[House Hearing, 118 Congress]
[From the U.S. Government Publishing Office]


           MODERNIZING U.S. ARMS EXPORTS AND A STRONGER AUKUS

=======================================================================

                                HEARING

                               BEFORE THE

                      COMMITTEE ON FOREIGN AFFAIRS
                        HOUSE OF REPRESENTATIVES

                    ONE HUNDRED EIGHTEENTH CONGRESS

                             FIRST SESSION
                               __________

                              May 24, 2023
                               __________

                           Serial No. 118-18
                               __________

        Printed for the use of the Committee on Foreign Affairs
        
        
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       Available:  http://www.foreignaffairs.house.gov/, http://
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                               __________

                    U.S. GOVERNMENT PUBLISHING OFFICE
                    
54-268PDF                  WASHINGTON : 2024                          


                      COMMITTEE ON FOREIGN AFFAIRS

                   MICHAEL T. McCAUL, Texas, Chairman

CHRISTOPHER H. SMITH, New Jersey     GREGORY MEEKS, New York, Ranking 
JOE WILSON, South Carolina               Member
SCOTT PERRY, Pennsylvania	     BRAD SHERMAN, California
DARRELL ISSA, California	     GERALD E. CONNOLLY, Virginia
ANN WAGNER, Missouri		     WILLIAM KEATING, Massachusetts
BRIAN MAST, Florida		     DAVID CICILLINE, Rhode Island
KEN BUCK, Colorado		     AMI BERA, California
TIM BURCHETT, Tennessee		     JOAQUIN CASTRO, Texas
MARK E. GREEN, Tennessee	     DINA TITUS, Nevada
ANDY BARR, Kentucky		     TED LIEU, California
RONNY JACKSON, Texas		     SUSAN WILD, Pennsylvania
YOUNG KIM, California		     DEAN PHILLIPS, Minnesota
MARIA ELVIRA SALAZAR, Florida	     COLIN ALLRED, Texas
BILL HUIZENGA, Michigan		     ANDY KIM, New Jersey
AUMUA AMATA COLEMAN RADEWAGEN, 	     SARA JACOBS, California
    American Samoa		     KATHY MANNING, North Carolina
FRENCH HILL, Arkansas		     SHEILA CHERFILUS-McCORMICK, 
WARREN DAVIDSON, Ohio	                 Florida
JIM BAIRD, Indiana		     GREG STANTON, Arizona
MICHAEL WALTZ, Florida		     MADELEINE DEAN, Pennsylvania
THOMAS KEAN, JR., New Jersey	     JARED MOSKOWITZ, Florida
MICHAEL LAWLER, New York	     JONATHAN JACKSON, Illinois
CORY MILLS, Florida		     SYDNEY KAMLAGER-DOVE, California
RICH McCORMICK, Georgia		     JIM COSTA, California
NATHANIEL MORAN, Texas		     JASON CROW, Colorado
JOHN JAMES, Michigan		     BRAD SCHNEIDER, Illinois
KEITH SELF, Texas
                           

                    Brendan Shields, Staff Director

                    Sophia Lafargue, Staff Director


                            C O N T E N T S

                              ----------                              
                                                                   Page

                               WITNESSES

Lewis, Jessica, Assistant Secretary, Bureau of Political-Military 
  Affairs, U.S. Department of State..............................     7
Karlin, Mara, Assistant Secretary of Defense for Strategies, 
  Plans, and Capabilities, U.S. Department of Defense............    17

                                APPENDIX

Hearing Notice...................................................    68
Hearing Minutes..................................................    70
Hearing Attendance...............................................    71

    STATEMENT SUBMITTED FOR THE RECORD FROM REPRESENTATIVE CONNOLLY

Statement submitted for the record from Representative Connolly..    72

            RESPONSES TO QUESTIONS SUBMITTED FOR THE RECORD

Responses to questions submitted for the record..................    74

 
           MODERNIZING U.S. ARMS EXPORTS AND A STRONGER AUKUS

                        Wednesday, May 24, 2023

                          House of Representatives,
                      Committee on Foreign Affairs,
                                                    Washington, DC.

    The committee met, pursuant to notice, at 2:07 p.m., in 
room 210, House Visitor Center, Hon. Michael McCaul (chairman 
of the committee) presiding.
    Chairman McCaul [presiding]. The Committee on Foreign 
Affairs will come to order.
    The purpose of this hearing is to discuss the challenges 
our allies and U.S. industry face with our arms exports 
processes, and how those challenges can be bridged to ensure 
America remains the partner of choice, and the trilateral 
security partnership between Australia, the United Kingdom, and 
the United States is successful.
    I now recognize myself for an opening statement.
    From its increasingly aggressive posture in the waters 
surrounding Taiwan to Chairman Xi's stated goal to unify with 
Taiwan, the malign actions of the Chinese Communist Party pose 
a clear and present danger. I have seen China's tactics 
firsthand. I recently led a congressional delegation to Asia, 
where I met with our Indo-Pacific Command, the 7th Fleet, and 
leaders in Japan, South Korea, and Taiwan, including President 
Tsai.
    After I met with President Tsai, the CCP sanctioned me, a 
badge of honor, as far as I'm concerned. In response to my 
delegation's visit, and Speaker McCarthy's meeting with 
President Tsai, the CCP launched more than 70 aircraft into 
Taiwanese airspace and deployed 11 warships, including an 
aircraft carrier, to encircle the island nation.
    The CCP is testing their capabilities and Taiwan's 
vulnerabilities in preparation for a potential invasion. This 
will not intimidate us. In fact, it only strengthens our 
resolve to foster a more innovative defense industrial base 
that can develop and supply weapons for deterrence and, if 
necessary, for defense.
    After seeing Taiwan's defense capabilities firsthand, I can 
say that they are not where they need to be. Weapons sales I 
signed off on 4 years ago, and the ranking member, have yet to 
make it to Taiwan. President Tsai asked me, ``Where are my 
weapons? I paid for them.''
    The war in Ukraine has shown us that weapons are needed 
before, not after, a conflict erupts. Now, more than ever, we 
need to work with our allies to counter this growing threat.
    The AUKUS partnership between Australia, the United 
Kingdom, and the United States is just that, and it will 
establish critical deterrence measures. However, for this 
trilateral partnership to succeed, we must reform prohibitive 
policies and complicated arms export rules as soon as possible 
through bipartisan legislation.
    It is this committee's responsibility to examine the policy 
and effectiveness of the U.S. Government for military sales and 
the International Traffic in Arms Regulations, known as ITAR--a 
regulatory measure which controls the export of defense and 
military technologies from U.S. defense companies.
    Last month, I held a classified roundtable with our AUKUS 
partners, first, and then, from our U.S. industry 
representatives, to discuss the challenges we face in the 
region due to growing CCP aggression, and how best to address 
them. We heard from them that much more needs to be done. 
Specifically, ITAR and our antiquated processes need 
legislative fixes for AUKUS to be successful.
    One of our AUKUS partners dedicates 1 percent of their 
annual defense budget to simply navigate U.S. export controls. 
In another case, it took a year and a half of paperwork to 
support the upgrade of a weapons system that we previously sold 
to them.
    Our approach to defense and military technology exports is 
in dire need of reform. This Administration has failed to 
deliver. So, Congress took bipartisan action in the last NDAA.
    My Taiwan Enhanced Resilience Act ensures that there can be 
creative solutions, such as foreign military financing grants, 
training for Taiwan forces, and war reserve stockpiles to 
bolster Taiwan's defense.
    Chairwoman Young Kim's Arms Exports Delivery Solutions Act 
mandates the Administration to report on why our weapons to 
Taiwan are delayed and to provide interim capabilities in the 
face of these delays.
    I also included a provision to better bring American 
innovation into Pentagon procurements to address delayed 
weapons development and address high-tech challenges like 
quantum computing, hypersonics, and artificial intelligence.
    Rebuilding our arsenal of democracy will require new 
thinking and innovative, dynamic companies. To that end, the 
House recently passed legislation that I introduced with the 
ranking member to strengthen the AUKUS partnership through 
cooperation on advanced capabilities. This legislation focuses 
on ensuring the State Department is authorizing technology 
transfers quickly to fully support implementation of this 
partnership.
    I will continue to lead efforts to help ensure the 
successful implementation of AUKUS throughout this Congress 
through additional bipartisan legislation. The longer outdated 
and costly regulations stand in the way of successful 
implementation, the more it plays into the CCP's hands and 
erodes our closest allies' security.
    We earn a great power global competition, and for far too 
long, at both the Department of Defense and State Department it 
has been business as usual. The year-long delays are 
unacceptable and we need results, not interagency 
fingerpointing. We can no longer accept the status quo of an 
ineffective and outdated system.
    The United States does not seek conflict, but only through 
strength can we provide the deterrence necessary to secure the 
peace in the region and around the globe. History has shown 
that projecting weakness invites aggression and emboldens 
dictators and despots.
    I still believe in Ronald Reagan's policy of peace through 
strength, and that was a doctrine that defeated the Soviet 
Union, and one we must continue to employ to project American 
strength across the globe.
    The chair now recognizes the ranking member, Mr. Meeks.
    Mr. Meeks. Thank you, Mr. Chairman.
    And, first, let me start by thanking our witnesses for 
appearing before this committee today. We so appreciate being 
able to hear from both of you on the critical work that the 
Biden Administration is doing with our allies and partners in 
pursuit of our shared security.
    For over a year now, we have seen how the United States, in 
lockstep with our allies and partners, has come to the aid of 
the Ukrainian people, who are defending themselves against 
Russia's brutal, unprovoked war of aggression. With over $35 
billion in military assistance provided since Russia's full-
scale invasion, the Administration's commitment to Ukraine's 
defense, and that of Europe, is ironclad and proven.
    Like Russia, in Europe, we are seeing similar aggressive 
behavior from China in the Indo-Pacific under the direction of 
President Xi. The People's Republic of China has engaged in a 
rapid military buildup and become more aggressive in its 
coercive tactics against Taiwan in each of the military, 
economic, and diplomatic grounds.
    China has also made significant advances in key military 
capabilities, such as long-range bomber aircraft, cruise 
missiles, and hypersonics. Last August, just after I joined 
Speaker Pelosi on her historic trip to Taipei and other 
countries in the Indo-Pacific, a record number of PRC aircraft 
violated Taiwan's air defense identification zone and engaged 
in increasingly provocative maritime actions.
    In its continued support for Taiwan, the Biden State 
Department has approved a record number of arms cases for 
Taiwan in the last 2 years to ensure it has the capabilities to 
defend itself and to deter potential Chinese military action. 
As Secretary Blinken has stated, when it comes to Beijing, the 
United States will compete with confidence, cooperate where we 
can, and contest when and where we must.
    An integral part of this strategy is the recently announced 
AUKUS Trilateral Security Framework between the United States, 
Australia, and the United Kingdom, which aims to strengthen 
defense cooperation and interoperability in the Indo-Pacific. 
This new security framework represents an important step 
forward for the United States in the Indo-Pacific and for our 
shared security encountering China's pacing threat.
    Within the border of the AUKUS agreement, Pillar I will 
strengthen Australia's undersea warfare capabilities at a 
critical time to counter the PRC's aggression and burden-share 
in the region.
    Pillar II advances military capabilities with the intent of 
developing and enhancing joint capabilities among Australia, 
the U.K., and the United States. Doing so will engender greater 
cooperation and, ultimately, improve security and 
interoperability in the region. Part of Pillar II's focus 
includes efforts to improve processes related to arms exports 
and sharing of sensitive defense technologies between the 
participants.
    Now, this must include encouraging and guiding our partners 
on how to strengthen their regulatory frameworks to enable us 
to share advanced defense technologies safely. Now, I know both 
agencies represented here by our witnesses have been intensely 
focused on this in recent months, and I'm hoping to hear more 
about what progress has been made thus far and the path 
forward.
    In short, to provide for the success of AUKUS, and for the 
promise of Pillar II to be fully realized and implemented, we 
must get it right, especially given the persistent and 
significant threat the PRC poses.
    In the Indo-Pacific, and across the globe, we are facing 
rapidly evolving threats which underscore the importance of 
reinforcing our alliances to safeguard our shared security. And 
I'm supportive of the Biden Administration's efforts to do so 
in Europe with our NATO allies and in East Asia in providing 
our allies, as well as Taiwan, the capabilities, not only to 
defend themselves, but to deter potential aggression.
    The United States can and must continue to stand as a 
leader among nations, leveraging not only our military 
strength, but also our diplomatic tools that are grounded in 
our values, so we may defend our security, protect our 
interests, and stand up for the rights and independence of free 
peoples throughout the world.
    And with that, I yield.
    Chairman McCaul. The gentleman yields back.
    Other members of the committee are reminded that opening 
statements may be submitted to the record.
    I ask unanimous consent for the gentleman from Connecticut, 
Mr. Courtney, to be allowed to sit on the dais and participate 
in today's hearing. And I welcome you, sir. And without 
objection, so ordered.
    We are pleased to have a distinguished panel of witnesses 
before us today.
    First, Ms. Jessica Lewis is the Assistant Secretary for the 
Bureau of Political-Military Affairs at the Department of 
State.
    And Dr. Mara Karlin is the Assistant Secretary of Defense 
for Strategies, Plans, and Capabilities at the Department of 
Defense.
    This committee recognizes the importance of the issues 
before us and are grateful to have both State and DoD here 
today to speak with us on these important issues.
    Now, your full statements will be made a part of the 
record.
    And I now recognize Assistant Secretary Lewis for her 
opening statement.

  STATEMENT OF JESSICA LEWIS, ASSISTANT SECRETARY, BUREAU OF 
      POLITICAL-MILITARY AFFAIRS, U.S. DEPARTMENT OF STATE

    Ms. Lewis. Thank you.
    Chairman McCaul, Ranking Member Meeks, honorable members of 
the committee, thank you for the opportunity to speak with you 
today.
    Almost exactly 20 years ago today, I started my career with 
the House Foreign Affairs Committee, and it is an honor to be 
here again today.
    I want to recognize the historic work that this committee 
is achieving under your leadership on critical foreign policy 
issues, whether it is AUKUS or otherwise. And I'm excited to 
talk to you about the role of the State Department in realizing 
AUKUS, one of the Biden-Harris Administration's key national 
security initiatives.
    Today, I'm going to, first, provide an overview of AUKUS; 
second, outline our roadmap for realizing AUKUS, including our 
AUKUS trade authorization mechanism, and third, discuss the 
importance of export controls. I will also speak briefly on 
foreign military sales.
    AUKUS, as you know, involves two Pillars. Pillar I, 
providing Australia with a conventionally armed, nuclear-
powered submarine capability at the earliest possible date. And 
Pillar I, trilaterally developing and providing joint advanced 
military capabilities. Ranging from artificial intelligence to 
hypersonics to cyber, Pillar II presents a generational 
opportunity to advance the key technologies of the future with 
two of our closest allies.
    But make no mistake, the success of AUKUS is not 
predetermined. It must be built. For AUKUS to succeed, we need 
to both innovate boldly and to protect our technology from 
those who wish to take advantage of any vulnerability in our 
systems.
    As the Australian Deputy Prime Minister said last week, 
``This is a big task. The barriers in both systems are vast and 
complex. There is no silver bullet.''
    As such, to implement AUKUS, we are innovating within our 
existing regulatory system, while simultaneously pursuing broad 
changes through legislation and international agreements.
    The roadmap consists of three steps: first, the AUKUS trade 
authorization mechanism, known as ATAM; legislative changes, 
and international consultations.
    First, the Department of State will implement a novel use 
of our existing authorities. The AUKUS trade authorization 
mechanism will provide an interim solution, expediting and 
optimizing technology-sharing and defense trade among only the 
AUKUS partners.
    Second, and simultaneously, the Administration plans to 
consult closely with Congress and propose legislative changes 
to meet the ambitions of AUKUS. To that end, we will seek 
legislation to clear a path to new exemptions for much of our 
defense trade with the U.K. and Australia. Under this 
legislative proposal, AUKUS partners will have many transfers 
preapproved and not subject to case-by-case review.
    Third, the Administration will also be seeking commitments 
from our AUKUS partners on shared standards for protection of 
defense information and material.
    Let me walk you through the first piece of this roadmap, 
the State AUKUS trade authorization mechanism. Under this 
authorization, the governments of the United States, the United 
Kingdom, and Australia will work together to create seamless, 
secure, and speedy defense trade between and among AUKUS 
partners, while, also, safeguarding our national security.
    We will define the AUKUS authorizations by three 
overlapping criteria, which are:
    First, a list of the project areas that fall within the 
scope of AUKUS.
    Second, a list of the technologies that cannot receive this 
preferential treatment.
    And third, a list of the approved communities or entities 
within each country that are going to receive or access this 
technology.
    All transfers under this authorization could proceed 
without any further need for an authorization or a license, 
while maintaining the records necessary to conduct compliance.
    While State is clearing a path to new exemptions, we are, 
simultaneously, moving forward with broader legislation and 
international action to develop a collective approach that 
streamlines defense trade with Australia and the U.K., while 
also protecting our technology.
    And as we follow through on the vision President Biden set 
out, it will also be crucial to maintain strong protections to 
ensure that the technological momentum our three countries 
achieve remains secure.
    Export controls have only grown more important during this 
era of strategic competition. For years, we have seen 
widespread evidence that our strategic competitors, including 
the People's Republic of China, Russia, and then, additionally, 
North Korea and Iran, are seeking to obtain and exploit our 
advanced military and civilian technologies. In this moment, we 
need to do all we can to move faster on AUKUS and also make 
sure that we have a calibrated approach to export controls.
    Finally, I would like to speak briefly about what we are 
doing to improve the speed of our foreign military sales writ 
large. We call this the FMS process. And we are working to 
deliver efficiencies both in the context of AUKUS and for our 
security partnerships across the globe.
    U.S. Government stakeholders, including the Departments of 
State, Defense, and the NSC, are all identifying efficiencies 
in the Foreign Military Sales process to optimize defense 
trade. The State Department has identified 10 areas for 
improvement to the FMS process, and we would be happy to brief 
you further on these recommendations.
    In closing, I would like to reiterate that, for AUKUS to 
succeed, we need to facilitate the flow of defense technologies 
and knowhow between our three nations, while safeguarding 
against hostile actors who would damage this collaboration and 
our competitiveness. We are confident that we will succeed, and 
we look forward to working with Congress to achieve this.
    Thank you, and I look forward to your questions.
    [The prepared statement of Ms. Lewis follows:]

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    Chairman McCaul. Thank you, Secretary Lewis.
    I now recognize Assistant Secretary Karlin for her opening 
statement.

