together and that the alliance will grow stronger as the years go by.

QUESTION: I'm Stephano Caretz from the Italian Economic Daily. My question is about the next generation of fighters for Japan. It's no mystery that the Japanese government would like to have access to the F-22, as a first choice, but the Congress said no. So your speech is warning that if the Japanese will end up choosing an alternative like the Euro-Fighter, the Americans will be very disappointed or even angry?

AMBASSADOR SCHIEFFER: Of course I'm not going to say we'd be angry. I think it would be very difficult to have as interoperable a force with a Euro-Fighter as it is with an American fighter. And I - obviously I'm the American Ambassador here. I hope the Japanese will buy American aircraft, but I think that the idea of having those airplanes interoperable with the forces that will already be in theater, that are American forces, is something that the Japanese will consider - I hope will consider - very strongly. What I was trying to say in the speech was, on the issue of F-22s, it's not just Japan that can't buy F-22s from the United States. There's a Congressional prohibition that does not allow the United States to sell F-22s abroad. Having said that, that doesn't mean F-22s can't be in theater. They can certainly be flown by Americans. The point I was trying to make is, it doesn't really make a difference whether there is a Japanese flag or an American flag on that F-22, if it is working in concert with the other planes, and I don't think any one plane will meet the needs of this particular theater. I think it will be a mix of airplanes, and that mix should fit together, because I think that when it fits together, it gives both countries greater capability than they would have if they were in stand-alone positions.

QUESTION: (inaudible), China Post newspaper of Taiwan. Mr. Ambassador, first of all, thank you very much for your time in this speech. And as you know that Taiwan's president Ma is being inaugurated today, and the relationship between Taiwan and China is of critical importance to regional security. What do you think that the United States and Japan should be doing to foster better relations between China and Taiwan?

AMBASSADOR SCHIEFFER: We have - both governments - have emphasized that the issues between China and Taiwan should be resolved peacefully, and both sides have said that neither China nor Taiwan should do anything to provoke the other into a military action, and I think that is a wise policy, and I think that is one that gives us the greatest hope for both resolving the issue and keeping peace in the neighborhood. No one will be served by someone trying to solve this problem through military means.

QUESTION: (inaudible), freelance journalist from Germany. Recently the Chinese president visited Japan. I'm sure you've been watching the events intensively. How do you assess the visit? Were you, from your American position satisfied with the way it went, or do we have some sort of thing where alarm bells rang, and you said, "Just a moment, we have to do some talking"? Overall, how did you see the visit, as it was handled by the Fukuda government?

AMBASSADOR SCHIEFFER: I think the United States saw it as a very positive step. I think all of us are served when the Chinese and Japanese can resolve their differences and pledge to work together, and I think you saw that. It was the first time, I guess in 10 years, that a Chinese president had been here. That in itself was a milestone. I thought the visit was a good one, and we applaud the effort on both sides to sit down and talk about any differences that they might have. So I think that there were not alarm bells that went off. I think there was applause that could be heard, because I think it was a step in the right direction.

QUESTION: Mr. Ambassador, I am Joel LeJean from RTL Broadcasting, from France. Thank you for coming today. When you ask your Japanese colleagues or partners to increase their defense spending, does it mean that we have to go beyond the 1% ceiling of the GDP? Can you give us an exact figure that you would like to see from the Japanese increasing in their defense spending? That is my first segment of question, and second question: What can you expect from the continuing fall of the U.S. dollar? Is it for you now an obligation to ask more budget to your partners, and does it mean also that the dollar falling is also maybe - and that's why the Japanese are sometimes wondering about your demands ...

AMBASSADOR SCHIEFFER: Falling dollar, what?

QUESTION: The falling dollar is also maybe a reason why the Japanese colleagues and partners you have are sometimes wondering about you in the United States, because the fall of the U.S. dollar also means that the U.S. economy's falling is not anymore the compass of the world economy. I mean, how can you assert that your Japanese partners that you need more from them, also do more for you, but also at the same time you don't do more for the world economy?

