[Senate Hearing 105-285]
[From the U.S. Government Publishing Office]


                                                        S. Hrg. 105-285


 
                     THE DEBATE ON NATO ENLARGEMENT

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

                                HEARINGS

                               BEFORE THE

                     COMMITTEE ON FOREIGN RELATIONS
                          UNITED STATES SENATE

                       ONE HUNDRED FIFTH CONGRESS

                             FIRST SESSION

                               __________

             OCTOBER 7, 9, 22, 28, 30 AND NOVEMBER 5, 1997

                               __________

       Printed for the use of the Committee on Foreign Relations



                                



                     U.S. GOVERNMENT PRINTING OFFICE
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                     COMMITTEE ON FOREIGN RELATIONS

                 JESSE HELMS, North Carolina, Chairman
RICHARD G. LUGAR, Indiana            JOSEPH R. BIDEN, Jr., Delaware
PAUL COVERDELL, Georgia              PAUL S. SARBANES, Maryland
CHUCK HAGEL, Nebraska                CHRISTOPHER J. DODD, Connecticut
GORDON H. SMITH, Oregon              JOHN F. KERRY, Massachusetts
CRAIG THOMAS, Wyoming                CHARLES S. ROBB, Virginia
ROD GRAMS, Minnesota                 RUSSELL D. FEINGOLD, Wisconsin
JOHN ASHCROFT, Missouri              DIANNE FEINSTEIN, California
BILL FRIST, Tennessee                PAUL D. WELLSTONE, Minnesota
SAM BROWNBACK, Kansas
                     James W. Nance, Staff Director
                 Edwin K. Hall, Minority Staff Director

                                  (ii)




                            C O N T E N T S

                              ----------                              

                       Hearing of October 7, 1997

                                                                   Page

Strategic Rationale for NATO Enlargement.........................     1

Albright, Hon. Madeleine, Secretary of State.....................     6
     Prepared statement..........................................    12

                       Hearing of October 9, 1997

Pros and Cons of NATO Enlargement................................    41

Brzezinski, Hon. Zbigniew, Counselor, Center for Strategic and 
  International Studies, Washington, DC..........................    46
    Prepared statement...........................................    47
Dean, Hon. Jonathan, Senior Arms Control Advisor, Union of 
  Concerned Scientists, Washington, DC...........................    67
    Prepared statement...........................................    70
Kirkpatrick, Hon. Jeane J., Senior Fellow and Director, Foreign 
  Policy and Defense Studies, American Enterprise Institute, 
  Washington, DC.................................................    47
    Prepared statement...........................................    52
Mandelbaum, Dr. Michael, Professor and Director of American 
  Foreign Policy, The Paul H. Nitze School of Advanced 
  International Studies, the Johns Hopkins University, 
  Washington, DC.................................................    72
Roth, Hon. William V. Jr., United States Senator from Delaware, 
  Chairman, Senate NATO Observer Group, and President, North 
  Atlantic Treaty Assembly.......................................    42
    Prepared statement...........................................    44

                      Hearing of October 22, 1997

Qualifications of Poland, Hungary and the Czech Republic for NATO 
  Membership.....................................................    91

Prepared statement of:

    Cambone, Dr. Stephen A., Senior Fellow, Political-Military 
      Studies Program, Center for Strategic and International 
      Studies, Washington, DC....................................   108
    Grossman, Marc, Assistant Secretary of State, European and 
      Canadian Affairs...........................................    91
    Kramer, Franklin D., Assistant Secretary of Defense for 
      International Security Affairs.............................    94
    Larrabee, Dr. Stephen F., RAND, Washington, DC...............   115
    Micgiel, Dr. John S., Director, East Central European Center, 
      Columbia University........................................   119

                      Hearing of October 28, 1997

Costs, Benefits, Burdensharing and Military Implications of NATO 
  Enlargement....................................................   123

Eland, Dr. Ivan, Director of Defense Policy Studies, CATO 
  Institute, Washington, DC......................................   165
    Prepared statement...........................................   167
Hadley, Hon. Stephen, partner, Shea and Gardner, Washington, DC..   170
    Prepared statement...........................................   172
Kugler, Dr. Richard, Distinguished Research Professor, Institute 
  For National Strategic Studies, National Defense University....   152
    Prepared statement...........................................   154
Slocombe, The Hon. Walter, Undersecretary of Defense For Policy..   124
    Prepared statement...........................................   131

              Hearing of October 30, 1997, Morning Session

NATO-Russia Relationship--Part I.................................   183

Kissinger, Hon. Henry A., President, Kissinger and Associates, 
  New York, New York.............................................   183
    Prepared statement...........................................   186

             Hearing of October 30, 1997, Afternoon Session

NATO-Russia Relationship--Part II................................   207

Matlock, Ambassador Jack F. Jr., George F. Kennan Professor, 
  Institute for Advanced Study, Princeton, New Jersey............   230
    Prepared statement...........................................   236
Odom, William E., Lt. Gen., USA, retired, Director of National 
  Security Studies, Hudson Institute, Washington, DC.............   238
    Prepared statement...........................................   242
Pickering, Ambassador Thomas R., Undersecretary of State for 
  Political Affairs..............................................   207
    Prepared statement...........................................   214
Simes, Dimitri K., President, Nixon Center for Peace and Freedom, 
  Washington, DC.................................................   245
    Prepared statement...........................................   248

                      Hearing of November 5, 1997

Public Views on NATO Enlargement.................................   261

Acheson, David C., President, The Atlantic Council of the United 
  States, Washington, DC.........................................   294
    Prepared statement...........................................   296
Ciccolella, Charles S., Assistant Director, National Security and 
  Foreign Relations Division, American Legion, Washington, DC....   305
    Prepared statement...........................................   306
Doubek, Robert W., President, American Friends of the Czech 
  Republic, Washington, DC.......................................   277
    Prepared statement...........................................   279
Harmon, Col. Herbert N., USMCR, National President, Reserve 
  Officers Association of the United States, Washington, DC......   315
    Prepared statement...........................................   317
Harris, David A., Executive Director, American Jewish Committee, 
  New York, New York.............................................   310
    Prepared statement...........................................   312
Joyce, John T., President, International Union of Bricklayers and 
  Allied Craftworkers, Washington, DC............................   313
    Prepared statement...........................................   314
Karatnycky, Adrian, President, Freedom House, New York, New York.   297
    Prepared statement...........................................   298
Koiva, Mati, member, Board of Directors, Joint Baltic American 
  National Committee, Incorporated, and President, Estonian 
  American National Council, Rockville, Maryland.................   283
    Prepared statement...........................................   284
Koszorus, Frank, Jr., board member, Hungarian American Coalition, 
  Washington, DC.................................................   270
    Prepared statement...........................................   272
Moskal, Edward J., President, Polish American Congress, 
  Washington, DC.................................................   266
    Prepared statement...........................................   269
Nowak, Jan, Representative, Central and Eastern European 
  Coalition, Annandale, Virginia.................................   262
    Prepared statement...........................................   264
Plesch, Daniel T., Director, British American Security 
  Information Council, Washington, DC............................   290
    Prepared statement...........................................   292
Rubinstein, Dr. Alvin Z., Political Science Department, 
  University of Pennsylvania, Philadelphia, Pennsylvania.........   318
    Prepared statement...........................................   320
Shanahan, Adm. Jack, USN (Ret.), Director, Center for Defense 
  Information, Washington, DC....................................   303
    Prepared statement...........................................   304
Stern, Hon. Paula, President, The Stern Group, New York, New 
  York, on behalf of the U.S. Committee to Expand NATO...........   286

                               APPENDICES
                               Appendix 1

Additional material received for the October 7 hearing record:
    ``Hearing on the Strategic Rationale for NATO Enlargement,'' 
      a staff memorandum to the members of the Foreign Relations 
      Committee..................................................   331
    ``Meeting the Challenges of a Post-Cold War World: NATO 
      Enlargement and U.S.-Russia Relations,'' A Report to the 
      Committee on Foreign Relations, submitted by Senator Joseph 
      R. Biden, Jr...............................................   338
    Prepared Statement of Senator Russell D. Feingold............   404
    Letter from Barbara Larkin, Assistant Secretary, Legislative 
      Affairs, Department of State, to Chairman Helms............   405
    Responses of Secretary Albright to Questions Asked by Senator 
      Helms......................................................   405
    Responses of Secretary Albright to Questions Asked by Senator 
      Feingold...................................................   413

                               Appendix 2

Additional material received for the October 9 hearing record:
    ``NATO Expansion; A Bridge to the Nineteenth Century,'' 
      submitted by Michael Mandelbaum............................   418

                               Appendix 3

Additional material received for the October 22 hearing record:
    ``Hearing on the Qualifications of Poland, Hungary, and the 
      Czech Republic for NATO Membership,'' a staff memorandum to 
      the members of the Foreign Relations Committee.............   439
    Excerpts from ``Nations in Transit: 1997--Civil Society, 
      Democracy and Markets in East Central Europe and the Newly 
      Independent States:''

        Czech Republic: Freedom in the World Ratings, 1988-1997..   446
        Hungary: Freedom in the World Ratings, 1988-1997.........   463
        Poland: Freedom in the World Ratings, 1988-1997..........   475