 STATEMENT OF MARA KARLIN, ASSISTANT SECRETARY OF DEFENSE FOR 
STRATEGIES, PLANS, AND CAPABILITIES, U.S. DEPARTMENT OF DEFENSE

    Ms. Karlin. Chairman McCaul, Ranking Member Meeks, 
distinguished members of the committee, thank you for the 
opportunity to speak with you today on the AUKUS partnership.
    AUKUS partners took a monumental step forward in March when 
we announced the optimal pathway for Australia to acquire and 
develop a conventionally armed, nuclear-powered submarine 
capability that strengthens the global nonproliferation regime, 
but that is only one part of AUKUS. We are actively pursuing 
cooperation under AUKUS on a range of advanced capabilities, 
sending a strong message to the world in favor of a free and 
open Indo-Pacific.
    Today, I hope to reinforce three main topics as they relate 
to AUKUS.
    First, how AUKUS fits into the 2022 National Defense 
Strategy.
    Second, how we are seizing the generational opportunity 
that AUKUS presents.
    And third, why we need to expand defense cooperation with 
our closest allies and partners.
    In framing the security environment, the 2022 National 
Defense Strategy describes the People's Republic of China as 
our most consequential strategic competitor for the coming 
decades, and it underscores how new and fast-evolving 
technologies are complicating escalation dynamics.
    The National Defense Strategy describes integrated 
deterrence as a holistic response to the strategies that our 
competitors are pursing and directs the use of campaigning to 
gain military advantage. It calls on the Department of Defense 
to build enduring advantages across the defense ecosystem to 
shore up our foundations for integrated deterrence and 
campaigning, and it describes allies and partners as a center 
of gravity for the strategy.
    What is needed now, more than ever before, is an approach 
that enhances our AUKUS partners' conventional military 
capabilities, opens support to a more integrated defense 
industrial base, increases information-sharing, and implements 
cooperative policies that reflect the concepts laid out in the 
National Defense Strategy.
    What cannot be overstated is this: we cannot do this alone, 
and our AUKUS partners stand shoulder-to-shoulder with the 
United States, as they have for many decades. As President 
Biden and Secretary Austin have said, AUKUS is a generational 
opportunity, and I want to thank this committee for its broad 
bipartisan support. Your work and support is vital to making 
AUKUS a success.
    Together with our AUKUS partners, we have identified 
several advanced capability opportunities in areas that range 
from artificial intelligence and quantum to hypersonics. Over 
time, the work we do will advance our own capabilities, as well 
as our partners, and will enable us to address the challenges 
that we will collectively face.
    We have reached a point in the global security environment 
and technology landscape where there is not only a benefit, but 
an imperative, to expand our defense technology-sharing 
practices. AUKUS is the beginning of a path that will lead to a 
more integrated and open defense ecosystem that balances the 
threats of strategic competition by harnessing the strengths of 
our collective capabilities. The U.S. network of alliances and 
partnerships is a strategic advantage that competitors cannot 
match, and maintaining this requires an active, whole-of-
government approach.
    We have supported our Ukrainian partners against Russia's 
illegal and unprovoked invasion of Ukraine without putting a 
single U.S. servicemember on the frontlines of that conflict. 
As our response to Russia's invasion has proven, we must 
maintain the ability to cutoff bad actors from dangerous 
capabilities, but we must also maintain the tools and vision to 
share and collaborate with our allies and partners. 
Preparations for future conflicts, or deterring them from 
occurring in the first place, will rely on our ability to 
expand and enhance military partnerships before any shots are 
fired.
    American business is one of the strongest and most 
resilient assets in the national toolkit. We need to widen the 
aperture, foster collaborative defense innovation, advance 
military interoperability with our allies and partners, and 
leverage our collective strengths as a force multiplier.
    AUKUS has provided a lens into not only what military 
capabilities our closest allies need, but also what barriers 
exist that hamper pursuit of our integrated National Defense 
Strategy, and how we need to adapt our approach to meet our 
national security objectives.
    To that end, the Administration plans to consult closely 
with Congress to propose legislative changes that would allow 
increased exemptions to licensing requirements for AUKUS 
partners, and expand it to permit transfers of both 
unclassified and classified defense articles and services. This 
bold approach is critical to ensuring the AUKUS partnership 
continues to innovate and to progress to meet the challenges of 
the global security environment.
    Mr. Chairman, Ranking Member Meeks, and distinguished 
members of the committee, thank you for the opportunity to meet 
with you today, and I look forward to answering any questions 
you may have.
    [The prepared statement of Ms. Karlin follows:]

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    Chairman McCaul. Thank you, Secretary Karlin.
    I now recognize myself for questions.
    First, we look forward to more of these conversations with 
you. Obviously, this is very important. We need more speed in 
the process. I think ITAR is well-intended, but we need 
exemptions, not just with Pillar I dealing with nuclear 
submarines, but also with Pillar II, if we're going to take the 
threat from China seriously. And many both private sector and 
our partners, including Australia, have told me how important 
these exemptions are to speed up the process.
    My first question is, you know, Pillar I has the 
exemptions. As you know, Pillar II does not. How would you plan 
to implement these exemptions to Pillar II? Secretary Lewis?
    Ms. Lewis. Thank you for that question, Mr. Chairman.
    And I agree with you that I think that it is very important 
that we focus on Pillar II to create a speedy, safe, and secure 
way to move forward with this defense trade between the three 
countries. So, let me talk both about the interim period, and 
then, on the legislative front.
    We are really looking for new exemptions. And the idea is 
that, if we know what is included under the AUKUS program, if 
we know technologies that cannot be included--something, for 
example, that might be prohibited by a treaty--and we know who 
is receiving it, then we will be able to, in essence, 
preapprove and have these transfers moved forward without 
needing a license on the front end. And I think, when we talk 
about exemptions, that is fundamentally what we are all trying 
to get at. So, we would be looking at a preapproval, not case-
by-case process.
    We also are going to be looking at moving forward with 
third-party transfers, a blanket exemption under AUKUS. And 
what that means is, for items that are U.S. defense articles 
that are controlled by one country, that they can be moved to 
another country within AUKUS without needing authorization.
    So, all of these are the pieces that we want to move 
forward with. We have this interim proposal, so that we can get 
moving right now. On the legislative side, I agree with you 
completely that we need more of these, and we want to come and 
sit down and work with you and your excellent staff on getting 
that legislative language exactly right.
    Chairman McCaul. Yes, I think codifying it will give 
certainty to our partners and, also, our contractors as well. I 
look forward to seeing your proposed legislation. We would like 
to move--I think time is of the essence here. And so, I look 
forward to working with both of you.
    Ms. Karlin, do you have anything to add to that?
    Ms. Karlin. Sir, I would just add, this is a historic 
opportunity. So, it does require historic change. And so, as we 
are pursuing this legislative proposal, we would like to 
consult very closely with all of you on how best to make that 
happen. But this really is a notable moment for ensuring that 
we can have stability and security in such a critical region of 
the Indo-Pacific.
    Chairman McCaul. Yes. Thank you.
    And we will, obviously, consult with our Armed Services 
Committee colleagues as well.
    Let me ask you, perhaps both of you, as I mentioned, when I 
was in Taiwan, President Tsai asked me, ``Where are my 
weapons?'' I did not have a good answer. And she said, you 
know, ``I paid for them.'' And you see the threat, as they 
circled the island in a very aggressive way.
    The ranking member and I signed off on 22 weapons systems, 
and as I look at the list, the earliest that any can be 
delivered is by 2025, and some as late as 2029.
    And I would like to enter these into the record, if I may, 
without objection.
    [The information referred to follows:]

    ********* INFORMATION NOT PROVIDED AT PRESS RELEASE 
**********
    Chairman McCaul. But why is this taking so long?
    Ms. Lewis. Let me start. We agree that there is urgency to 
make sure that Taiwan is prepared as part of deterrence to keep 
China from moving forward.
    Let me take a moment and talk about the way that the arms 
sales process works. As you know, once you clear a sale, which 
we have sent up here, it, then, goes on contract, and only once 
it is on contract and Taiwan, in this case, has paid for it, 
does production start.
    And so, I do not have the exact list, but I'm fairly sure 
I'm correct that we are now in the point where we are looking 
at the production timeline for those weapons to be built. Let 
me say a couple of things about that.
    We agree that the defense industrial base needs to work 
together with us and the Department of Defense to speed up 
industrial production. This is a worldwide problem, not just 
Taiwan-specific. And the Department of Defense has taken urgent 
steps, led by the Deputy Secretary, on this issue.
    When it comes to Taiwan, specifically, I think, as you 
know, since 2017, we have sent up billions of dollars in arms 
sales to be authorized through this committee. And in addition, 
over the past year, we have signed off on more arms sales to 
Taiwan than in the previous decade. Now, we need to work on 
them getting produced and getting to Taiwan quickly.
    Chairman McCaul. And I would just say time is of the 
essence. I think they are going to try to influence the 
election, the Presidential election, in Taiwan. If they fail, 
then they are going to be looking at some sort of blockade 
event.
    And so, my question is--and I asked the Secretary this 
question--can we redirect some of our weapons sales from one 
country and send it into Taiwan? And then, second, why cannot 
we do third-party sales of some of these weapons systems that 
other countries have, and we would simply give them permission 
to put these weapons in-country?
    Ms. Lewis. Well, I think we need to look at all available 
options. Obviously, for third-party transfers, one country 
would have to agree to transfer those weapons. But I think you 
are right to ask us to take a look at all of those, including 
some of the new authorities that were included in the bill that 
I know that you authored as well.
    Chairman McCaul. Thank you. I would like to speed it up.
    And, Ms. Karlin, do you have any additional thoughts?
    Ms. Karlin. Thank you.
    Well, I would, first of all, just like to thank Congress 
for the Taiwan Enhanced Resilience Act. I think that has been 
really important and shows the bipartisan support for this 
important effort. Having appropriated resources can make that a 
little bit easier, of course, in terms of being manifested.
    I would also like to note, as Assistant Secretary Lewis 
briefly highlighted, our Deputy Secretary has directed the 
Department to find ways to accelerate and bolster Taiwan's 
self-defense capabilities, to strengthen cross-strait 
deterrence, looking at both material and non-material 
capabilities. And it is focused; it is a senior-level effort, 
and it is across the entire Department, to ensure that this 
critical issue is getting the resources and the attentions that 
it needs.
    Chairman McCaul. Well, I know you did an FMF, and thank you 
for that. I will be talking to the Senate Foreign Relations 
Committee about, and also the Appropriations Committee, about 
appropriating our authorization.
    With that, I recognize the ranking member, Ranking Member 
Meeks.
    Mr. Meeks. Thank you, Mr. Chairman.
    And thank you for your testimony.
    And I think that we have on this committee tried to work in 
a bipartisan way, understanding the need and the expediency of 
trying to make sure that our allies are working--we are working 
collectively together, as we saw take place at the G7.
    And one of the things that I have been to figure, you know, 
I have been asking a lot, because why does--and I listened to 
your explanation--why does it take so long to have the 
production lines done? And I hear what you are saying.
    And when I talked to a number of those in the industry 
themselves, it is just it takes time. It takes time for them to 
get the employees back online, and what it takes to produce, 
and it is just, you know, there is no way, they tell me, that 
they can expedite quicker than they have been doing. I do not 
know whether there is something that we could do to engage to 
help them in that manner or not, but that is what they are 
telling me. They are telling me that it is just difficult. Once 
it is authorized, once we go through the steps that you have 
enunciated here, it just takes that amount of time to do 
business, to align it together. Do you find that to be the case 
also?
    Ms. Lewis. Well, let me start by saying, I do think we are 
having a couple of factors happening at the same time. One, we 
are seeing a significant increase in demand for defense 
articles around the world, both, obviously, not just because of 
the Ukraine war, in addition, because of the challenges in the 
Indo-Pacific. And so, there is an increased demand. That also 
coincided with COVID. It coincided with supply chain issues.
    I do think, however, that there are steps that we can take, 
working with industry. Sometimes it is a matter--and Dr. Karlin 
may have more on this--on finding a part from a sub-sub-
supplier that had been shut down that we need to get moving 
again. Sometimes it is investing a little money upfront, so 
that a production line can get started.
    I think there are a whole host of steps that we can take 
with industry, as they look at the challenges that they have, 
you know, in terms of hiring new staff, adding actual 
capabilities.
    Mr. Meeks. Which is, basically, what I was asking. Are 
there ways that you all can work together, you know, to make 
sure that production is happening in a more timely fashion?
    Let me ask, Dr. Karlin, you know, one of the concerns that 
I do have is, in the 2023 worldwide threat assessment, the U.S. 
Director of National Intelligence emphasized the threat that is 
posed by China's persistent efforts to acquire foreign science 
and technology information and expertise, especially in the 
defense space, and emphasized the extensive use of economic 
espionage and cybertheft.
    Now, I have some concerns, because I do not want some of 
our sensitive equipment and technology and brain to go to 
China. And so, also, particularly in Australia, they said that 
there was an area of opportunity for China, given its location 
and a comparatively nascent regulatory architecture, that 
Australia's intelligence services emphasized this threat in its 
own 2023 threat assessment, and its directive stating that the 
targeting of Australian defense industry personnel having 
increased--and I quote--``since the AUKUS announcement last 
year,'' which gives me concerns. And we know what China has 
been doing in a nefarious way.
    So, I want to make sure that the Australian and the U.K. 
regulatory structures that are controlling sensitive defense 
technologies that are comparable to what we have in the United 
States--are they the same? Do they differ? Is it safe? To make 
sure it does not get in the hands of the Chinese.
    Ms. Karlin. Sir, as you know, Australia and the U.K. are 
among our closest allies in the world, and they have mature 
defense trade control processes. We have a long history of 
working with them and have shared some of our most sensitive 
military technology to date--F-35 being a great example, or F-
18s as well, not to mention submarine technology.
    As it relates to AUKUS specifically, we will work very 
closely with them on ensuring we have trilateral standards for 
secured defense trade--making sure that all of us have the 
technological, security, legal, and regulatory frameworks that 
are providing export controls consistent with those that we 
implement in the United States as well.
    Mr. Meeks. So, thank you for that.
    So, are there any improvements you think that needs to be 
done? Because, you know, when we do talk to them, when I do 
talk to our allies in Australia and the U.K., sometimes we hear 
these conversations. So, are there any improvements that you 
think in the regulatory structure that are necessary to ensure 
appropriate protections against malign actors? And what, if 
any, risk to our national security is related to sensitive 
defense capabilities if our regulatory frameworks are 
misaligned?
    Ms. Lewis. I very much appreciate the question, and I think 
it is important that we take these serious issues under 
consideration, as we move forward with AUKUS. Again, we do have 
full confidence that we can work with our allies to protect 
these technologies.
    What I would also say is that, anytime that we are putting 
together a structure like we are putting together with this new 
AUKUS authorization, we always have to come together to make 
sure that we are aligned; that we have crossed every ``T'' and 
dotted every ``I,'' but I am very confident that we will be 
able to do this, given that these are two of our closest 
allies.
    Mr. Meeks. Yes. Thank you.
    I yield back.
    Chairman McCaul. The chair recognizes Mr. Smith.
    Mr. Smith. Thank you very much, Mr. Chairman.
    And thank you both for your leadership and for being here 
today to testify.
    Let me just ask, Secretary Lewis, you pointed out that 
``The Administration will also be seeking commitments from our 
AUKUS partners on shared standards for the protection of the 
defense information and materials, consistent with the steps 
the United States takes to protect such information and 
materials.'' Perhaps you would elaborate on some of those steps 
and whether or not those commitments are actually yielding 
fruit?
    And I would just point out, you know, for decades, the 
United States, as we all know, especially with dual-use items, 
aided and abetted the Chinese Communist Party. Post-Tiananmen 
Square, we gave them just about anything they wanted and they 
built up a capacity and a capability, courtesy of us, and, of 
course, the Europeans. So, hopefully, there has been lessons 
learned there.
    But, when it comes to our two allies--our two great allies 
we are talking about--I was wondering if you could speak to the 
issue of, yes, defense corporations are one thing--and I'm sure 
you are looking at that very closely--I hope you are also 
looking at colleges and universities. I chaired a series of 
hearings on Confucius Institutes and was shocked to some 
extent. I even asked the GAO to look into it, and they came 
back and said, ``The agreements are confidential.'' They would 
not share what they have agreed to with the Chinese Communist 
Party.
    And we know it is a malign influence that they are having 
on college campuses and university campuses. But we also know 
that that gives them a launching pad to be eyes and ears on the 
spot there to try to--particularly in colleges where there is a 
great deal of defense work going on.
    And I am wondering, you know, if we are doing that well in 
the United States to ensure that those vulnerabilities aren't 
exploited, but also with our two partners, the U.K. and--
because they have Confucius Centers, too, and they have many of 
them. The whole world has them, but they have many of them as 
well.
    Ms. Lewis. Again, thank you for the question, and I do 
think you are raising an incredibly important issue, which is, 
as we move forward with speed within the AUKUS framework, we 
also need to make sure that we do it in a secure way.
    And I think you are flagging a particular challenge when it 
comes to the PRC. Because, as you point out, we know the PRC 
has a long history of trying to exploit our technology, to take 
our intellectual property. They have looked at trying to get 
into a whole range of our technology. And I am aware of the 
issues that you raised related to universities.
    Again, I think when it comes to the question of Australia 
and the U.K., because these are truly our closest allies, 
because of the sophistication of their systems and the way we 
are able to work very closely together, I am absolutely 
confident that we will be able to have the highest standards 
that you would expect to make sure that those exports and 
intellectual properties do not end up in the wrong hands.
    I very much appreciate you raising concerns related, not 
just into the defense field, but as we look across educational 
institutions and universities. And we will be certain to take 
that into account.
    Mr. Smith. I do appreciate that very much.
    Let me just ask, do you see any enhanced role for 
cooperation with the Quad countries--Australia, India, Japan, 
and, of course, us, and perhaps even with the Republic of 
Korea?
    Ms. Lewis. Thank you for the question.
    I think at this moment in time we are very focused on 
getting AUKUS right, and that is the focus of what we are doing 
right now. As we progress, we are always happy to look at ways 
that we can further cooperate with other allies and partners.
    Mr. Smith. Thank you so much. I yield back the balance.
    Chairman McCaul. The gentleman yields.
    The chair recognizes Mr. Sherman.
    Mr. Sherman. A capitalist economy tends to move toward 
just-in-time delivery. You get it to your customer just when 
they are ready to pay for it. So, with baby formula, sometimes 
we have a shortage. With certain drugs, we have a shortage. And 
we are seeing a shortage in munitions as well, and what 
concerns me is that we do not have enough together with all our 
allies to provide enough artillery shells, et cetera, to 
Ukraine, and their ability to fire artillery shells is one-
tenth of what our ability is. That is to say, that is a much 
smaller military.
    Do we have a system in defense procurement where we can pay 
companies, not for what they deliver, but for just having 
standby manufacturing capacity? Ms. Karlin?
    Ms. Karlin. Thank you very much.
    I think Russia's unprovoked and aggressive war in Ukraine 
has helped a whole lot of folks internalize something that we 
had seen in the environment, but probably had not appreciated 
to the extent possible, which is that criticality of investing 
in defense industrial bases, both of our own and our allies.
    Mr. Sherman. But, more specifically, do we have a system 
where we pay military defense contractors to have standby 
manufacturing capacity?
    Ms. Karlin. Well, I might, specifically, highlight that 
Congress has given, I know, the Department of Defense this 
multiyear procurement authority for munitions, and that that--
--
    Mr. Sherman. I did not say, ``multiyear procurement.'' I 
said, ``standby manufacturing.'' You pay somebody just to be 
ready to produce in the future--not for what they have 
produced, but for the capacity to produce. It is a yes-or-no 
question. Do you have an answer?
    Ms. Karlin. I just want to ensure I understand the 
question, sir.
    Mr. Sherman. Is there any--do you have the capacity to 
contract with a private munitions manufacturer to say, ``In 
addition to what we may pay you for what you deliver, we are 
going to pay you to have a plant out somewhere that you are not 
even using that is ready to go in an emergency.''?
    Ms. Karlin. Well, right----
    Mr. Sherman. Do we have that capacity or not? Do we use it 
or not?
    Ms. Karlin. I would like to get back to you on that.
    Mr. Sherman. OK, get back to me on that.
    [The information referred to follows:]

