Thank you Joe. I appreciate your kind words of introduction and I appreciate all the courtesies that have been extended to me in the very few hours that I've been here in Provo. I'm most grateful for them starting with being met at the airport by Richard and the very excellent dinner that we just had with the president of the university, some of the trustees, the founder of the Wheatley Institution, and the former president of the university so this has really been quite a treat for me. I've tried to learn a little about what your institution does and the reach that you seem to have, and I guess that your community seems to have around the world because everybody gets an opportunity at some kind of service abroad. To me, that's music to my ears. I wish more Americans had that kind of experience. I cannot tell you how many times I would sit in a National Security Council meeting when I was either the director of national intelligence or deputy secretary of state and I looked around the table and I asked myself, "How many of these people—here we are talking about global issues—how many of them have lived abroad?" And well, there was myself, I knew that. Then I looked and I said, "Well the military they probably have, that sort of goes with the territory: you serve abroad, but you usually either live in a trench or you live in a tent, or you live at a military base, you're usually not living in the economy." But it was striking to me how few of the others had actually lived abroad. So I just think that that's a valuable experience to prepare individuals for working in modern times when we are so interdependent in this world. Ninety-five percent of the world's population lives somewhere else besides the United States. I joined the Foreign Service in 1960; it was the very end of the Eisenhower administration. My first commission as a foreign service officer was signed by Dwight D. Eisenhower and then I spent 37 years in the service, left for four years to go to the private sector, and then when George W. Bush was elected, he invited me back to serve as ambassador for the United Nations and then I ended up having a sequence of jobs in the Bush administration for which I will be ever grateful to President Bush for having given me the opportunity first as UN ambassador, then as ambassador to Iraq, then as the first director of national intelligence, and lastly I ended my career as the deputy secretary of state.
I had nine postings abroad during the course of my career on four different continents. The concentration of my career was in Asia and in Latin America. I served in Hong Kong—that was my first assignment—I served in Vietnam when the Vietnam situation was heating up, back in the early 1960s. I was asked if I wanted to volunteer for that, and I did, and it turned out to be a career-defining experience for me. In fact so career-defining that I couldn't get away from it. I spent almost four years in Vietnam and then I got recruited to be in the Paris Peace Talks on Vietnam, and then I thought I'd gotten away from it and no, no. Henry Kissinger wanted me to come and work on the National Security Council where I was his director for Vietnam during the time that we negotiated the final withdrawal agreement in 1973 which we signed in early 1973. I've also had policy jobs, in Washington, I mentioned one the directorship for Vietnam and the National Security Council I was the deputy national security advisor at one point and as was mentioned I was the deputy secretary of state and then I had this excursion into intelligence being the director of national intelligence and a number of people asked at the time, "Well what the heck, why are they putting an ambassador, a diplomat in charge of overseeing our intelligence community?" But in fact the disciplines are related: they're interrelated. The diplomats rely on intelligence, to start with, to gain better understanding of circumstances and situations and people, and they also generate a certain amount of intelligence through their diplomatic reporting because one of our principal functions as foreign service officers particularly in the earlier stages of our career is reporting an analysis, really interesting things to do actually.
When I was in Vietnam as a young officer, I was a provincial reporting officer and I covered seven different provinces in Vietnam. And I'd go out one week: I'd visit a province, I'd collect economic, political, military, social information, and then I'd come back—we didn't have the internet of course and Blackberries and all of that—I'd have to come back to Saigon and write up my report on a yellow legal pad and then a secretary would type them up and we'd cable them in to Washington, get my laundry done and then go back out the following week again and visit another province. And so it went. But our reports you know, it turned out that if you go out, spend time talking to people maybe the first time you go out and just get a rough idea what's happening, but once you've visited a province for the fifth or sixth time, you become pretty familiar with what's going on. So that was an important part of my career, and I think it related and it helped me in my job as setting up this new directorate of national intelligence, as did the fact of having run five different embassies where we had intel people serving and where I'd had a lot of interaction with them there. So in these what turns out to be 44 years in total in government, I thought I'd start first of all we'll get to the current situation but I was trying to disstill as I was flying here from Washington today, what are some of the lessons that I've drawn from a career in national security and I wanted to lay a few of these out here for your consideration.
