AMBASSADOR ISCHINGER: Thanks very much. I think now we can continue. It's my great pleasure now to open our second panel this morning. We have two longtime friends of the Munich Security Conference. Both of our panelists have been with the Munich Security Conference when they served in the U.S. Senate for many years. So let me welcome both Secretary John Kerry and Secretary Chuck Hagel, both now no longer in the Senate but both now for a year, for practically a year, Secretary of State and Secretary of Defense. Welcome, Mr. Secretaries. (Applause.)
I think the way we want to use these 45 minutes or so is that both Secretaries will offer introductory comments; and if you have a question to ask, please put it on one of the slips of paper and hand it to the staff, and then we'll use whatever time we have to have a discussion, a Q&A session, in just a few minutes.
John, would you like to start? Thank you.
SECRETARY KERRY: Well, thank you very much, Ambassador Ischinger. I'm very grateful for the opportunity to be here. (In German.) Nice to be with everybody. And I am -- I want to remark that Ambassador Ischinger had the pleasure of going to the renowned Fletcher School at Tufts University, but it sounds to me like he lost his Boston accent. I don't know what happened to him along the way. (Laughter.)
This is a very real and special pleasure for Chuck and me to be here at this conference. We do know this conference well. And as Walter said, we are not just friends from the Senate but we're friends from a common experience of a long period of time. So it's a pleasure for us now to be working together as partners with respect to the national security issues that challenge all of us.
So the fact is also that both Chuck and I feel this Atlantic relationship very much in our bones. Both of our families emigrated to the United States from Europe, and both of our fathers signed up to fight tyranny and totalitarianism in World War II. And we both watched the Berlin Wall go up as we grew up, and we grew up as Cold War kids.
So we come to these discussions -- both of us -- with part of our formative years planted in the post-Cold War/post-World War period, and certainly deeply in the Cold War period. As a kid who grew up in school doing drills to get under my desk in the event of nuclear war, this is something that still conditions my thinking.
It was during that period of time that I first encountered what I came to understand as one of the unmistakable symbols of the enduring American-European partnership. I was a young kid who served -- who was with my father in Berlin when he served as the legal advisor to the then High Commissioner to Germany, James Conant. And I spent a piece of my childhood getting on trains in Frankfurt and going through the dead of night to arrive in Berlin and be greeted by the American military man, and move between a British sector, a French sector, an American sector, and a Russian sector. So I can remember cold signs warning you about where you were leaving, and I can remember guns rapping on the windows of my train when I dared to lift the blinds and try to look out and see what was on the other side.
I'll also never forget walking into a building -- I used to ride my bicycle down to Kurfurstendamm when it was still rubble. We're talking about the early 1950s, just to date myself. And you could see a plaque on a building that said: "This was rebuilt with help from the Marshall Plan." But the truth is today, as we gather in Munich in 2014, George Marshall's courageous vision -- resisting the calls of isolationism and investing in this partnership -- requires all of us to think about more than just buildings. That period of time saw the Marshall Plan lead America's support for the rebuilding of a continent. But it was more than just the rebuilding of a continent; it was the rebuilding of an idea, it was the rebuilding of a vision that was built on a set of principles, and it built alliances that were just unthinkable only a few years before that.
And I say all of this to try to put this meeting and the challenges that we face in a context. So long as I can remember, I have understood that the United States and Europe are strongest when we stand united together for peace and prosperity, when we stand in strong defense of our common security, and when we stand up for freedom and for common values. And everything I see in the world today tells me that this is a moment where it's going to take more than words to fulfill this commitment. All of us need to think harder and act more in order to meet this challenge.
With no disrespect whatsoever -- in fact, only with the purest of admiration to the strategic and extraordinary vision of Brent Scowcroft sitting over here, Henry Kissinger, Zbig Brzezinski, who I don't see but I know is here somewhere. There he is. These are men who helped to shape and guide us through the Cold War and the tense moments and the real dangers that it presented. But the fact is that this generation of confluence of challenges that we're confronting together are in many ways more complex and more vexing than those of the last century. The largely bipolar world of the Cold War, East-West, was relatively straightforward compared to the forces that have been released with the fall of the Berlin Wall, the rise of sectarianism, the rise of religious extremism, and the failure of governance in many places. In fact, we should none of us be surprised that it is the wisdom and vision of Henry Kissinger in his brilliant book Diplomacy -- which, if you've read it, reread it; if you haven't, read it for the first time -- lays all of this out in his first chapter as he talks about the balance -- the old game of balance of power and interests. And as he predicts that this is more convoluted because of the absence of a structure to really manage and cope with this new order that we face. Those were his words.
