KLAUS SCHWAB: Good evening.
I take great pleasure to introduce to you Secretary Ash Carter, I just heard the 25th secretary of defense of the United States. And actually, I welcome you to the forum as a platform for public-private cooperation.
And you -- of course we all know about the department of defense, but actually you are also the CEO of the largest enterprise in the world. And you are, in addition, an academic, and when you came first here, a number of years ago, you came in your formal capacity as someone, I know, who has a deep, global -- now you have insights, but at the time, you also already had a deep global knowledge.
So we are delighted to have you here, particularly for our members -- recently we went to the Pentagon, together with a number of our members, and I have to say I was so impressed and so surprised how you are a forward-looking man, and looking, particularly, also as the fourth industrial revolution and how it impacts your own work -- your own work in terms of defense, but your own work also in terms as the CEO of this huge organization.
So, Mr. Secretary, what -- we are living in a turbulent world, and it's great to hear from someone who is really at the center, and who knows what's going on. What keeps you awake at night?
SECRETARY OF DEFENSE ASH CARTER: Well, because I'm the secretary of defense of the United States, and because of the pivotal role that we have long played and -- and -- and continue to play -- not alone, because we also have lots of friends, and that's not just because we're powerful, but because of the values we stand for -- and I see friends here, and I'm grateful to all of them.
But, Klaus, look, let me just begin at the beginning. Something that's very much on my mind this year is the defeat of ISIL. This needs to occur. It will occur, and it needs to occur, first and foremost, in Syria and Iraq.
This is the parent tumor of ISIL, and we need to defeat it there. But then we need to combat it elsewhere around the world to which it has spread, and we also need to defeat (sic) our homelands.
Now, just this week, I have been discussing with my colleagues -- and I'll be doing it more in coming weeks -- our operational concept for doing that.
We have a very specific plan, and if you think about it in World War II news reel terms -- you know, in arrows on maps, you should be thinking of an arrow going to Mosul, capturing Mosul, and an arrow going to Raqqa in Syria and capturing Raqqa, the so-called capital.
That's the operational plan for Iraq and Syria. I was talking to Prime Minister Abadi today about the success he's had in Iraq and then our move forward to Hit and Mosul. And our strategic approach to doing that is, first of all, to use the great might of American military power.
We’re looking -- we're doing more. We're accelerating our effort, and we're looking for opportunities, Klaus, to do yet more. But our -- we are also taking the strategic approach of enabling capable and motivated local forces.
This is critical, because we've all had the experience of trying to occupy places that we have cleared of terrorists, and that's something difficult for foreigners to do. So we do want to find capable local forces.
That's what the -- why it's so important to work through the Iraqi Security Forces, and then do that world-wide.
So, we need to defeat ISIL. If you're asking me what else keeps me up at night, I'm afraid it's not a short list. You know we have a nuclear deal with Iran. That's important, and I think that's a good deal.
However, it doesn't solve all of our problems with Iran. And we're still concerned about its malign influence in the region, freedom of navigation -- ballistic missiles and other issues that we have, and protecting our long-time friends and allies in the Gulf, to include especially Israel.
Then we have North Korea. And I know you had an invitation to the North Koreans, which by taking the self-isolating step, which seems to be their habit of testing a nuclear weapon, they're not here. But -- and this may sound odd to those of you, who like me, have watched the situation of North Korea for so many years Klaus.
But we call it in the Defense Department, "fight tonight." It's not that we want to fight tonight, but up on the DMZ -- and I was just there a few weeks ago, you have to be ready every night.
And then finally, looking further ahead and more geopolitically, we have a competitive situation that we don't want to lead to armed conflict, but we have to acknowledge a competitive situation with Russia on the one hand in Europe, with China in Asia.
And I'll just say one thing about Asia -- it's terribly important for this audience, because it's a big business market. It's half of the world's economy, half of its population. For 70 years, peace and stability have been kept in Asia, because of the American military. We aim to keep that going.