    ********* INFORMATION NOT PROVIDED AT PRESS RELEASE 
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    Ms. Karlin. If I might say that we are focused, in 
particular, because there is----
    Mr. Sherman. I hear you. I have got limited time here.
    Ms. Karlin. Ok. Thank you.
    Mr. Sherman. We have a process for approving foreign 
military sales. And often, that process is slow, and we have 
had discussions in this committee for over 20 years on that. 
And Congress has passed some legislation--I have been involved 
in drafting it--to speed that process forward.
    Ms. Lewis, are we in a position where, if somebody applies 
to make a foreign military sale, that that file gets dealt with 
immediately? Or, is there, literally, a backlog where you have 
got to put that file aside because you are working on something 
else? Can we immediately fully staff every application?
    Ms. Lewis. You mean at the State Department before it comes 
here?
    Mr. Sherman. At the State Department.
    Ms. Lewis. Yes, we immediately staff once a case comes in. 
Now, that is whether it is on the commercial side or, as you 
were referencing, the foreign military sales side.
    Mr. Sherman. And I think this is critical because, not only 
do we have the foreign policy implications and a relationship 
with the country that is applying, but every time we get a 
foreign military sale, that builds the defense infrastructure 
here in the United States. And every time somebody is turned 
down by the United States and goes somewhere else, that builds 
the military infrastructure somewhere else. And that 
``somewhere else'' is not fully aligned with us, since we 
declined.
    Do you take into consideration, in saying yes or no, what 
effect the saying ``no'' will have on both our infrastructure 
and the infrastructure of where else they may go for the 
military equipment?
    Ms. Lewis. We certainly take into consideration all of the 
issues that we are required to, which includes a whole range of 
things, including the impact on that country; whether they are 
competitors; human rights issues. And all of those factors are 
taken into account.
    Mr. Sherman. I just want to point out, finally, burden-
sharing comes up. We like to say that we are only doing 3.5 
percent. We mislead the American people when we say that. It is 
well over 4 percent. And the difference comes from not counting 
veterans' benefits as a cost of having a military. In the 
private sector, any CPA who did not treat provision for retiree 
benefits as a cost of doing business would be in jail.
    So, we are spending well into the 4s. We are asking others 
to do 2s, and I am glad the U.K. and Australia are at least 
meeting that standard.
    I yield back.
    Chairman McCaul. The gentleman yields.
    The chair recognizes Mr. Wilson.
    Mr. Wilson. Thank you very much, Mr. Chairman.
    And I thank both of our witnesses for being here today.
    And I share the concern of Congressman Brad Sherman in 
regard to artillery shells. It has been brought to my attention 
by the chairman of the Armed Services Committee, Mike Rogers, 
that we have nearly 2 million in inventory, DPICM artillery 
shells. And these types of weapons have already been used by 
Putin. And additionally, the Ukrainians also have used these 
weapons, or artillery shells. Our very valued ally, Turkiye, 
has provided these shells.
    And so, I hope every effort will be looked in to providing 
these. We have them in inventory. In fact, they may become 
obsolete if we do not use them sufficiently. And a great way to 
get away with obsolescence is to provide them immediately to 
Ukraine.
    With that in mind, I'm really grateful that South Carolina 
is playing an important role with the Australia, United 
Kingdom, United States trilateral security pact toward 
acquiring nuclear-powered submarines. Currently, there are four 
Australian naval officers training at the Navy Nuclear Power 
Training Command and Nuclear Power Training Unit located at 
Joint Base Charleston. This training is directly advancing and 
improving the Australian navy capability under the trilateral 
security pact by ensuring that we can train Australian navy 
leaders on the nuclear capabilities that are tied to their 
projected submarine acquisitions. These officers will graduate 
next month, and we look forward that more officers and enlisted 
personnel will be coming in the future.
    And, Secretary Karlin, Chairman Mike McCaul has made it so 
clear, but it just has to be stated over and over again, the 
delays in foreign military sales truly are putting, I believe, 
putting the American people at risk. We should be working for 
peace through strength, not exhibiting the vulnerabilities of 
our allies, and the United States, in particular, by having 
weakness of not providing the equipment.
    And it is my understanding it takes 18 months for a 
standard contract to be fulfilled. To me, that just puts our 
allies and all of us at such risk. With the tensions that we 
have with the Chinese Communist Party, with War Criminal Putin 
invading Ukraine, we need to expedite.
    And so, what will be done to expedite? And certainly, less 
time--it is just absolutely crucial. That is just inexcusable--
18 months.
    Ms. Karlin. Congressman, I completely agree with you that 
we have got to be able to provide the capabilities for our 
allies and partners as quickly as possible in support of their 
requirements and, also, in support of our National Defense 
Strategy.
    Last summer, Secretary Austin established a Foreign 
Military Sales Tiger Team that focused on identifying 
efficiencies, clearing systemic issues, and accelerating the 
responsiveness of the system to meet the capability 
requirements of our allies and partners. And this Tiger Team 
has focused on friction points within our process and has 
identified dozens of recommendations that are focused on 
exactly what you are saying, sir.
    So, we are firmly committed to making sure that we can move 
as quickly as possible. Some of the solutions look like 
actually making sure we have got a data-driven approach, so we 
have a complete picture of where in the process these different 
sales are. Some of this looks like ensuring there is 
accountability in implementing the recommendations and making 
sure, frankly, that the most senior leaders of the Department 
are tracking the particularly important ones. And so, we have 
done a number of things on that, and our colleagues at the 
State Department have as well, as Assistant Secretary Lewis 
will----
    Mr. Wilson. And to me, Chairman McCaul has been very 
creative for you. And that is that much of this equipment could 
be provided from the inventories of our allies, and then, we 
backfill to the allies. This just needs to be expedited. We see 
that with Australia. Really, the people of Taiwan are at such 
risk.
    It has just been very frustrating to me, as we work with 
the world's largest democracy, India. They found that you can 
have expedited military sales from Putin. And so, we need to be 
there to get ahead of that. The world's largest democracy 
should not be relying on War Criminal Putin. We should be 
providing the ability for the equipment to be provided as 
quickly as possible, so that we can provide peace through 
strength, to protect the United States, protect the Indo-
Pacific, to protect the people of India.
    I yield back.
    Chairman McCaul. The gentleman yields.
    The chair recognizes Mr. Connolly.
    Mr. Connolly. Thank you, Mr. Chairman.
    And welcome.
    I want to ask about capability. The Ukraine war has 
highlighted weaknesses and strengths in our allied capability 
in responding to the Russian aggression and depredation in 
Ukraine.
    We formed this alliance, AUKUS, and I guess I want to ask 
you about the capability of one of those allies, Australia. The 
Australian government issued a report, ``The Defense Strategic 
Review,'' earlier this year, and they concluded, quote, ``The 
current Australian military is no longer fit for purpose.'' 
Unquote. That is a stunning conclusion.
    Assistant Secretary Karlin, are you familiar with this 
report?
    Ms. Karlin. I am, indeed.
    Mr. Connolly. And does it concern you?
    Ms. Karlin. I think it is heartening that Australia's 
government recognizes the urgent need for----
    Mr. Connolly. Yes, I get it. That is the State Department 
line, not the Defense Department.
    Are you concerned about a report that says they are not fit 
for purpose? Isn't that a pretty sweeping statement?
    Ms. Karlin. I think they are recognizing that they need to 
make important changes.
    Mr. Connolly. Hum.
    Ms. Karlin. That is hard and that is important, and I 
applaud them for doing that. I would rather that they recognize 
the need for those----
    Mr. Connolly. All right. Well, we will note your applause.
    I guess I'm noting my concern and asking whether, as people 
trying to form an alliance, the depth of that concern, and 
you're heartened.
    Assistant Secretary Lewis, are you concerned at that 
conclusion and what it means in terms of what the United States 
has to do working with this ally, who is certainly motivated, 
to make sure that they are fit for purpose?
    Ms. Lewis. Well, sir, I really appreciate you raising these 
issues. I also believe that we are going to be able to work 
hand-in-glove with Australia. Our experience with Australia, 
when we look at the capabilities that they have acquired over 
the years--I think Dr. Karlin mentioned the F-35, for example--
they have shown us time and time again that they are able to 
take a problem, work on it, and handle the most sophisticated 
technology and capabilities that anyone in the world has. So, I 
remain confident.
    And may I add one more thing? I also think that the AUKUS, 
both Pillar I and Pillar II are going to provide all of us our 
opportunities to strengthen our capabilities.
    Mr. Connolly. Well, what do you think--what do you think 
the phrasing means, ``They're not fit for purpose,'' if you are 
so confident?
    Ms. Lewis. I'm not able to assess exactly what that 
phrasing means. I think it----
    Mr. Connolly. What do you----
    Ms. Lewis. I assume it means that they are--that the person 
who wrote the report is saying that they need to make 
improvements to be fit for purpose.
    Mr. Connolly. Yes, they, in fact, identified six major 
areas where serious improvements have to be made. Are you 
familiar with the report?
    Ms. Lewis. I have not read that particular report.
    Mr. Connolly. Going back to you, Assistant Secretary 
Karlin, you are familiar with the report?
    Ms. Karlin. Indeed. I would say, as the U.S. military has 
had to make important shifts, as it has moved away from the 
post-9/11 wars, so, too, do allies and partners, particularly 
those who are worried about security and stability in the Indo-
Pacific.
    Mr. Connolly. Do you think that--let's say it means 
something, ``We're not fit for purpose.'' Is that due, do you 
think, in part, to disinvestment or lack of investment in the 
defense sector in Australia over the years?
    Ms. Karlin. I think it is probably due--I would defer to 
them, of course--but I think it is probably due more toward 
them seeing a threat picture that looks different. And them 
putting AUKUS, for example, at the heart of this DSR, as you 
are citing, is actually quite positive. It shows, for example, 
the need to invest in really sophisticated undersea capability, 
which is particularly relevant, given what that changing 
security environment looks like in the Indo-Pacific.
    Mr. Connolly. Yes. I agree with you. I mean, listen, I 
believe in Australia. I want Australia to be a partner, but I 
also want us to recognize where there are weaknesses that have 
to be addressed.
    As I started out, I have been very involved in NATO and the 
European response to the situation in Ukraine. And we have got 
to be candid about acknowledging weaknesses to address them. 
And this report really caught my eye earlier this year, and I 
just want to make sure that, as we proceed, especially as we 
proceed to talk about nuclear submarines, that capability 
across the board in the Australian has got to be upgraded, if 
we are going to meet the threat. And I take your point that 
there is sort of renewed appreciation of the threat assessment 
in the region, but we cannot ignore years of neglect when they, 
in fact, occur.
    And by the way, finally, that brings us back to the 
chairman's point about Taiwan. You know, we do not have until 
1929--I mean 2029--to address defense capability in Taiwan. I 
do not think we are going to have that luxury, and that is why 
we have got to accelerate that timeline. I would echo the 
chairman's response.
    I appreciate both of you being here.
    And I yield back. Thank you, Mr. Chairman.
    Chairman McCaul. The gentleman yields.
    The chair recognizes Mr. Perry.
    Mr. Perry. Thank you, Mr. Chairman.
    Secretary Karlin, look, I know we are here to talk about 
AUKUS, and the United States needs to be a serious force, and 
if we are going to lead, even in that part of the world and 
have partners, they are going to want to know that we are 
serious as well.
    It is my understanding your office is responsible for 
drafting the National Defense Strategy. Am I out of line there, 
or is that correct?
    Ms. Karlin. That is spot-on.
    Mr. Perry. Ok. I thought so.
    You know, in another life, people like me waited for that 
to come out to see what was in it to guide us--power 
projection, planning strategy, posture, force array, et cetera. 
And I'm just thinking about when I go to the section entitled, 
``Strength, Resiliency, and Adaptability,'' the report states 
that, ``Climate change is one of the biggest threats to the 
defense ecosystem.'' And it goes on to say, ``The Joint Forces 
must''--``The Joint Force must integrate climate change into 
its threat assessments.''
    Ok, fine, so to speak. We live in a world of limited 
resources. I'm sure you know that. That is acutely--I think 
people in town are acutely aware of it right now.
    Can you quantify to me, is there some--is there some weapon 
that China or Russia or Iran, or any of our adversaries have, 
that is going to imperil our traditional fuel sources? If we 
just say--and I do not know exactly what you mean, because I 
read this climate change, ``integrate climate change into a 
threat assessment.'' Is there something--they have some climate 
weapon that we are trying to avoid or counteract?
    How do renewable fuels do any better at counteracting 
whatever weaponry they have, whatever strategy they have, than 
traditional fuels, for instance?
    Ms. Karlin. So, what that part of the National Defense 
Strategy is trying to get at, sir, is the operational impact of 
changes in weather. So, for example, rising sea levels affects 
our bases that are on the water, and we need to account for 
that.
    Mr. Perry. Ok. So, that's it? That is the only thing that 
we are doing, as far as you are concerned, in that space? Would 
that----
    Ms. Karlin. So, that is one example that----
    Mr. Perry. One example? But there are, you would 
acknowledge there are many other examples?
    Ms. Karlin. It is trying to get at how the security 
environment is changing and the impact that that is having on 
our Force's ability to operate, whether it is----
    Mr. Perry. But that is what I'm looking for, the direct 
impact. Because, as far as I know, the military--the Navy, in 
particular--have been dealing with rising and lowering sea 
levels, if not for tides, if anything else, ever since it has 
been the Navy and the Marines. And the Army, if you have been 
in the Army, you sleep out in the rain.
    I do not know--look, I read through your credentials. You 
have got a long--you know, you have published a lot. You have 
been around a lot. I do not know if you have ever done a 
carrier landing under goggles. I do not know if you have flown 
a low-level mission in the trees under a flare. I do not know 
if you have humped a pack through the trails of Afghanistan. 
But the folks that are depending on what you write have to do 
those things.
    And here's what they are not focused on: They are not 
focused on a recycling program where the enemy is raining fire 
down on their heads. They are trying to stay alive and win the 
war with the least amount of casualties as quickly as possible. 
And I wonder, and I'm concerned, because this is what we 
project--this is what we project to the folks in AUKUS and 
around the world as the leader. And if we cannot focus on 
lethality and readiness--lethality and readiness--and maybe in 
your case, because it is the National Military Strategy, Force 
projection, then we are in the wrong business, ma'am. We have 
got our eye off the ball.
    And I do not know if you have noticed recruiting levels 
lately. But maybe instead of this paragraph, there ought to be 
a paragraph on why recruiting levels are unsustainable and why 
Americans no longer want to be in the military, and why they no 
longer can qualify to be in the military because they are 
overweight or because they have been incarcerated, or because 
they have addictions. Maybe that should be the focus, instead 
of climate change and rising sea levels.
    You know, if the base has rising sea levels, maybe you 
ought to look China and just build a base out of, you know, a 
reef that does not--where no base exists. Maybe that should be 
the military strategy. And I wonder if you have considered any 
of that.
    Ms. Karlin. This National Defense Strategy is, arguably, 
among the punchiest and pithiest the Department of Defense has 
put out. It has one very clear priority, which is the urgent 
need to sustain and strengthen deterrence, focused on the 
People's Republic of China. It looks at that from a strategic 
perspective and from an operational perspective as well.
    And, sir, part of the reason that we do not need to build 
islands the way that the Chinese do is because dozens of 
countries have welcomed our troops around the world to have 
bases there.
    Mr. Perry. Oh, on bases that aren't under water because of 
rising sea levels?
    Mr. Chairman, I yield the balance.
    Chairman McCaul. The gentleman yields back.
    The chair recognizes Mr. Keating.
    Mr. Keating. Thank you, Mr. Chairman.
    I would like to thank the witnesses.
    I'm curious--and I guess we could do it in the context of 
AUKUS Pillar II, but we could do it more broadly--I'm just 
concerned on an ongoing basis, as we are developing technology, 
advanced technology, and defenses together, the issue of 
artificial intelligence, and AI is a concern, a growing concern 
about making sure we have controls over that kind of advanced 
technology. So, it cannot get out of control or be misused 
somehow. When we are doing this research, is that an area that 
we are doing independently or in conjunction with our allies 
like in AUKUS Pillar II?
    Ms. Karlin. AUKUS Pillar II is really trying to look at 
advanced capabilities exactly as you say, sir--artificial 
intelligence being one example; hypersonics being another 
example, and trying to figure out how we can better collaborate 
with our allies to realize these capabilities, develop them, 
exercise them, et cetera.
    Mr. Keating. But what about controlling them? Are we doing 
research, so that somehow these cannot somehow get out of 
control, spinning into a catastrophe?
    Ms. Lewis. Sir, if I may, I think that you hit on a 
critically important point, which is, why, when we move forward 
with AUKUS, it does not mean that everything that anybody wants 