So today we are witnessing youth populations, huge youth populations: 65 percent of a country under the age of 30, under the age of 25 in some places; 50 percent under the age of 21; 40 percent under the age of 18 -- unemployed, disenfranchised, except for what globalization has brought them in their capacity to be able to reach out and see what the rest of the world is doing even as they are denied the opportunity to do it too -- an enormous, desperate yearning for education, for jobs, for opportunity. That's what drove Tahrir Square, not the Muslim Brotherhood, not any religious extremism, but young kids with dreams. That's what led that fruit vendor in Tunisia to self-immolate after he grew too tired of being slapped around by a police officer, denied his opportunity just to sell his fruit wares where he wanted to.
We are facing threats of terrorism and untamed growth in radical sectarianism and religious extremism, which increases the challenge of failed and failing governments and the vacuums that they leave behind. And all of this is agitated by a voracious globalized appetite and competition for resources and markets that do not always sufficiently share the benefits of wealth and improved quality of life with all citizens.
And this is all before you get to the challenge of global food security, water availability, and global climate change. These are the great tests of our time. Now, even as our economies in the United States and Europe begin to emerge from the economic trials of the last years, we are not immune to extremism or to the natural difficulties of nurturing democracy, and particularly as we measure what is happening with the number of jihadists who are attracted by the magnet of the Assad regime to Syria, where from Europe and from America and from Australia and from Great Britain and from many other places they now flock to learn the trade of terror, and then perhaps to return to their home shores.
The task of building a Europe that is whole and free and at peace is not complete. And in order to meet today's challenges both near and far, America needs a strong Europe, and Europe needs a committed and engaged America. And that means turning inward is not an option for any of us. When we lead together, others will join us. But when we don't, the simple fact is that few are prepared or willing to step up. That's just a fact. And leading, I say respectfully, does not mean meeting in Munich for good discussions. It means committing resources even in a difficult time to make certain that we are helping countries to fight back against the complex, vexing challenges of our day.
I'll tell you, I was recently in Korea and reminded that 10 of the 15 countries that used to receive aid from the United States of America as recently as in the last 10 years are today donor countries. Think about that: 10 of the 15 and the others are on their way to being donor countries. Now let me be fair. We need to have this debate in America too right now. The small fraction of our budget that we invest in our diplomacy and in foreign assistance is a miniscule investment compared to the cost of the crises that we fail to avoid.
So as a transatlantic community, we cannot retreat and we must do more than just recover -- all of us. What we need in 2014 is a transatlantic renaissance, a new burst of energy and commitment and investment in the three roots of our strength: our economic prosperity, our shared security, and the common values that sustain us.
Now first, our shared prosperity: Who would have imagined at the first Munich conference in 1963 that $2.6 billion in goods and services would flow between us every day? That didn't happen by accident, nor did the 4 trillion that we invest in each other's economies every single year, or the more than 13 million jobs that we support mutually because of it. The depth and breadth of our economic position and partnership was a conscious choice of the men I described and other men and women during that period of time who had a vision, and they need to be a conscious reflection of our vision today.
Today, as our economies recover, we also have to do more to put this indispensable partnership to work, a shared prosperity that benefits us all. And we can start, frankly, by harnessing the energy and the talents of our people, which is what the Transatlantic Trade and Investment Partnership is all about. T-TIP is about more than growing our economies. It will promote trade, investment, innovation. It will bring our economies closer together while maintaining high standards in order to ensure that we create good jobs for these young people who are screaming about the future. And it will cement our way of doing business as the world's gold standard. Imagine what happens when you take the world's largest market and the world's largest single economy and you marry them together with the principles and the values that come with it. It will -- if we're ambitious enough, T-TIP will do for our shared prosperity what NATO has done for our shared security, recognizing that our security has always been built on the notion of our shared prosperity.
We are the most innovative economies in the world, the United States and Europe, and as such we have a major responsibility to deal with this growing potential catastrophe of climate change. I urge you, read the latest IPCC report. It's really chilling. And what's chilling is not rhetoric; it's the scientific facts, scientific facts. And our history is filled with struggles through the Age of Reason and the Renaissance and the Enlightenment for all of us to earn some respect for science. The fact is that there is no doubt about the real day-to-day impact of the human contribution to the change in climate.
Next year, the United States will assume responsibility for the Arctic Council, and I can tell you just looking at what's happening in the Arctic -- and there are others here who are deeply invested in that -- we have enormous challenges. None of them are unsolvable. That's the agony of this moment for all of us. There are answers to all of these things, but there seems to be an absence of will, an absence of collective leadership that's ready to come together and tell our people not what they're necessarily telling us through this crazy social media, incredible confluence of information that they're sort of told they're interested in, but for us as leaders to suggest to them this is what you ought to be interested in because it actually affects your life and your livelihood and your future.