Now, that's not to exclude anybody else, it's not to keep anybody else down. It has never been that way. Japan rose, South Korea rose, Taiwan rose. Southeast Asia -- now India and China. We welcome that. But you can't take for granted the environment of peace and security.
So, these are the things that keep me up. But my job is to -- so -- is to let -- make a situation where everybody else doesn't -- isn't kept up at night. So, I'm happy if you're up at night and you're not up at night, because that means that you get to lie there, dream your dreams, wake up, hug your children and take them to school, go to work, live full lives.
That's what you're -- what's supposed to happen. And my job is -- with other colleagues here, is to provide protection, without which none of that is possible.
MR. SCHWAB: Mr. Secretary, I have two follow-up questions. One is more specific, one is more of a general nature.
To start with the specific one, we had also seen a reassuring message of the prime minister of Iraq that actually ISIL could be defeated by the end of the year in Iraq. Are you not afraid -- that those fighters, we speak here mainly also about foreign fighters, afterwards are dispersed, and you transport the issue from Iraq and Syria back to Europe, to the United States, and we will see the consequences in terms of increased terrorist acts?
SEC. CARTER: Well, you have to be concerned about that.
But at the same time, I mean, part of the campaign plan is not to let these people out. And that's part of the concept of defeating them where they are. Now, that won't be perfect, and some of them will get out -- some of them will go back to the countries from which they originate, which sadly include many in Europe, a few -- but a worrisome few -- in the United States.
And that's why I said you have to deal with the metastasis. Some of them will show up in Libya, and already are, and some of them will show up in our homelands.
So, we need to protect ourselves and we need to protect our people, and take that seriously. And we will.
But -- but, you know, the -- the phenomenon originated in Iraq and Syria, and I -- I think that you -- the psychological importance of -- of the defeat of this phony ideology and the idea that there's an Islamic state is a very important victory to have, Mr. Klaus. It's necessary. Is it sufficient? No. We'll need to keep watching out for and fighting its metastasis where it crops up. But we've got to defeat it in Iraq and Syria.
And just on Prime Minister Abadi's point, I mean, I'm delighted that he feels that way, I share that ambition. I think he's very entitled to that momentum as a result of the victory in Ramadi. And one of the good things about that is I think it gives him the opportunity to do more and for us to do more in -- in partnership for him -- with him. Success gives opportunities for more success. It was a great performance by the Iraqi security forces.
MR. SCHWAB: Mr. Secretary, I have -- again, a specific question, a straight-forward question. Do you feel Turkey is doing enough to support you?
SEC. CARTER: Well --
(CROSSTALK)
SEC. CARTER: I would like Turkey to do more. By history, by geography, Turkey is in a pivotal position here. Now, Turkey's a long-time friend of ours, it's a NATO ally. We're strongly in support of them, we stand with it in terms of defense of its own territory. But the reality is it shares a big border with Iraq and Syria, which border has been porous to foreign fighters, Klaus, going in both directions and I think the Turks can do more.
I think the Turks can do more to fight ISIL. They're helping us fight ISIL by, for example, hosting our aircraft in Turkey. I'm grateful for that, but I think they can do more. So I -- they're on the list of -- and I'm sorry to say it's a -- it's -- it's not a small list, of countries that I think could make contributions that are distinctive, unique and necessary to the defeat of ISIL.
One of the reasons I'm in Europe this week, Klaus, is to talk to the defense ministers of all the coalition. I met with the key seven in Paris two days ago. I'm going to convene all of the defense ministers -- first time ever -- of the coalition to defeat ISIL in Brussels in a couple of -- of weeks. And precisely the purpose there is to set expectations in terms of the capabilities that will be needed from everybody, Turkey included.
MR. SCHWAB: Mr. Secretary, now my general question – and I. Just rapidly, sometimes, there are concerns that U.S. do not have any more capability to be present at the same time in all those troubled areas you mentioned. Aren't you overstretched?
SEC. CARTER: Well, I mean, we've always liked to have more. What defense -- minister of defense secretary wouldn't -- wouldn't tell you that? But if you -- to go back through the commitments I described, we are conducting what we call the rebalance to the Asia-Pacific region, which is really just a way of saying what I said earlier, which is we aim to keep the role -- historical role of the United States.
