1. 1 of 11 GEN Barry R. McCaffrey, USA (Ret.) November 2013 www.mccaffreyassociates.com A US PERSPECTIVE THE AMERICAN ARMED FORCES AND NATIONAL SECURITY Presentation to: The Heritage Foundation Colonel James McGinley and Honorable Maribeth Walton McGinley Strategic Leadership Lecture November 12, 2013 BARRY R. McCAFFREY GENERAL, USA (RETIRED) 211 N. Union Street, Suite 100 Alexandria, VA 22314 brm@mccaffreyassociates.com 703-519-1250

2. 2 of 11 GEN Barry R. McCaffrey, USA (Ret.) November 2013 www.mccaffreyassociates.com BIOGRAPHY OF GENERAL BARRY R. MCCAFFREY, USA (RET.) Barry McCaffrey served in the United States Army for 32 years and retired as a four-star General. At retirement, he was the most highly decorated serving General, having been awarded three Purple Heart medals (wounded in combat three times), two Distinguished Service Crosses (the nation’s second highest award for valor) and two Silver Stars for valor. For five years after leaving the military, General McCaffrey served as the Director of the White House Office of National Drug Control Policy (ONDCP). Upon leaving government service, he served as the Bradley Distinguished Professor of International Security Studies from 2001-2005; and an Adjunct Professor of International Security Studies from 2006-2010 at the United States Military Academy at West Point, NY. He served as an Associate Professor in the Department of Social Sciences from 1973-1976 teaching American Government and Comparative Politics. General McCaffrey is a member of the Council on Foreign Relations and the Inter-American Dialogue. He serves on the Board of Directors of the National Association of Drug Court Professionals and the Atlantic Council of the United States. He has served on the Board of Directors of several corporations in the engineering design, technology, and services sectors. He also serves on the Board of Directors of CRC Health Group – the nation’s largest behavioral health care company. He has recently joined the Board of Directors of Prospira PainCare, Inc. He is also proud to serve on South Carolina’s SCRA Board of Advisors. General McCaffrey attended Phillips Academy, Andover, Mass.; and graduated from West Point with a Bachelor of Science degree. He earned a master's degree in American Government from American University and attended the Harvard University National Security Program as well as the Business School Executive Education Program. In 2007 he was inducted into the US Army Ranger Hall of Fame at the US Army Infantry Center, Ft. Benning, GA. In May 2010, he was honored as a Distinguished Graduate by the West Point Association of Graduates at the United States Military Academy. General McCaffrey is married to Jill Ann McCaffrey. They have three married adult children and six grandchildren. Their son, Colonel Sean McCaffrey, just retired from the Armed Forces after his third combat tour. Currently, General McCaffrey is President of his own consulting firm based in Alexandria, Virginia www.mccaffreyassociates.com. He also serves as a national security and terrorism analyst for NBC News.

3. 3 of 11 GEN Barry R. McCaffrey, USA (Ret.) November 2013 www.mccaffreyassociates.com THE SEVEN PRINCIPLE GLOBAL SECURITY CHALLENGES The proliferation of nuclear, biological, and chemical weapons. Regional war among nation states. (4 state sponsors of terrorism: Cuba, Iran, Sudan and Syria). Civil war and failed states. (58,045 total US killed and wounded in Iraq and Afghanistan). International terrorism. (51 Foreign Terrorist Organizations). The global recession and poverty. International crime and drug cartels. Humanitarian crisis/refugees.

4. 4 of 11 GEN Barry R. McCaffrey, USA (Ret.) November 2013 www.mccaffreyassociates.com MAJOR CUTS TO US DEFENSE BUDGET: THE NEXT FIVE YEARS FY 2013 Base Budget provides $525.4 billion, a reduction of $5.2 billion from the FY 2012 enacted level ($530.6 billion. The incremental costs of Overseas Contingency Operations (OCO), including ongoing efforts in Afghanistan and support for the Office of Security Cooperation in Iraq, are funded separately in the FY 2013 budget request at $88.5 billion, a decrease of $26.6 billion from the FY 2012 enacted level.

5. 5 of 11 GEN Barry R. McCaffrey, USA (Ret.) November 2013 www.mccaffreyassociates.com GLOBAL US MILITARY STRENGTH (2.3 Million Military Personnel) GROUND COMBAT SYSTEMS TOTAL Tanks8,325 Armored Fighting Vehicles 18,539 Self-Propelled Guns1,934 Towed Artillery Pieces 1,791 Rocket Projectors (MLRS) 1,330 Portable Mortar Systems 7,500 Portable AT Weapons 28,000 Logistical Vehicles106,407 AIR POWERTOTAL Air Force Aircraft5,484 Army Aircraft5,050 Navy Aircraft2,710 Marine Aircraft1,160 Coast Guard Aircraft 231 Air Force ICBMs450 Air Force Satellites 63 Total Bombers, Fighters, Attack (all branches) 4,040 UAV’s882 SEA POWERTOTAL Total Combat Ships290 Aircraft Carriers10 Frigates24 Destroyers61 Submarines71 Coastal Craft12 Mine Warfare14 Amphibious Assault 28