President Obama is implementing an ambitious plan that sees climate change not only as a challenge, but as an incredible set of opportunities for all of us, and I believe that. The marketplace that created the great wealth in our country in the 1990s which saw every single quintile of our income earners see their income go up, every quintile saw their income go up, and we created the greatest wealth the world has seen during the 1990s, greater even in America than the period of the Pierponts and the Morgans and the Rockefellers, Carnegies, Mellons, much greater. You know what it was? It was a $1 trillion market with 1 billion users. It was the high-tech market, the personal computer mostly, communications.
The energy market that we are staring at -- that is the solution to the climate change. Energy policy is the solution to climate change. That market, my friends, is a $6 trillion market today with 4 to 5 billion users today, and it will grow to some 9 billion users over the course of the next 20 to 30 years. It is the mother of all markets, and only a few visionaries are doing what is necessary to reach out and touch it and grab it and command its future.
I spoke last week at Davos about the diplomatic work that the United States is engaged in, that I am engaged in, at the direction of President Obama, who believes in this vision and in all of these issues, and our European partners are jointly with us undertaking on three of the most important initiatives right now to make the Middle East and the world more secure.
With the help of countries like Germany, the U.K., Italy, Denmark, Norway, Russia, we reached an agreement, ratified by the United Nations, to remove chemical weapons from Syria. Obviously, I'm sure there'll be some questions about that, and there ought to be, but together, we need to all keep the pressure on the Assad regime to stop making excuses and fulfill Syria's promises and obligations and meet the UN deadlines.
With the help of the EU, Germany, U.K., France, and Russia -- as well as China -- Iran agreed to freeze and roll back its nuclear weapons program for the first time in a decade. And in the coming months, we will remain unified -- or I hope we will -- to guarantee Iran's willingness to reach a comprehensive agreement that resolves the world's concerns about its nuclear program, hopefully through diplomacy backed up by the potential of force.
With the help of the EU and the Quartet, we are pursuing a long-sought and much-needed peace between Israelis and Palestinians. I have to tell you, the alternatives to successfully concluding the conflict, when you stop and list them, are or ought to be unacceptable to anybody. If you look at it hard, you ought to come out and say failure is not an option, though regrettably the dynamics always present the possibility.
And so together we need to help the parties break through the skepticism, which is half the challenge, and begin to believe in the possibilities that are within their grasp. As President Obama said on Tuesday, "In a world of complex threats, our security and leadership depend on all the elements of our power -- including strong and principled diplomacy." And it depends on harnessing the power of our strongest alliances, too. No one country can possibly hope to solve any of the challenges that I have listed on its own.
That's why this kind of meeting and the alliance that it represents, more importantly, and the work that we do out of here after these meetings -- that's why it's so important that the United States and Europe stick together, that we continue to understand the importance of the strength of our unity and unity in action, whether we're working on Afghanistan, the Central African Republic, the challenge of the Maghreb, the Levant, the DPRK, global challenges like cyber security, infectious disease, or the pursuit of a world without nuclear weapons. Plain and simply, our shared prosperity and security are absolutely indivisible. And in a shrinking world where our fundamental interests are inseparable, a transatlantic renaissance requires that we defend our democratic values and freedoms. Don't for an instant underestimate how important that it is or that the difference that it makes to courageous people like those in the Ukraine, in Ukraine who are standing up today for their ability to have a choice about their future.
As I say all of this, the United States is the first to admit that our democracy too has always been a work in progress. We know that. We're proud that we work at it openly, transparently, accountably to reform it, to fix it, and to strengthen it when needed. President Obama's review and revision of our signals intelligence practices is a case in point. So I assure you we come to this conversation with humility. But humility is not a reason to avoid calling it the way you see it. And the fact is that we see a disturbing trend in too many parts of Central and Eastern Europe and the Balkans. The aspirations of citizens are once again being trampled beneath corrupt, oligarchic interests, interests that use money to stifle political opposition and dissent, to buy politicians and media outlets, and to weaken judicial independence and the rights of nongovernmental organizations.
Nowhere is the fight for a democratic European future more important today than in Ukraine. While there are unsavory elements in the streets in any chaotic situation, the vast majority of Ukrainians want to live freely in a safe and a prosperous country, and they are fighting for the right to associate with partners who will help them realize their aspirations. And they have decided that that means their futures do not have to lie with one country alone, and certainly not coerced. The United States and EU stand with the people of Ukraine in that fight. Russia and other countries should not view the European integration of their neighbors as a zero-sum game. In fact, the lessons of the last half century are that we can accomplish much more when the United States, Russia, and Europe work together. But make no mistake, we will continue to speak out when our values and our interests are undercut by any country in the region. President Obama leaves no doubt about America's commitment to this relationship, and he will come to Europe three times already scheduled this year to reinforce the investment in our shared future.