The first, and I think is an important one, is that we are still the richest and most powerful nation in the world. Sometimes the way I hear people talk about current events I think people lose sight of that fact. We're not on our back foot; we're not on our heels; we're not a country in decline. Sure, like everybody else we suffered from the economic setbacks of 2007 and 2008 and the whole financial crisis, but I think that's well on the way to resolution. And our economy is still by far the strongest in the world. China is definitely giving us a run for the money and one day in aggregate terms I think perhaps the Chinese GDP, even in our lifetimes, could be larger than ours, but the per capita income, as you know, is going to not compare in any way. And when you think of the quality of life in China, they also have a long way to go, although I don't want to deprecate the great lengths that China has come since the reform era of 1978 launched by Dang Xiao Ping in the late 1970s. But if you think about it, the United States has been the world's largest economy probably since sometime in the latter part of the 19th century. That's when we overtook Great Britain as the world's largest economy, and it's kind of interesting to see that we didn't immediately adopt a political role commensurate with our economic strength. It seems that that requires a certain political maturation process that took place and really we ended up being launched up on the world scene as a result of our involvement in World War I and the role we tried to play in the post-war settlement to Woodrow Wilson and so forth. Of course, our leadership role became categorically apparent, if you will, in World War II both in the conduct of that war and in the post-war arrangements that were negotiated, the creation of the United Nations, the Bretton-Woods Economic Agreements and so forth. And we played a strong leadership role ever since in the Cold War of course, instrumental in leading ultimately to the demise of the Soviet Union and that brings us of course to today, and we'll get back to the current situation shortly.
But the second point that I'd like to make is I've learned through my 44 years in the Foreign Service the incredible importance of the role of the President in the direction and execution of our foreign policy and of our national security policy. I'm not sure that in some countries there's quite the appreciation of how concentrated the power of the President and how important Article II of the Constitution is in terms of carrying out our national security and foreign policies abroad. To be sure, the congress has policy making roles, and it has a power of the purse, but when push comes to shove, it is really the President who provides the leadership and the direction. History is, of course, replete with examples of this going all the way back to the beginning of the republic through the Civil War through the First World War through the Second World War and through the Cold War and up to this very day. An interesting point about this is that unlike a parliamentary system, let's say in Great Britain, where a prime minster may have had a whole bunch of other cabinet positions beforehand and be deeply involved in the formulation of government policy, a President can sometimes arrive in his first term in office with practically no foreign policy experience with the hope and intent of having a strong domestic agenda and the hope of keeping the foreign policy issues a little bit on the back burner, if you will.
Woodrow Wilson wrote a note to himself in one of his diaries that he hoped that problems over there in Europe weren't going to interfere with his plans for domestic reform. Well he got some domestic reform done to be sure, particularly the Federal Reserve Bank and a few other things, but he was definitely up to his neck in foreign policy issues once the United States entered World War I and then of course with the whole end of his life—his active life—was devoted to trying to restore peace through the Versailles process and the negotiations at the end of World War I. Bill Clinton in his first inaugural address, I think he had one sentence about foreign policy. And in some respects the current president had hoped to sort of push the foreign policy and the national security agenda a little bit to the back so that he could put his domestic agenda in the forefront and in one sense, he really had reason because we were coming through this enormous financial crisis. And he wanted to get Iraq and Afghanistan behind us but, about which we'll talk a little more later.
Another lesson from my experience has had to do with the role of diplomacy and the role of the ambassadors. When you think of diplomacy, let's say on the grand scale, you think of major treaties, major diplomatic accomplishments, some of which were absolutely extraordinary, of extraordinary importance for our country; the Louisiana Purchase for example, which Thomas Jefferson executed. The purchase of Alaska by Seward—what a good deal! Was it 7 million dollars for Alaska? There've also been some notable failures: the Treaty of Versailles that we were talking about earlier.
But at a different level, perhaps a little bit more mundane, what people like myself are more used to, diplomacy is a day-to-day activity. Conducted by the United States government principally by the Department of State, although there are other agencies of our government, such as the U.S. Trade Representative, or the Defense Department that carry out (the Commerce Department) extensive, myriad transactions literally every day with counterparts around the world. I can't tell you how complex—just to take one embassy for example: I was our ambassador to Mexico for four years—a relationship such as that can be. When I had my staff meeting every day in Mexico City, there were 33 different federal agencies represented at my daily staff meeting. So think about all the different things: border, customs, multiple law enforcement agencies, the FBI, the DEA—all these people had representatives in my embassy and were carrying out relationships with their counterparts and trying to make arrangements so that we could have a smoother and more beneficial—mutually beneficial—conduct of the relationship between our two countries. Not to mention the fact that at the same time we were having a major free trade negotiation with Mexico which ultimately lead to the creation of the North American Free Trade Agreement.