AMBASSADOR SCHIEFFER: That we don't do more for the Japanese? Well, I think the Japanese defense needs are such that they would not be able to meet those needs by spending less than 1% or even 1% on their defense budget. Obviously this is a decision the Japanese people have to make, but when you talk about a new jet fighter, talk about Aegis destroyers, you talk about missile defense - it's very difficult for me to see, with the cost of those weapons systems that they'll be able to continue to have this unofficial 1% ceiling. It's not only 1%, it is shrinking. It's less this year than it was last year. So I think that the Japanese people will have to make that decision, but the point that I was trying to make in the speech is that a lot of people in this neighborhood are spending a lot more money on defense, and yet the Japanese are not. I think the Japanese are getting a bargain in the alliance from just the dollar standpoint, on what we bring to the table. Our capacity, our capability has increased dramatically because we are spending more on defense than we were 10 years ago. That helps Japan, because we're in alliance with Japan. I don't think it is unfair of us to suggest that Japan needs to look at that and make an assessment and a hard choice perhaps, but Japan needs to spend more on defense than it is spending today.

Now with regard to the dollar and the strength of the dollar, I think that the dollar will strengthen over time. I think we're seeing an unusual pressure on the dollar, and I think that it will adjust over time. But I don't think that we're saying that because the dollar has been weaker in the last few months that therefore Japan has to do more or do less. What Japan needs to do is buy the systems that will defend it, and those cost a lot of money. And it has to make some very difficult choices in doing that, but it cannot get the value, in my judgment, for the yen that it spends - whether it's a weak dollar, strong dollar, whatever - if it doesn't reform its procurement practices. And it's those practices that could be reformed in such a way that they could get more value for the yen that they spend - whatever the value denominated is in dollars.

QUESTION: Sam Jameson, freelance. There has been some suspicion that one of the reasons Japanese budgets have not increased more is that they are putting less in the defense budget and hiding it elsewhere. Richard Samuels, for instance, in his book pointed out that the Coast Guard budget is not part of the Japanese defense budget, and that that budget has increased. I myself aware am aware of it before: Spy satellites that are rotating over North Korea are called weather satellites, and that money is in the prime minister's office. Is there some Enron accounting involved in this kind of hiding money, less clarity and more opaqueness?

AMBASSADOR SCHIEFFER: I don't think that we're talking about hiding money. I think we're talking about traditionally what the Japanese have spent on defense. Now I'm not entirely familiar with all of the issues that you bring up, but I think that the bottom line on all of it is that the Japanese have been spending less on defense in recent years, and I don't know - for four or five years now - and Japanese personnel have actually gotten cuts in pay, so if the Japanese are hiding it, I'm sure those folks would like to figure out where it's hidden and go get it.

QUESTION: I'm Yoshi Iinuma, the Oriental Economist. I would like to ask about the Futenma relocation issue. This has been in close talks for many years, and it has an aspect of something like a pork barrel public works project, and besides I know there is an argument even among American professionals that the need of staying - strategic need of keeping Marines in Okinawa is not as compelling as the United States want to keep Yokosuka or Kadena, and so I think the money that could be spent on Futenma could most effectively be used for another purpose, for another, say, joint collaboration for defense. So do you think any possibility in future of having a second thought or another thinking about Futenma relocation?

AMBASSADOR SCHIEFFER: No. I think that we very carefully calibrated what we could do in Futenma, to answer one question, and that was the question that Prime Minister Koizumi presented to President Bush at the very beginning of his prime ministership, and the first year of President Bush's presidency, and that was, is there some way that we could reduce the number of Marines in Okinawa without reducing the capability of the United States in theater. And we took that question to heart and we studied it with great intensity, and we came up with a formula that we believe that we could reduce the number of Marines in Okinawa by moving 8,000 of them to Guam, with 9,000 of their dependents. This is a major change in the force, but by keeping them in Guam, we keep them in theater. We believe that the number of Marines that are in Okinawa today is the minimum number that we can keep in this part of the world to have that capability, and if we reduce that, we would severely restrict the ability of the United States to act in not only the defense of Japan, but in the defense of the region, and so that's why we don't want to change that agreement. What we have to do, though, is we have to implement that agreement. We're happy to move those Marines, and we will move those Marines as soon as the facilities in Guam are built. And when those facilities in Guam are built, and the Futenma replacement facility is built, then we can close Futenma and reduce something that has been an irritant in the relationship, but until those pieces are moved around, we can't do it. And the longer it takes to implement the plan that we've agreed upon, the longer it will take to move those Marines. So I think that we've had the debate. We've had some very intense negotiations. Now we need to implement it.

QUESTION: (inaudible), Pan-Orient News. Sir, it's very reassuring what you said, that no potential adversaries on earth can stand against the supremacy of the United States forces and power, but it seems this is not the case in Iraq and Afghanistan where the roadside bombs and suicide bombers are moving the game, basically. So what do you think? What seems to be the problem? And if you think it would be a little bit wiser idea to reduce spending on these arms and defer the money to the social and economic situation, in the United States and all over the world, so that also the countries that complain about nuclear hypocrisy can be pushed more to stop their nuclear arms.