For more than 70 years -- this year we will celebrate the 70th anniversary of D-Day -- the United States and Europe have fought side by side for freedom, and that is what binds us. Those ties have grown stronger in the 25 years since the fall of the Berlin Wall, in the 15 years since our post-Cold War NATO enlargements began, in the 10 years since the EU began expanding again. It is important to understand this is more than just a measure of years; it is a measure of the most productive partnership in the history of international affairs, nothing less.
Our challenge today is to ensure opportunity, security, and liberty for Americans and Europeans, but also for people all over the world who look to us for that possibility. Our challenge is to renew this partnership and to live up to the legacy of the world's strongest alliance. The 21st century will demand these commitments from all of us, and I believe we have to rise to this occasion as Americans and Europeans always have, and that's the only thing that will give meaning to this kind of a meeting and meaning to the legacy that we need to honor in our generation. Thank you. (Applause.)
My pleasure to introduce to you my friend from the Senate. We are both in different parties, but believe me, we share a vision and we are really enjoying working together these days. Chuck Hagel, the Secretary of Defense. (Applause.)
SECRETARY HAGEL: John, thank you. Thank you very much, and to Ambassador Ischinger, thank you for once again hosting this conference, an important conference. It's good to be back in Munich. As you noted, I have been here many times, and I especially appreciate being here with my friend and former colleague and now cabinet partner John Kerry.
I want to also recognize our United States congressional delegation, which I have been part of a number of times, led by an unfamiliar face here, John McCain. John, I see you. Thank you. Sheldon Whitehouse, Senator, thank you for your leadership. And many of the delegation are individuals who have led on this issue for many years, and you are all quite familiar with most of the U.S. congressional delegation. So thank you for your continued leadership and involvement.
I also want to recognize our American Ambassador to Germany John Emerson, who is here somewhere, for his work and his efforts. And it is not easy, as we all know, for an ambassador in any country at any time, but Ambassador Emerson has done a tremendous job and we very much appreciate his good work and his leadership as well. (Applause.)
In preparing for these remarks, I was looking through the memoirs of Henry Stimson, who over a long and distinguished career held both my job -- actually, he held my job when it was Secretary of War, and he held it twice. He also held John Kerry's job, Secretary of State. The book I thumbed through contained a handwritten letter from McGeorge Bundy. Many of you know -- knew McGeorge Bundy, worked with McGeorge Bundy, and certainly, everyone knows who he was. He helped in this particular case Henry Stimson write his memoirs, and that book was published in 1952.
In Bundy's letter to an admirer, Bundy described Stimson's recollections of life as a picture of history worth going on with, whatever the ups and downs. I recall these words here in Munich this morning because this conference is itself a picture of history, the history of the transatlantic partnership. And that history is very much worth going on with. That's why we're celebrating this gathering's 50th anniversary.
The transatlantic partnership has been successful because of the judicious use of diplomacy and defense. Over the last year, John and I have both worked to restore balance, balance to the relationship between American defense and diplomacy. With the United States moving off a 13-year war footing, it's clear to us, it's very clear to President Obama that our future requires a renewed and enhanced era of partnership with our friends and allies, especially here in Europe.
As this panel acknowledges, we need what John just described and as Ambassador Ischinger has noted, a transatlantic renaissance. The foundation of our collective security relationship with Europe has always been cooperation against common threats. Throughout most of the 20th century, these common threats were concentrated in and around Europe, but today the most persistent and pressing security challenges to Europe and the United States are global. They emanate from political instability and violent extremism in the Middle East and North Africa, dangerous non-state actors, rogue nations such as North Korea, cyber warfare, demographic changes, economic disparity, poverty, and hunger.
And as we confront these threats, nations such as China and Russia are rapidly modernizing their militaries and global defense industries, challenging our technological edge in defense partnerships around the world. The world will continue to grow more complicated, interconnected, and in many cases more combustible. The challenges and choices before us will demand leadership that reaches into the future without stumbling over the present. Meeting this challenge of change will not be easy, but we must do so and we must do so together. As our strategy in defense investments will make clear, the U.S. sees Europe as its indispensable partner in addressing these threats and challenges, as well as addressing new opportunities.
The centerpiece of our transatlantic defense partnership will continue to be NATO, the military alliance that has been called the greatest peace movement in history. In Afghanistan, NATO-led forces are doing extraordinary work to help the Afghan people by strengthening the Afghan army and police so that they can assume responsibility for their nation's security. European nations have maintained remarkable cohesion and commitment in the face of sacrifice, uncertainty, and challenges in Afghanistan.