Sometimes people ask me, "Well gee, with modern communication and all these things, aren't ambassadors irrelevant? I mean, aren't you just a messenger boy? Can't all this business be conducted now directly between the President on the one hand and his counterpart on another with the secretary of state can call his counterpart?" Well, there's a certain amount of truth to that, but not that much. And why do I say that? First of all, any country, certainly one of the stature of the United States, is going to want to have people on the ground who can give a faithful, reliable, in-depth assessment of what is happening in that country to understand the different factors and currents and cross-currents that are at work. And you can't do that from a great distance; you think you might be able to, but all of you know that there's an enormous difference to understanding a situation virtually, let's say teleconference, or an email or a telegram, as opposed to being right there and knowing the person that you deal with.
I used to , when I was deputy secretary, attend part of the orientation of the ambassadors who were going abroad for the first time (they were going abroad as ambassadors for the first time,) and a number of them were political appointees and I said, "Don't forget you cannot advocate that your eyes-and-ears-responsibility to your deputy or to anybody else because if the President of the United States visits your country, the country that you're assigned to, when he arrives at the airport, he's going to jump into his limousine and bring you in with him, and he's going to expect you to give him the top notch briefing on the current situation before 45 minutes later he's going to meet the president or the host leader of the country which he's visiting." So you're the eyes and ears, you're the faithful understanding of the place and you can pass and can do a fair amount of the negotiation, clearing away of the underbrush, teeing up agreements so the higher level people can move in at the later stage when you're coming to closure. There are a lot of different things that ambassadors can and will do and I think in some respect, particularly if Washington has confidence in an ambassador, it's quite surprising how much latitude and leeway they have in carrying out and in implementing and even formulating American policies.
So let me talk just a little bit about today's global picture and maybe I can start by talking a bit about what I think are the fundamentals of foreign policy. It seems to me that when we go out to represent our country or we're in the state department, the things that we think about the most are the security and safety of the United States, the prosperity and the well-being of our country, the faithful representation, if you will, of our political and economic values, our commitment to democracy, and our commitment to free-market systems. And all of these things start at home. I mean, if we don't have a strong military and a strong security establishment, if we don't have a healthy and strong economy, the rest may not matter that much. That, it seems to me, is the indispensable precondition for an effective and successful national security policy. Now supplementing that, I'd say that the next most important thing is our alliances. It's very important to keep our friendships and our alliances in good shape. We have some absolutely critical alliances around the world that really have been a cornerstone of our international security policy for generations ever since the beginning of the Cold War. So I suppose you'd say foremost amongst those alliances is an alliance with NATO which is now 26 countries. And then there's the alliance with Japan, probably the most important relationship that we have, certainly the most important security relationship we have in the Asia-Pacific region, and then with South Korea, another treaty ally, and then the Philippines and Thailand, which also happen to be allies, and Australia. Along with these security arrangements that we have with these countries, we have a network of economic relationships, which I mentioned briefly earlier on the Bretton-Woods system that was established after World War II that set up the World Bank, the IMF, the different regional banks, and so forth, but we also have these free trade arrangements. We have free trading agreements with some 23 countries around the world, I believe. Certainly important amongst those is the North American Free Trade Agreement, agreements we have with some countries in the Middle East, in Jordan, Israel, Morocco, an agreement with Australia, an agreement with South Korea, and several others—in Latin America as well: Panama, Peru, Chile—the Central American countries.
That is kind of a network, an economic network of countries that have a likeminded view and a philosophy towards investment for example, and settlement of disputes and transparency of economic arrangements and freedom of trade, of course. There are two major trading arrangements that are being negotiated at this very moment that are of strategic importance. There's the Trans-Pacific Partnership which is being negotiated among some 12 countries including Japan and Vietnam, several other Southeast Asian countries—and then Mexico and Columbia and Canada it adds up to twelve in all—Malaysia. And there's a Transatlantic Trade and Investment Partnership that is being negotiated between the United States and the European Union. So if you think of it, if you take in addition to the 23 or so free trade agreements already, and then you add these two mega-arrangements—one in the Atlantic and one in the Pacific—we're really moving fast towards the notion of linking major parts of the world together economically.