                               Appendix 4

Additional material received for the October 28 hearing record:
    ``Hearing on the Costs, Benefits, Burdensharing, and Military 
      Implications of NATO Enlargement,'' a staff memorandum to 
      the members of the Foreign Relations Committee.............   488
    Prepared Statement of Senator Russell D. Feingold............   499
    ``The High Cost of NATO Expansion,'' a policy analysis by 
      Ivan Eland.................................................   500
    Responses of Mr. Slocombe to Questions Asked by Senator Helms   519
    Responses of Mr. Eland to Question Asked by Senator Biden....   522
    Prepared statement of Dr. Stephen A. Cambone, Senior Fellow, 
      Political-Military Studies Program, Center for Strategic 
      and International Studies, Washington, DC..................   523

                               Appendix 5

Additional material received for the October 30 hearing record:
    ``Hearings on NATO-Russian Relations,'' a staff memorandum to 
      the members of the Foreign Relations Committee.............   531

                               Appendix 6

Additional material received for the November 5 hearing record:
    Letter from Alexandr Vondra, Ambassador of the Czech 
      Republic; Gyorgy Banlaki, Ambassador of the Republic of 
      Hungary; and Jerzy Kozminski, Ambassador of the Republic of 
      Poland; to Chairman Helms..................................   537
    Paula Stern, U.S. Committee to Expand NATO, supplemental 
      submissions................................................   537
    Lithuanian-American Community, Inc., prepared statement......   546
    Armand Scala, President of the Congress of Romanian 
      Americans, prepared statement..............................   549
    U.S.-Baltic Foundation, prepared statement...................   549
    John E. Moon, Commander-in-Chief, Veterans of Foreign Wars of 
      the United States, letter and attachment...................   551



                STRATEGIC RATIONALE FOR NATO ENLARGEMENT

                              ----------                              


                        TUESDAY, OCTOBER 7, 1997

                                       U.S. Senate,
                            Committee on Foreign Relations,
                                                    Washington, DC.
    The committee met at 10:14 a.m., in room SD-419, Dirksen 
Senate Office Building, Hon. Jesse Helms (chairman of the 
committee), presiding.
    Present: Senators Helms, Lugar, Hagel, Smith, Thomas, 
Ashcroft, Grams, Frist, Biden, Sarbanes, Robb, Feingold, 
Feinstein, and Wellstone.
    Also Present: Senator Warner.
    The Chairman. The committee will come to order.
    Madam Secretary, as you know, we welcome you. We appreciate 
your being our lead-off witness as the Foreign Relations 
Committee begins its consideration of NATO expansion.
    For nearly 50 years, NATO has defended democracy against 
communism and other forms of tyranny in Europe. Despite that 
success, many Americans will never forget the betrayal at Yalta 
which left millions of Europeans behind enemy lines.
    Today, with the expansion of the NATO alliance, we have an 
historic opportunity to right that wrong by accepting Poland, 
Hungary, and the Czech Republic into NATO. All Americans should 
welcome these nations as they finally become equal partners in 
a community of democratic nations, thereby ensuring that their 
new democracies shall never again fall victim to tyranny.
    Now, if Europe and the United States are to enjoy a century 
of peace, upcoming, one that does not replicate the bloody wars 
of the past century, we must embrace these democracies and 
guide them and show them away from their tragic histories of 
ethnic division and war.
    That said, there's a right way and a wrong way to proceed 
with NATO expansion. We in the Senate recognize that this vital 
undertaking is not without cost to the United States, and I am 
convinced that the three new democracies are willing and eager 
to bear their fair share, but we must now make certain that our 
present NATO allies are likewise willing to fulfill their end 
of the bargain.
    Just last week our allies made clear to us that they expect 
the United States, meaning the American taxpayers, to pay the 
lion's share of the cost of expansion. Now, Madam Secretary, 
ratification of NATO expansion by the U.S. Senate may very well 
succeed or fail on the question of whether you can dissuade our 
allies of that notion.
    Further, we must resist any temptation by the leadership of 
our country to rush forward into an ill-considered NATO 
partnership with Russia. Now, while the United States is 
willing to take steps to demonstrate that NATO represents 
absolutely no threat to a democratic Russia, NATO's relations 
with Russia must be restrained by the reality that Russia's 
future commitment to peace and democracy, as of this date, is 
far from certain. In fact, I confess a fear that the United 
States' overture toward Russia may have already gone a bit far.
    I believe, Madam Secretary, that it's fair to expect the 
administration to outline a clear, strategic rationale for NATO 
expansion and to explain clearly to the U.S. Senate what 
potential threats NATO may face in the 21st century and why an 
expanded NATO alliance is necessary to counter such threats.
    To illustrate, it is self-evident I think that one such 
potential threat will manifest itself if and when Russia takes 
a turn for the worse. In your testimony today, Madam Secretary, 
I hope that you will address this and other possible threats to 
Europe's security.
    We live in a time when the United States finds few allies 
within NATO or elsewhere in the struggle for freedom. Too many 
expect the American taxpayers to pay the bills and to leave the 
driving force up to these other nations.
    For example, France boasts of investments to prop up the 
terrorist regime in Iran, a regime that has spilled the blood 
of American and French citizens alike. In fact, the European 
Union waits with baited breath for Iran to allow their 
Ambassadors to return to Tehran.
    Denmark and the Netherlands, both having courageously 
condemned China's human rights record in Geneva earlier this 
year, now find themselves in the incomprehensible position of 
being sanctioned by the Chinese while their opportunistic 
European Union partners rush to enrich themselves with new 
business opportunities.
    Somehow an understanding must be made clear that the United 
States did not create the NATO alliance and prepare for war and 
send our troops to fight and die in Europe and spend our 
country into debt for 50 years simply to defend European real 
estate or European economic interests. Our commitment was first 
and foremost to the defense of democracy and the preservation 
of human liberty and it must remain so.
    So many of our cold war allies have so quickly forgotten 
how close they came to losing their freedoms, but you, Madam 
Secretary, more than most, know that freedom cannot be taken 
for granted because your family personally suffered the peril 
of tyranny, ignored or tolerated by those entrusted with 
leadership at that time.
    NATO has yet to fight a war because NATO was thoroughly 
convinced and convincing all along that NATO has been prepared 
to fight a war, if necessary. But with the collapse of the 
Soviet Union, the American people have turned their attention 
to problems at home. There is no audible demand by the American 
people to play the role of international referee or world 
policeman.
    Together we must explain to the American people that NATO 
enlargement is vital precisely because it will secure peace and 
security into the next century and ensure, at the same time, 
that America will not be called upon once again to save Europe 
from the advance of tyranny.
    Now, Madam Secretary, as I conclude, I want to share with 
you and others here today a passage written by the man I 
consider the greatest statesman of the 20th century, Winston 
Churchill. In his 1929 book, The Aftermath, Mr. Churchill tried 
to warn the world about the slide down the slippery slope 
toward the next world war.
    At first his apprehensions fell on deaf ears, and in 
connection with that, Mr. Churchill years later wrote the 
following, with which I shall conclude.
    He said: ``To the faithful, toiled, burdened masses, the 
victory was so complete that no further efforts seemed 
required. Germany had fallen and with her the combination that 
had crushed her. Authority was disbursed. The world unshackled. 
The weak became the strong. The sheltered became the 
aggressive. The contrast between victors and vanquished tended 
continually to diminish. A vast fatigue,'' he said, ``dominated 
collective action and, through every subversive element, 
endeavored to insert itself. Revolutionary rage, like every 
other form of psychic energy, burnt low. Through all five acts, 
the drama had run its course,'' he said. ``The light of history 
is switched off. The world stage dims. The actors shrivel. The 
chorus sings. The war of the giants has ended. The quarrels of 
the pygmies has begun.''
    I think that just about says it all. Senator Biden?
    [Material submitted by Chairman Helms follows:]

            The Madrid Summit--New Members, Not New Missions

                            [By Jesse Helms]