AMBASSADOR SCHIEFFER: Well those are very good questions. What I was trying to say in the speech is that a conventional army, a conventional military, there is none on the face of the earth that can compete with the United States. I think that what we - and you saw that in Iraq. I mean the Iraqi army was no match for the United States army, and I don't think that there is any match for the United States military anywhere in the world in that sense. But what you have in Iraq today is an insurgency. It's an asymmetrical fight. It's much more difficult because it doesn't involve a conventional military force, and we have to develop better ways of dealing with that than we have in the past, and I think Secretary Gates talked about that in a speech he made a week or so ago, that the United States has to develop better strategies and may have to forego weapons systems that would be used in those conventional fights in order to develop weapons that can be more effective against IEDs and things like that, and he talked about the personnel carriers, basically, that we've developed after the Iraq war that protect people when they're out on patrol and what-not. They have had a tremendous impact in the way that we've been able to conduct our operations in Iraq, but there was a huge cost in lives before they were developed. So we have to do a better job there.

Now with regard to military spending, I wish we could spend less on military. I wish we could do a whole lot of things, but I'm afraid that Americans feel that they are at risk in the world because we're Americans, and I don't think any of us would feel comfortable in losing the technological and military advantage we have right now, and I think we're going to have to bear that burden for a long time, and I think we're going to have to bear that burden not just for our sake, but for the sake of the international order, and if you come right down to it here in Japan, if the United States lost its ability to be decisive in this theater, it would change the whole dynamic of peace and security in this region, in this part of the world, and I don't think it would be for the better.

QUESTION: My name is Kobayashi with Kyodo News. I wonder if you could comment on Japan's new law to try to ease or lift the restrictions requiring non-military use of space, and I was curious about how you think, how does the United States expect the change of legislation would affect the balance of the security alliance?

AMBASSADOR SCHIEFFER: I don't specifically have a thought on how it will change things, but I think that the law is a recognition of modern reality, that with missile defense and all that it entails, you have to have the ability to hit an adversary wherever that adversary might be trying to hit you. And I think that the new law is a recognition of that.

QUESTION: Andrew Horvat, freelance. Mr. Ambassador, I think your remarks may have been inspired by an ongoing Japan defense spending scandal, and I'm wondering if you have done any internal studies as to how much more Japan could do if Mr. Moriya had less golf bills paid for by suppliers and if the effect of that collusion could have been offset by better, more transparent procurement policies.

AMBASSADOR SCHIEFFER: Well, we haven't done any studies. But what I was trying to say in this whole process is we need to reform the procurement process. We need to reform it in Washington, and I think it needs to be reformed here as well. And we have got to stop looking at defense spending as the ultimate political public works project. It's not that. It is to provide for the security of our citizens, and there are ways that I hope I suggested in here that I believe would provide more value to Japanese taxpayers, more value to American taxpayers, if they were implemented.

QUESTION: I am Satoru Suzuki with TV Asahi. Mr. Ambassador, if I may ask you about the Six-Party Talks: North Koreans have recently come up with more than 18,000 pages of documents, basically the records of their plutonium production activities at the Yongbyon facility. Now do you still believe it possible for you and for us to reach a final agreement on the denuclearization of the Korean peninsula before this administration leaves office in January, and North Korea will be removed from the list of state sponsors of terrorism before you leave Japan? And specifically, do you support the House bill that requires that the administration certify that North Korea has presented a complete and correct declaration of all their nuclear activities and programs? I heard that the administration does not support it. Could you explain why not?

AMBASSADOR SCHIEFFER: OK, you said the agreement, and then there was something else - the second part, I'm sorry? The agreement before the end of the term, and what else?

QUESTION: Of this administration. Do you believe it possible to reach a final agreement on the denuclearization of the Korean peninsula, which means North Korea will be removed from the list of state sponsors of terrorism, which means - I mean before you leave Tokyo.

AMBASSADOR SCHIEFFER: Yes, I think it is possible. I think that we now have 18,000 pages of documents that are purportedly the records of the plutonium production in North Korea. You've got to say that that's a positive development. Now I think we're in the process of evaluating that information, and to see if it is credible. And I think we have to depend on - wait until that evaluation is done before I can really answer that question as to how much more is needed or if that's going to be sufficient. It is possible to reach an agreement, but the agreement must at the end of the day say this, that North Korea has given up not only its programs, but its existing weapons, because at the end of the day the United States must have assurance that the Korean peninsula is nuclear free with regard to weapons. That's the bottom line. If the North Koreans are prepared to do those things, then what we have said is that good things can follow. And the North Koreans can enter the international community in good standing, just as the Libyans have done. That's what we hope will happen, but it's really up to the North Koreans as to whether that will happen and the timetable under which it will happen.