As we bring our combat mission to a conclusion after 13 years, we should all be very proud of what our alliance has accomplished. Members of the International Security Assistance Force, especially smaller nations, have greatly benefited from the experience of training and working alongside other partners in Afghanistan. We must continue to hone the capabilities we've fielded and sustain these deep and effective defense relationships. And NATO must continue to develop innovative ways to maintain alliance readiness as we apply our hard-earned skills to new security challenges.
In reviewing U.S. defense priorities tempered by our fiscal realities, it's clear that our military must place an even greater strategic emphasis on working with our allies and partners around the world. That will be a key theme of the Department of Defense's upcoming Quadrennial Defense Review which will articulate our defense strategy in a changing security and fiscal environment.
The United States will engage European allies to collaborate more closely, especially in helping build the capabilities of other global partners. We're developing strategies to address global threats as we build more joint capacity -- joint capacity with European militaries. In the face of budget constraints here on this continent as well as in the United States, we must all invest more strategically to protect military capability and readiness.
The question is not just how much we spend, but how we spend together. It's not just burdens we share, but opportunities as well. The Department of Defense will work closely with our allies' different and individual strengths and capabilities, from the training of indigenous forces to more advanced combat missions. We're looking at promising new initiatives, including Germany's framework nations concept, which could help NATO plan and invest more efficiently and more effectively.
In Africa, the U.S. military and our European allies are already partners in combating violent extremism and working alongside our diplomats to avert humanitarian catastrophes. In Mali, in the Central African Republic, the U.S. and European partners are providing specialized enablers such as air transport and refueling. We're there to support a leading operational role for French forces. The U.S. has supported France's leadership and efforts. And we also welcome the German Defense Minister von der Leyen's recent proposal to increase German participation in both countries.
All of us must work closely together with African nations in helping them build their security forces and institutions. A more collaborative approach to global security challenges will require more defense establishments to cooperate not just on the operational level, but on the strategic level as well. We are working with two allies -- the U.S., UK, and Australia, building the three of us closer collaboration between our militaries across a broad range of areas from force development to force posture.
For example, the United States is helping the UK regenerate its aircraft carrier capability, which will enable more integrated operation of our advanced F-35 fighters and more broadly enhance our shared ability to project power. And last year, an Australian army officer became the deputy commanding general of U.S. Army forces in the Pacific. This is helping connect our forces more strategically with our allies and partners in the regions.
We believe this collaboration offers a model -- a model for closer integration with other allies and partners, including NATO as a whole, and it'll influence U.S. strategic planning and future investments. Sustaining and enhancing these cooperative efforts will require shared commitment and shared investment on both sides of the Atlantic. That includes United States commitments to a strong military posture in Europe.
Since the end of the Cold War, the United States has continuously adjusted its defense posture to new strategic realities around the world. As our force structure draws down following the end of our longest war, there will be, there must be, adjustments in our posture to meet new challenges. For example, to respond to elevated threats to our diplomatic facilities in North Africa and the Middle East, we have partnered with Spain to position U.S. Marines in Moron, and we have put other forces throughout the region on heightened alert status. These forces not only enable us to respond to crises or support ongoing operations, but they also expand our diplomatic options amid the recent violence in South Sudan. The rapid availability of nearby forces allowed American diplomats to remain on the ground and help broker a ceasefire.
An important posture enhancement is European missile defense in response to ballistic missile threats from Iran. Over the last two days, I've been in Poland, where I reaffirmed the United States commitment to deploying missile defense architecture there. As you all know, that's part of Phase 3 of our European Phased Adaptive Approach. Yesterday afternoon, the USS Donald Cook departed the United States for Rota, Spain, where over the next two years she will be joined by three additional missile defense-capable destroyers.
Despite fiscal constraints, the budget that we will release next month fully protects our investment in European missile defense. Our commitment to Europe is unwavering. Our values and our interests remain aligned. Both principle and pragmatism secure our transatlantic bonds.
In 1947, a time of widespread doubt about the continued value of the transatlantic partnership, Henry Stimson argued that America could, in his words, no sooner stand apart from Europe than desert every principle by which we claim to live. He helped persuade Americans that, in his words, our policy toward the world -- in that policy, "There is no place for grudging or limited participation Foreign affairs are now our most intimate domestic concern." Americans know well the wisdom in Stimson's warning. We also know well the responsibilities we shoulder in partnership with all of you.
As President Obama told the American people in his State of the Union Address this week, our alliance with Europe remains the strongest the world has ever known. I have every confidence that our successors will be there 50 years hence to again celebrate the most successful and effective collective security alliance in history. But as we all know, it will require continued strong and visionary leadership, attention, resources, and strong commitment.
In 2064, there will still be a Wehrkunde, and there will still be a strong and enduring transatlantic alliance. Thank you. (Applause.)