    WASHINGTON, D.C.--As NATO leaders meet in Madrid today to discuss 
the enlargement of the Alliance, some words of caution are in order. 
The Clinton administration's egregious mishandling of NATO expansion is 
raising serious concerns in the U.S. Senate, which must approve any 
enlargement treaty.
    There is growing distress among supporters of enlargement (like 
myself) that the administration's plan for NATO expansion may be 
evolving into a dangerous and ill-considered plan for NATO 
transformation: that we are not inviting new nations into the NATO that 
won the Cold War, but rather into a new, diluted NATO, converted from a 
well-defined military alliance into a nebulous ``collective security'' 
arrangement.
No Rationale
    To date, the Clinton administration has failed to present the 
Senate with any credible strategic rationale for NATO expansion--that 
is, no explanation of the threat posed to the Atlantic Alliance, nor 
why an expanded NATO is needed to counter it. Instead, all sorts of 
misguided proposals are floating around for transforming NATO's mission 
and purpose, in an effort to justify Alliance expansion.
    Deputy Secretary of State Strobe Talbott, the Clinton 
administration's pointman on NATO expansion, argues that while ``during 
the Cold War, military and geopolitical considerations mainly 
determined NATO's decisions . . . today, with the end of the Cold War, 
other non-military goals can and should help shape the new NATO.'' 
NATO's primary mission, Mr. Talbott is saying, should no longer be the 
defense of Europe, but rather ``promoting democracy within NATO states 
and good relations among them''--in other words, nation-building.
    Others see this ``new NATO'' serving as a stand-in peacekeeper for 
a United Nations discredited by its failures in Somalia and Bosnia. 
Indeed, the NATO-Russia ``Founding Act,'' largely negotiated by the 
Clinton administration, enshrines this new role for NATO, hailing 
NATO's ``historic transformation'' in making ``new missions of 
peacekeeping and crisis management in support of the U.N.'' primary 
Alliance functions.
    Advocates of NATO transformation make a better case for the 
Alliance to disband than expand. NATO's job is not to replace the U.N. 
as the world's peacekeeper, nor is it to build democracy and pan-
European harmony or promote better relations with Russia. NATO has 
proven the most successful military alliance in history precisely 
because it has rejected utopian temptations to remake the world.
    Rather, NATO's mission today must be the same clear-cut and limited 
mission it undertook at its inception: to protect the territorial 
integrity of its members, defend them from external aggression, and 
prevent the hegemony of any one state in Europe.
    The state that sought hegemony during the latter half of this 
century was Russia. The state most likely to seek hegemony in the 
beginning of the next century is also Russia. A central strategic 
rationale for expanding NATO must be to hedge against the possible 
return of a nationalist or imperialist Russia, with 20,000 nuclear 
missiles and ambitions of restoring its lost empire. NATO enlargement, 
as Henry Kissinger argues, must be undertaken to ``encourage Russian 
leaders to interrupt the fateful rhythm of Russian history . . . and 
discourage Russia's historical policy of creating a security belt of 
important and, if possible, politically dependent states around its 
borders.''
    Unfortunately, the Clinton administration does not see this as a 
legitimate strategic rationale for expansion. ``Fear of a new wave of 
Russian imperialism . . . should not be seen as the driving force 
behind NATO enlargement,'' says Mr. Talbott.
    Not surprisingly, those states seeking NATO membership seem to 
understand NATO's purpose better than the Alliance leader. Lithuania's 
former president, Vytautas Landsbergis, put it bluntly: ``We are an 
endangered country. We seek protection.'' Poland, which spent much of 
its history under one form or another of Russian occupation, makes 
clear it seeks NATO membership as a guarantee of its territorial 
integrity. And when Czech President Vaclav Havel warned of ``another 
Munich,'' he was calling on us not to leave Central Europe once again 
at the mercy of any great power, as Neville Chamberlain did in 1938.
    Poland, Hungary, the Czech Republic and other potential candidate 
states don't need NATO to establish democracy. They need NATO to 
protect the democracies they have already established from external 
aggression.
    Sadly, Mr. Havel's admonishments not to appease ``chauvinistic, 
Great Russian, crypto-Communist and crypto-totalitarian forces'' have 
been largely ignored by the Clinton administration. Quite the opposite, 
the administration has turned NATO expansion into an exercise in the 
appeasement of Russia.
    After admitting East Germany in 1990 (and giving the Soviet Union 
neither a ``voice'' nor a ``veto'' in the process), the U.S. delayed 
NATO expansion for nearly seven years in a misguided effort to secure 
Russian approval. Russia, knowing an opportunity when it sees one, has 
used its opposition to NATO expansion to gain all sorts of concessions, 
ranging from arms-control capitulations to the NATO-Russia ``Founding 
Act.''
    That agreement concedes ``primary responsibility . . . for 
international peace and security'' to the U.N. Security Council, where 
Russia has a veto. It gives Russia (the very country NATO is 
constituted to deter) a voice at every level of the Alliance's 
deliberations. And it gives Russia a seat at the table before any new 
candidate members (those being brought in to protect them from 
aggression) get a seat at the table.
    It is my sincere hope that the U.S. Senate can approve NATO 
expansion. But if we are to do so, some dramatic changes must be made. 
As chairman of the Senate committee that must approve the resolution of 
ratification, I urge the administration to take the following steps 
before presenting NATO expansion to the Senate:
   Outline a clear, complete strategic security rationale for 
        NATO expansion.
   Agree that no limitations will be placed on the numbers of 
        NATO troops or types of weapons to be deployed on territory of 
        new member states (including tactical nuclear weapons)--there 
        must be no second-class citizens in NATO.
   Explicitly reject Russian efforts to establish a ``nuclear 
        weapons-free zone'' in Central Europe.
   Explicitly reject all efforts to tie NATO decisions to U.N. 
        Security Council approval.
   Establish a clear delineation of NATO deliberations that are 
        off-limits to Russia (including, but not limited to, arms 
        control, further Alliance expansion, procurement and strategic 
        doctrine).
   Provide an immediate seat at the NATO table for countries 
        invited to join the Alliance.
   Reject Russian efforts to require NATO aid for Russian arms 
        sales to former Warsaw Pact militaries joining the Alliance, as 
        a quid pro quo for NATO expansion--NATO must not become a back 
        channel for new foreign aid to Russia.
   Reject any further Russian efforts to link concessions in 
        arms control negotiations (including the antiquated ABM treaty 
        and the CFE Treaty) to NATO expansion.
   Develop a plan for a NATO ballistic missile defense system 
        to defend Europe.
   Get clear advance agreement on an equitable distribution of 
        the cost of expansion, to make certain American taxpayers don't 
        get stuck with the lion's share of the bill.
Strategic Threats
    Is renewed Russian aggression the only strategic threat NATO must 
consider? Of course not. There are many potential threats to Europe, 
including the possibility of rogue states like Libya and Iran one day 
threatening the continent with weapons of mass destruction. But the 
Clinton administration has failed to define NATO expansion in terms of 
any strategic threat.
    If the Clinton administration views NATO not as a tool to defend 
Europe, but as a laboratory for social work, then NATO should not only 
eschew expansion, it should declare victory and close shop. The costs 
of maintaining NATO, much less expanding it, cannot be justified if its 
mission is democracy-building and peacekeeping. There are other, less 
expensive and more appropriate forums for such ventures (such as the 
European Union and the Organization for Security and Cooperation in 
Europe). NATO is a military alliance--it must remain so or go out of 
business.

    Senator Biden. Thank you, Mr. Chairman.
    Madam Secretary, welcome. It is always a pleasure to have 
you here.
    Mr. Chairman, I have stated my support for NATO enlargement 
many times on the floor of the U.S. Senate and in private 
forums. So, today I will only summarize my rationale for this 
policy.
    Europe remains a vital interest for the United States. 
Other than North America, no other region can match Europe's 
combination of political, economic, military, and cultural 
power and significance to the United States. The European 
Union, for example, has a population one-third larger than ours 
and a combined GDP slightly greater than ours.
    A large percentage of the world's democracies are in 
Europe. By any geopolitical standard, it would be a catastrophe 
for American interests if instability were to alter the current 
situation in Europe.
    After the cold war, there are new threats to Europe: Ethnic 
and religious conflicts, one nation crossing the borders of 
another as Yugoslavia did in Bosnia, international crime and 
drugs; also I might note a possible future threat to Mideast 
oil supplies.
    For this reason, enlargement is being combined with a new 
strategic doctrine and a force posture that provides a more 
mobile and capable force projection capability in event of any 
of those crises.
    In the 20th century, Europeans have proven incapable, left 
to themselves, of settling their differences peacefully. The 
United States it seems to me must continue to lead the new 
security architecture for that continent, for if we do not, I 
do not know who will.
    In this context, admitting Poland, the Czech Republic, and 
Hungary into NATO will extend the zone of security to central 
Europe in a way that, if left undone, will leave a gray zone 
and insecurity in that region.
    The question, I would emphasize, is not whether to enlarge 
NATO or remain the same. The status quo, Madam Secretary, in my 
view is not an option. If we were not to enlarge, the countries 
between Germany and Russia would inevitably seek other means to 
protect themselves, creating bilateral or multilateral 
alliances as they did in the 1930's with, I predict, similar 
results.
    There is also a powerful moral argument for enlargement: 
Redeeming our pledge to former captive nations to rejoin the 
west. I mean both NATO and the EU when I say the west because 
the Europeans will have to step up to that ball plate as well.
    When they are fully qualified to join both, their security 
will be fully secured. This fall's final accession talks 
between NATO and each of the three candidate countries, Poland, 
the Czech Republic, and Hungary, will reveal whether each of 
them meets the alliance's demanding qualifications. Based on 
what I saw in my travels, I believe they do.
    Enlargement, Mr. Chairman, need not adversely affect our 
relations with Russia. We must redouble our political and 
economic engagement with that country in my view, and the NATO-
Russia Founding Act of May 1997 is a significant step in the 
right direction and the Partnership for Peace arrangement is 
equally as important.
    The NATO-Russian Permanent Joint Council created by the 
founding act has begun functioning. I especially look forward 
to the fourth in our series of hearings on October 30th when we 
will examine the new NATO-Russian relationship.
    Mr. Chairman, in my view two big issues must be solved 
before the Senate considers ratification. One is directly 
related, one not as directly, but they're both important: 
Bosnia and cost sharing. If Bosnia is the prototypical European 
crisis of the 21st century, then in the coming weeks--and I 
mean weeks--the United States and its NATO allies had better 
come up with a workable post-SFOR scenario.
    Similarly, while the United States must continue to 
exercise its leadership role in NATO, our European and Canadian 
alliance partners must agree, as you indicated, to step up to 
the plate and bear their fair share of enlargement costs.
    The definitive NATO study on cost will come out in 
December. In anticipation of the report, this committee will 
hold its third hearing on NATO enlargement on October 22nd when 
we will examine the cost and burden sharing items. So, today I 
will not speak much to those items in my questioning.
    Mr. Chairman, I believe that admitting Poland, the Czech 
Republic, and Hungary to NATO, if they meet the qualifications, 
which they appear to meet, will be in the security interest of 
the United States of America. I believe to do otherwise would 
be to extend a zone of instability rather than one of 
stability.
    I look forward to the Secretary's testimony.
    Thank you again, Mr. Chairman, for setting up an aggressive 
series of hearings prior to the requirement for us to decide 
whether or not to expand the Washington Treaty. Thank you.
    The Chairman. Thank you, sir. Now we will hear from you, 
Madam Secretary.

