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Mr. RODMAN. Defense. This is, as you know—we have had a robust R&D program with the Japanese over the years, and they are now approaching a decision on how to carry that forward. And they haven't yet made a decision, but I think there was a hint in the President's—the joint statement of the President and Prime Minister Koizumi that they are approaching making a decision, and I think you can expect, given the nature of the threat, that they are quite interested in pursuing missile defense.

Mr. BEREUTER. Is there a time line for their decision that has been announced?

Mr. RODMAN. I don't know if it has been announced. I think it will be soon. I don't know anything more specific than that.

Mr. BEREUTER. I think it was you, perhaps, Mr. LaFleur, that first mentioned the Yongsan base in Seoul. This has been on the agenda for quite some period of time; I think since 1991 formally it has been considered. My understanding has always been that we were willing to leave that facility if an adequate replacement was made available to us, and that there would be a significant financial contribution from the Republic of Korea for us to make that move. Has there been any retreat from that understanding? Are we any closer to having a commitment of how much Korean currency will be generated for that purpose?

Mr. LAFLEUR. Sir, we have, in fact, had some considerable discussion on what would be needed to move our forces out of Yongsan into new facilities located around and alongside some of our existing facilities further south, notably Osan Air Force Base. And indeed the Korean Government has indicated that they are prepared to move forward to try to procure additional land that we would need in order to realize that relocation. Finally, and as a demonstration of this, they are looking to make a rather substantial increase in their defense budget

Mr. BEREUTER. May I simply express to you a concern that they do, in fact, make a significant contribution. That contribution ought to be substantial, and you ought to push hard on that.

Is there any evidence, Secretary Rodman and Mr. LaFleur, of a change in the sunshine policy which was enunciated by previous President Kim? Is there any change noticeable?

Mr. RODMAN. The sunshine policy? No. I think the new President is of the same party and has the same philosophy, and this is something we discuss with him on a regular basis.

Mr. BEREUTER. Would you agree, Mr. LaFleur? Is that your assessment?

Mr. LAFLEUR. I think that is broadly true. Certainly events have evolved since the new President has taken over, and I think in our discussions with the Republic of Korea, both at the summit level on down, and also in partnership with the Japanese, we have all agreed that we also need to take a firm approach with North Korea.

Mr. BEREUTER. Thank you.

Admiral Fargo, you mentioned the IMET program in specific reference to Indonesia and the consultations that may go on. I would ask you the breadth of those consultations, and how you will proceed in DoD to do that.

I am an advocate of the IMET program. This Committee has given in recent years everything requested in terms of our authorization. We have occasionally moved it up. Secretary Cohen and some former Chairman of the Joint Chiefs and Vice Chairman have actually come to the Hill speaking very specifically to Congress about the importance of the IMET program. May I suggest that was very salutary, and that might need to be continued in the Bush Administration.

What would you tell me about the consultation-or anything else you would like to offer for our consideration about the IMET program? You made reference to specifically the change in Indonesia.

Admiral FARGO. Well, I think the IMÉT program is very important, as well as the regional defense counterterrorism fellowships that we use. You know, fundamentally it is a moderate secular Muslim democracy, and one whose success is, I think, very important to the stability and security of Southeast Asia.

The TNI, the Indonesian military, is one of the coherent institutions there, and they need reform. Certainly we all agree to that. IMET and these other programs are a clear path to provide the TNI the kind of model that they need to facilitate that reform.

Mr. BEREUTER. Well, I would just say in closing that we have all had our concerns about the TNI, but they are a crucial institution—some people would say the major institution—in the coherence of that very difficult country. And I think the past Administrations, maybe present, I am not sure, have been too cautious in assessing a few critics when we had an IMET program which was specifically directed toward the problem in Indonesia. I would encourage you to consult a little more broadly than has been the case in the past so we can go forward with the program that should be in our national interest. Thank you.

Thank you, Mr. Chairman.
Mr. LEACH. Well, thank you, Mr. Bereuter.
The gentlelady from Guam, Ms. Bordallo.

Ms. BORDALLO. Thank you very much, Chairman Leach, for asking me to—or inviting me to be a part of the hearing this morning, and to our Ranking Member Faleomavaega, to Secretary Rodman, Secretary LaFleur and our good friend Admiral Fargo.