to send or share will just be sent. We are still going to have 
to know the technologies that, for example, cannot be moved. We 
are still going to have to know who is going to receive them. 
And the reason that will be--but, then, we want, once we know 
that, we want them to be able to move quickly and smoothly.
    Mr. Keating. Right, but----
    Ms. Lewis. What you are saying is we need to make sure that 
we have protections in place to make sure that they do not get 
exploited.
    Mr. Keating. Even for our own use.
    Ms. Lewis. Yes, and I think that is something that, you 
know, particularly, I know there are concerns in the AI space, 
but that we really are going to have to look at across the 
board.
    Mr. Keating. I do think it is something that we have to pay 
particular attention to going forward, given the advancements 
in AI.
    Second, we are talking about delays quite a bit, and they 
are not just simply explained through a one-dimensional view of 
what causes delays. If you could--you know, I'm on Armed 
Services as well; we are well aware of this, but some of our 
members here aren't--could you describe, you know, that period, 
the valley of death when you are taking it from prototype to 
real product and what you are doing about that? And explain 
that delay, what valley of death means in terms of delays in 
production.
    Ms. Karlin. Absolutely. There are technologies that will be 
developed, and then, the question is really, do you decide to 
mass produce them? Do you decide that they need to pop out in 
the right quantity, so that they are relevant for the Force? 
And that is sort of that valley of death of how do you make 
that transition.
    I can assure you, sir, this is an area Deputy Secretary 
Hicks and Under Secretary Shyu have been extremely focused on. 
And how do we make that easier? Particularly, how do we make 
that easier for those smaller businesses who maybe do not have 
the same level of experience of working with the Department?
    Mr. Keating. So, some of these delays aren't just pure 
regulation or a delay in--there are real-life reasons for these 
delays. And certainly, we can do more. And Assistant Secretary 
Shyu I think is doing extraordinary work in this particular 
area herself. And I just want the members here to understand, 
this isn't just an issue of red tape or slowing down. There is 
very real technological and production issues that are here, 
financial issues.
    And by the way, for the Members of Congress that are here, 
budgeting from CR to CR to CR, and not dealing with the real 
budget, we have to take responsibility as well, when we do not 
act the way we are supposed to act with real order.
    So, I yield back.
    Chairman McCaul. The gentleman yields back.
    Mr. Mast is recognized.
    Mr. Mast. Thank you, Mr. Chairman.
    I appreciate both of you being here. Obviously, a lot of 
conversations blur between both agencies, both bureaus.
    So, I want to start with longer-range missiles and start 
with you, Ms. Lewis. Can you discuss with us right now what is 
the U.K. doing to provide longer-range capabilities, as their 
role to support the U.K.--or the Ukraine?
    Ms. Lewis. Sir, first of all, we are all working very hard 
to get Ukraine the capabilities they need. We think----
    Mr. Mast. Longer-range, though, specifically? I understand.
    Ms. Lewis. Yes.
    Mr. Mast. Go on.
    Ms. Lewis. You know, I am not going to go into details on 
exactly what the U.K. is providing or not. I do think that all 
of our partners have different capabilities that they are able 
to provide at different times. And I think the goal is to make 
sure that, as the fight changes in Ukraine, that Ukraine has 
what it needs for the fight. So, whether it was in the 
beginning, when we were looking at Stingers and Javelins, to 
tanks later in the war, to air defense right now, we are 
working together, both with the U.K., but with a whole host of 
about 50 other countries to make sure they get what they need.
    Mr. Mast. That does not seem like the most effective way to 
wage war, in that micromanaging way that you are looking at 
each and every distance--is this the appropriate time, given 
what bipartisanly has been discussed here about the timelines 
to get munitions from one place to another? Even with allies 
not at war, those timelines are just not reasonable to be the 
most tactical and the most capable entities on the battlefield. 
And so, I think it does hurt the system as a whole.
    But let's move to our own personal opinions, if you are not 
willing to speak about U.K. on this. Are you concerned about 
Ukraine having longer-range capabilities?
    Ms. Lewis. I believe that Ukraine has been responsible and 
with what we have----
    Mr. Mast. Quantify ``responsible,'' please.
    Ms. Lewis. When we started working with Ukraine, we have 
provided them over the past 15 months over $36 billion in 
security assistance. They have used those weapons to fight the 
war, to defend their homeland.
    I was just in Ukraine, actually, last week----
    Mr. Mast. What would you consider irresponsible?
    Ms. Lewis. Well, to step back from Ukraine, we have rules 
about how our weapons can be used----
    Mr. Mast. Let's not step back.
    Ms. Lewis [continuing]. Across the board.
    Mr. Mast. Let's just stick with Ukraine. What would you 
consider irresponsible?
    Ms. Lewis. I think when we have provided weapons to 
Ukraine, we have provided them for them to use them in Ukraine. 
We have provided them to use them to fight the war, to defend 
their sovereignty and territorial integrity.
    Mr. Mast. So, you would consider it irresponsible for them 
to attack Russia in sovereign Russian territory?
    Ms. Lewis. We have not provided weapons for that purpose.
    Mr. Mast. Ms. Karlin? You work on strategy.
    Ms. Karlin. Indeed. Thank you.
    It's----
    Mr. Mast. Do you think that would be sound strategy?
    Ms. Karlin. It is our assessment from the Department of 
Defense perspective that, with the existing GMLRs capability, 
that the Ukrainians have on their HIMARS, they can reach the 
vast majority of targets that they need to inside Ukrainian 
territory.
    Moreover, we are working----
    Mr. Mast. I'm asking about outside of Ukrainian territory.
    Ms. Karlin. Right now, we are really focused on making sure 
they have what they need to deliver effects on the battlefield 
to retain their sovereign territory.
    Mr. Mast. I think it is also an important consideration, 
when looking at the battlefield, more to understand how Russia 
might look at the battlefield; that whether--I'm not trying to 
get you to say something that you should not. I understand the 
concerns about what you are saying is responsible or not 
responsible. But to have an ally have a capability adds another 
dimension to what Russia has to think about, has to calculate 
for. Whether our ally uses it for that purpose or not, I think 
it is important that you bear in mind what we make Russia have 
to worry about.
    In that, Mr. Chairman, I thank you for the time.
    Mr. Issa [presiding]. Oh, but would the gentleman yield?
    Mr. Mast. Who was that, Mr.----
    Mr. Issa. This is the chairman right now.
    Mr. Mast. Oh, yes, absolutely, Mr. Issa.
    Mr. Issa. Thank you.
    Following up on the gentleman's questions that I think were 
implied, is it correct that some weapons the Ukrainians have 
could fire and hit some parts of Russia, and based on guidance 
and agreements, they have not?
    Ms. Lewis. My understanding, I think as you know, the 
weapons Dr. Karlin just described do have different ranges and 
different capabilities----
    Mr. Issa. Let me rephrase that. Have they fired on Russia 
during this engagement at all?
    Ms. Lewis. Not that I'm aware of, but I'm not--I mean, 
there may be things I'm not aware of, but I'm not aware of them 
having done that.
    Mr. Issa. Ok. I think that was part of the gentleman's 
question. I appreciate the gentleman yielded.
    And we now go to the gentleman from California, Mr. Bera.
    Mr. Bera. Thank you, Mr. Chairman.
    [Audio malfunction] to do some framing, because Xi Jinping 
and the PRC are going to frame AUKUS as, you know, being 
offensive and being anti-China, et cetera. And the truth is, 
you know, I'm very supportive of AUKUS, very supportive of our 
working with our allies, but it is in response to the PRC's 
aggression in the maritime space; its aggression in the South 
China Sea; its aggression in the Indian Ocean Region. And it is 
a response to, you know, keep a rules-based order; to keep 
freedom of navigation; to continue what really has been a 
peaceful, prosperous, stable number of decades in East Asia, in 
the Indian Ocean region, in the Indo-Pacific--one that China, 
or the PRC and Xi Jinping are moving to disrupt.
    So, I reject Xi Jinping's narrative that, you know, this is 
the United States being offensive with partners and allies. In 
fact, it is Xi Jinping's economic coercion, reaction to 
legitimate questions by the Australians on COVID origins, and 
their hand in economic coercion/retaliation that really has 
pushed Australians to be one of our more hawkish allies here 
and understand the competition that we face, and where Xi 
Jinping wants to take the PRC.
    So, I applaud the work of the Administration. I think this 
is a very important deal, and very important for us to, again, 
maintain an architecture, a rules-based order, freedom of 
navigation, maritime security for not just the AUKUS partners, 
but also for the other countries in the region.
    You know, when I look at gray zone tactics around Vietnam's 
Exclusive Economic Zone, when I look at gray zone tactics 
around the Philippines, when I look at Xi Jinping's aggression 
in the Strait of Taiwan, again, it is not the United States 
that is changing this, the dynamic in the region. It is 
intentional change led under Xi Jinping's leadership.
    And I am all in favor of dialog with the PRC and trying to 
reset this, but it is not the United States that is looking for 
conflict. It is Xi Jinping creating that context.
    So, bringing it back to AUKUS, you know, I also sit on the 
intelligence community and very much appreciate the partnership 
that we have with the Australians, but also, as we start to 
share critical technologies, the Chinese are very good at 
stealing those technologies. And I do worry about cyber risk. I 
do worry about how we maintain the security around these 
technologies.
    And maybe either one of you, or both of you, if you would 
want to talk to things that we should be thinking about from 
the congressional side, as we develop and share the most 
sensitive technologies, that we can make sure that our partners 
have the highest level of cybersecurity as well?
    Ms. Lewis. Well, thank you, and I agree. I think this is a 
critically important issue for us to look at.
    You know, I want to start by saying that, because it is 
Australia and the U.K., and because we have had such close 
cooperation with them on some of our most sensitive 
technologies, intelligence capabilities, we really do believe 
that we can work together, as we put standards in place, not 
just on the cyber front, but, really, across the board, to make 
sure that we maintain that mission-critical control over these 
key capabilities and sometimes information.
    I think that, when we look at other examples where we have 
worked very closely with countries, particularly as it relates 
to their export controls, we have been able--and I am confident 
that we will be able to do that in this environment, in this 
AUKUS alliance as well--excuse me--AUKUS authorization; that we 
will be able to make sure that all--that we align, both from 
the technical level, but all the way up to the strategic level.
    Ms. Karlin. I might just add to Assistant Secretary Lewis' 
point the emphasis on the trilateral standards--really, all 
three of us taking this as seriously as possible. And I think 
we have really found in the conversations with our Australian 
and British colleagues that we all have the same strategic 
perspective on why we want to ensure, you know, why AUKUS 
exists and why it needs to be a success.
    Mr. Bera. Great. Thank you.
    I yield back.
    Mr. Issa. I thank the gentleman.
    I will now recognize myself for a round of questions.
    Following up on my colleague's question, you used the word 
``would be.'' So, it is fair to say that you have some items 
which you believe that, particularly, Australia will engage, 
provide, and comply with that would allow you to have that full 
confidence currently, rather than ``would,'' is that correct?
    Ms. Lewis. I think it is both. We currently have confidence 
and we will continue to have confidence. I think, as you 
build----
    Mr. Issa. But you are going to ask them to do certain 
things in order to comply fully with our goals of not having 
sensitive equipment in any way fall into other hands?
    Ms. Lewis. We are going to ask all three countries to do 
that, yes.
    Mr. Issa. Ok. But I just want to make it clear that it is a 
confidence that those laws and other efforts will be--will take 
place that causes you to ask for authorization, but recognize 
that it does not actually begin the transfer until those terms 
are met.
    Ms. Lewis. I think, just to be clear--and I appreciate the 
question--we also believe we are going to do multiple things 
simultaneously. So, given the urgency that we have heard from 
you, and that we feel ourselves, we believe, under our current 
authorities that we have now, that we are going to be able to 
set up this structure using the articles that we know that come 
under AUKUS----
    Mr. Issa. Sure. I appreciate you----
    Ms. Lewis. Ok. Just making sure.
    Mr. Issa [continuing]. Do everything you can do without our 
permission, and then, come to our permission when you only are 
absolutely positive you need it. Nothing surprising there after 
24 years.
    But urgency is an interesting tee-up for my next question, 
and it is primarily a DoD question. But, earlier today, there 
was a figure of $36 billion that has been expended in Ukraine 
in an actual weapons system. A fair number is what I heard one 
of you say. Currently, there is about $19 billion of backlog 
with Taiwan. Now, in 15 months, $36 billion--some of it pretty 
advanced weapons; some of it bread-and-butter weapons--have 
been successfully transferred, and for the most part expended 
on the battlefield. Is that a fair statement?
    Ms. Karlin. Sir, I believe so on expended, but I do not 
want to say that. I want to be correct.
    Mr. Issa. Sure. But, I mean, they are shooting the shit as 
fast as they can; let's be honest.
    Ms. Karlin. They are 100----
    Mr. Issa. We were there. We did not see them holding back 
just in case they someday wanted to use it.
    Ms. Karlin. Indeed, we have no, no evidence of that.
    Mr. Issa. Ok. So, based on the assumption that $30-plus 
billion has been, literally, expended, delivered and expended 
in a 15-month period, what is our basis not to provide in a 
similar speed, as though they were at war, the $19 billion, 
rather than as an expenditure, but as a deterrent? You know, 
I'm asking this because everybody has a reason you cannot do 
something until the shit hits the fan. OK? Then, it is come as 
you are; bring what you have. Go find it and get it.
    I want to know why we have not, in light of Xi Jinping's 
aggression and threats of almost immediate invasion, why we 
have not expedited as though they were similar to Ukraine, at 
least some of that $19 billion that they have agreed to pay 
for.
    Ms. Lewis. Well, you here in Congress, actually, in the 
most recent defense authorization bill provided us the ability 
to do so with $1 billion. So, the vast majority of the 
assistance that has gone to Ukraine has gone through something 
called the Presidential----
    Mr. Issa. I'm not talking about Ukraine. I'm talking about 
Taiwan.
    Ms. Lewis. Sir, I understand. I'm just--I'm saying that we 
have used something called the Presidential drawdown authority, 
which allows us to take from DoD stocks and provide directly to 
Ukraine.
    Mr. Issa. So, you are saying that it is the drawdown 
authority that accounts for virtually all of the $36 billion of 
transfers to Ukraine?
    Ms. Lewis. It accounts for the vast majority, over $20 
billion of it, and it is the speediest way to move forward. And 
Congress gave us that ability with Taiwan, and the Secretary of 
Defense recently said that we are planning to move forward on 
that $1 billion, as provided for by Congress.
    Mr. Issa. Ok. Now, with the remaining time, a billion ain't 
what it used to be. Would you say, fairly, that the type of 
deterrent equipment necessary by Taiwan to truly cause China to 
think again about invasion would be dramatically greater than 
$1 billion--meaning, we need to look at the $1 billion and 
exponentially increase it to the extent that the authority 
could be used? That is a fair statement, isn't it?
    Ms. Lewis. I think that what Taiwan needs is significant. 
Obviously, I would defer to Congress on what it chooses to 
authorize.
    Mr. Issa. Ok. I like that.
    With that, we recognize the gentlelady from Pennsylvania, 
Ms. Wild.
    Ms. Wild. Thank you, Mr. Chairman.
    My first question is for Assistant Secretary Lewis. There 
are two distinct components of our strategy to defend core U.S. 
interests vis-a-vis the PRC. First is building a broad 
coalition that will stand up against PRC attempts to undermine 
global rules, and the second is deepening security and 
strategic cooperation with our closest allies and partners to 
deter the PRC from considering military options, but sometimes 
these two things come into conflict.
    Some of our partners in Southeast Asia have expressed 
concerns about AUKUS and fear that our initiative could, in 
fact, rachet up tensions in the region. How do we reassure 
those partners that AUKUS is a defense-and deterrence-focused 
initiative, and that we are going to be a responsible partner 
in the competition with China, so that they are less hesitant 
to support us?
    Ms. Lewis. Thank you for the question.
    And I do think that it is really important that we talk 
about AUKUS for what it is. And really, it is about deepening 
and strengthening the very close alliances that we already have 
with Australia and the U.K., and it is an opportunity for us to 
take some of these very critical capabilities on AI, on cyber, 
and hypersonics, and work together.
    I think when we talk to some of our allies in the region, 
as they raise these concerns, I think the message is this is 
one piece of an Indo-Pacific strategy that is going to involve 
working together with different countries in different ways.
    And I think, as Secretary Blinken said, our goal with China 
is to compete, where necessary; to cooperate where we can on 
mission-critical issues that affect the whole globe, and then, 
confront, if we need to. And so, I think it is very important 
that we need to get that message across.
    And we are working--part of my job, and I know part of Dr. 
Karlin's job, is to work with all of our other allies and 
partners throughout the region, as they look at both their 
security needs, their defense capabilities, and the ways that 
they wish to deepen and strengthen their relationships with the 
United States and our other allies and partners.
    Ms. Wild. Do you believe we can do that in a way that will 
be reassuring to them?
    Ms. Lewis. I do believe we can do that, yes.
    Ms. Wild. All right. I have more questions for you that I'm 
going to submit in writing.
    [The information referred to follows:]