    STATEMENT OF HON. MADELEINE ALBRIGHT, SECRETARY OF STATE

    Secretary Albright. Thank you very much, Mr. Chairman.
    Mr. Chairman, Senator Biden, members of the committee, it 
is with a sense of appreciation and anticipation that I come 
before you to urge support for the admission of the Czech 
Republic, Hungary, and Poland to NATO.
    Each of us is playing our part today in the long unfolding 
story of America's modern partnership with Europe. That story 
began not at the Madrid summit, nor when the Berlin Wall fell, 
but half a century ago when your predecessors and mine 
dedicated our Nation to the goal of a secure, united Europe.
    It was then that we sealed a peacetime alliance open not 
only to the nations which shared our victory in World War II, 
but to our former adversaries. It was then that this committee 
unanimously recommended that the Senate approve the North 
Atlantic Treaty. On that day, the leaders of this body rose 
above partisanship and they rose to the challenge of a pivotal 
moment in history.
    Mr. Chairman, I believe you are continuing that tradition. 
I thank you for your decision to hold these hearings early, for 
the bipartisan manner in which you and Senator Biden are 
conducting them, and for the serious way in which you have 
framed our discussion.
    I am honored to be a part of what you have rightly called 
the beginning of the process of advice and consent.
    As I said, I am very conscious of history today. I hope we 
can take a moment to remember what was said half a century ago 
about the alliance we are striving to renew and expand today.
    Senator Arthur Vandenberg, Chairman Helms' extraordinary 
predecessor, predicted that NATO would become the greatest war 
deterrent in history. He was right. American forces have never 
had to fire a shot to defend a NATO ally.
    This committee predicted that NATO would free the minds of 
men in many nations from a haunting sense of insecurity and 
enable them to work and plan with that confidence in the 
future, which is essential to economic recovery and progress. 
Your predecessors were also right.
    President Truman said that the NATO pact will be a 
positive, not a negative influence for peace, and its influence 
will be felt not only in the area it specifically covers but 
throughout the world. He was right too.
    Thanks in no small part to NATO, we live in a different 
world. Our Soviet adversary has vanished. Freedom's flag has 
been unfurled from the Baltics to Bulgaria. As I speak to you 
today, our immediate survival is not at risk.
    Indeed, you may ask if the principle of collective defense 
at NATO's heart is relevant to the challenges of a wider and 
freer Europe. You may ask why, in this time of relative peace, 
are we so focused on security.
    The answer is we want the peace to last. We want freedom to 
endure, and we believe there are still potential threats to our 
security emanating from European soil.
    You have asked me, Mr. Chairman, what these threats are. I 
want to answer as plainly as I can.
    First, there are the dangers of Europe's past. It is easy 
to forget this, but for centuries virtually every European 
nation treated virtually every other nation as a military 
threat. That pattern was broken only when NATO was born and 
only in the half of Europe NATO covered. With NATO, each 
member's security came to depend on cooperation with others, 
not competition.
    That is one reason why NATO remains essential. It is also 
one reason why we need a larger NATO which extends its positive 
influence to Europe's other half.
    A second set of dangers lies in Europe's present. Because 
of the conflict in the Balkans and the former Soviet Union, 
Europe has already buried more victims of war since the Berlin 
Wall fell than in all the years of the cold war. It is sobering 
to recall that this violence has its roots in the same problems 
of shattered states and of ethnic hatreds that tyrants 
exploited to start this century's great wars.
    Finally, Mr. Chairman, and most important, we must consider 
the dangers of Europe's future. By this I mean direct threats 
against the soil of NATO members that a collective defense pact 
is designed to meet. Some are visible on Europe's horizon, such 
as the threat posed by rogue states with dangerous weapons. 
Others may not seem apparent today, but they are not 
unthinkable.
    Within this category lie questions about the future of 
Russia. We want Russian democracy to endure. We are optimistic 
that it will, but one should not dismiss the possibility that 
Russia could return to the patterns of its past. By engaging 
Russia and enlarging NATO, we give Russia every incentive to 
deepen its commitment to peaceful relations with neighbors, 
while closing the avenue to more destructive alternatives.
    We do not know what other dangers may arise 10, 20, or even 
50 years from now. We do know that whatever the future may 
hold, it will be in our interest to have a vigorous and larger 
alliance with those European democracies that share our values 
and our determination to defend them.
    We recognize NATO expansion involves a solemn expansion of 
American responsibilities in Europe. As Americans, we take our 
commitments seriously and we do not extend them lightly. Mr. 
Chairman, you and I certainly agree that any major extension of 
American commitments must serve America's strategic interests.
    Let me explain why welcoming the Czech Republic, Hungary, 
and Poland into NATO meets that test.
    First, a larger NATO will make us safer by expanding the 
area in Europe where wars simply do not happen. By making clear 
that we will fight if necessary to defend our allies, it makes 
it less likely our troops will ever be called upon to do so.
    Now you may say that no part of Europe faces any immediate 
threat or armed attack today. That is true. The purpose of 
enlargement is to keep it that way. Senator Vandenberg said it 
in 1949: NATO is not built to stop a war after it starts, 
although its potentialities in this regard are infinite. It is 
built to stop wars before they start.
    It is also fair to ask if it is in our vital interest to 
prevent conflict in Central Europe. Some have implied it is 
not. I am sure you have even heard a few people trot out what I 
call the consonant cluster clause, the myth that in times of 
crisis Americans will make no sacrifice to defend a distant 
city with an unpronounceable name, that we will protect the 
freedom of Strasbourg but not Szczecin, Barcelona but not Brno.
    Let us not deceive ourselves. We are a European power. We 
have an interest in the fate of the 200 million people who live 
in the nations between the Baltic and Black Seas. We waged the 
cold war in part because these nations were held captive. We 
fought World War II in part because these nations had been 
invaded. If there were a major threat to the security of their 
region, we would want to act, enlargement or no enlargement. 
Our aim must be to prevent that kind of threat from arising.
    The second reason why enlargement passes the test of 
national interest is that it will make NATO stronger and more 
cohesive. The Poles, Hungarians, and Czechs are passionately 
committed to NATO and its principles of shared responsibility. 
Their forces have already risked their lives alongside ours 
from the Gulf War to Bosnia.
    I know you have expressed concern that enlargement could 
dilute NATO by adding too many members and by involving the 
alliance in too many missions. Let me assure you that we 
invited only the strongest candidates to join and nothing about 
enlargement will change NATO's core mission which remains the 
collective defense of NATO soil.
    At the same time, it is important to remember that NATO has 
always served a political function too. It binds our allies to 
us just as it binds us to our allies. So, when you consider the 
candidacy of the Czech Republic, Hungary, and Poland, I ask you 
to consider this. On the issues that matter, from 
nonproliferation to human rights, to U.N. reform, here are 
three nations we have been able to count on and will continue 
to be able to count on.
    Mr. Chairman, the third reason why a larger NATO serves our 
interests is that the very promise of it gives the nations of 
central and eastern Europe an incentive to solve their own 
problems. To align themselves with NATO, aspiring countries 
have strengthened their democratic institutions, made sure 
soldiers serve civilians, signed 10 major accords that resolve 
virtually every old ethnic and border dispute in the region.
    I have been a student of central European history and I 
have lived some of it myself. When I see Romanians and 
Hungarians building a genuine friendship after centuries of 
enmity, when I see Poles, Ukrainians, and Lithuanians forming 
joint military units after years of suspicion, when I see 
Czechs and Germans overcoming decades of mistrust, when I see 
central Europeans confident enough to improve their political 
and economic ties with Russia, I know something remarkable is 
happening.
    NATO is doing for Europe's east precisely what this NATO 
predicted it would do for Europe's west after World War II. 
This is another reminder that the contingencies we do not want 
our troops to face, such as ethnic conflict, border skirmishes, 
and social unrest, are far more easily avoided with NATO 
enlargement than without it.
    In short, a larger NATO will make America safer, NATO 
stronger, and Europe more peaceful and united. That is the 
strategic rationale. But I would be disingenuous if I did not 
tell you I see a moral imperative too.
    NATO defines a community of interest among the free nations 
of North America and Europe that both preceded and outlasted 
the cold war. Americans have long argued that the nations of 
central Europe belong to the same democratic family as our 
allies in western Europe. As Americans, we should be heartened 
so many of them wish to join the institutions we did so much to 
build.
    We should also think about what would happen if we were to 
turn them away. That would mean freezing NATO at its cold war 
membership and preserving the old Iron Curtain as its eastern 
frontier. It would mean locking out a whole group of otherwise 
qualified democracies simply because they were once, against 
their, will members of the Warsaw Pact.
    Why would America choose to be allied with Europe's old 
democracies forever but its new democracies never? Were we to 
do that, confidence would crumble in central Europe leading to 
a search for security by other means, including costly arms 
buildups and competition among neighbors.
    We have chosen a better way. We have chosen to look at the 
landscape of the new Europe and to ask a simple question: Which 
of these nations that are so clearly important to our security 
are ready to contribute to our security? The answer to that 
question is before you today awaiting your affirmation.
    I said at the outset, Mr. Chairman, that there are weighty 
voices on both sides of this debate. Let me address a few of 
the concerns I expect you will consider fully.
    First, we all want to make sure that the costs of a larger 
NATO are distributed fairly. Last February the administration 
made a preliminary estimate of America's share. Now we are 