AMBASSADOR ISCHINGER: Thank you very much, Mr. Secretary. We have not a lot of time, so we'll call on a few questions. I have a huge number of cards, and I apologize -- I have to apologize to most of those who have written down their questions. We can literally take two or three or maximum of four depending on the length of the answers.
Let me start with a question of my own, which I'd like to address -- (laughter) -- to Secretary Kerry. We had the very interesting panel discussion yesterday between Tzipi Livni and Saeb Erekat, who were both sitting right here in the first row with Martin Indyk, on the situation as where we are right now. How optimistic are you that you can actually nail this down? Question one.
And if I may add one to you, Mr. Secretary of Defense, a couple years ago, one of your predecessors, Bob Gates, gave a pretty strong valedictorian speech admonishing us, European allies, to do more, because if we didn't do more, we would be not as useful as your allies as we should be. Now, are you today as unhappy as Bob Gates was with us?
Maybe we start with the Secretary of State.
SECRETARY KERRY: Well, Mr. Ambassador, I am willing to take risks, but I'm not willing to hang myself here. (Laughter.) So I'm not going to tell you how optimistic I am. I'm going to tell you that I'm hopeful. I believe in the possibility or I wouldn't pursue this. President Obama believes in the possibility. I don't think we're being quixotic and un -- I'm a little surprised by some of the articles that tend to write about an obsession or a fanatical effort to try to achieve this, et cetera. We're just working hard. We're working hard because the consequences of failure are unacceptable.
I mean, I want you all to think about it. Ask yourselves a simple question: What happens if we can't find a way forward? Is Fatah going to be stronger? Will Abu Mazen be strengthened? Will this man who has been committed to a peaceful process for these last years be able to hold on if it fails? What is the argument for holding on? Are we going to then see militancy? Will we then see violence? Will we then see transformation? What comes afterwards? Nobody can answer that question with any kind of comfort.
By the same token, for our friends, I see good Minister Tzipi Livni here, who has been absolutely spectacular in this process, committed to it. Prime Minister Netanyahu has taken very tough decisions to move this down the road, very tough decisions, as has President Abbas, who had the right to go to the United Nations and has foresworn it in an effort to try to keep at the table and keep the process moving.
For Israel, the stakes are also enormously high. Do they want a failure that then begs whatever may come in the form of a response from disappointed Palestinians and the Arab community? What happens to the Arab Peace Initiative if this fails? Does it disappear? What happens for Israel's capacity to be the Israel it is today -- a democratic state with the particular special Jewish character that is a central part of the narrative and of the future? What happens to that when you have a bi-national structure and people demanding rights on different terms?
So I think if you -- and I'm only just scratching the surface in talking about the possibilities, and I've learned not to go too deep in them because it gets misinterpreted that I'm somehow suggesting, "Do this or else," or something. I'm not. We all have a powerful, powerful interest in resolving this conflict. Everywhere I go in the world, wherever I go -- I promise you, no exaggeration, the Far East, Africa, Latin America -- one of the first questions out of the mouths of a foreign minister or a prime minister or a president is, "Can't you guys do something to help bring an end to this conflict between Palestinians and Israelis?" Indonesia -- people care about it because it's become either in some places an excuse or in other places an organizing principle for efforts that can be very troubling in certain places. I believe that -- and you see for Israel there's an increasing de-legitimization campaign that has been building up. People are very sensitive to it. There are talk of boycotts and other kinds of things. Are we all going to be better with all of that?
So I am not going to sit here and give you a measure of optimism, but I will give you a full measure of commitment. President Obama and I and our Administration are as committed to this as anything we're engaged in because we think it can be a game-changer for the region. And as Foreign Minister Abdullah bin Zayed said -- he's here somewhere -- to a Paris meeting of the Arab League the other day, spontaneously he said, "You know, if peace is made, Israel will do more business with the Gulf states and the Middle East than it does with Europe today."
This is the difference of 6 percent GDP per year to Israel, not to mention that today's status quo absolutely, to a certainty, I promise you 100 percent, cannot be maintained. It's not sustainable. It's illusionary. There's a momentary prosperity, there's a momentary peace. Last year, not one Israeli was killed by a Palestinian from the West Bank. This year, unfortunately, there's been an uptick in some violence. But the fact is the status quo will change if there is failure. So everybody has a stake in trying to find the pathway to success.
The final comment I would say, Mr. Ambassador, is after all of these years, after Wye, after Madrid, after Oslo, after Taba, after Camp David, after everything that has gone on, I doubt there's anyone sitting here who doesn't actually know pretty much what a final status agreement actually looks like. The question is: How do you get there? That's political courage, political strength, and that's what we have to try to summon in the next days. And I'll just tell you I am hopeful and we will keep working at it. And we have great partners of good faith to work with, and I'm appreciative for that.