    ********* **********
    Ms. Wild. But I want to move on to a question I have of 
Assistant Secretary Karlin having to do with the production, 
the output of our defense hardware. It is my understanding that 
we are currently producing, roughly, 1.2 Virginia Class 
submarines a year, and we would like to see it closer to 3.
    My understanding, further, is that part of AUKUS Pillar I 
is that Australia has signaled plans to make an investment into 
our shipbuilding industry, which, obviously, would help with 
production, but, on the other hand, I have concerns about what 
the impact might be on American workers and families if this 
kind of investment is made. I say that as a Representative of a 
district that is on the leading edge of advanced specialized 
manufacturing, including in the defense field. Can you address 
that, please?
    Ms. Karlin. Absolutely. And as you know, ma'am, the most 
recent request for our defense budget included $4.6 billion in 
investments in our submarine industrial base for both 
maintenance and production, because we want to increase the 
number you highlighted and we want to have more submarines 
available and ready.
    Exactly, as you know, the Australians have committed to 
make a significant contribution to our submarine industrial 
base. That is particularly important. Obviously, it is 
meaningful in terms of jobs for Americans, in terms of helping 
our industry, but I would highlight it is also especially 
important because investment early, we have seen, in the 
industrial base is going to bear fruit. And we have watched 
this, with thanks to Congress' leadership in recent years, that 
that trajectory looks increasingly better.
    Ms. Wild. Ok, but how is it going to--what is the interplay 
going to be in terms of how we make sure that we produce as 
much as we can here, while still accepting this generous 
investment?
    Ms. Karlin. Thank you.
    I do not know that these will clash. The investment that 
the Australians will be making, the significant investment in 
our submarine industrial base, will be for our industrial base, 
specifically, for what we are producing. Obviously, much of 
that is for our own submarines, and then, of course, those that 
one would, ultimately, sell to Australia. So, I do not think 
there is a mutual exclusivity here going forward.
    Ms. Wild. Ok. I think we may be talking about two different 
things, but----
    Mr. Mast [presiding]. The gentlewoman's time is expired.
    Ms. Wild [continuing]. My time is up. Thank you.
    Mr. Mast. The chair now recognizes Chairman Green for 5 
minutes.
    Mr. Green. Thank you, Mr. Chairman, for holding this 
important hearing today and for your work to strengthen 
America's alliances during a critical point in our Nation's 
history.
    The AUKUS partnership represents one of the most critical 
strategic frameworks for countering the Chinese Communist Party 
in the Indo-Pacific and around the globe. Working alongside our 
closest allies, the U.K. and Australia, is a golden opportunity 
to roll back the gains the CCP has made, not only in the Indo-
Pacific, but in other critical domains of competition, such as 
cyber and financial markets.
    As we celebrated Victory in Europe Day this week, it was a 
timely reminder of what can be achieved when we work together 
with freedom-loving partners. However, without consistent 
effort and efficiency, and effective diplomacy, there is no way 
AUKUS can live up to this potential.
    The Biden Administration wants to take a victory lap for 
signing this agreement, but does not seem willing to make the 
effort to ensure we are leveraging it in the fight against the 
CCP. American leadership is the most essential component of 
this alliance, but how can our partners trust us when they see 
how we treat our Taiwanese allies--where we have $19 billion in 
backlog in weapons systems deliveries, while they experience an 
existential threat to their way of life?
    I recognize the inherent challenges present in achieving 
the goals of AUKUS, many of which stem from bureaucratic 
inefficiencies and outdated statutes that do not move at the 
pace of the threat or technology. I do thank our witnesses for 
their commitments to tackling these issues head-on.
    I also thank my colleagues on this committee for making 
arms export reform a priority, and that is what I would also 
like to speak about. I would like to address the issue of ITAR 
and ITAR's exemptions.
    This last week, I traveled to the United Kingdom and I met 
with, among others, the Defence Minister. He raised a very 
serious concern that Canada is granted an ITAR full exemption, 
but the U.K., our greatest ally, is not. He cited a specific 
example of a U.K. company that has technology that would 
advance our hypersonic missile capability, but the company, if 
the company sells to the United States under ITAR, that 
technology becomes exclusively controlled by the United States. 
That company has chosen not to sell the technology to the 
United States to help us with our capability.
    He also said compliance costs have him spending a half a 
billion pounds in every year. He, specifically, said that half 
a billion pounds could buy American equipment for him, if he 
did not have to do that with compliance. The U.K. wants an 
exemption to ITAR equivalent to Canada.
    As Winston Churchill noted regarding our World War II 
alliance, ``There is only one thing worse than fighting with 
allies, and that is fighting without them.''
    We have got to fix this issue with England. To miss the 
opportunity to have this capability is unacceptable, and I have 
intentions to bring a bill that would do just that.
    And I would like to ask my first question. Would you guys 
support that, and if not, why not?
    Ms. Lewis. Sir, first of all, let me start by saying I 
think you raise sort of the core issue that we are trying to 
address here today, which is how to make sure that our defense 
trade, but, specifically, in this case, our defense trade under 
AUKUS with two of our closest allies, can move with speed and 
with safety and in a secure way.
    As we look at the issue of how to make that happen, we have 
put together a plan that encompasses, actually, not only the 
ITAR, which only governs, actually, our commercial sales, but, 
actually, our foreign military sales, with are our government-
to-government sales.
    And just for reference, 90 percent of the sales, the trade 
that we do, for example, with Australia is actually under 
Foreign Military Sales process.
    Mr. Green. Right. I mean, he is asking, very specifically, 
for an ITAR exemption. We are not talking AUKUS in this case. 
Hypersonics are not a part of AUKUS, as I understand AUKUS. I 
understand there is a second phase of this that is AI and other 
things, right, but hypersonics aren't in there.
    I'm not going to go into detail in this setting on what he 
shared with us about the capabilities advancement that that 
would be for our development of that resource, but it ain't 
happening because that company has made a business decision. 
They made a business decision not to give their technology 
that, then, would restrict their sale anywhere else.
    And it is the United Kingdom. They have been with us--I 
mean, the blood that has been shared, spilled on the soil 
together, on beaches in Normandy, all over Europe. I mean, 
there is no reason why we can do the same with Canada, but we 
cannot do it with the U.K.
    And so, my argument is--and we are going to bring 
legislation, and I would love for you guys to support this ITAR 
exemption.
    And with that, I yield.
    Mr. Mast. The gentleman's time has expired.
    The chair now recognizes Ms. Jacobs for 5 minutes.
    Ms. Jacobs. Thank you, Mr. Chair.
    And thank you both for being here.
    As we are talking about how to improve our arms exports, I 
think one of the things that is going to be really important is 
ensuring that our arms transfer policy aligns with our values 
and our broader strategic foreign policy goals. You know, it is 
not only important for human rights and all of the good things 
and moral reasons, but I think it is, actually, really 
important for our long-term security and our ability to have 
these alliances in the future.
    So, I was really encouraged by the Biden Administration's 
new Conventional Arms Transfer Policy, and, in particular, one 
of the specific changes that changes the standard from actual 
knowledge that arms would be used to commit atrocities to a 
commitment not to transfer arms that would, more likely than 
not, contribute to atrocities.
    So, Assistant Secretary Lewis, I wanted to see if you could 
talk about how this policy is materially going to change 
things; how you plan to do monitoring and evaluation to assess 
its impact on arms transfers, and how you are going to 
implement this new standard.
    Ms. Lewis. Well, first of all, thank you for the question. 
I think the Conventional Arms Transfer Policy, which is the 
policy that governs all of our arms transfers around the 
world--and actually, you have--you could have read from my 
talking points on that specific change that we made, as it 
relates to the human rights standard.
    I would recognize that the CAT Policy also includes a whole 
host of other things; for example, trying to make our weapons, 
looking at different ways to finance them, and a whole host of 
other things, as we move forward.
    But, to get to your specific question, we already work very 
closely with our colleagues in DRL, the bureau that oversees 
our human rights issues, as we look at arms transfers. And so, 
we are using these criteria as we evaluate all of the 
transfers.
    We are going to continue our current end-use monitoring 
programs, some of which are done by the Defense Department, 
some of which are done by the State Department, depending on 
the authorities--again, to make sure that we comply with the 
law.
    And then, in addition, I think you are probably aware that 
we also have to do Leahy vetting when arms transfers are funded 
through using U.S. Government money.
    So, there is a whole host of ways that we have to address 
this criteria in the CAT Policy.
    Ms. Jacobs. I'm glad you brought up end-use monitoring 
because, while this revised policy says the United States will 
monitor/ensure transferred arms are used responsibly and in 
accordance with the conditions and obligations of the policy, 
including human rights and international humanitarian law, as 
you both know, at the moment, current U.S. end-use monitoring 
programs are really only focused on diversion risks, but they, 
actually, do not monitor or track how U.S. items are being 
used, including in human rights or international humanitarian 
law violations.
    So, how will implementation of the CAT address this gap and 
how we do end-use monitoring?
    Ms. Lewis. Well, I do think we are going to continue to do 
end-use monitoring, as it complies with both the law and this 
program. I think we are--and again, part of that includes the 
work that we do with DRL and the other pieces of the bureau--
I'm sorry--of the State Department that work on these issues.
    I know that this has been something that, from the 
President on down, making sure that we consider human rights, 
as we look at these arms transfers, will continue to be at the 
core of our policy.
    Ms. Jacobs. Ok. Well, that sounds great, although it sounds 
like most of what you are saying is what you have been doing, 
and not necessarily what has changed, based on this policy. So, 
I will look forward to working with you to make sure that we 
are, actually--this is not just a continuation, but, actually, 
doing something new.
    I wanted to go to the FMS 2023 that you all just put out. 
It references the CAT Policy in it, which I think is great. 
However, the FMS 2023 policy itself does not mention human 
rights concerns at all. So, how will the CAT Policy and FMS 
2023 fit together? And how will you ensure that retooling FMS 
does not sideline the very human rights concerns that you are 
addressing, trying to address through the new CAT Policy?
    Ms. Lewis. Thank you for that question. I think it is, 
actually, a really important question to answer.
    These two things, to me, work; they align, actually, quite 
well together. If you look at what we have put in the FMS 2023 
plan, we are looking at things about prioritizing, having 
priorities as we look at the arms sales that we transfer. We 
are looking at making sure we take a regional perspective. We 
are looking at issues related to the training of the people who 
do the work in our embassies to get arms sales to move. We are 
looking at improving our processes with Congress. So, I do not 
think any of that work is incongruent with the same principles 
laid out in the CAT Policy.
    Ms. Jacobs. Thank you.
    Mr. Mast. The gentlelady's time as expired.
    The chair now recognizes Mr. Barr for 5 minutes.
    Mr. Barr. Thank you, Mr. Chairman.
    Thank you to our witnesses for being here and discussing 
the important trilateral relationship that is, I think, 
critical to deterring the Chinese Communist Party in the Indo-
Pacific.
    So, let me start with Taiwan. Assistant Secretary Lewis, we 
know that Taiwan is waiting on a number of FMS deliveries from 
conventional weapons like the Abrams tank to F-16 upgrades, 
asymmetric harpoons and HIMARS. Is State working with the 
defense industrial base to prioritize delivery of these 
asymmetric weapons that would be most effective at countering a 
cross-strait invasion? And I would be happy for our Defense 
Department witness to offer her thoughts as well.
    Ms. Lewis. Sir, I think that we are all very focused on 
getting Taiwan what it needs to defend itself. As you know, 
that $19 billion that you are discussing is our sales that have 
already moved through our process and are now in the production 
phase.
    And I think I will just say one or two things, and then, 
let Dr. Karlin speak more to that. Because the Defense 
Department has really been leading the charge on key 
capabilities to reduce the timelines or increase production, so 
that we can get those mission-critical capabilities to partners 
like Taiwan.
    Ms. Karlin. Thank you.
    We are running an effort that is chaired by Deputy 
Secretary Hicks to make sure that Taiwan is getting the 
material and non-material capabilities it needs as quickly as 
possible and that there is the most senior-level attention as 
possible.
    We are constantly engaging Taiwan as well to work with them 
in terms of an understanding of what those capabilities would 
look like, obviously, in line with our longstanding policy and 
our commitments.
    I would, also, just take a moment now to thank Congress 
because, as it relates to our own military, Congress' support 
of multiyear procurement of munitions has been especially 
important for our military, as we look at ensuring that we have 
the most combat-credible force to deal with these kinds of----
    Mr. Barr. Yes, and, Dr. Karlin, there is a lot of 
bipartisan work going on, not just in this committee, but also 
in the Select Committee on the Strategic Competition Between 
the United States and China. And you are going to see those 
recommendations on multiyear procurement. The industrial base 
needs certainty on this, and this has got to be an absolutely 
top priority of accelerating those FMS and getting those 
capabilities now, yesterday, what have you, to that democracy.
    Let me followup. Out of all of the open FMS cases with 
Taiwan, how many can we expect to be completed by the end of 
this calendar year?
    Ms. Lewis. I think in this setting we are not going to 
discuss when things will be delivered. Happy to continue that 
conversation.
    Mr. Barr. Yes, a fair point. Just know that this is an 
urgent priority for the Congress, as you know.
    Let me ask you about AUKUS governance. Assistant Secretary 
Lewis, how is the State Department planning on deciding which 
sectors or projects are AUKUS projects that will qualify for 
expedited approvals under the AUKUS trade authorization 
concept?
    Ms. Lewis. Sir, we are going to be sitting down both with 
Australia and the U.K. to work through exactly those details. 
So, obviously, it needs to fit into the definitions of what we 
are working on within AUKUS.
    And then, I think the second piece of that is we are also 
looking at making sure we understand sort of what is excluded. 
And we did that very carefully because it is easier to move 
quickly when you have a clear list of what----
    Mr. Barr. A blacklist.
    Ms. Lewis [continuing]. Right, what cannot move, as opposed 
to sort of trying to keep track of what can move.
    Mr. Barr. And again, I do not know if this is the right 
setting, but is there an example of a technology, a critical 
technology, that is so sensitive that it could not be shared in 
the AUKUS general----
    Ms. Lewis. I think I can answer that in a broad way. We 
have certain items that we are prohibited from transferring 
under treaties, for example, that would violate our nuclear 
nonproliferation laws.
    Mr. Barr. Ok. To both of our witnesses, clarity is key for 
AUKUS's success. Industries wanting to participate in this 
opportunity need to know what is possible for this to work. 
They need a green light/red light system. Have either of your 
agencies actually sat down with your counterpart ministries in 
the U.K. or Australia and outlined specifically what barriers 
exist in their laws or regulations that could hinder 
implementation?
    Ms. Lewis. We have been in, really, a nonstop conversation 
with our counterparts in Australia and the U.K. to try to make 