6. 6 of 11 GEN Barry R. McCaffrey, USA (Ret.) November 2013 www.mccaffreyassociates.com CURRENT WORLD NUCLEAR STOCKPILES **Source: The Washington Post – April 19, 2012

7. 7 of 11 GEN Barry R. McCaffrey, USA (Ret.) November 2013 www.mccaffreyassociates.com **All data retrieved from the CIA World Fact Book - 2013 COMPARATIVE GDP DATA Trillions Thousands

8. 8 of 11 GEN Barry R. McCaffrey, USA (Ret.) November 2013 www.mccaffreyassociates.com US ENERGY PRODUCTION AND DEMAND US crude oil production last year grew by more than one million barrels a day. The largest increase in the world. The largest increase in US history. International Energy Agency predicting North American oil production to dominate world-wide supply growth over the next five years – due to “hydraulic fracking" and “shale oil recovery” technologies that can access formerly inaccessible reserves. The U.S. could become the world's biggest oil producer by 2020, overtaking OPEC giant Saudi Arabia. North American production expected to grow by 3.9 million barrels a day between 2012 and 2018, accounting for more than half of the increase in non-OPEC production for the period. Production in Nigeria, Venezuela, Mexico, UK, Indonesia, Iran decreasing. US crude oil production has raced ahead of new pipeline infrastructure to move it from oil fields to refineries. US recorded the worlds highest increase in natural gas consumption and production in 2012. (US also had highest drop in coal use.) Natural gas accounts for 25% of the energy consumed daily in the US. Net import of petroleum and other liquids consumption fell from 60% of total demand in 2005 to 45% in 2011. Will be 34% of total demand in 2019.

9. 9 of 11 GEN Barry R. McCaffrey, USA (Ret.) November 2013 www.mccaffreyassociates.com THE GROWING CYBER THREAT Since 2002, the FBI has seen an 84 percent increase in the number of computer intrusion investigations. 556 million people are victim to cyber crime per year. In the first half of 2009, there were more than 40,000 cyber attacks against the Department of Defense. According to BG John Davis (former Deputy Commander, Joint Task Force-Global Network Operations (JTF-GNO), these attacks cost the Pentagon more than $100 million to clean up. In 2011, FBI Executive Assistant Director Shawn Henry reported that cyber criminals stole over $100 million from US banks. Nearly 39% of cyber attacks are on the Healthcare industry. Approximately 10% of attacks are towards the Government and US Military. For fiscal year 2014 budget, the FBI have requested an additional 152 positions (60 special agents, one intelligence analyst, and 91 professional staff) and $86.6 million to help address the Cyber threat. In February 2013, President Barack Obama issued the Cybersecurity Executive Order – outlining steps the administration will take to protect critical US infrastructure from cybersecurity threats.

10. 10 of 11 GEN Barry R. McCaffrey, USA (Ret.) November 2013 www.mccaffreyassociates.com 2013-2016 NEAR TERM NATIONAL SECURITY CHALLENGES TO AMERICA #1 RISK -- WITHDRAWAL FROM AFGHANISTAN: ‒ 34,000 US forces in NATO-ISAF are 870 miles from the open sea--- and the US Navy. ‒ Pakistan safe transit essential to logistics survival of the force. (60,000 vehicles; 100,000 conex containers). ‒ 2014 declared withdrawal shapes entire political/military calculus of the Karzai government and the Taliban. ‒ April 5, 2014 presidential election will largely shape the future of Afghanistan. #2 RISK – Aggression by a nuclear armed Iran and war in the Gulf. #3 RISK – North Korean transition fails. Military/nuclear confrontation with US, South Korea, Japan. #4 RISK – Pakistan implodes – General Kayani and the superb Pak Army/ISI lose control – security of 90-110 nuclear weapons at risk. #5 RISK – The popular Fidel Castro dies in Cuba - violent regime change takes place. #6 RISK – The courageous Mexican PRI Administration of President Pe ñ a Nieto is countered by the violence of the six drug cartels. Rule of law collapses.

11. 11 of 11 GEN Barry R. McCaffrey, USA (Ret.) November 2013 www.mccaffreyassociates.com **Source: The Gallup Organization, Poll dated June 13, 2013 10% 23% 26% 34% 35% 36% 48% 57% 76% 20% Congress Television news Newspapers Banks Public Schools Medical System Supreme Court Religion Police US Military 0%40%60%80% 32% THE AMERICAN PEOPLE: A CRISIS OF CONFIDENCE IN INSTITUTIONS President