AMBASSADOR ISCHINGER: Thank you very much. Thank you. (Applause.)
SECRETARY HAGEL: Ambassador, thank you. Let me just add a couple of sentences to what Secretary Kerry said. First, I enthusiastically support what Secretary Kerry is doing. We all know there is risk in everything. There is risk in status quo. The risk is always there in anything in complicated areas of the world. But I believe there is far more risk in letting this slide.
I noted in my comments that -- not in the context of this particular issue but overall on security issues, it's going to continue to take -- as the world is very instructive on this point and the history has been particularly instructive -- committed leadership and vision to address any big challenge. And as much risk and uncertainty that is in this one, I do strongly applaud and support what John's doing here. It's clearly in everyone's interest.
As to your question, Secretary Gates may have said it a little differently than I did, but essentially, I said the same thing as Secretary Gates did. This is a partnership. Partnerships mean partnership. Everybody has to participate. Everyone has to contribute. Everybody has a role to play. Because not only is something new today with restrained resources in everyone's budgets. I get that, the realities of what we're each dealing with in our own respective countries, own respective political dynamics and dimensions -- but if your nation's security is not worth an investment, is not worth leadership in fighting for that investment, then you've got the wrong leadership or -- again, history's been instructive on this point -- then the future of that country is in some peril. It's going to take some courage and vision and strong leadership to make this point clear to all of our constituents. And the Europeans must play their role as well. Thank you.
AMBASSADOR ISCHINGER: Thank you very much. Among the many questions that were handed to me, there are two that are almost identical, and I'm going to take these two together.
The first one is from Lord Powell from the UK, and they're both on the T-TIP. Now, they're both addressed to both of you as former senators, and I read the first question from Charles Powell: "T-TIP is indeed vital, as Secretary Kerry says. Is it achievable now that the Senate majority leader intends to deny the President fast-track trade promotion authority?"
And the other question is from an American, Charles Kupchan from Georgetown University. Professor Kupchan raises the following question: "T-TIP is "the next big thing' for the Atlantic relationship. As former senators, please discuss the prospects for congressional support, especially in light of Senator Reid's recent comments."
This is exactly the same question. I don't know which one of you wants to take that one.
SECRETARY KERRY: Well, I don't -- look, I respect Harry Reid. I've worked with him for a long time, obviously. Our colleagues are here -- Lindsey Graham and John McCain and former Senator Joe Lieberman. And I think all of us have learned to interpret a comment on one day in the United States Senate as not necessarily what might be the situation in a matter of months or in some period of time.
Let's get T-TIP done, put it in its context, then we wage the fight. And I'm not at all convinced that what we've heard is going to -- I just think that there's a lot of room here still, so I wouldn't let it deter us one iota, not one iota. I've heard plenty of statements in the Senate on one day that are categorical, and we've wound up finding accommodation and a way to find our way forward. So this should not be a deterrent, and I hope nobody will let it stand in the way.
On the merits, this is a major initiative for us, for Europe, for the relationship, for the world. And when you combine it with the TPP, it really has a capacity to achieve what the WTO has not been able to succeed in, and it could have a profound impact on jumpstarting the economies for all of us. It's worth millions of jobs, and in the end, jobs are a very powerful political persuasion.
SECRETARY HAGEL: This TPP is clearly in the self-interest of both sides of the Atlantic, clearly. And I would suspect that our senators here this morning would have a better sense of this than two former senators, but this is a good example of what I was referring to in my remarks about let's be smart and let's be wise and let's be collaborative and use all of the opportunities and mechanisms that we have to enhance each other -- culturally, trade, commerce, exchanges.
We all know that a secure economic base -- a dynamic, strong economy -- is the anchor of any nation's freedom. Without the money, without the resources, your options become very limited very quickly. So I would hope that this would get done by the United States Senate. It's clearly in everyone's interest. Thank you.
AMBASSADOR ISCHINGER: Thank you very much. I have one concluding question because we have already run out of time for a while. This is from Jo Joffe, whom both of you know. His question is the following, and I read it: "The U.S. keeps going through cycles of withdrawal. Is this another one? And if so, who is going to mind the store?"
A question addressed, again, to both of you.
SECRETARY KERRY: Well, I think -- look, I think everything I said in my comments make it clear -- and I said it at Davos -- we're not withdrawing from anything, folks, except we're drawing down our troops in Afghanistan because that's an agreed-upon approach with ISAF, some 50 nations, and because it is time for the full transition to the Afghan Armed Forces and the Afghan people. So that's a planned process, but it is also contemplating maintaining a presence for the purpose of continuing to train, equip, and advise the Afghan Armed Forces and to maintain a platform to do counterterrorism. So we're hardly withdrawing; we're transitioning.