sure that all of our systems are aligned. And that will need to 
continue, as we continue to work through all of these steps to 
move forward.
    Mr. Barr. That is great. Well, I appreciate that effort to 
give industry that clarity.
    With that, I yield back.
    Chairman McCaul [presiding]. The gentleman yields back.
    The chair recognizes Ms. Manning.
    Ms. Manning. Thank you, Mr. Chairman.
    Dr. Karlin, as you know, our ally Japan faces serious 
challenges from China. I was recently on a congressional trip 
to Japan. We spent a great deal of time focusing on the 
dramatic increase of Japan's military budget and the increasing 
importance of our relationship. And as you know, the next AUKUS 
step, the expansion into hypersonic weapons, falls squarely 
into Japan's priorities.
    So, could you talk about whether there are ways Japan can 
contribute to different aspects of AUKUS and whether they could 
be brought into deeper cooperation with this group in the 
future?
    Ms. Karlin. Thank you.
    First, I would just like to applaud the extraordinary 
investments that we see by Japan exactly. As you know, ma'am, 
they really are meaningful. We are also, from the Department of 
Defense perspective, doing all we can to strengthen that 
relationship--most recently, announcing that we are going to 
send our most capable marine regiment out to Japan.
    Regarding any sort of expansion, right now, we are really 
focused on ensuring that AUKUS can succeed as designed, and 
then, as we have generated momentum on it, et cetera, we are 
absolutely interested in looking at exploring opportunities to 
integrate partners into kind of certain activities or so, as we 
go forward.
    Ms. Manning. Are there security or other concerns that 
Japan, technology concerns that Japan would have to overcome to 
create a closer relationship with AUKUS?
    Ms. Karlin. I think we would want to ensure, just as we 
were saying about the trilateral need, to make sure we have got 
elevated standards. I think with any country we will work with 
in such an intimate way on sensitive technology cooperation, 
you know, we have the same strategic goal; let's make sure 
that, operationally, we can make that a reality.
    Ms. Manning. Ok. And under Pillar II, the agreement seeks 
to expand technology-sharing, cyber and quantum capabilities, 
as you were just describing, and artificial intelligence. How 
important is it that we have the upper hand in these critical 
areas? And can you talk about what safeguards need to be put in 
place to prevent China from seeking to steal our technology and 
undermine our capabilities?
    Ms. Karlin. Thank you.
    It is incredibly important, as we see the security 
environment shifting, and I would highlight, as we see the 
military technological environment shifting as well, for us to 
be able to collaborate closely with our allies. And to be 
clear, all boats are rising here. It is a two-way street. We 
are also getting things from them. And given these changes, a 
failure to collaborate and integrate and innovate will actually 
only hurt us, I think, in this competition. We have got to do 
that, though, with these meaningful safeguards.
    And I do believe, as it relates to Australia and the U.K., 
specifically, that we are in a similar headspace on the need to 
ensure that security.
    Ms. Manning. Thank you.
    Assistant Secretary Lewis, can you talk about some of the 
challenges the defense production industry is facing overall; 
the impact it is having in terms of our assistance to Taiwan 
and other countries, and what can and needs to be done to help 
strengthen our supply chain?
    Ms. Lewis. Thank you for that question, and I will 
certainly talk about what we are seeing.
    I think we are really at a moment of what I call tectonic 
change when it comes to security assistance and cooperation 
around the world. Because we are seeing--not only because of 
the war in Ukraine, but because countries are concerned about 
the PRC threat--we are seeing the eastern flank of Europe 
really change its security posture, dramatic increases in both 
security needs and defense spending.
    And that is happening at the same time that our defense 
industrial base is emerging from COVID, just as many other 
industries in the United States have done. And we are working 
very closely with the defense industrial base to increase their 
production, to see where we can make investments. And then, as 
Dr. Karlin has outlined, the Deputy Secretary of Defense has 
honed-in on a specific set of capabilities where we need to 
really move more quickly.
    Ms. Karlin. If I could just add----
    Ms. Manning. Sure.
    Ms. Karlin [continuing]. Just really thanking Congress for 
the CHIPS Act, which has some profound relevance for all of 
this, because it will help us bolster essential American 
industry to maintain our military and technological edge, 
without which, frankly, much of this just will not be feasible.
    Ms. Manning. And if there were cuts to what has been 
achieved through our CHIPS Act because of the deficit 
negotiations, would that have a negative impact?
    Ms. Karlin. I think there would absolutely be national 
security implications if we are unable to make the meaningful 
change that we need as a country to shore up our defense 
industrial base, which really is a core strategic asset.
    Ms. Manning. I want to thank you both for your service to 
our country.
    And with that, I yield back.
    Chairman McCaul. The gentlelady yields back.
    The chair recognizes Mr. Burchett.
    Mr. Burchett. Thank you, Mr. Chairman.
    As someone whose questions get asked kind of late in the 
day, and as the 435th most powerful Member of Congress, I 
expect when I ask my questions, you all are to act shocked and 
maybe you can proclaim how profound my questions were, and how 
intellectually they were presented to you. Because, that way, 
when we record this and show it to my folks back home, that is 
what I want them to think, anyway. So, thank you all so much.
    Secretary Karlin, ma'am, do you believe that stability in 
the Middle East is any way possible in shape, form or fashion, 
honestly?
    Ms. Karlin. Sir, stability in the Middle East writ large, I 
do believe we an have some stability and security in the Middle 
East. Over the years, it has gone up and down. Right now, if we 
just look at Yemen, as an example, we have had the longest 
period of quiet since the civil war broke out, and that is, 
indeed, a positive.
    Mr. Burchett. OK, but you said this morning any efforts to 
increase security and stability in the region should be 
welcomed by all. And, of course, China has worked with Iran to 
build relationships with the Saudis. Do you believe that that 
should be welcomed?
    Ms. Karlin. I think efforts to bring the countries together 
in a more peaceful way are a positive. That said, I think it is 
quite clear that many of our Gulf countries have a threat 
perception of Iran's irresponsible and aggressive behavior that 
is quite in line with ours as well.
    Mr. Burchett. Ok. China seems to be attempting to become a 
diplomatic actor in the region. Do you think that is a good 
thing?
    Ms. Karlin. I think to the extent the People's Republic of 
China is trying to play a more positive role in the region, 
that is a good thing. I do want to emphasize that there is 
absolutely no comparison to the level, scope, scale of U.S. 
involvement in the Middle East decades and decades long than 
what we see in the People's Republic of China.
    I would also just note for our partners in the Middle East, 
of course, that, as they increasingly cooperate with the 
People's Republic of China, we will, of course, look at the 
technological implications of that cooperation, the 
communications of that cooperation as well, to ensure that our 
robust relationship can result in the security that we need to.
    Mr. Burchett. Yes, ma'am. I feel like any effort of the 
Chinese toward anything is looking out for China. And with 
their involvement in the Middle East, to me, that is a 
dangerous situation. I think it shows, especially any alignment 
with Iran, who has stated that they do not believe Israel 
should exist, to me, is an affront to me and a lot of people 
that I represent.
    Do you think that Chinese involvement in the Middle East is 
a threat to the Abraham Accords?
    Ms. Karlin. I do not know that I would see it as a threat 
to the Abraham Accords per se. I think, on the face of it, it 
is clear that the People's Republic of China has a relationship 
with Iran, and it is also clear that, like us, the Gulf 
countries are worried, understandably, about Iran's 
irresponsible and aggressive behavior. So, I think that those 
who participate in the Abraham Accords would want to be aware 
of how various countries understand the threats in the region; 
who is fomenting threats in the region, and how best to tackle 
them.
    Mr. Burchett. Ok. The Israel Defense Chief of Staff says 
Iran, right now, has more enriched uranium than ever before and 
is increasingly aggressive. Do you think your plan of 
deterrence is working?
    Ms. Karlin. We take effort to deter Iran very seriously 
across the U.S. Government. I would note, most recently, in 
late March when there was an attack by Iranian-sponsored 
militias, the U.S. military responded, I think within 12 hours 
or so. And we believe the Iranians understood what that 
response was as well.
    Mr. Burchett. Again, I would hope the State Department and 
the White House would pay special attention to the situation 
with Iran with their statements of hostility historically and 
currently. I think it ought to be a notable awareness for us, 
and if the Chinese are hooking up with them, I would be really 
concerned.
    So, anyway, thank you, ma'am.
    And I yield the remainder of my 3 seconds, Mr. Chairman.
    Chairman McCaul. We thank the gentleman for his eloquence 
and for yielding back.
    The chair now recognizes Mr. Moskowitz.
    Mr. Moskowitz. Thank you, Mr. Chairman.
    You know, actually, kind of continuing the same line of 
thought from the previous speaker, I just got back from Israel, 
Jordan, Egypt, and Italy with the Speaker. And we met with the 
King of Jordan. We met with the President of Egypt, the Foreign 
Minister of Egypt, the CIA Director of Egypt; the Prime 
Minister of Israel, the President of Israel, the speaker of the 
house; the Prime Minister of Italy, the President of Italy, the 
speaker of the house, Italy.
    And there was a consistent theme among these four 
countries, and that was China. And also, the consistent theme 
was, is that they were very honest. They want to do business 
with the United States. They want to buy our equipment. They 
think our stuff is superior. But if we cannot sell it to them, 
they are going to get it somewhere else. And that is new, I 
think, for the United States, that similar equipment can be 
purchased from Russia and China. Since the fall of the Soviet 
Union, maybe we have not had that in the space.
    Also, we heard from them that, if we start to pull out of 
the region, whether it is in Africa or in the Middle East, 
because we are focused elsewhere, China is coming in, and China 
is not coming in with grants; they are coming in with loans--
loans that at some point in time China is hoping maybe will not 
get paid, so that they can take further control of those 
countries' economics.
    Also, when China comes in, they do not lift these countries 
up and give--the projects they are funding do not come to the 
workers of those countries because they bring Chinese labor to 
build all of these things.
    And so, I have serious concerns that I think we are a 
general fighting the last war, and that we have not changed 
with the times.
    Secretary Karlin, did I hear you say, or did someone bring 
up, that it takes 18 months to do a contract?
    Ms. Karlin. Someone did raise that figure. I cannot 
corroborate that figure. I do not know if Assistant Secretary 
Lewis can, either.
    Ms. Lewis. I cannot, either, on that. I would be happy--can 
I address the issues----
    Mr. Moskowitz. Please, yes. Sure.
    Ms. Lewis [continuing]. That you raised previously.
    Mr. Moskowitz. Absolutely.
    Ms. Lewis. Because we have, actually, spent a lot of time 
thinking about this. The United States currently is about 41 
percent of the world market on arms sales. You take a 10-year 
average, and that is we have actually increased from 38 percent 
to 41 percent. Russia has fallen from the second-largest 
producer in the world to the third-largest producer, and China 
is down there in the single digits. And our sales combined is 
larger than the next sort of five countries aligned below us on 
that.
    Mr. Moskowitz. No, listen, I understand where the data is. 
I'm telling you where it is going--OK?--if we do not fix some 
of these problems. When these folks are looking us in the eye 
and telling us, you know, ``We purchased these things. We 
haven't received them. We'd like them from you. We still think 
you're the best partner, but at some point in time we're going 
to buy them elsewhere.''--or, in some instances, in Egypt, they 
already have--that is putting us on notice that something isn't 
working.
    Another one of my colleagues asked you about excess 
capacity. Let me tell you what he is asking. OK? Because this 
is no different than with the COVID supply chain, right? We had 
to buy stuff from all over the world. We were competing with 
everybody, but Antarctica for materials during COVID. OK? Most 
of the stuff was procured from China and other countries. It 
was not made here.
    And we had all this money and we incentivized all these 
companies to bring these new lines, right, to make masks in-
country. It took months and months and months and months to do 
that, or for them to change their lines to ventilators, it took 
months and months to do that.
    And so, what he is asking is, are there excess lines that 
are already built, right? Are we incentivizing producers to 
have excess lines, in the event we get into--I do not know--a 
war or a proxy war? So that, when we use the Production Act, we 
are not waiting. We saw, when we used the Production Act, it 
was not like this
    [snapping his fingers]; it is still months to bring these 
lines online. So, that is what the question was: do we have 
excess capacity? Are we incentivizing excess capacity that we 
can bring online because it is already built?
    Ms. Karlin. I think we are not at that stage yet, frankly, 
because we are trying to increase that capacity. I hope that we 
will be at that stage going forward. But, right now, what we 
are trying to do, especially in key areas, is to signal to 
industry--and Congress has actually, obviously, been really, 
really important in this--to be able to signal where we want 
our priorities, where we want to prioritize, and how we can 
increase the security and the resilience of the defense 
industrial base.
    Mr. Moskowitz. My last question because I'm out of time, do 
we know--and if you cannot share it, that is fine--do we know 
how many days, if we got into a hot war, do we know how many 
days of supply we have before we would be in an existential 
situation?
    Ms. Karlin. That would depend, specifically, on what 
platform you are talking about, but we would be delighted to 
have that conversation in another forum.
    Mr. Moskowitz. Thank you, Mr. Chairman. I yield back.
    Chairman McCaul. The gentleman yields.
    The chair recognizes Mrs. Young Kim.
    Mrs. Kim of California. Thank you, Chairman McCaul.
    And I want to thank all of our witnesses for joining us 
today.
    You know, as chairwoman of the Indo-Pacific Subcommittee, 
one of my priorities is ensuring that our Foreign Military 
Sales programs are supporting the most vulnerable allies and 
partners in the region.
    Last Congress, Chairman McCaul and I introduced the Arms 
Exports Delivery Solutions Act, which requires an annual report 
from DoD and DOS that details the efforts being taken to 
address the multibillion dollar backlog of arms sales to Taiwan 
and our other allies in the Indo-Pacific.
    And 2 weeks ago, we received the 5508 report due to us from 
that legislation regarding Foreign Military Sales. And in that 
report, the State Department highlights challenges, such as the 
supply chain issues and long lead deliveries as causes for 
delays to that process.
    A question to you, Ms. Lewis: one of the report 
requirements is for a description of interagency efforts to 
support Taiwan's attainment of operational capabilities, 
including training. Where is that part of the report?
    Ms. Lewis. I think we are certainly happy to discuss that 
with you further and if there is additional information you 
need in the report. I guess what I----
    Mrs. Kim of California. It is not in the report. That is 
why I'm asking. But the report also required a description of 
the action the Department is planning to take or has taken to 
prioritize Taiwan's FMS cases. So, when can we expect that 
portion?
    Ms. Lewis. If there is anything that is not included, we 
will be happy--I will be happy to take that back and make sure 
that you get that. I'm also happy to answer any questions now 
or in another setting, if that is possible.
    Mrs. Kim of California. Well, would you agree, then--the 
couple of questions I asked, it is not there--so, would you 
agree this report is incomplete? And when should we expect to 
get the rest of the report that includes the information that 
we were asking through that legislation?
    Ms. Lewis. I'm happy to take that back and get back to you 
as soon as we can.
    [The information referred to follows:]