But this still does leave, if you look at this alliance framework and the different economic arrangements, it still does leave a bit of a gap. And what is that gap? The gap is some of the rising powers that are not necessarily part of these arrangements that we're talking about. I suppose foremost among which you'd have to mention the country of China and you'd have to certainly mention Russia, especially in light of some of the issues that have arisen with Russia in recent months. And you would have to mention or raise a number of other parts of the developing world. And what I would say is when you move outside the area of our alliances and close economic relationships, really you have two categories of countries: You have these rising countries China, Russia, India, Brazil—the BRICs, actually, they call themselves by the acronym the BRICS; they formed an association with each other—Brazil, Russia, India, China, and South Africa. And then, in addition to these rising countries, you have the ones that are in a little more trouble. There I think you'd have to talk about major parts of the Middle East, many of which are not adequately integrated with the rest of the global economy and which have been subject to extraordinary instability and violence in the past couple of decades.
So now, within this group of countries and issues, where do we stand today, and what are the problems that are really posing the greatest challenge to American foreign policy? I guess I would have to start with the Middle East. It's a toss-up: sometimes the Mid-East with international terrorism, sometimes I wake up in the morning and I think that the Russian problem in the Ukraine is more serious than the problem of the Middle East and terrorism, and then I oscillate back and forth depending. I think a lot of people have the same ambivalence about which problem is more challenging, but they're both difficult. Let me start with the Middle East.
When I was ambassador to Iraq, of course we had close to 100,000 troops there and we had a large assistance program, but that was back in 2004 and 2005. At the end of 2011, we withdrew the last United States combat troops and I think since that time, the situation in Iraq has deteriorated considerably. And I think perhaps one of the most important contributing—no, I think there were two contributing factors. One is the fact that we left; I think it was a pity that we were not able to negotiate the continued presence of a small, residual force to provide needed intelligence support, logistic support, advice, and so forth; it didn't have to be a large force, but it would have been good if we could have kept 10-15-20,000 troops there in an advisory and support role, not a combat role. But the truth of the matter is the Iraqi government didn't want it. And it was too neuralgic a political issue for them. If they had signed this so-called Status of Forces Agreement with us that would have permitted these troops to stay, they would have had to pass it through their congress, and there were elements in their congress that would have simply filibustered any kind of possible residual forces agreement with the U.S. so we left.
The other complicating factor was that the situation in Syria started to deteriorate, as we all know, and the old al-Qaeda in Iraq group, that's the group that was there and very active when I was in Iraq, had morphed itself into what today we call ISIS or ISIL: the Islamic State in Iraq and Syria. They developed a certain amount of strength in Syria, then they started sending people over to Iraq and then eventually in recent months they've developed control over significant spots of territory between the two countries to the point that we woke up a couple of months ago and lo and behold, this ISIL was starting to practically march down the two main rivers, the river arteries of Iraq, the Tigris and the Euphrates rivers. They captured Mosul; they captured Fallujah. They've captured other places. All of a sudden people were asking themselves, "Oh my goodness, are they going to be in Baghdad tomorrow or something?" And at that point, that combined with a couple of these absolutely ghastly, horrific executions of the prisoners that they've captured sort of energized American, and I think, Western and Arab reaction generally, so that we got to the point in recent weeks the President has really done pretty much an about face with respect to the policies that he'd been conducting there before. First of all, he's prepared to countenance and has already begun carrying out some air attacks in Syria, which you'll remember a year ago he was on the verge of doing and then decided not to, pulled back from it, to the surprise of many and to the disappointment of quite a few. And he sent some not combat troops, not in the sense of large infantry units that are going to go do the fighting themselves, but he has sent troops back to Iraq to provide an important support role to the Iraqi and Kurdish forces in that country to help them acquire sufficient stability and capacity to push this ISIL back.