working with our allies to produce a common estimate by the 
December meeting of the North Atlantic Council. At this point 
the numbers we agree upon as 16 allies are needed prior to any 
further calculations made in Washington.
    I know that you are holding separate hearings on this 
question, but I will say this. I am convinced that the cost of 
expansion is real but affordable. I am certain our prospective 
allies are willing and able to pay their share because in the 
long run it will be cheaper for them to upgrade their forces 
within the alliance than outside it. I will insist that our old 
allies share this burden fairly. That is what NATO is all 
about.
    I know there are serious people who estimate that a larger 
NATO will cost far more than we have anticipated. The key fact 
about our estimate is that it is premised on the current 
favorable security environment in Europe. Obviously, if a grave 
threat were to arise, the cost of enlargement would grow, but 
then so would the cost of our entire defense budget.
    In any case, there are budgetary constraints in all 16 NATO 
democracies that will prevent costs from ballooning. That is 
why the main focus of our discussion, Mr. Chairman, and our 
consultations with our allies needs to be on defining the level 
of military capability we want our old and new allies to have 
and then making sure that they commit to it. We should spend no 
more than we must but no less than we need to keep NATO strong.
    Another common concern about NATO enlargement is that it 
might damage our cooperation with a democratic Russia. Russian 
opposition to NATO enlargement is real. But we should see it 
for what it is, a product of old misperceptions about NATO and 
old ways of thinking about its former satellites in central 
Europe. Instead of changing our policies to accommodate 
Russia's outdated fears, we need to encourage Russia's more 
modern aspirations.
    This means we should remain Russia's most steadfast 
champion whenever it seeks to define its greatness by joining 
rule-based institutions, opening markets, and participating 
constructively in world affairs.
    But when some Russian leaders suggest that a larger NATO is 
a threat, we owe it candor to say that is false and to base our 
policies on what we know to be true. I believe our approach is 
producing results from our cooperation in Bosnia to agreements 
to pursue deeper arms cuts, to new signs that the new START II 
Treaty may be moving ahead in the Duma, to NATO's new 
relationship with Russia.
    I know that some are concerned that this relationship with 
Russia may actually go too far. You have asked me for an 
affirmation, Mr. Chairman, that the North Atlantic Council 
remains NATO's supreme decisionmaking body. Let me say it 
clearly: It does and it will. The NATO-Russia Founding Act 
gives Russia no opportunity to dilute, delay, or block NATO 
decisions.
    Another important concern is that enlargement may create a 
new dividing line in Europe between a larger NATO and the 
countries that will not join in the first round. We have taken 
a range of steps to ensure this does not happen, from NATO's 
commitment to an open-door policy, to a stronger Partnership 
for Peace, to the new Euro-Atlantic Partnership Council.
    Among the countries that still aspire to membership, there 
is enthusiastic support for the process NATO has begun. They 
understand a simple fact: With enlargement, no new democracy is 
permanently excluded; without enlargement, every new democracy 
would be permanently excluded.
    The most important thing the Senate can do to reassure them 
now is to get the ball rolling by ratifying the admission of 
the first three candidates.
    A final concern I wish to address has to do with Bosnia. 
Some have suggested our debate on NATO enlargement simply 
cannot be separated from our actions and decisions in that 
troubled country. I agree with them. Both are aimed at building 
a stable, undivided Europe. It was our experience in Bosnia 
that proved a fundamental premise of our enlargement strategy: 
There are still threats to security in Europe that only NATO 
can meet.
    We cannot know today if our mission in Bosnia will achieve 
all its goals, but we can say that whatever may happen, our 
interest in a larger, stronger NATO will endure long after the 
last foreign soldier has left that country.
    We can also say that NATO will remain the most powerful 
instrument we have for building effective military coalitions 
such as SFOR. At the same time, Bosnia does not by itself 
define the future of a larger NATO. NATO's most important aim, 
if I can paraphrase Arthur Vandenberg, is to prevent wars 
before they start so it does not have to keep the peace after 
they stop.
    These are some of the principal concerns I wanted to 
address today. I know our discussion is just beginning. I am 
glad that it will also involve other committees of the Senate, 
the NATO Observers' Group, and the House of Representatives. 
Most important, I am glad it will involve the American people.
    When these three new democracies join NATO in 1999, as I 
trust they will, it will be a victory for us all, Mr. Chairman. 
On that day, we will be standing on the shoulders of many. We 
will be thankful to all those who waged the cold war on the 
side of freedom, to all those who champion the idea of a larger 
NATO, to all those Members of Congress from both parties who 
voted for resolutions urging the admission of these three 
nations, to all those Republican Members who made NATO 
enlargement part of their Contract with America.
    Now, Mr. Chairman and members of the committee, all of our 
allies and future allies are watching you for one simple 
reason: The American Constitution is unique in the power it 
grants to the legislative branch over foreign policy, 
especially over treaties. In this matter, you and the American 
people you represent are truly in the driver's seat.
    That is as it should be. In fact, I enjoy going to Europe 
and telling our allies this is what we want to do but 
ultimately it will be up to our Senate and our people to 
decide. I say that with pride because it tells them something 
about America's faith in a democratic process.
    But I have to tell you that I say it with confidence as 
well. I believe that when the time comes for the Senate to 
decide, Mr. Chairman, you and I and the American people will 
stand together, for I know that the policy we ask you to 
embrace is a policy that the administration and Congress shaped 
together, and I am certain that it advances the fundamental 
interests of the United States.
    Thank you very much.
    [The prepared statement of Secretary Albright follows:]
                Prepared Statement of Secretary Albright
    Chairman Helms, Senator Biden, members of the committee: it is with 
a sense of appreciation and anticipation that I come before you to urge 
support for the admission of the Czech Republic, Hungary and Poland to 
NATO.
    Each of us today is playing our part in the long unfolding story of 
America's modern partnership with Europe. That story began not in 
Madrid, when the President and his fellow NATO leaders invited these 
three new democracies to join our Alliance, nor eight years ago when 
the Berlin Wall fell, but half a century ago when your predecessors and 
mine dedicated our nation to the goal of a secure, united Europe.
    It was then that we broke with the American aversion to European 
entanglements, an aversion which served us well in our early days, but 
poorly when we became a global power. It was then that we sealed a 
peacetime alliance open not only to the nations which had shared our 
victory in World War II, but to our former adversaries. It was then 
that this committee unanimously recommended that the Senate approve the 
original NATO treaty.
    The history books will long record that day as among the Senate's 
finest. On that day, the leaders of this body rose above partisanship 
and they rose to the challenge of a pivotal moment in the history of 
the world.
    Mr. Chairman, I believe you are continuing that tradition today. I 
thank you for your decision to hold these hearings early, for the 
bipartisan manner in which you and Senator Biden are conducting them, 
and for the serious and substantive way in which you have framed our 
discussion.
    I am honored to be part of what you have rightly called the 
beginning of the process of advice and consent. And I am hopeful that 
with your support, and after the full national debate to which these 
hearings will contribute, the Senate will embrace the addition of new 
members to NATO. It would be fitting if this renewal of our commitment 
to security in Europe could come early next year, as Congress 
celebrates the 50th anniversary of its approval of the Marshall Plan.
    As I said, and as you can see, I am very conscious of history 
today. I hope that you and your colleagues will look back as I have on 
the deliberations of 1949, for they address so many of the questions I 
know you have now: How much will a new alliance cost and what are its 
benefits? Will it bind us to go to war? Will it entangle us in far away 
quarrels?
    We should take a moment to remember what was said then about the 
alliance we are striving to renew and expand today.
    Senator Vandenberg, Chairman Helms' extraordinary predecessor, 
predicted that NATO would become ``the greatest war deterrent in 
history.'' He was right. American forces have never had to fire a shot 
to defend a NATO ally.
    This Committee, in its report to the Senate on the NATO treaty, 
predicted that it would ``free the minds of men in many nations from a 
haunting sense of insecurity, and enable them to work and plan with 
that confidence in the future which is essential to economic recovery 
and progress.'' Your predecessors were right. NATO gave our allies time 
to rebuild their economies. It helped reconcile their ancient 
animosities. And it made possible an unprecedented era of unity in 
Western Europe.
    President Truman said that the NATO pact ``will be a positive, not 
a negative, influence for peace, and its influence will be felt not 
only in the area it specifically covers but throughout the world.'' And 
he was right, too. NATO gave hope to democratic forces in West Germany 
that their country would be welcome and secure in our community if they 
kept making the right choices. Ultimately, it helped bring the former 
fascist countries into a prosperous and democratic Europe. And it 
helped free the entire planet from the icy grip of the Cold War.
    Thanks in no small part to NATO, we live in a different world. Our 
Soviet adversary has vanished. Freedom's flag has been unfurled from 
the Baltics to Bulgaria. The threat of nuclear war has sharply 
diminished. As I speak to you today, our immediate survival is not at 
risk.
    Indeed, you may ask if the principle of collective defense at 
NATO's heart is relevant to the challenges of a wider and freer Europe. 
You may ask why, in this time of relative peace, are we so focused on 
security?
    The answer is, we want the peace to last. We want freedom to 
endure. And we believe there are still potential threats to our 
security emanating from European soil.
    You have asked me, Mr. Chairman, what these threats are. I want to 
answer as plainly as I can.