The questions that I am going to ask this morning are very important to the leaders of Guam and to the people of Guam. First to the panel, the recent visit at the USS Carl Vinson has shown Guam's capabilities in hosting an aircraft carrier. Could the panel here today evaluate the visit in the context of suggesting what steps can be taken to further Guam's suitability to permanently home-port an aircraft carrier in the future? Would the Chairman of the panel like to answer it?

Admiral FARGO. Congresswoman, as you know, and we have discussed this personally on any number of occasions, we think Guam is absolutely strategic, in our view, with respect to the Pacific. It has the ability to maintain our ships and certainly provide logistic support, and its key location in the near vicinity of the East Asian littoral makes it a very attractive location. We have moved, I think, two submarines right now, and the third one will be there shortly, and certainly we view Guam as being a place where our presence is welcome, as has been indicated by the people of Guam. I think

83 percent have said they would like an increased military capability.

We are still in the process of looking at our force posture and footprint throughout Asia and the Pacific, and I think it is way premature right now to make any commitments beyond the point of saying to you that I think that Guam's future is very bright and positive, in my view, as a key location for our military forces.

Ms. BORDALLO. Thank you. Thank you, Admiral, and I am glad that we are still in the picture.

Second, this is for you, Admiral, I just received an e-mail this morning raising the possibility of an A-76 study at Andersen Air Force Base in October, which may affect approximately 184 Federal civilian positions at the base. I have never seen a better run base than Andersen Air Force Base, and we have both seen firsthand the problems with deprivatized base operation support contract at COMNAVMAR.

So what are your thoughts, Admiral, with regards to further A76 studies in Guam?

Admiral FARGO. Well, let me address the fundamental piece of privatization. I actually am a fan of privatization in most respects. Certainly what I have seen is when we have outsourced capabilities that aren't core military capabilities to the private sector, that really is in our best interest. We look at each of these very carefully in terms of the most efficient organization and try to decide what can be done by the private sector and what ought to be done by core military people to use their skills properly. But I think what we have found is that as these outsourcing efforts mature, they certainly get much better, and we have lots of good examples. Bangor, Washington, is a good example. El Centro, California is a good example, and I think the outsourcing effort at COMNAVMAŘ is improving every year as we better understand how to manage that.

I don't know the specifics of Andersen, but once again I would refer to my previous comments that I think Andersen has a particularly bright and positive future. It is going to be a place that we are going to use increasingly in the future.

Ms. BORDALLO. Thank you very much, Admiral. I think our concern is mainly with misplacing Federal employees when we do this privatization, and I think that is what our concern is.

The third question, Admiral, could you share with the Committee your view of how the current impasse between the Air Force and the Marine Corps over the cleanup of Andersen South could be resolved? Does the withdrawal of the Marine Corps from Guam represent a shift in planning with regards to training Marines in other areas within the Asia-Pacific region such as Australia?

Admiral FARGO. Well, I think the specific decision that the Marine Corps has made with respect to Andersen South is that, you know, they have surveyed it and taken a look at it, and they feel that Andersen South doesn't meet their specific training needs. However, that has nothing to do with any other efforts.

I know specifically you had some concerns about Australia and the newspaper articles about Marines moving to Australia. Those were, you know, way off the mark and certainly not part of any plans that we are contemplating.

Ms. BORDALLO. I think my last windup, Mr. Chairman-my list of questions comes from Guam's close association with the military and our enduring support of a strong American presence in the Asia-Pacific area. So let me ask lastly and for the record, is there absolutely any doubt in your mind that the people of Guam are grateful for the outstanding work you do, and that we stand ready to welcome an increased military presence on our island? I would like to ask all three members of the panel.

Mr. RODMAN. I am absolutely convinced of that.
Ms. BORDALLO. Thank you.

Admiral FARGO. I have had lots of interaction with the people of Guam over many, many years, and there is no doubt in my mind that they welcome our presence tremendously.

Mr. LAFLEUR. And certainly everything I have heard about that also convinces me of Guam's welcome and support.

Ms. BORDALLO. I just want to end by saying that we are all very patriotic Americans, and we look forward to increased military activity in the future. Thank you, Mr. Chairman.