I don't doubt the commitment of the President to try to turn this thing around, and I think some very positive steps have really been taken to accomplish that because he's now done three or four things none of which he'd done before. He's made a move in Syria; he's put some troops, some forces back into Iraq; he's carrying out some air strikes in Iraq as well, and he has signaled very clearly that he sees this as a long-term problem. He seems to be saying,"I understand that this is going to be a problem through what remains of my time in office, and will likely be a problem well beyond." And personally, I think that's the right assessment. I think anybody who is asking the question, "How many days how many weeks or how many months it's going to take?" must be smoking that peace pipe that was given to me at dinner and putting the wrong stuff in it. This is going to take months and years, not days and weeks. And it's going to involve—you know, people talk about boots on the ground—you can't do this all with air strikes and drones; I think it's foolish to think that you can. They can play a role, particularly against the more visible targets. They can give people a psychological boost; people on the ground are saying, "Well, the Americans are with us again, at least they're doing something"—whereas for a little while they wondered whether we had completely lost interest. But in the end there's no substitute for ground forces both military and police of that country itself restoring, re-establishing governmental authority, and extending its RIT throughout the country. You cannot claim to be a self-respecting sovereign state of a country like Iraq when the second largest city in the country is under control of the enemy. That's a totally unacceptable situation. So my caveat about all of this is the question that I think those of us with enough gray hairs here, or too little hair, know is a question that has dogged us in the past, which is, "Will we have the patience to stick this out?" I don't think it's going to cost us a lot of casualties, but I think it's going to cost us time, effort, and money, and we ought to be willing to put that up for a sustained period of time. I hope that we have that kind of stick-to-it-ive-ness, but the record of recent history isn't necessarily that encouraging.
So I guess the question you'd have to ask yourself is, "What makes this situation so different from what Mr. Obama was looking at just a couple of years ago that we're now ready to really stay the course?" I think we're going to have to wait and see. But I would certainly be among those who would applaud what he's done and encourage him to stay the course. One other point I'd make here, because my expertise is really more on Iraq because I was ambassador there, but I think the Iraq situation is a little easier to see and understand than the Syria one, which is opaque. No one's really gotten in there. I mean, these forces are fighting each other, but it's not as if there's a lot of transparency as to what's going on. And it's gotten very complicated because we are fighting ISIL, which is also an enemy of the regime and we don't have much use for the regime either. The Syria issue is a lot more complex, and I would confess that I have a little more difficulty in seeing how best to address that situation and what we're doing as far as helping the Free Syrian Army, and training this group of 5,000 or so soldiers is a fairly modest effort when you think about what they are up against. On the other hand, who knows what this bombing of ISIL will do? Who knows how long the Bashar al-Assad, the Syrian regime, will last. There are a lot of imponderables there, and I confess to not seeing my way as clearly through that, but I happen to believe that the Iraq part is the priority part, too. If you believe in sequencing a strategy, it seems to me, the Iraq part is really the one that has to be addressed earlier than the Syrian one.
Maybe we could just shift to Russia for a moment because that's been the other complex problem that's been facing us in recent months. It's kind of interesting that back in the 20 [presidential] campaign Governor Romney was saying that Russia was the major threat to the U.S. and all the sophisticates in Washington were kind of chuckling about that and none of us, I mean myself included, weren't too sure why he was saying that, and of course he looks rather clairvoyant at this point, given the way Mr. Putin has behaved in the last couple of years. And so, I guess you have to ask yourself first of all, "What's at work here?" And I think that this is a man who has said that he thought that the breakup of the Soviet Union was the greatest catastrophe of the 20th century; I think that back in the 1990s after the Soviet Union fell apart, Russia was not in an economic position really to assert itself. Its GDP had dropped, there was economic disarray, and so forth. But since that time—particularly since the advent of Mr. Putin—the economy has improved dramatically with great rise in oil and gas production as well as the pretty substantial rise in oil and gas prices, which has put Russia in a position to be able to assert itself economically again.