Even as we do that, right now we have just finished helping to conclude a ceasefire in the Sudan. I spent most of the Christmas break on the phone with President Kiir, former Vice President Riek Machar, with the foreign minister and prime minister of Ethiopia, the president of Uganda. That's not disengagement. In the Great Lakes, we have a special envoy who has just succeeded in working with Mary Robinson of the UN and with President Kabila and Paul Kagame. And we have succeeded in disarming the M23, creating a structure by which we will now be able to begin doing development and helping those nations to stabilize.
We're working in the Central African Republic and we're working to help the French in Mali. We are deeply engaged in Iran negotiations for some two years. We have been working -- I began that work as a United States senator to begin to open up that opportunity of a dialogue. We have an interim first-step agreement -- not an interim agreement -- a first step to lead to final conclusion. We are working with Geneva II, with Russia. That came from diplomacy and cooperation. And we are trying to press for transition. I think we need to do more. John McCain, Senator Graham and I are talking. There are powerful feelings for why we believe Assad needs to feel even more sense of urgency to come to the table. We're deeply involved there.
We're deeply involved in the Middle East peace process. We're involved with the Emirates, with the Saudi Arabians, and others working with respect to Egypt and Egypt's transition. We're rebalancing with Asia. We're working on North Korea. I will be in China in two weeks working on the North Korean issue, working with Korea, Japan, reunification -- you name the issue -- South China Sea.
I can't think of a place in the world that we are retreating, not one. And I believe we are engaged in a profoundly proactive and visionary way to try to give life to this partnership in ways that make a difference. We're working in Libya. We're working together with our friends from Italy, Great Britain, and France to stabilize and work with President -- with Prime Minister Zaydan to build a legitimate security force. We're deeply engaged in that training and otherwise.
So as I think -- I mean, there isn't a part of the world that I can think of. We're working on Cyprus quietly. You're not hearing about it. We're working on Nagorno-Karabakh, the Caucasus. We have an extraordinary amount of diplomatic reach at this particular moment, including in Latin America. And most recently, I just concluded a summit with the foreign minister of Mexico and the foreign minister of Canada leading up to a summit between the president and the prime minister which will further cement the North American hemispheric interests and our work on the TPP and the T-TIP.
So I think this narrative, which has, frankly, been pushed by some people who have an interest in trying to suggest that the United States is somehow on a different track, I would tell you it is flat wrong and it is belied by every single fact of what we are doing everywhere in the world.
SECRETARY HAGEL: I would just add, Ambassador -- (applause) -- that we have just heard the Secretary of State of the United States inventory some of the things we're doing, some of the places we've been. I have never seen a full inventory of exactly what we're doing everywhere, but I would venture to say the United States is more present doing more things in more places today than maybe ever before. How we're doing it is differently, and it's what I talked about, what John talked about -- capacity-building for our partners, working closer with our partners, being able to do more as we are more creative with these initiatives.
So we're not going anywhere, and I would just add this as I end my comment. I've been Secretary of Defense almost a year. I have had three major trips to the Asia Pacific. I have had countless trips to Europe. I've had a number of trips to the Middle East, Afghanistan. He's the traveler. I'm not. But when you have a Secretary of Defense dealing with the things that we're dealing with in the Pentagon, with budget restraints and force posture reductions and so on, and still we in DOD are doing the kinds of things we're doing with our combatant commanders to assist our diplomatic effort, which I talked about, we're doing a lot of things all over the world. And if that narrative is not getting out there, then maybe that's our fault, but I hope no one will leave here with any kind of misunderstanding that somehow we're withdrawing from the world or we're doing limited work. It's just the opposite.
SECRETARY KERRY: Mr. Ambassador, can I just add to that important areas? We just concluded a security -- a High-Level Strategic Dialogue with Pakistan. And I've just concluded, as you know, some two months ago a negotiation with President Karzai for a bilateral security agreement, which we are waiting for a signature for. But we continue our anti-terror initiatives not just there, but in Yemen, in many other parts of the world, and particularly now, we are focusing in on Syria where there are increasing numbers of extremists. And so I think you'll be hearing and seeing more of this over the course of the next weeks and months. But I think Chuck may be right; I think we need to be more assertive about what we are doing.
AMBASSADOR ISCHINGER: Thank you very much. Thank you also, both of you, for deciding to show up here jointly together. I can't think of a better demonstration of the commitment of the Obama Administration to keep the transatlantic link, keep the transatlantic relationship strong and alive. So thank you for that strong message here today. Let's give these two gentlemen a hand. Thank you very much. (Applause.)