I am about to submit the -- our -- a major new budget for the -- will carry the United States into the years ahead. It fully resources that. It makes new investments that sadly, we now have to make in the defense of Europe and NATO territory as a consequence of Russia's aggressive behavior, which we've seen in Ukraine and I wish it weren't so. For a quarter century we haven't had to make those investments. Now we will.
We have the money and Congress has given us the money and the resources. We have the forces to defeat ISIL. So the answer is, you're never happy but we have the forces we need to meet our commitments. The key is, to me and one of the reasons I'm here is to make sure that we are ahead of everybody else.
We have historically been that in all technological areas of warfare and security and one of the things I'm determined is that the United States stays that way so that not only could I answer that question now Klaus, but my successor, my successor's successor, can answer the same question with the same, you know, confidence that my predecessors gave me. I have the finest force the world has ever know and I'm very grateful for it.
MR. SCHWAB: But do you suspect, Mr. Secretary, we have talked a lot during this meeting about the force, industrial revolution, new technologies.
It is a small book which I have published. I devote also one chapter to new technologies in -- that's being used in military action. How do you prepare for this new wave of technologies and how will it rewrite the rules and methods of warfare?
SEC. CARTER: Well, technologies does it has -- technology is a partial answer to your question but there's another part that I'll get to in a minute. But just take the technology part. Some of you may know I'm a technologist myself.
And when I started out in this business Klaus, when I began my career, and I never expected to be in defense. But it was a reflex. It was a part of the culture of technology to have a connection to defense. IT was also true that most technology of consequence originated in the United States, and much of it in connection with the government.
Now that's still true to a large extent, but not nearly to the extent it was there. So if we're going to continue to do what we need to do, which is stay ahead of a dangerous world, we need to do that in a different way. And I'm highly aware of that.
So I'm trying to build bridges, one of the reasons I'm here, to the tech -- innovative community that are as strong but different as the ones I grew up with. The other answer to your question is people.
And another thing, the people in this room who manage big enterprises, like I manage a big enterprise is our -- you know, the thing that really makes the American military so wonderful is our people. It's an all-volunteer force so I have to ask for them. I have to find them. I have to compete for them just like every company does.
If I want to have the best out of -- and Klaus, that to me means, learning what the best techniques for human resources management is, recruitment, retention. How do you connect to today's generation? They don't put up with -- they don't see their careers the way we did.
They're not going to put up with a system that seems old to them. We need to connect to them and where their heads are. So one of the things I wanted to do here, was talk to the leaders of major enterprises or -- they have the same issues I do.
They need to stay ahead in a competitive world of technology and they need to compete for talent. Is there anything they can teach me? We'll always be different, because we're the profession of arms. But I still -- I would like to learn what the best are thinking and the most innovative people. And by the way, I want them to be part of our enterprise too.
These are people who want to make a difference in the world. That's why they're here. That's why they're in the positions they're in. One of the ways they can make a difference is by helping us.
MR. SCHWAB: You train people very well, not only in the utilization of hardware and so on, but particularly in working together in leadership.
Do you see a better pact between business and -- and the Defense Department in general? Do you prepare people for the business world?
SEC. CARTER: Yeah, I -- this is -- that's really great -- and I'm so proud that in this generation, our veterans, as they're called -- people who have served in our military -- are regarded as wonderful people to employ. Why? They've had exactly the experience you've had, of order, discipline, organization, mission accomplishment, sometimes experiences way beyond their years.
And -- and -- and -- so they're young people with tremendous capability. Employers understand it now. I only say that that's remarkable -- it shouldn't be remarkable, but remember, I -- I remember the Vietnam generation. And that was not the rap on American service members at that time. We've turned that around.
Now, there's a bad side to that, Klaus, which is all these people are trying to hire my people. And I want them to, because I want the best for our people. On the other hand, I don't want our good people to leave.