    ********* COMMITTEE INSERT **********
    Mrs. Kim of California. Well, one of the requirements in 
Section 5508(b) is for the State Department and DoD to 
recommend to Congress authorities we can use, and actions we 
can take, to support expedited arms shipments to Indo-Pacific 
allies. And the report does not have these recommendations. So, 
what are they?
    Ms. Lewis. Well, I think we covered some of those here 
today. Because the issues that the region and that Taiwan are 
facing in terms of the production timeline challenges that we 
are having are not specific to the region. These are across-
the-board challenges for our defense industrial base.
    And so, I think, again, the work that Deputy Secretary 
Hicks has done at DoD to prioritize specific capabilities--we 
have done things; for example, we had lines that were cold, 
meaning they had stopped producing items. Gone back, figured 
out why is that line cold. Sometimes it comes down to a 
specific widget, that a sub-producer may have gone out of 
business.
    Mrs. Kim of California. Thank you. I look forward to----
    Ms. Lewis. We have gone back to see those----
    Mrs. Kim of California [continuing]. Getting that, specific 
recommendations in the report when you complete that.
    [The information referred to follows:]

    ********* COMMITTEE INSERT **********
    Mrs. Kim of California. Section 5508 also required the 
State Department and DoD to submit the report by March 31 of 
this year. So, why were your agencies unable to meet that 
deadline and why is the report incomplete?
    Ms. Lewis. My understanding is we submitted the report on 
April 17th. I think, as you know, we have a large number of 
reports that are----
    Mrs. Kim of California. April 17th is still not March 31. 
So, I hope that we can expect the next report, which is due 
March 31 of next year, 2024, to be on time.
    Ms. Lewis. Of course.
    Mrs. Kim of California. Next question: AUKUS is intended to 
strengthen the ability of the United States, Australia, and the 
U.K. to support each respective government's security and 
defense interests. And much of the conversation around the 
security pact has been about nuclear-powered submarines. So, 
what are the areas of cooperation, other than the transport of 
nuclear-powered submarines to Australia, that AUKUS can serve 
as a platform for?
    Ms. Karlin. Thank you.
    There are, indeed, two Pillars, if you will, of AUKUS. One 
is, as you know, the United States providing Australia with a 
conventionally armed, nuclear-powered submarine capability at 
the earliest possible date, while setting the highest 
nonproliferation standard. That is kind of known as Pillar I.
    And Pillar II is that AUKUS will develop and provide joint 
advanced military capabilities to promote security and 
stability. As of now, a handful of those areas include 
hypersonics, artificial intelligence, for example. What we 
really want to do is be able to lift up all of our defense 
industrial bases and to cooperate together, so we can enhance 
our competitive military edge.
    Mrs. Kim of California. Thank you.
    Very quickly, the last question: I know there was a lot of 
numbers being thrown around about the exact dollar amount for 
Taiwan arms that is on backlog right now. So, is it $19 
billion? Twenty billion? Twenty-one billion? Do you know?
    Ms. Lewis. Ma'am, I think that it depends what you are 
counting. I think our view is those have come out of the U.S. 
Government system and are items that are being--that are in 
production. And so, again, we would have to go industry-by-
industry to analyze that further.
    Mrs. Kim of California. Thank you. My time is up. I yield 
back.
    Chairman McCaul. The gentlelady yields back.
    The chair recognizes Ms. Kamlager-Dove.
    Ms. Kamlager-Dove. Thank you, Mr. Chair.
    First, completely unrelated, I just want to say that Tina 
Turner died today, and she was the master of soft diplomacy 
and, also, a former constituent of mine. So, I'm a little sad.
    But I am glad that this committee is holding a hearing on 
the important topic of U.S. arms exports policy and reclaiming 
the underutilized oversight role that Congress plays in our 
security cooperation. For trusted partners with closely aligned 
goals, such as Ukraine and Taiwan, U.S. security assistance can 
be essential in helping our allies deter aggression and defend 
against existential threats.
    But as the revised CAT Policy acknowledges, when our 
defense material is transferred to actors who do not employ it 
responsibly, U.S. weaponry can and has been used to violate 
human rights and international humanitarian law, harm 
civilians, and undermine long-term U.S. interests in stability 
and good governance abroad.
    There was an earlier question about end-user monitoring, 
and I have a followup question to that. What tools and 
resources would the U.S. Government need to conduct robust 
monitoring of how arms delivered to security cooperation 
partners are actually used?
    Ms. Lewis. Well, we do end-use monitoring. And I will talk 
about the State Department side, and the Defense Department 
does something similar. So, when weapons are transferred, we 
have--on our side, it is on the commercial side--we have the 
responsibility to account for those weapons. There are site 
visits. There are simple mechanisms, such as making sure, 
literally, you have a log of those weapons; you know where they 
are, and a whole host of other ways to ensure that we know that 
they have been delivered and accounted for properly. I know the 
Defense Department has similar mechanisms in place for their 
end-use monitoring.
    But I think one of the things that I, actually, think is 
really important is, as we look at the human rights question, I 
think it is not just an issue of end-use monitoring. I think 
the Leahy vetting piece is actually equally as important.
    And so, I think as you know, we have all of our partners 
have to sign agreements on the use of U.S.-origin defense 
equipment and comply with the laws of armed conflict and 
international humanitarian law and respect for human rights. 
And then, when it comes to Leahy vetting, we have to get down 
even to the unit level to ensure that--just to clarify, when it 
is provided using U.S. Government funding--that we are not 
providing those to units that have committed gross violations 
of human rights.
    So, I think, for me, we tend to talk about end-use 
monitoring, but I, actually, think for me it is the combination 
of that with the Leahy vetting that is mission-critical in 
terms of meeting the goals that you are laying out.
    Ms. Kamlager-Dove. Right, because there is a difference 
between how they are being accounted for, and then, what they 
are actually being used for.
    Ms. Lewis. And who they are going to.
    Ms. Kamlager-Dove. Correct.
    Ms. Lewis. Yes.
    Ms. Kamlager-Dove. Would you like to add to this, Ms. 
Karlin?
    Ms. Karlin. Thank you.
    The only point I would add to what Assistant Secretary 
Lewis was saying is that, when we are training partner 
militaries, we spend a ton of time on things like rule of law 
and human rights. And we do that because it is our values. We 
also do that because there is a lot of evidence that it will 
make them more effective. And so, we want to ensure that they 
take that approach. In light----
    Ms. Kamlager-Dove. But that sounds like the honor system.
    Ms. Karlin. I'm not sure if I understand. As in?
    Ms. Kamlager-Dove. You said: we go through these trainings 
and we are talking about the use of international law, human 
rights violations, et cetera. So, letting folks know what they 
should not be using them for?
    Ms. Karlin. Absolutely, and also helping them understand 
that that is, ultimately, not effective. So, they should not do 
it because it is wrong, and they should not do it because it 
will not, ultimately, achieve their strategic aims.
    Ms. Kamlager-Dove. Right. Also recognizing that people 
still do bad things with our weapons. And so, there has to be 
consequential maneuvers as well.
    Ms. Karlin. Absolutely, a main component.
    Ms. Lewis. Yes, all I would say is I think you have to look 
at these as combined. I think it is very important that we do 
provide training and that we include in any training that we 
provide the human rights law, international humanitarian law, 
et cetera, because people need to know the rules of the game. 
And then, you are right; then, in addition, we have to do the 
other pieces.
    Ms. Kamlager-Dove. So, my last question for Ms. Karlin, is 
under the Biden Administration's new guidance, do you 
anticipate any changes to the weaponry amounts or recipients of 
arms transfers that we have seen in the past?
    Ms. Karlin. I think you are referencing the updated CAT 
Policy?
    Ms. Kamlager-Dove. Uh-hum. Correct.
    Ms. Karlin. And we have absolutely used that to inform our 
own FMS Tiger Team look, as I know my State Department 
colleagues have as well. And we will ensure that threshold that 
is highlighted, the notable change in the threshold, you know, 
applying it more likely than not threshold, will inform how we 
look at these transfers.
    Ms. Kamlager-Dove. Great.
    Thank you, Mr. Chair. I yield back.
    Mrs. Kim of California [presiding]. Thank you.
    I now would recognize Mr. Huizenga for 5 minutes.
    Mr. Huizenga. Well, thank you, Madam Chair.
    I appreciate this. I do not want to dwell too long on this. 
So, let's move quickly before I get to ITAR and Foreign 
Military Sales.
    But, going off of what my colleague, Mr. Mast, has asked 
earlier, is there evidence that Ukraine has struck Russia 
directly?
    Ms. Lewis. I thought he asked a slightly different 
question. I think----
    Mr. Huizenga. Ok. Well, then, I will clarify that question.
    Ms. Lewis. Yes.
    Mr. Huizenga. Is there evidence that Ukraine has struck 
Russia?
    Ms. Lewis. I have seen news reports indicating that. Beyond 
that, I do not have any specific evidence myself.
    Mr. Huizenga. Ok. Do we know whether any U.S. arms or U.S.-
supplied arms were used in that?
    Ms. Lewis. We have seen those same news reports, and I 
believe that we are looking into that. As I think you also 
know, and as I said before, we provide our weapons for the 
Ukrainians to use in their fight in Ukraine. And I just want to 
say again what we all know, that, obviously, the war would end 
today if Russia stopped its aggression.
    Mr. Huizenga. Do you have any concern about F-16s that has 
just been announced, of a potential transfer to Ukraine, that 
that could be used or misused?
    Ms. Lewis. I do not have any concerns about that. I think 
that, as----
    Mr. Huizenga. Because you believe the Ukrainians would use 
them for the purpose intended?
    Ms. Lewis. I believe so, but, obviously, that has not 
happened yet. But that would be my understanding.
    Mr. Huizenga. Ok. Would it not be better to have, say, 
Poland send the MiG-29s?
    Ms. Lewis. I believe Poland has already sent them MiG-29s, 
which they are already trained on and using. And so, the 
announcement that was made would be providing them with this 
additional training----
    Mr. Huizenga. Right.
    Ms. Lewis [continuing]. And capability.
    Mr. Huizenga. All right. I'm going to move on. I will leave 
with this statement. Many of us had encouraged this 
Administration to get, whether it was TOW missiles, other arms, 
in earlier prior to the conflict, so that it could not be used 
as a view toward escalation, that the United States is directly 
involved. I think that would have been a much better situation.
    I'm going to move on to ITAR and the Foreign Military 
Sales. I have been at this for a fair amount of time. I was a 
district director for my predecessor. I was a State legislator. 
I have been in this position, both in an older district and a 
new district. I have talked to suppliers, both in the district 
and in Michigan. Virtually all of them over the years have 
relayed difficulties that they face in compliance with some of 
the various frameworks--ITAR being one of those.
    And regardless, it seems that the same issues arise. The 
current ITAR framework is too burden and clients' costs are too 
significant for smaller, oftentimes, mom-and-pop or small 
business shops with innovative technologies who, instead, 
choose to enter the commercial market rather than using the 
military.
    In fact, I had a small supplier tell me that they are 
facing pressure from their tier 1 supplier to use non-ITAR-
regulated products because they do not want to deal with the 
headache of ITAR in their final supply chain.
    So, Assistant Secretary Lewis, how is State working to stop 
this process from getting in the way of innovative companies 
looking to bring their products to market within the defense 
industrial base?
    Ms. Lewis. Well, I think, as you know, we have looked at 
these issues across the board. And when it comes to ITAR in 
terms of AUKUS, I think I laid out a plan where we are going to 
be able to create a smooth-moving system, where we already know 
the people who are going to receive it on the end----
    Mr. Huizenga. But this is only going to do it in AUKUS?
    Ms. Lewis. I'm sorry?
    Mr. Huizenga. Only within AUKUS?
    Ms. Lewis. We are doing that within AUKUS right now. We 
have also created, in addition to AUKUS, open general licenses 
which allow some technology to also move freely. And I'm happy 
to continue to work with you. I'm a former staffer, so I 
appreciate the importance of talking to the people back in your 
district, if there are specific issues.
    I know that, in addition, we have gone through a series of 
changes in our regulations, and sometimes as simple as updating 
the website, so that people can understand what is there, to 
try to help people with these compliance issues.
    Mr. Huizenga. All right. Ok. In my last few seconds here, 
artificial intelligence. We cannot continue to be flatfooted. 
What assurance do we have that your Department, from your 
Department, the United States is working to combat or deter the 
use of AI technologies against ourselves or our allies from 
places like China? And is there an attempt for our allies and 
our partnership members to be sharing that information?
    Ms. Lewis. I think we are working across the interagency on 
all of those issues.
    Mr. Huizenga. I yield back.
    Mrs. Kim of California. All right. I now recognize Mr. 
Costa for 5 minutes. Oh, he is not here.
    Mr. Crow, you are now recognized for 5 minutes.
    Mr. Crow. Thank you.
    And thank you to both of you for coming in today and for 
your testimony.
    Assistant Secretary Lewis, I would like to start with you. 
Your bureau has encountered a significant explosion of workload 
in the last year, in particular, but we have the largest land 
war in Europe since World War II. We have a modernizing NATO 
with significant new investments. We have AUKUS and other deals 
going on right now.
    Can you just touch on for a moment the impact of that 
workload on your bureau? Because, at the same time, there is a 
lot of people here criticizing the speed at which you do 
things. A lot of these folks also are cutting your resources 
and your budget as well and making it harder for you to 
actually doing the things that they are asking you to. So, I 
would love to--just comment on what your folks are doing day-in 
and day-out and the impact of that workload on them.
    Ms. Lewis. Well, I very much appreciate the question. I 
have to say, I came to the bureau about 2 years ago, and it is 
an extraordinary team of professionals. We have over 25 percent 
are veterans in my bureau, and then, a significant number who 
we also have active duty military serving.
    And the reason they serve in the Bureau Political-Military 
Affairs is because they believe in the mission, and they 
believe that--and our workloads in some cases have increased 
over the past 15 minutes 15,000 percent, and those same----
    Mr. Crow. Fifteen thousand?
    Ms. Lewis. Fifteen thousand percent for some of the pieces 
of my bureau.
    And when I talk to my team and I say, ``Hey, you're here 
working late,''--you might be here over a weekend to get 
something to Ukraine, or to get something to Taiwan, or to one 
of our partners and allies--they tell me, ``That's what we're 
here to do. There's nothing else we would rather do.''
    In spite of that, we still move 95 percent of cases on the 
foreign military side within 24 to 48 hours. It is 
extraordinary, the work that is being done.
    I would note that we had a $3 billion increase in foreign 
military financing going to the eastern flank. My team has 
taken that on. We have concurrence in over $9 billion, and 
growing, from the Defense Department.
    And the team also negotiates all of our security 
cooperation agreements. In a normal year, my security 
cooperation team negotiates four of those. This year, they are 
negotiating nine. The reason they are negotiating nine of these 
agreements is because countries around the world want to deepen 
and strengthen their security cooperation relationship with us, 
and we are in charge of making sure that we have the underlying 
agreements to do that.
    So, it has been extraordinary. I am both honored and 
humbled to be at the head of this bureau at this mission-
critical time.
    Mr. Crow. Well, that is an extraordinary effort, and I 
appreciate you painting that picture. And I thank you and your 
team for doing that critical work.
    So, with additional funding, say, hypothetically, if 
Congress were to provide additional funding to your bureau, 
what would you use that funding for and what would the impact 
of it be?
    Ms. Lewis. I have to be careful to not get ahead of any 
specific asks, but what I would say is I am working very hard 
to increase the staff that we have to meet the mission. I have 
always believed that one of the jobs of a good manager is to 
make sure your people match your mission, as your mission 
shifts and changes. And we are literally in the process of 
doing that. And so, I think we would continue that work.
    Mr. Crow. Ok. Thank you very much.
    Dr. Karlin, to you next, are you aware of the 
Administration reconsidering policy with regard to cluster 
munitions and providing cluster munitions to Ukraine?
    Ms. Karlin. Thank you.
    Right now, we are really focused on making sure that 
Ukraine gets what it needs that can be effective on the 
battlefield immediately. And we have, thanks to Congress' 
support, I think, seen the extraordinary impact of that over 
the last 15 or so months. Obviously, cluster munitions would 
have a serious humanitarian impact, and that has informed our 
thinking to date.
    Mr. Crow. Ok. Last, could you, Dr. Karlin, comment on the 
impact of technology and telecommunications investments by the 
PRC in places around the world, and the impact that that has on 
our ability to develop enhanced intelligence relationships and 
export control relationships with our allies and partners?
    Ms. Karlin. We absolutely look vigilantly at how, and in 
what ways, the PRC makes such investments. And I have been 
heartened to see that many of our partners around the world 
have increasingly recognized that there will be pros and cons, 
if you will, of engaging in such activity. And I think we have 
seen a number of examples of partners who recognize that, that 
that is actually not a----
    Mr. Crow. Are we doing enough to communicate the risks, 
long term and short term, if they are to accept those types of 
investments?
    Ms. Karlin. I can tell you we are doing a lot from the 
Department of Defense. Where there are certain partners that we 
understand that they may be pursuing such relationships, we 
articulate to them in a frank conversation the implications of 
doing so, and frankly, the implications for our relationship.
    Mr. Crow. Thank you. I yield back.
    Mrs. Kim of California. I now recognize Mrs. Radewagen for 
5 minutes.
    Mrs. Radewagen. Thank you, Madam Chair.
    [Speaking Samoan] Alofa lava.
    And good afternoon. I want to thank the both of you for 
appearing and testifying today.
    We are nearly at the 2-year mark since the original 
announcement for AUKUS, and since then, nefarious actors have 
spread misinformation about what AUKUS is. Quite simply, I want 
to address the Treaty of Rarotonga, which formalized a nuclear 
weapons-free zone in the South Pacific. I was there when they 
signed it.
    Now, we Pacific Islanders have a long memory, and the 
nuclear weapons legacy of the early cold war still impacts us 
today. We all know that AUKUS has nothing to do with nuclear 
weapons. Can you describe how the Department of Defense and the 
State Department are addressing misinformation regarding AUKUS? 
And are you meeting and working with Pacific Island nations to 
address their potential concerns regarding AUKUS?
    Ms. Karlin. We are absolutely looking at this important 
point that you are raising, ma'am. And I think you see the 
fruits of those conversations in the reactions to the 
announcement that the three heads of State made about 2 months 
or so ago on the submarines piece, which is that our colleagues 
around the Indo-Pacific largely understood what we were doing 
and understood what we weren't doing.
    And so, while we recognize that there may be some parties 
who want to foment misinformation about what we are doing, I 
think having those really kind of active channels of dialog 
with these partners has been incredibly important. And we are 
finding that there is a pretty clear understanding among those 
partners of why we are engaged and what that looks like.
    Mrs. Radewagen. Secretary Lewis?
    Ms. Lewis. And all I would add is, first of all, I think 
your voice is very important in this. And I think we are being 
very intentional when we talk about conventionally armed, but 
nuclear-powered submarine capability, and being very clear 
about what that means.
    I also know that we are working hard to strengthen our 
relationships across the Indo-Pacific. And one of these defense 
cooperation agreements that we just signed was with PNG. And I 
think that indicates that, in addition to this conversation, we 
need to continue to work to deepen and strengthen our security 
cooperation relationships.
    Mrs. Radewagen. Thank you for your answers.
    Now, on to the meat of the hearing. Do you feel there is a 
sufficient mechanism to solve both strategic-level and policy-
level concerns between the three partners? And can you please 
explain how that mechanism works?
    Ms. Lewis. Yes. I think the short answer is yes. I think 
these are some of our closest partners--I'm sorry--closest 
allies around the world. We already have a mechanism in place 
that allows us to meet regularly and to sit and talk through 
both the strategic questions, but sometimes, also, really these 
nitty-gritty technical issues, which when it comes to defense 
trade, actually, are mission-critical. And we are meeting 
regularly with them now, and that will continue going forward.
    Ms. Karlin. I might just add, ma'am, this is a historic 
opportunity that will require historic change. We are clear-
eyed about that. Congress' bipartisan support of AUKUS, and 
realizing the intention of AUKUS, is also really critical to 
that. And I believe our British and Australian colleagues get 
that, too.
    Mrs. Radewagen. Thank you, Madam Chair. I yield back the 
balance of my time.
    Mrs. Kim of California. Thank you.
    I now recognize Mr. Schneider for 5 minutes.
    Oh, Mr. Costa is here. Sorry.
    Mr. Costa. Thank you, Madam Chairperson.
    Dr. Karlin, there has been a lot of discussion over the 
pace of AUKUS and implementation timelines. And I think, on a 
bipartisan basis, no one is satisfied with the timelines we are 
looking at right now. I hope you are not satisfied with them.
    We had a committee hearing briefing with defense 
contractors last month and got a number of perspectives. There 
was a briefing, a comment from one of the witnesses, from 
Adrian, a smaller defense manufacturer, who said that we ought 
to look at reimagining our procurement practices on capability 
development. They used as an example NASA. Instead of trying to 
do the ground-up and everything, now NASA is looking at really 
setting details for specifications on how the goals should be 
designed and implemented, and then, let the private sector try 
to achieve it, once those goals are established in terms of 
what end results the Department of Defense is seeking.
    I want to know whether or not you folks are looking at 
changing your approach and looking at the specific purpose or 
goals. In other words, do not tell the industry what to build, 
but tell them the mission and let the innovation occur.
    So, what is your reaction to this idea and how could it be 
applied for the Department to move quicker, whether we are 
talking about AUKUS or in our current supply chain efforts with 
the war in Ukraine?
    Ms. Karlin. I think it is a really reasonable and important 
approach, especially as we recognize how the technological and 
security environment is changing. As it relates to AUKUS, 
specifically, this is why we really want to work closely with 
Congress on a bold and innovative approach with legislative 
change, so that we can advance AUKUS projects.
    And the cornerstone of that would be exempted defense trade 
for AUKUS projects and bilateral defense trade, to include 
classified information-sharing. So, we want to work with you 
closely on developing that because, as I said earlier, this 
really is an historic opportunity. So, we are going to need to 
make historic change. I think the moment does call for that.
    Mr. Costa. No, and I think there is an opportunity here. 
And frankly, you know, it reminds me of that old adage. You 
know, one of the definitions of insanity is doing things the 
way you have always done them and expect different results; it 
is not going to happen.
    And so, we need to reimagine, with the challenges we face 
with China and our efforts dealing with AUKUS, and also, I 
think that applies in our current situation. I mean, I hear the 
Department of Defense concerns about our own supply chains and 
our own needs. And certainly, NATO partners are feeling 
similarly. So, we ought to look at how we can do this better 
than we have in the past.
    Ms. Karlin. I think that is exactly right. I mean, you 
know, the goal of AUKUS is we are really trying to increase our 
capability, our interoperability, and deliver deterrence at 
every phase. And we need that to succeed, and that requires the 
cooperation of our entire U.S. Government, in addition, of 
course, to our British and Australia partners.
    Mr. Costa. Yes, let me just make one comment, and this 
relates to the big picture that we are all dealing with here, 
as it relates to lifting the deficit and getting our budget 
done by October 1st.
    And I will just underline what Representative Keating said. 
I have been here 19 years, and I have heard Secretaries of 
State and Secretaries of Defense that are Republicans and that 
are Democrats. And they all concur, when we talk about our 
budget process, that the most difficult situation that we put 
the Department of Defense in, and State, is when we engage in 
these continuing Continuing Resolutions for a month, for 2 
months, and contracts on your part are not resolved. They are 
left in limbo, Defense contractors do not know exactly what the 
lay of the land is and what to expect.
    And we make ourselves most vulnerable when we do not do our 
jobs and we do not provide a budget on time. That is an 
editorial comment, and it has not gotten much better here in 
the last 19 years. We need to work on that. That is Congress' 
responsibility.
    Thank you. I yield back the balance of my time.
    Mrs. Kim of California. Thank you.
    I now recognize Mr. Waltz for his 5 minutes.
    Mr. Waltz. Thank you, Madam Chair.
    Ms. Karlin, you have said a couple of times--and I 
certainly agree--that this is an historic opportunity and it 
needs historic change as it pertains to AUKUS. I want to speak 
for a few minutes as it pertains to Taiwan.
    Would you agree that that is a historic threat? That is 
certainly the case in multiple National Defense Strategies, I 
think you would agree. I think that also needs historic change 
in terms of our processes.
    We have talked about an AUKUS bubble. I think we need to 
talk about a Taiwan bubble and how we can accelerate, fast-
track, provide waivers, and work with the Congress to really 
peel back the layers on these weapons systems and get them 
there faster as a deterrent measure.
    Ms. Lewis, you have said a couple of times that you agree, 
we need to look at all options, but I do not think that is good 
enough. We need to understand what is actually being done, and 
then, what barriers we need to remove to move faster.
    So, in that vein, Ms. Karlin, on the DoD Tiger Team, you 
mentioned 12 recommendations. Can you give some examples of 
what those recommendations were? And can you provide those 12 
recommendations to the committee?
    Ms. Karlin. I think, Congressman, you may be referring to 
the State Department Tiger Team. They outlined 10 
recommendations.
    Mr. Waltz. Ok.
    Ms. Karlin. So, I might defer to Assistant Secretary Lewis 
on that.
    Mr. Waltz. OK, but did not Defense Secretary Hicks also 
have a DoD Tiger Team?
    Ms. Karlin. Yes. So, there has also been an FMS Tiger Team 
that the Department of Defense has run as well.
    Mr. Waltz. And were there recommendations?
    Ms. Karlin. There have been a couple of key 
recommendations. The entire----
    Mr. Waltz. What are they?
    Ms. Karlin. So, a couple of key initiatives that I would 
highlight.
    So, one is the need for us to have a data-driven approach, 
so that we can accelerate the development of a common operating 
picture and security cooperation. Effectively, we want to be 
able to figure out FMS cases--where are they from initiation to 
delivery? How do we have that whole life cycle----
    Mr. Waltz. So, this is an FMS Tiger Team, not a Taiwan?
    Ms. Karlin. So, there are two separate efforts.
    Mr. Waltz. Ok.
    Ms. Karlin. That is the FMS Tiger Team. The other effort 
that you may be referring to is the effort that Deputy 
Secretary Hicks has been highlighting.
    Mr. Waltz. Right.
    Ms. Karlin. Yes, exactly. So, that one is on Taiwan, and 
that one is looking at how we can ensure that we are finding 
ways to accelerate and bolster Taiwan's self-defense 
capabilities.
    Mr. Waltz. And, Ms. Karlin, what are we doing, right? I 
understand; we went through the Tiger Team last year. There are 
recommendations. We identified needs.
    But can you provide the committee what you are actually 
putting in place--timelines, troops to task, so to speak, and 
what, then, the effect will be on these systems to accelerate 
them? Is that possible?
    Ms. Karlin. Yes.
    Mr. Waltz. Ok.
    [The information referred to follows:]