    First, there are the dangers of Europe's past. It is easy to forget 
this, but for centuries virtually every European nation treated 
virtually every other as a military threat. That pattern was broken 
only when NATO was born and only in the half of Europe NATO covered. 
With NATO, Europe's armies prepared to fight beside their neighbors, 
not against them; each member's security came to depend on cooperation 
with others, not competition.
    That is one reason why NATO remains essential, even though the Cold 
War is over. It is also one reason why we need a larger NATO, so that 
the other half of Europe is finally embedded in the same cooperative 
structure of military planning and preparation.
    A second set of dangers lies in Europe's present. Because of 
conflict in the Balkans and the former Soviet Union, Europe has already 
buried more victims of war since the Berlin Wall fell than in all the 
years of the Cold war. It is sobering to recall that this violence has 
its roots in the same problems of shattered states and hatred among 
ethnic groups that tyrants exploited to start this century's great 
wars.
    Finally, Mr. Chairman, and most important, we must consider the 
dangers of Europe's future. By this I mean direct threats against the 
soil of NATO members that a collective defense pact is designed to 
meet. Some are visible on Europe's horizon, such as the threat posed by 
rogue states with dangerous weapons that might have Europe within their 
range and in their sights. Others may not seem apparent today, in part 
because the existence of NATO has helped to deter them. But they are 
not unthinkable.
    Within this category lie questions about the future of Russia. We 
have an interest in seeing Russian democracy endure. We are doing all 
we can with our Russian partners to see that it does. And we have many 
reasons to be optimistic. At the same time, one should not dismiss the 
possibility that Russia could return to the patterns of its past. By 
engaging Russia and enlarging NATO, we give Russia every incentive to 
deepen its commitment to democracy and peaceful relations with 
neighbors, while closing the avenue to more destructive alternatives.
    We do not know what other dangers may arise 10, 20, or even 50 
years from now. We do know enough from history and human experience to 
believe that a grave threat, if allowed to arise, would arise. We know 
that whatever the future may hold, it will be in our interest to have a 
vigorous and larger alliance with those European democracies that share 
our values and our determination to defend them.
    We recognize NATO expansion involves a solemn expansion of American 
responsibilities in Europe. It does not bind us to respond to every 
violent incident by going to war. But it does oblige us to consider an 
armed attack against one ally an attack against all and to respond with 
such action as we deem necessary, including the use of force, to 
restore the security of the North Atlantic area.
    As Americans, we take our commitments seriously and we do not 
extend them lightly. Mr. Chairman, you and I do not agree on 
everything, but we certainly agree that any major extension of American 
commitments must serve America's strategic interests.
    Let me explain why welcoming the Czech Republic, Hungary and Poland 
into NATO meets that test.
    First, a larger NATO will make us safer by expanding the area in 
Europe where wars simply do not happen. This is the productive paradox 
at NATO's heart: By imposing a price on aggression, it deters 
aggression. By making clear that we will fight, if necessary, to defend 
our allies, it makes it less likely our troops will ever be called upon 
to do so.
    Now, you may say that no part of Europe faces any immediate threat 
of armed attack today. That is true. And I would say that the purpose 
of NATO enlargement is to keep it that way. Senator Vandenberg said it 
in 1949: ``[NATO] is not built to stop a war after it starts, although 
its potentialities in this regard are infinite. It is built to stop 
wars before they start.''
    It is also fair to ask if it is in our vital interest to prevent 
conflict in central Europe. There are those who imply it is not. I'm 
sure you have even heard a few people trot out what I call the 
``consonant cluster clause,'' the myth that in times of crisis 
Americans will make no sacrifice to defend a distant city with an 
unpronounceable name, that we will protect the freedom of Strasbourg 
but not Szczecin, Barcelona, but not Brno.
    Let us not deceive ourselves. The United States is a European 
power. We have an interest not only in the lands west of the Oder 
river, but in the fate of the 200 million people who live in the 
nations between the Baltic and Black Seas. We waged the Cold War in 
part because these nations were held captive. We fought World War II in 
part because these nations had been invaded.
    Now that these nations are free, we want them to succeed And we 
want them to be safe, whether they are large or small. For if there 
were a major threat to the security of their region, if we were to wake 
up one morning to the sight of cities being shelled .and borders being 
overrun, I am certain that we would choose to act, enlargement or no 
enlargement. Expanding NATO now is simply the surest way to prevent 
that kind of threat from arising, and thus the need to make that kind 
of choice.
    Mr. Chairman, the second reason why enlargement passes the test of 
national interest is that it will make NATO stronger and more cohesive. 
The Poles, Hungarians and Czechs are passionately committed to NATO and 
its principles of shared responsibility. Experience has taught them to 
believe in a strong American leadership role in Europe. Their forces 
have risked their lives alongside ours from the Gulf War to Bosnia. 
Just last month, Czech soldiers joined our British allies in securing a 
police station from heavily armed Bosnian Serb extremists.
    Mr. Chairman, I know you have expressed concern that enlargement 
could dilute NATO by adding too many members and by involving the 
alliance in too many missions. Let me assure you that we invited only 
the strongest candidates to join the Alliance. And nothing about 
enlargement will change NATO's core mission, which is and will remain 
the collective defense of NATO soil.
    At the same time, it is important to remember that NATO has always 
served a political function as well. It binds our allies to us just as 
it binds us to our allies. So when you consider the candidacy of the 
Czech Republic, Hungary and Poland, Mr. Chairman, I ask you to consider 
this:
    When peace is threatened somewhere in the world and we decide it is 
in our interest to act, here are three nations we have been able to 
count on to be with us. In the fight against terror and nuclear 
proliferation, here are three nations we have been able to count on. In 
our effort to reform the UN, here are three nations we have been able 
to count on. When we speak out for human rights around the world, here 
are three nations we will always be able to count on.
    Here are three nations that know what it means to lose their 
freedom and who will do what it takes to defend it. Here are three 
democracies that are ready to do their dependable part in the common 
enterprise of our alliance of democracies.
    Mr. Chairman, the third reason why a larger NATO serves our 
interests is that the very promise of it gives the nations of central 
and eastern Europe an incentive to solve their own problems. To align 
themselves with NATO, aspiring countries have strengthened their 
democratic institutions. They have made sure that soldiers serve 
civilians, not the other way around. They have signed 10 major accords 
that taken together resolve virtually every old ethnic and border 
dispute in the region, exactly the kind of disputes that might have led 
to future Bosnias. In fact, the three states we have invited to join 
NATO have resolved every outstanding dispute of this type.
    I have been a student of central European history and I have lived 
some of it myself. When I see Romanians and Hungarians building a 
genuine friendship after centuries of enmity, when I see Poles, 
Ukrainians and Lithuanians forming joint military units after years of 
suspicion, when I see Czechs and Germans overcoming decades of 
mistrust, when I see central Europeans confident enough to improve 
their political and economic ties with Russia, I know something 
remarkable is happening.
    NATO is doing for Europe's east precisely what it did--precisely 
what this Committee predicted it would do--for Europe's west after 
World War II. It is helping to vanquish old hatreds, to promote 
integration and to create a secure environment for economic prosperity. 
This is another reminder that the contingencies we do not want our 
troops to face, such as ethnic conflict, border skirmishes, and social 
unrest are far more easily avoided with NATO enlargement than without 
it.
    In short, a larger NATO will prevent conflict, strengthen NATO, and 
protect the gains of stability and freedom in central and eastern 
Europe. That is the strategic rationale. But I would be disingenuous if 
I did not tell you that I see a moral imperative as well. For this is a 
policy that should appeal to our hearts as well as to our heads, to our 
sense of what is right as well as to our sense of what is smart.
    NATO defines a community of interest among the free nations of 
North America and Europe that both preceded and outlasted the Cold War. 
America has long stood for the proposition that this Atlantic community 
should not be artificially divided and that its nations should be free 
to shape their destiny. We have long argued that the nations of central 
and eastern Europe belong to the same democratic family as our allies 
in western Europe.
    We often call them ``former communist countries,'' and that is true 
in the same sense that America is a ``former British colony.'' Yes, the 
Czechs, Poles, and Hungarians were on the other side of the Iron 
Curtain during the Cold War. But we were surely on the same side in the 
ways that truly count.
    As Americans, we should be heartened today that so many of Europe's 
new democracies wish to join the institutions Americans did so much to 
build. They are our friends and we should be proud to welcome them 
home.
    We should also think about what would happen if we were to turn 
them away. That would mean freezing NATO at its Cold War membership and 
preserving the old Iron Curtain as its eastern frontier. It would mean 
locking out a whole group of otherwise qualified democracies simply 
because they were once, against their will, members of the Warsaw Pact.
    Why would America choose to be allied with Europe's old democracies 
forever, but its new democracies never? There is no acceptable, 
objective answer to that question. Instead, it would probably be said 
that we blocked the aspirations of our would-be allies because Russia 
objected. And that, in turn, could cause confidence to crumble in 
central Europe, leading to a search for security by other means, 
including costly arms buildups and competition among neighbors.
    We have chosen a better way. We have chosen to look at the 
landscape of the new Europe and to ask a simple question: Which of 
these nations that are so clearly important to our security are ready 