Now, I console myself when our good people leave by -- with the following thought. If they see that having been in the U.S. Department of Defense is good for their careers, then even though they leave, somebody new will come in who's ambitious and good and wants to be part of it. And I'll keep the pipeline going.
So in a way, it's good. And it makes us attractive. And I need to be attractive because I'm competitive. I can't -- I don't draft -- we don't have a draft in the United States. I can't make people serve. They've got to want to serve.
MR. SCHWAB: Mr. Secretary, usually defense departments are very secluded in a national environment. Today, we are living in a global world, and here you have the representatives of many countries. How much does, let's say, real defense not only need treaties and cooperation in the context of very specific -- special organizations like NATO? How much does it really need a coalition between business and defense on a more global level?
SEC. CARTER: It -- that's absolutely necessary, in my judgment, because for public officials to protect the public space so that private companies and people can do what they're supposed to do, I need their help in today's world, which means I need their understanding. And it can't be me just telling them what to do, because I don't have that power. I've got to meet them half-way.
And so I'm talking to people here about, for example, how to help us counter terrorism. It -- and I have to do that in a way that respects their business interests and also that respects society's other wishes, which are for privacy and freedom of the Internet and so forth.
On the other hand, nobody ever thought that the Internet -- the Internet was supposed to bring you civilization and community and prosperity, not evil. And so people don't want that. And -- but I can't dictate solutions to that. I've got to work with the private sector, and that's true in logistics. It's true in personnel management. I'm part of society and I'm most successful when I work with those.
By the way, you mentioned allies. The secretary general, our honored and very effective secretary general of NATO is here -- that's one very strong organization. I started right off at the beginning saying, "We don't do everything by ourselves; that's not the American way." And one of the things I'm proud of is we have -- we have lots of friends.
Lot of people want to work with us, and when other people act up -- other countries act up, they drive people into our arms, and we like working with other people, and we like the fact that they like to work with -- with us.
And I -- I think it's -- it's an important measure because we stand for things that they stand for and values that they want to protect, too. So I'm proud of that, but it -- but it also makes us more effective, because we've got to work together.
MR. SCHWAB: So defense, in the broadest sense, is not just the job of the Defense Department, it's the job of all of us?
SEC. CARTER: Now, that's a very wise observation too, Klaus. And so I -- I -- I can't do everything I just described in terms of defeating ISIL without John Kerry's political efforts in Syria. I can't do them without our homeland security, our law enforcement, our border security.
You know, we're -- we're celebrating, rightly so, the recapture of Ramadi from ISIL. But there's still a job ahead there. People have to be brought back. Their homes have to be put back together. Water has to be turned on. Electricity -- it's not over yet.
And that's a whole side of things that's not military, but it's necessary to sustain a success. And -- you know, this is where the rest of the U.S. government comes in. This is where I'm going to be asking others to make contributions also.
MR. SCHWAB: But -- but, Mr. Secretary, I should add -- the community here is a stakeholder community -- business, particularly. I -- I think we have also the obligation to make sure that we make your job abundant in addressing the root causes. I mean, if --
SEC. CARTER: Sure.
MR. SCHWAB: -- we -- if we create sufficient jobs for the young generation, hopefully your job can be -- you could be dismissed, if we do -- if we really take care of our responsibilities to address the root causes.
SEC. CARTER: Yeah, I mean -- and -- and to the extent that some -- some really evil people are at work -- you know, prosperity might not make that go away. But it will be -- create an environment in which they can't run rampant, and where they are brought to justice quickly.
And that is provided by a humanane and prosperous and -- and -- and -- a world in which -- you know, young people have promise. And that's what this crowd is -- is all about.
MR. SCHWAB: Ladies and gentlemen, friends, we will continue the discussion in -- with a broader panel, integrating distinguished people from the international defense community. So please remain seated and I would like to thank Secretary Carter for providing with an insight. I frankly was pondering for some time whether we should integrate defense and you into such a program. But I felt it introduced a multi-stakeholder community as part of it and we are thankful for your presence. Thank you.