    ********* INFORMATION NOT PROVIDED AT PRESS RELEASE 
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    Ms. Lewis. May I jump in here?
    Mr. Waltz. Sure.
    Ms. Lewis. Because some of these are actually State 
Department authorities.
    Mr. Waltz. Uh-hum.
    Ms. Lewis. So, let me just walk you through a few of them.
    The first one is we are looking at using a new authority 
for Taiwan that Congress provided, which is a billion dollars--
--
    Mr. Waltz. I know the PDA. Got it.
    Ms. Lewis. Right.
    Mr. Waltz. Five hundred million announced, uh-hum.
    Ms. Lewis. Well, that, the reason I'm focusing on that is 
that provides us the ability to immediately deliver, which I 
think is the question that you were asking. So, that is thing 
one.
    Mr. Waltz. Uh-hum.
    Ms. Lewis. The second thing--and I cannot go into all of 
the details here--but what I can tell you is, we have looked at 
a specific set of capabilities and specific systems that Taiwan 
needs, and we have been able to prioritize those systems, both 
in terms of if we have, let's say, a hundred of them, making 
sure a certain percentage goes to Taiwan.
    And again--I cannot get into all the details here, for 
obvious reasons--we have been able to, also, make sure that 
certain systems are being produced more quickly, so they get to 
Taiwan more quickly.
    Mr. Waltz. But we still have a case where we have MQ-9 ISR, 
right, that is 2027 or later. The chairman has his list of 
2022. For example, the harpoons took 2 years to get on contract 
award. The F-16s were just delayed. I mean, we have a series of 
major end items that are due somewhere between 2027 and 2029. 
And yet, Xi has told his military to be ready by 2027 and, 
arguably, some analysts think he will accelerate before Taiwan 
has these capabilities. And from a deterrent standpoint, that 
is too late.
    And if we look at the model in Ukraine in providing all of 
these systems after the country is devastated, at huge expense 
to global stability and the taxpayer, that is a losing model.
    So, I look forward to working with you, and I think we need 
a tiger team here in the Congress to peel back these layers and 
understand where we can accelerate authorities, whether it is 
enhancing the PDA or accelerating those authorities to move 
faster.
    Thank you.
    Ms. Lewis. Thank you.
    Mr. Waltz. I yield my time. Thank you, Madam Chair.
    Mrs. Kim of California. Thank you.
    I now recognize Mr. Schneider for 5 minutes.
    Mr. Schneider. Thank you, Madam Chair.
    And I want to thank the witnesses for your time here today.
    As was noted--and you said it very well--this is an 
historic opportunity that requires historic change in long-term 
strategic thinking.
    And also as mentioned, I look forward to working together 
with the Administration and this committee to try to clear away 
obstacles and work to develop a smart, secure path forward for 
what is a vitally important region for our Nation and for the 
world.
    When it comes to collaborating with close partners in tough 
neighborhoods, there is a lot to be learned, I think, from the 
history, our history of collaborating with another key ally, in 
this case, specifically, Israel. Our assistance has helped the 
Israel Defense Forces become one of the most effective 
militaries in the world. Less well-known, however, is that the 
United States assistance has helped develop Israel's formidable 
defense industrial base.
    So, when it comes to the Indo-Pacific, how would you think 
about goals of supplying our allies with capabilities versus 
helping them buildup their own indigenous capabilities, or 
capacities and capabilities, specifically, in the case of 
Taiwan?
    Ms. Lewis. Well, this is a very interesting question, and 
we, actually, have paid close attention to the development of 
Israel's defense industrial base. And they really have 
developed some very significant capabilities.
    I think, as we look across the Indo-Pacific and Taiwan, 
when we talk about developing indigenous capabilities, we need 
to do that in collaboration with our defense industrial base. 
And we have to make sure that we develop things--I'm going to 
get a little technical here--cooperative agreements, direction 
agreements, all of these kinds of things.
    We are very sensitive to the fact that our industry has to 
lead the way on the decisionmaking in terms of what makes sense 
for them to do in coordination with another country. But I do 
think, when we have countries that have significant 
capabilities, that have an educated work force, that have, 
potentially, their own defense industrial base, that it makes 
sense to look at that potential moving forward.
    Mr. Schneider. Ok. Assistant Secretary Karlin?
    Ms. Karlin. I would completely concur with Assistant 
Secretary Lewis' points.
    Mr. Schneider. Ok. And I know, just for the sake of time, I 
have many more questions, but we have only a little bit of 
time. And I'm going to yield back, so others can speak.
    Mrs. Kim of California. Thank you very much.
    I now recognize Mr. Kean for 5 minutes.
    Mr. Kean. Thank you, Madam Chairman.
    Thank you, also, to our witnesses for being with us today.
    From the war in Ukraine to the cooperative of defenses in 
Taiwan, and requests from our allies for equipment made in 
America, the United States, once again, stands as the arsenal 
of democracy. I, like many of my colleagues, see AUKUS as a 
once-in-a-generation opportunity to seek to counter the CCP's 
malign influence in the Indo-Pacific and, also, strengthen our 
relationships with close regional allies. The success of this 
partnership requires that our arms exports are able to meet the 
security needs of our allies at a time when our friends in 
Asian and Europe continue looking to the United States for 
leadership.
    What are the specific choke points that are slowing things 
down that you think that you have identified that we can cut 
through more quickly for foreign military sales?
    Ms. Lewis. Let me start by talking about what we have 
identified at the State Department, and then, talk a little bit 
about the defense industrial base, and then, Dr. Karlin may 
have more to add.
    So, just to start with, as I said before, 95 percent of our 
cases move through the Foreign Military Sales process in 24 to 
48 hours. So, we really took a look at, what are the challenges 
in the other 5 percent? So, we have made a list of 
recommendations.
    So, the first one is to make sure that we are prioritizing 
correctly, based on our national security goals. That sounds 
like just talk, but that, actually, could make a significant 
difference in terms of being able to move forward on key 
priorities.
    Second of all, we are looking at regions. So, rather than 
having to say, OK, we can provide this new capability only to 
one country, when we start that analysis, look at it from a 
regional perspective, so we are prepared to move quickly and 
answer those questions for the entire region.
    We are also looking at other things like working with this 
committee here on the congressional notification process to 
make sure that is as streamlined as possible. I am happy to 
talk about more details there.
    Mr. Kean. Yes. That would be great. Please.
    Ms. Lewis. There are a whole host of other things, but just 
to give you a sense.
    Mr. Kean. Ok. We are going to talk regions real quick on 
Ukraine.
    Ms. Lewis. Yes.
    Mr. Kean. Now that the Pentagon has realized it 
overestimated the value of the ammunition, missiles, and other 
equipment sent to Ukraine by around $3 billion, and has 
additional drawdown authority, is the Biden Administration 
prepared to increase weapons package it is transferring to 
Ukraine to implement a critical counteroffensive? I am 
concerned that the Administration has been rationing weapons to 
Ukraine ahead of the counteroffensive to conserve Presidential 
drawdown authority, when, in reality, it did not have to, and 
it has known that since March.
    Ms. Karlin. Thank you for raising this.
    I have seen no evidence that the Department has rationed 
its support to Ukraine. Indeed, I cannot tell you of another 
time where I have seen the Department has mobilized for racing 
assistance that has had a direct impact on the battlefield so 
quickly.
    As you do highlight, sir, during our regular oversight 
process of the drawdown authority, these inconsistencies in how 
equipment for Ukraine was valuated were discovered. 
Effectively, what happened in a handful of cases was that 
replacement costs were used rather than net book value was 
used. So, the amount of the equipment, the value of it, was 
overestimated. That has not constrained our support whatsoever, 
and the DoD Comptroller has worked to reissue guidance to 
ensure that that clarity is there.
    Mr. Kean. And finally--and then, I will yield back after 
this--I was pleased to see the recent announcement regarding 
the Administration's decision to allow Ukrainian pilots to 
train on F-16s. However, the Administration still refuses to 
provide ATACMS and DPICMs which could have an immediate impact 
on the battlefield, as Ukraine prepares its counteroffensive. 
Other members of this committee have brought up that our allies 
are sending equipment and training in for long before this 
President has.
    I just want to end with that statement. I yield back.
    Mrs. Kim of California. Thank you.
    I now recognize Mr. Lawler for 5 minutes.
    Mr. Lawler. Thank you, Madam Chair.
    As you both know, U.S. arms exports to Turkey have been 
highly controversial in the past few years. Most recently, 
Turkey has requested to upgrade and add to its existing fleet 
of F-16 fighter jets. And last month, the Administration 
approved a software sale to the country to modernize its fleet. 
Notably, the Administration did not approve the sale of 40 
additional F-16s that Turkey requested. Can you please describe 
the process for reviewing and, potentially, approving this 
request?
    Ms. Lewis. I'm happy to address that. Let me just clarify. 
I think the second sale you mentioned was for upgrades that 
were mission-critical for their ability to fly, in essence, the 
software that went into the planes.
    Mr. Lawler. Uh-hum.
    Ms. Lewis. I'm not----
    Mr. Lawler. Right, I said the software.
    Ms. Lewis. Yes.
    Mr. Lawler. Yes.
    Ms. Lewis. And then, I'm unclear as to the third one you 
mentioned. You were saying we did not approve something, 
specifically?
    Mr. Lawler. Didn't approve the sale of 40 additional F-16s.
    Ms. Lewis. I'm not aware that that is--oh, it is the new 
one. That, just to be clear, we have reviewed that, and I think 
at this point, when we place things into tiered review--which 
is the process where we put sales before the committee--we 
cannot discuss anything publicly. So, I think at this point, I 
think what would be the most effective to say is that we have 
certainly reviewed that case and that we are moving forward 
expeditiously.
    Mr. Lawler. Ok. Given President Erdogan's relationship with 
Vladimir Putin, will the upcoming runoff election in Turkey 
impact this decisionmaking at all?
    Ms. Lewis. I think, as we look at arms sales 
decisionmaking, we look at a whole host of criteria. I'm not 
aware, as of right now, that--I know the election is happening 
in real time--that we have sales before us where the outcome of 
that election would influence our decisionmaking on a 
particular sale.
    Mr. Lawler. And this past February, Secretary Blinken 
visited Turkey. How did the Secretary address the situation 
with President Erdogan?
    Ms. Lewis. I was not--I'm not privy to his specific 
conversation, but I know he addressed a whole host of issues 
while he was there--ranging from, obviously, issues with NATO, 
Turkey as a NATO ally, and then, a whole host of additional 
concerns that we have involving the region. And I am sure, 
although, again, I was not there for that, that they discussed 
other issues, like Ukraine and NATO accession.
    Mr. Lawler. Ok. When I visited Taiwan with the chairman of 
this committee, President Tsai expressed a need for increased 
defense training and cooperation and delivery of critical 
weapons systems. It is absolutely crucial that we provide 
Taiwan with the aid they so desperately need to stand up to 
Chinese aggression in the Indo-Pacific.
    Unfortunately, there has been a huge arms backlog. And I 
sent a letter today to Secretary Blinken, along with some of my 
colleagues on that trip, that urged the State Department to 
address these shipment delays, as it is not consistent with 
U.S. law to leave Taiwan without necessary arms that they 
purchased.
    What exactly is the root cause of this delay? And what is 
the State Department and DoD doing to address it, so that we 
can efficiently and effectively get these weapons systems to 
them? As we saw in Ukraine, the failure to get these weapons 
systems to the Ukrainian people/government early, the military 
earlier, was part of the problem here.
    Ms. Lewis. Well, sir--and I'm glad you raised this issue--I 
think, as you pointed out, these are sales that have already 
moved through the Department and through Congress. And what the 
challenges are now, moving forward, really is on the production 
side.
    Mr. Lawler. Right. So, what is the State Department and DoD 
doing to address that?
    Ms. Lewis. Well, we have to work with industry on that, 
because industry is the one producing them. So, what we are----
    Mr. Lawler. Right. So, what are we doing?
    Ms. Lewis. Well, what we are doing is, one, we are working 
on having them increase production for specific capabilities, 
so that they can produce more of the items needed.
    We are also looking, where possible, to prioritize what is 
being produced for Taiwan. I'm not going to get into the 
specifics of what we are doing in each capability in this 
setting, but we are working through that with industry. But, 
ultimately, industry is the one who has to--they have to----
    Mr. Lawler. Right, but we are paying them. So, we need to--
--
    Ms. Lewis. Well----
    Mr. Lawler. We need to expedite this process.
    Ms. Lewis. Taiwan is actually----
    Mr. Lawler. Right, they are purchasing the weapons.
    Ms. Lewis. Yes. Yes.
    Mr. Lawler. But it is as a result of Defense Department 
contracts and State Department contracts. We need to expedite 
the process.
    Mrs. Kim of California. The gentleman's time is up.
    In the interest of time, because the votes are being taken, 
I would like to call for Mr. Courtney for 5 minutes.
    Mr. Courtney. Thank you, Madam Chairwoman.
    And again, for the record, I just want to thank Mr. McCaul 
and Mr. Meeks for the courtesy to join you from the Arms 
Services Committee to talk about AUKUS, which there is great 
interest.
    After the announcement on March 13th out at Naval Base 
Point Loma, March 13th, when the three heads of government, 
three navies stacks hands to make an extraordinary commitment, 
the government of Australia, really within days, announced a 
commitment of $386 billion which was supported by the 
opposition party to execute AUKUS over the life of the program.
    I think it is important to note this is a country with 26 
million people that is smaller than the State of Texas and the 
State of California. So, obviously, they have committed in a 
big way in terms of making sure that this is a success.
    Dr. Karlin, the Department of Defense sent over three 
requests for AUKUS implementation which are in this committee.
    The first is a bill to authorize the sale of two Virginia 
Class submarines to Australia.
    The second, to authorize the Australian government to 
invest $2 billion into the U.S. submarine industrial base.
    The third is to authorize training to Australian private 
industry to begin developing its own submarine industrial base.
    Can you talk for a moment about the need for Congress to 
reciprocate Australia's extraordinary commitment by moving 
forward in terms of getting these bills to the President's 
desk?
    Ms. Karlin. Absolutely. First of all, Congressman Courtney, 
thank you for your tremendous leadership on all things AUKUS. 
It has been just tremendous, as I noted.
    So, we need to act on these three legislative proposals for 
Pillar I, the submarine piece of AUKUS, for several reasons.
    So, first is it is a signal of our commitment to AUKUS, 
which is critical for generating deterrence across every phase 
of the optimal pathway. Acting now sends a message to our 
defense industrial base as well that there will be a persistent 
flow of business to come, which is a topic, of course, that we 
have heard a lot about over these last few hours, and really 
ensuring that that submarine industrial base is able to start 
taking the steps that it needs with Australia's contribution.
    Frankly, Australia is going to be making a significant 
investment in our submarine industrial base, and absent this 
legislative proposal, we actually do not have a way to take 
that money in. And so, we know that our submarine industrial 
base--you know just about better than anyone--has issues that 
long predate and have nothing to do with AUKUS, which is why 
the Administration has tried to make an historic investment in 
the submarine base. Australia wants to do so alongside us. And 
we want to be able to absorb all of that. And you noted, of 
course, that they have made robust commitments, really shown 
that they have skin in the game.
    On that other legislative proposal that you highlight, we 
need to start training Australians as soon as possible, 
frankly, because we want them to be able to build the capacity 
to safely and responsibly be stewards of conventionally armed, 
nuclear-powered submarines. So, that is really why that is the 
case.
    And then, of course, the ship transfer legislation, we need 
to just show just how seriously we are taking this. So, we have 
an ally in Australia who has made major commitments in terms of 
putting its money where its mouth is, to demonstrate its 
seriousness with AUKUS. This is in all of our interests, to be 
clear, and we want to show that we can take their investment; 
that we can train them to be responsible, and that we will also 
be able to deliver on the submarines--all of which, I would 
just underscore, helps our submarine industrial base.
    Mr. Courtney. Great. Thank you.
    And I'm sure, again, Mr. McCaul and all our colleagues on 
this committee are going to do everything we can to demonstrate 
on a bipartisan basis just what Australia on its own bipartisan 
basis.
    There was a fourth proposal which came over last week in 
the Defense Production Act, which President Biden and Prime 
Minister Albanese announced on Saturday at the G7, which is, 
basically, to include Australia and the U.K. within the scope 
of the Defense Production Act, which will help stimulate all 
those other technologies that are part of Pillar II.
    Again, can you talk about the need to make sure that we 
move this measure swiftly?
    Ms. Karlin. Absolutely. Look, Pillar II, the scope, the 
scale, the complexity of it is really unlike anything that we 
have ever done, right? This is a generational opportunity.
    And the announcement that the President made over the 
weekend really highlighted how this change would accelerate and 
strengthen AUKUS implementation. It would build new 
opportunities for U.S. investment in the production and 
purchase of Australian critical minerals, critical 
technologies, and other strategic sectors.
    So, while we are still looking, of course, at what it would 
mean for specific AUKUS projects, it underscores the point I 
made earlier that this is a two-way street; that, actually, 
given the security environment, given the rapidly evolving 
technological environment, we need to be able to work with one 
another as much as possible.
    Mr. Courtney. Right.
    Thank you, Madam Chairman. I yield back.
    Mrs. Kim of California. Thank you.
    I thank the witnesses for their valuable testimony and the 
members for their questions.
    The members of the committee may have some additional 
questions for the witnesses, and we will ask you to respond to 
those in writing.
    And pursuant to committee rules, all members may have 5 
days to submit questions, statements and extraneous materials 
for the record, subject to the length limitations.
    [The information referred to follows:]

    ********* INFORMATION NOT PROVIDED AT PRESS RELEASE 
**********
    Mrs. Kim of California. Without objection, the committee 
now stands adjourned.
    [Whereupon, at 4:59 p.m., the committee was adjourned.]

                                APPENDIX

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         STATEMENT FOR THE RECORD FROM REPRESENTATIVE CONNOLLY

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            RESPONSES TO QUESTIONS SUBMITTED FOR THE RECORD

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