and able to contribute to our security? The answer to that question is 
before you today, awaiting your affirmation.
    I said at the outset, Mr. Chairman, that there are weighty voices 
on both sides of this debate. There are legitimate concerns with which 
we have grappled along the way, and that I expect you to consider fully 
as well. Let me address a few.
    First, we all want to make sure that the costs of expansion are 
distributed fairly. Last February, at the behest of Congress and before 
the Alliance had decided which nations to invite to membership, the 
Administration made a preliminary estimate of America's share. Now that 
we have settled on three candidates, we are working with our allies to 
produce a common estimate by the December meeting of the North Atlantic 
Council. At this point, the numbers we agree upon as 16 allies are 
needed prior to any further calculations made in Washington.
    I know you are holding separate hearings in which my Pentagon 
colleagues will go into this question in detail. But I will say this: I 
am convinced that the cost of expansion is real but affordable. I am 
certain our prospective allies are willing and able to pay their share, 
because in the long run it will be cheaper for them to upgrade their 
forces within the alliance than outside it. As Secretary of State, I 
will insist that our old allies share this burden fairly. That is what 
NATO is all about.
    I know there are serious people who estimate that a larger NATO 
will cost far more than we have anticipated. The key fact about our 
estimate is that it is premised on the current, favorable security 
environment in Europe. Obviously, if a grave threat were to arise, the 
cost of enlargement would rise. But then so would the cost of our 
entire defense budget.
    In any case, there are budgetary constraints in all 16 NATO 
democracies that will prevent costs from ballooning. That is why the 
main focus of our discussion, Mr. Chairman, and in our consultations 
with our allies, needs to be on defining the level of military 
capability we want our old and new allies to have in this favorable 
environment, and then making sure that they commit to that level. We 
must spend no more than we must, but no less than we need to keep NATO 
strong.
    Another common concern about NATO enlargement is that it might 
damage our cooperation with a democratic Russia. Russian opposition to 
NATO enlargement is real. But we should see it for what it is: a 
product of old misperceptions about NATO and old ways of thinking about 
its former satellites in central Europe. Instead of changing our 
policies to accommodate Russia's outdated fears, we need to encourage 
Russia's more modern aspirations.
    This means that we should remain Russia's most steadfast champion 
whenever it seeks to define its greatness by joining international 
institutions, opening its markets and participating constructively in 
world affairs. It means we should welcome Russia's decision to build a 
close partnership with NATO, as we did in the NATO-Russia Founding Act.
    But when some Russian leaders suggest that a larger NATO is a 
threat, we owe it candor to say that is false--and to base our policies 
on what we know to be true. When they imply that central Europe is 
special, that its nations still are not free to choose their security 
arrangements, we owe it to candor to say that times have changed, and 
that no nation can assert its greatness at the expense of its 
neighbors. We do no favor to Russian democrats and modernizers to 
suggest otherwise.
    I believe our approach is sound and producing results. over the 
past year, against the backdrop of NATO enlargement, reformers have 
made remarkable gains in the Russian government. We have agreed to 
pursue deeper arms reductions. Our troops have built a solid working 
relationship on the ground in Bosnia. Russia was our full partner at 
the Summit of the Eight in Denver and it has joined the Paris Club of 
major international lenders.
    What is more, last week in New York we signed documents that should 
pave the way for the Russian Duma to ratify the START II treaty. While 
this prospect is still by no means certain, it would become far less so 
if we gave the Duma any reason to think it could hold up NATO 
enlargement by holding up START II.
    As you know Mr. Chairman, last week, NATO and Russia held the first 
ministerial meeting of their Permanent Joint Council. This council 
gives us an invaluable mechanism for building trust between NATO and 
Russia through dialogue and transparency.
    I know that some are concerned NATO's new relationship with Russia 
will actually go too far. You have asked me for an affirmation, Mr. 
Chairman, that the North Atlantic Council remains NATO's supreme 
decision making body. Let me say it clearly: It does and it will. The 
NATO-Russia Founding Act gives Russia no opportunity to dilute, delay 
or block NATO decisions. NATO's allies will always meet to agree on 
every item on their agenda before meeting with Russia. And the 
relationship between NATO and Russia will grow in importance only to 
the extent Russia uses it constructively.
    The Founding Act also does not limit NATO's ultimate authority to 
deploy troops or nuclear weapons in order to meet its commitments to 
new and old members. All it does is to restate unilaterally existing 
NATO policy: that in the current and foreseeable security environment, 
we have no plan, no need, and no intention to station nuclear weapons 
in the new member countries, nor do we contemplate permanently 
stationing substantial combat forces. The only binding limits on 
conventional forces in Europe will be set as we adapt the CFE treaty, 
with central European countries and all the other signatories at the 
table, and we will proceed on the principle of reciprocity.
    Another important concern is that enlargement may create a new 
dividing line in Europe between a larger NATO and the countries that 
will not join in the first round. We have taken a range of steps to 
ensure this does not happen.
    President Clinton has pledged that the first new members will not 
be the last. NATO leaders will consider the next steps in the process 
of enlargement before the end of the decade. We have strengthened 
NATO's Partnership for Peace program. We have created a new Euro-
Atlantic Partnership Council, through which NATO and its democratic 
partners throughout Europe will shape the missions we undertake 
together. We have made it clear that the distinction between the 
nations NATO invited to join in Madrid and those it did not is based 
purely on objective factors--unlike the arbitrary line that would 
divide Europe if NATO stood still.
    Among the countries that still aspire to membership, there is 
enthusiastic support for the process NATO has begun. Had you seen the 
crowds that cheered the President in Romania in July, had you been with 
me when I spoke to the leaders of Lithuania and Slovenia, you would 
have sensed how eager these nations are to redouble their efforts.
    They understand a simple fact: With enlargement, no new democracy 
is permanently excluded; without enlargement, every new democracy would 
be permanently excluded. The most important thing the Senate can do to 
reassure them now is to get the ball rolling by ratifying the admission 
of the first three candidates.
    Mr. Chairman, a final concern I wish to address has to do with 
Bosnia.
    Some have suggested that our debate on NATO enlargement simply 
cannot be separated from our actions and decisions in that troubled 
country. I agree with them. Both enlargement and our mission in Bosnia 
are aimed at building a stable undivided Europe. Both involve NATO and 
its new partners to the east.
    It was our experience in Bosnia that proved the fundamental premise 
of our enlargement strategy: there are still threats to peace and 
security in Europe that only NATO can meet. It was in Bosnia that our 
prospective allies proved they are ready to take responsibility for the 
security of others. It was in Bosnia that we proved NATO and Russian 
troops can work together.
    We cannot know today if our mission in Bosnia will achieve all its 
goals, for that ultimately depends on the choices the Bosnian people 
will make. But we can say that whatever may happen, NATO's part in 
achieving the military goals of our mission has been a resounding 
success. Whatever may happen, our interest in a larger, stronger NATO 
will endure long after the last foreign soldier has left Bosnia.
    We can also say that NATO will remain the most powerful instrument 
we have for building effective military coalitions such as SFOR. At the 
same time, Bosnia does not by itself define the future of a larger 
NATO. NATO's fundamental purpose is collective defense against 
aggression. Its most important aim, if I can paraphrase Arthur 
Vandenberg, is to prevent wars before they start so it does not have to 
keep the peace after they stop.
    These are some of the principal concerns I wanted to address today; 
I know you have many more questions and I look forward to answering 
them all.
    This discussion is just beginning. I am glad that it will also 
involve other committees of the Senate, the NATO Observers' Group and 
the House of Representatives. Most important, I am glad it will involve 
the people of the United States. For the commitment a larger NATO 
entails will only be meaningful if the American people understand and 
accept it.
    When these three new democracies join NATO in 1999, as I trust they 
will, it will be a victory for us all, Mr. Chairman. And on that day, 
we will be standing on the shoulders of many.
    We will be thankful to all those who prosecuted the Cold War, to 
all those on both sides of the Iron Curtain who believed that the goal 
of containment was to bring about the day when the enlargement of our 
democratic community would be possible.
    We will be grateful to all those who championed the idea of a 
larger NATO--not just President Clinton, or President Havel, or 
President Walesa, but members of Congress from both parties who voted 
for resolutions urging the admission of these three nations. we will 
owe a debt to the Republican members who made NATO enlargement part of 
their Contract with America.
    Today, all of our allies and future allies are watching you for one 
simple reason. The American Constitution is unique in the power it 
grants to the legislative branch over foreign policy, especially over 
treaties. In this matter, Mr. Chairman, members of the Committee, you 
and the American people you represent are truly in the driver's seat.
    That is as it should be. In fact, I enjoy going to Europe and 
telling our allies: ``This is what we want to do, but ultimately, it 
will be up to our Senate and our people to decide.'' I say that with 
pride because it tells them something about America's faith in the 
democratic process.
    But I have to tell you that I say it with confidence as well. I 
believe we will stand together, Mr. Chairman, when the time comes for 
the Senate to decide, because I know that the policy we ask you to 
embrace is a policy that the Administration and Congress shaped 
together, and because I am certain that it advances the fundamental 
interests of the United States.
    Thank you very much.