Mr. LEACH. Well, thank you, Representative Bordallo, and let me just say from a mainland congressional perspective, we are very appreciative of the attitudes and feelings and patriotism of the people of Guam, and we are very respectful of your presence and your presenting their perspective to this Committee.

Ms. BORDALLO. Thank you, Chairman.
Mr. LEACH. And it is very helpful, and we thank you very much.

I would like just to briefly turn to the subject of terrorism. Secretary Rodman, what is the likelihood that the United States will be committing Armed Forces to the Philippines in any significant way in a counterterrorism effort this year?

Mr. RODMAN. As you know, we have been working with the Armed Forces of the Philippines in the last couple of years, in operations last year, and we have been discussing with them for many months a program for this year. I think I will ask Admiral Fargo to say a little bit more about it, but it is likely to be a training exercise later this year and a way of—an exercise that will assess the training component of our security assistance package. I don't expect it to be a combat operation.

Mr. LEACH. Admiral?

Admiral FARGO. I think that is exactly right. Of course, the Philippines are a good friend and have been very supportive in the global war on terrorism, and we want to help the Philippines in ways that they find helpful. We are doing a great deal with the Philippines right now. It is the largest security assistance program in my area of responsibility. I think we have about $20 million this year in funds to improve the maintenance of their equipment and about $30 million counterterrorism funds. That supports a very robust counterterrorism training program, actually five separate modules that are developing light reaction companies and light infantry brigades, a night capability to allow them to MediVac their people, as well as the ability to fuse intelligence in an actionable manner.

So we are going to continue to move forward with those programs and the multiple exercises we do throughout the year with the Philippines. Our instinct right now is to do another exercise,

another Balikatan, if you will, at the end of this first increment of security assistance training, and we will be able to use that exercise to, one, evaluate the effectiveness of the training and then adjust it appropriately for the next year.

Mr. LEACH. I appreciate that very much, and that strategy seems to me to be very reasonable. I think if there is an upgrading into using U.S. Special Forces for active combat, this would certainly be a subject that I think a lot of congressional consultation might be appropriate.

Let me turn to the other great—well, not the only other great, but a great Asian island circumstance out of Indonesia. Secretary Rodman, do you have any assessment on the terrorism issue in terms of do you find it escalating? Do you find it contained? Do you find it a problem that is increasing with events in other parts of the world? And what kinds of both attitudinal and policy and approaches should the United States be using to help the Indonesians?

Mr. RODMAN. In Southeast Asia as a whole, we have been very pleased with the way most governments have tackled this problem. Indonesia has been perhaps the hardest case, given it is a Muslim country, and perhaps more vulnerable to this kind of extremism, and we have been working for a long time to persuade the Indonesian Government to take the problem seriously and to do as much as it could to crack down.

I have to say since the Bali bombing, the Indonesian Government has been much more galvanized and more energetic, and that, of course, was a great—not only a great tragedy, but I guess a wakeup call that this was not an American problem or a problem somewhere else, but it affected Indonesia directly. So my sense is that they are more—working harder at the problem, but it is difficult given the nature of the terrain and the vast scale of the country. But it is, I think, a reason for us to be engaged with the Government of Indonesia, to be helping them, to be engaged with their military and other institutions of the society in order to help them do what they have to do.

Mr. LEACH. Well, one of the more controversial programs, Admiral Fargo noted in his prepared testimony, relates to IMET, and you are suggesting that it would be helpful to institutionalize more contacts between the Indonesian military and the United States military; is that a fair assessment?

Admiral FARGO. Mr. Chairman, that is a very fair assessment.

Mr. LEACH. Can I turn to Secretary LaFleur? On security of Americans in Indonesia, in this case particularly American diplomatic personnel, are we confident of their security?

Mr. LAFLEUR. We obviously monitor the situation continuously as events transpire that might produce demonstrations or increased levels of threat to our personnel, and certainly in recent months the security situation did reach a level of real concern, but it is clear that the government does want to provide security for our personnel there and is certainly working at the problem. Secretary Rodman said they do face challenges there, and we need to have a continuing dialogue to assure the security of our personnel. We will be working with them on that.

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