QUESTION: What about the House bill?

AMBASSADOR SCHIEFFER: Oh, the House bill? I think I'm going to leave that up to the House to decide whether they're going to pass that or not.

QUESTION: My name is Makiko Takita for the Sankei Shimbun. Relating to Mr. Suzuki's question, I have a question about Japanese citizens being kidnapped by North Korea, and I think that you are one of the people who is more reserved about removing North Korea from the list of terrorism-sponsoring states. But the recent development seems to be, it's moving more toward what Mr. Hill wants it to be. What do you think about that?

AMBASSADOR SCHIEFFER: I think that both Chris Hill and myself and the American government believe that every effort has to be made to make progress on the abduction issue, and I think all of us understand that. Every time that I think Chris Hill meets with the North Koreans, he says that this is absolutely essential to the process, and I think all of us continue to have hope that the North Koreans will do something in this area that will be progress. And I think it was part of the, I think, September agreement that was two or three years ago, and it continues to be part of the whole process. If North Korea wants to rejoin the international order and do it in a way that they can have normal relations with not only the United States but Japan and the rest of the world, they have to address this issue. It is intolerable to think that a country would abduct the citizens of another country and that would be acceptable behavior. It's not. They have to address that. I think we have repeatedly said that, and we would hope that in the process of negotiations the North Koreans would understand that they need to address this issue.

QUESTION: Roy Lockheimer, a professional associate member of this club. I enjoyed your remarks very much. I thought they were brilliant, and ...

AMBASSADOR SCHIEFFER: Thank you. You're a fine American.

QUESTION: I wondered what you would think of my thought, which I have publicized a few times in the past, that there be a public access secretariat to the U.S.-Japan treaty arrangement. Right now there's no public access to the secretariat. I'm thinking of what was done in the NATO arrangement where, for example, the Italian government a few years ago made space and a university available for NATO studies, directly part of the NATO organization. I think if we added some way that the public could exchange opinions on the U.S. and Japanese side and with foreign lecturers being brought in that could be a U.S.-Japan alliance university, with branches in Okinawa and all over Japan and all over the United States, to make a more active involvement for the general public. What do you think of that?

AMBASSADOR SCHIEFFER: I think that the more that we can encourage people to look at this alliance in a strategic sort of way and to recognize that this is not just window dressing between our two countries but really does provide for the security of each of our countries, the better off we'd be. Now what exact form that takes, I don't know, but I think academic study, study within think tanks, both in Japan and the United States, I think those are all very positive things. I don't think that we can over-emphasize in either country the vital nature of this alliance to our respective security, and one of the things that I think sometimes you get a feeling when you live here in Japan is that somehow Japanese think that the alliance is opaque to Americans. I don't think it is. I think Americans recognize that our ally Japan gives us great security in the world, and not just in Asia. And I think that the American people are very favorably disposed toward this alliance, and the more they know about it, the more they study it, the better they will be able to maintain that alliance. So I think anything we can do in that regard is positive.

QUESTION: Todd Crowell with Aegis Sentinel in Hong Kong. My question is, how can it possibly cost $10 billion to move 8,000 Marines from one place to another? I'm not asking this in an argumentative way; I'm simply puzzled.

AMBASSADOR SCHIEFFER: Well that's a good question, because it's not just moving those 8,000 Marines; it's all of the things that go with them, from barracks to wharves to storage facilities to ammunition depots, to facilities to maintain and expand these very expensive weapons systems that accompany them, and it's not a question of just putting a Marine with a backpack on the boat and getting him there. It just costs that much because it costs that much. And there are so many moving parts to it that it is extraordinarily expensive. Now do I think that we could do it cheaper? I do. And I think that we ought to work at that. It gives us no extra security because it costs more. And that's really what I was trying to say in the speech. We need to look at how we spend this money, and we need to look at - in the United States we say ebite every nickel that goes through the joint.' We ought to do that because it doesn't necessarily have to cost what the sticker price is, if we work at it, but if we don't have procurement reform in both countries, it will cost that much or more. Now what we've done with the Japanese and American contractors, is we have said this is what we're prepared to do to move 8,000 people down here, and, with those specifications, and we've called upon each other to think of ways that could make it less costly and more efficient.