In addition to that, I think that it's also given Mr. Putin the nerve, if you will, to react to some of these events of the 1990s that the Russians view with considerable regret, like the expansion of NATO among other things. And I think one of the turning points (and I saw this when I was deputy secretary of state in the last administration was in 2008 in the spring at the NATO summit meeting in Bucharest) NATO invited Georgia, the country of Georgia, and the country of Ukraine to join the alliance—mentioned in the final communique that they looked forward to these two countries becoming members of the alliance. And I think that may have been hat sort of was the starting point, if you will, of this most recent series of events because it wasn't long thereafter that the Russians invaded the country of Georgia and I've always felt when they did that that one of the purposes was to send the message to the West that we shouldn't even think about trying to incorporate Georgia into NATO and I think they were even more concerned about any possibility that the U.S. and NATO might bring the Ukraine into NATO membership. So, I think that the basis or the underlying explanation of Mr. Putin's' behavior in seizing the Crimea in trying to foster unrest in eastern Ukraine is to send a message to this country and what the Russians call their near abroad to say, "Look, we're going to limit your room for international maneuver, and we want to have a voice in some of these critical foreign policy decisions that you make." Now, he doesn't say it quite that explicitly, but clearly that's the message that is being sent and I recall that when the new prime minister of the Ukraine came to office and they asked him, "Well are you still interested in NATO membership," he said, "Well that's not on our radar screen at the moment." Now subsequently some in Ukraine have started talking again about the possibility of NATO membership, but I believe that Mr. Putin will do everything he can to prevent that from happening. So, in my view of what's happening is this nostalgia for the Soviet Era, this trying to repair at least somewhat this "greatest catastrophe of the 20th century" as Putin would call it; it's this effort on the part of the Russians to reassert their influence in the bordering countries, and Ukraine has a particularly special meaning in Russian history because of the way the Russian state was originally formed. So I think that's a particularly sensitive issue for the Russians given also the fact that the Black Sea Fleet is situated in the Ukraine (well, now it's situated in the Crimea, which they took over just outright). So, will this lead to some further encroachment by Mr. Putin into other parts of Europe? Is he going to go after the Baltic States next? Is he going to use the fact that some of these countries have large Russian-speaking populations in their countries? You can't be sure. We have in past history sometimes underestimated the willingness of authoritarian figures to take risk. We certainly did that in the case of World War II with both the Japanese and the Germans. But is that the situation we're facing today or isn't it?
My own view is the fact that in a way these countries in Eastern Europe got in under the wire in terms of joining NATO, and since they have that protection of the NATO treaty and Article V, an attack on one is an attack on all; I'm not sure that Mr. Putin would ever want to take that big a risk. I think that at the moment at least, the best I can foresee would be to continue pressure on some of the neighbor states that are not NATO members. But the question still remains, would he ever contemplate doing something beyond?
What's the challenge for American diplomacy here? It seems to me this is something that really requires a lot of effort and a lot of work. This is a huge diplomatic challenge for us, among other things. I mean, we also have to shore up the defenses of the Western European countries, we have to help the Ukraine to the extent we can, but we've also got to try to get inside of the heads of the leadership of Russia to see if there are ways that we can find to normalize things and bring them back to somewhat more comfortable chorus of events because what's happened lately, frankly, is dangerous. Not because I think any conflagration is imminent but because there are just too many uncertainties out there and too many risks for misunderstanding. And I also get the impression that Mr. Putin—sometimes I wonder if he isn't improvising some of his policy. Wakes up in the morning and says, "What am I going to do today to get them upset?" You tell me. It's a conundrum especially when you're dealing with a quite authoritarian leader who would appear to have all the levers of control in his own hand; I don't see that there's some alternative pull or source of power that is dealing with these things. I would say that, just as an aside, this is one of the really interesting challenges in the intelligence community is leadership analysis—how do you understand some of these people? How do you get into the minds of people whose societies are relatively close or whose leadership procedures are quite closed? How do you understand what the Ayatollah in Tehran is thinking or the North Koreans? It's a very, very interesting subset of intelligence tradecraft, doing good leadership analysis. It's hard to come by and it takes a variety of different disciplines to be able to do that, but it can be extremely important when you're dealing with dangerous, authoritarian countries.
Last thing I thought I'd mention before—I know I've gone beyond my time here, but before opening it up to questions that I'm sure will cover a lot of ground during the question and answer period—is China, because we really ought to end on the note of China. And I have some experience with that because I served in Hong Kong (and you did your mission there, right?) Once upon a time, I was in Hong Kong in my first foreign service assignment in 1961-63 when there was a bamboo curtain. I mean, you couldn't get into China or out of it; the only people who could come in or out were like household help that came from Canton, and during Chinese New Year, they worked in Hong Kong, they would go back Canton where the different districts there curing Chinese New Year. But the rest of us, the only way we learned—I tell the intelligence officers this today and they can't quite visualize it. The way we learned about China, we got all the Chinese newspapers from the mainland, we had a big warehouse in downtown Hong Kong, and we had a bunch of translators translating everything that was in those newspapers, that was source number one. Source number two was interviewing refugees, people who had fled China. We had a big debate in the consulate back then about whether there was a famine in China. We had reports of famine; we now know historically that there was a famine, and of course today it would be so easy. You just send a few satellites over the country, and you know, monitor this, that, and the other thing, but you'd find out in a matter of days, certainly where there were food shortages and a shortage of food production. But we were left to sort of having to puzzle all this stuff out. My next experience with China was going with Henry Kissinger to China in 1972 just after Mr. Nixon had made his trip there. I went with Kissinger in June of '72; Nixon went in February. And I went along with him because I was the Vietnam guy on the National Security Council. And in those days, as long as the war was going on, we were always talking with all these foreign leaders about Vietnam and then the country had nothing; it was a totally poor country, no cars, all bicycles. Those of you who have been to China know the story about how they've migrated from bicycles to cars. Now there are a lot of cars and practically no room for the bicycles to move anymore.
Then when I was deputy secretary of state, I was in charge of the US-China political dialogue and the change in China in those 40 or so years has just been absolutely extraordinary. In 1979 when we established relations with China, I remember discussing in the state department what are we going to import from this country? Because we'd established relations; we could now trade; the embargo was finally lifted, and we debated what we were going to buy. And of course now we buy everything! But that wasn't true; back then there was nothing. So it's amazing, and that combined with Dang Xiao Ping's reforms have really led to the China that we see today. Now, when I was conducting the dialogue, I don't think the problem of the South China Sea and the exaggerated claims to the South China Sea that China has were quite so acute. They weren't being quite as assertive and they weren't being quite as vocal, and in the last couple years that seems to have happened. It's more or less coincided with two things. First, the continued ascension and growth of China's economic and military strength. There's been a change in leadership under Xi Jinping, and they seem to be striking a more nationalistic note in their behavior. Fortunately, so far no serious conflict has broken out: it's been confined to skirmishes with the various states where they have conflicting claims, the Philippines, Vietnam, and so forth. Maybe it'll just stay that way like a low grade fever, sort of a low level of conflict between these countries until they finally negotiate out their differences, which is what they should do. But in the meanwhile, again, it's concerning any time you have that kind of dispute between half a dozen countries. Really, it isn't only the Philippines and Vietnam with whom they have these maritime disputes, they have them with Malaysia, Taiwan, and several other countries as well. So that's been an issue. More concerning is that they have the same argument with the Japanese over some islands in northeast Asia and which islands—they're rocks practically—that are under Japanese control, and we've had a couple of incidents where fighter planes have been flown over that area and if there were ever any kind of conflictive situation to develop between Japan and China that could be a very, very dire situation indeed.
Having said all of that, it really seems to me—given where China seems to be headed, which is to be the largest economy in the world (and it's going to certainly grow in military power and influence)—it behooves us to cultivate the best possible relationship that we can with the Chinese. There's no point in making bad relations with China a sort of self-fulfilling prophecy. I mean if China really develops and demonstrates aggressive intentions, we'll learn about it soon enough, but absent that, I think it's in our interest to work on all aspects of the relationship, economic, political, military, more military transparency, and I think that's getting better now. When I was working on this dialogue, we couldn't get high-ranking Chinese military officers to participate. Now there is much more interchange between our military officers. And I think that's a good idea. I heard the chief of naval operations the other day saying that he had four meetings with his Chinese counterpart in the last year. I consider that to be a positive thing and the more those counterpart encounters take place, the better. And I think we also have to try to find—and Dr. Kissinger makes this point very frequently—we have to find areas where we have a common interest on which we can work together, and those do exist. I can think of some major issues where we have common interest such as global warming, such as different aspects of the security situation in other parts of the world, like piracy off the coast of Africa. There are areas where we can do projects together to try to build confidence between our two countries. But I dwell a bit on China because clearly that is going to be—perhaps already is—but certainly will become America's most important bilateral relationship in the decades ahead. So maybe I can end on that note and then open it up to some questions.