    The Chairman. Thank you, Madam Secretary, for a very 
eloquent statement. It will be written about and talked about 
for some time because this is an important subject. It is an 
important milestone in not only the history of this country, 
but the world.
    We are going to have a round of 6-minute questions by each 
Senator, and I hope that they will not be taken up by 
statements up until 10 seconds before the red light comes on 
and therefore give you a chance to answer.
    Reports that NATO intends to consult with Russia on such 
fundamental matters as the military strategy and nuclear 
doctrine of the alliance have caused a great concern among a 
great many leaders of our country, past and present. They, you 
better believe, are contacting me with suggestions.
    Now, how can NATO consult with Russia on these and other 
matters without compromising the security or decisionmaking 
process of NATO?
    I guess that leads to a second question. Will you establish 
fire walls in NATO's relations with Russia and assure that 
Russia has neither a voice nor a veto in NATO discussions of 
issues such as arms control, strategic doctrine, and further 
alliance expansion? A pretty hefty question but I know you can 
handle it.
    Secretary Albright. Thank you.
    Mr. Chairman, we are pleased with the development of the 
NATO-Russia relationship to date. We believe that the NATO-
Russia Founding Act and the Permanent Joint Council it created 
offers real opportunities to develop a partnership between NATO 
and Russia through regular consultations and activities to 
build practical cooperation.
    I have been very pleased with the early work of that 
council, including its first ministerial meeting in New York on 
September 26th, and I think that in many ways that was quite a 
remarkable meeting in starting this process out. I believe that 
these elements of the NATO-Russia relationship, together with 
our bilateral efforts to integrate Russia more fully into the 
rest of the West, are beginning to bear fruit.
    At the same time, let me be very clear about your concern. 
The Founding Act and the Permanent Joint Council created as a 
result do not provide Russia any role in decisions the alliance 
takes on internal matters, the way NATO organizes itself, 
conducts its business, or plans, prepares for and conducts 
those missions which affect only its members, such as 
collective defense, as stated under Article 5.
    The Permanent Joint Council will not be a forum in which 
NATO's basic strategy doctrine and readiness are negotiated 
with Russia, nor will NATO use the Permanent Joint Council as a 
substitute for formal arms control negotiations such as the 
Conventional Forces in Europe (CFE) Treaty.
    Consistent with our past approach to relations with Russia, 
NATO will continue to explain to Russia its general policy on a 
full range of issues, including its basic military doctrine and 
defense policies. Such explanation will not extend to a level 
of detail that could in any way compromise the effectiveness of 
NATO's military forces. Such explanations will only be 
offered--and I state this very emphatically--after NATO has 
first set its policies on issues affecting internal matters. 
NATO has not and will not discuss these issues with Russia 
prior to making decisions within the North Atlantic Council.
    Now, further, the Permanent Joint Council operates by 
mutual agreement, which means both NATO and Russia must agree 
to discuss an issue in the first place. NATO's policy always 
will first be established by consensus requiring all allies' 
agreement. Moreover, NATO is not required to discuss any issue. 
The Founding Act is a political commitment, not a legal 
document. The U.S., thus, will always retain the ability to 
prevent the Permanent Joint Council from discussing any issue 
which it does not want addressed for whatever reason within 
that forum.
    So, let me just reemphasize. I can assure you that the 
Permanent Joint Council will never be used to make decisions on 
NATO doctrine, strategy, or readiness. The North Atlantic 
Council is NATO's supreme decisionmaking body, and it is 
sacrosanct. Russia will not play a part in the NAC or NATO 
decisionmaking and it will never have a veto over NATO policy. 
Any discussion with Russia of NATO doctrine will be for 
explanatory, not decisionmaking, purposes.
    But I also would like to state, Mr. Chairman, that I think 
we will find the Permanent Joint Council a very useful 
mechanism for having discussions with Russia on issues of 
mutual interest. If the first meeting that we just held in New 
York is an example of it, I look forward to seeing that as a 
very useful mechanism as we develop our relationship with a 
democratic Russia.
    The Chairman. Very quickly because the yellow light is on. 
That is a good answer to my questions and I appreciate it.
    Have our allies met the current defense obligations to 
which they have committed themselves as members of NATO?
    Secretary Albright. Yes, they have. We are all part of how 
we burden-share in terms of allotments for NATO. As you know, 
there are really two parts to the NATO budget. There are common 
budgets for which there are assessments, and then each country 
provides within its defense budget to live up to its 
obligations under NATO. I believe that they are doing so and I 
also believe that they will do so as we go through developing 
the processes for the payment of the enlargement.
    The Chairman. Very well.
    Our distinguished Ranking Member, Mr. Biden.
    Senator Biden. Thank you, Mr. Chairman.
    Madam Secretary, I have had the occasion now--it seems a 
little premature--to debate this subject in different fora with 
several of my colleagues who oppose the expansion of NATO, most 
recently before a group of chief executive officers and opinion 
leaders from one of our States who were here in town.
    There have also been closed meetings that Senator Roth and 
I have set up in the Senate's NATO Observer Group where our 
colleagues come in and state their support, opposition, or 
concern.
    It seems to be coming down to a pretty basic thing. It is 
kind of ironic. The only thing that seems to be carrying the 
momentum right now in the minds of many of my colleagues and 
the American people is the moral imperative, and that is that 
Poland and particularly Hungary and the Czech Republic were 
left behind the curtain. the curtain is up. Now is the time to 
let them come to the west from the east.
    But there's very little knowledge--I should not say 
knowledge--there is very little consensus about why this is in 
the vital interest of the United States. Very few people 
believe that adding, as brave and as valiant as they may be, 
the Polish army and the Czech army and the Hungarian army to 
NATO is any more likely to make them sleep more safely in 
Peoria than they sleep today.
    I am going to recite the arguments I hear very briefly, and 
then stop and ask you to comment because they are the essence 
of what we are going to have to answer in order to prevail.
    You indicate that the American people will eventually agree 
with NATO expansion. I think there is only one lesson I take 
away from the Vietnam War and that is that a foreign policy, no 
matter how well or poorly constructed, cannot be maintained 
without the informed consent of the American people. Right now 
there is not informed consent.
    Right now, if you ask the American people if they think 
there is a need for NATO, if they like spending $120 billion a 
year, or whatever allocation we would conclude is warranted by 
our NATO membership, I suspect you would find them saying the 
same thing I hear from my colleagues. Why cannot Europe do 
this? Why not leave well enough alone?
    If we expand, the alliance will lose its vitality. As one 
of my senior colleagues on the Armed Services Committee said in 
a debate I recently had with him ``if it ain't broke, don't fix 
it.''
    If you expand it, you are going to diminish consensus. We 
have a hard enough time getting 16 nations to agree now. Expand 
it by three or more nations and it is going to even be more 
difficult to obtain consensus. You are going to do what was 
done 300 years ago in Poland when the princes got together and 
each had a veto. You are going to allow the basic structure to 
crumble.
    These are the arguments that I keep hearing, but the root 
argument is as follows. Look at Europe. As one of our 
colleagues says, of the six largest armies in the world, five 
are in Asia. Our economic future lies in Asia. We have a 
disproportionate allocation of our resources in Europe. Why are 
we doing this?
    It comes down, in my view, to the need to answer the 
following question, and then I will cease when I ask it,--why 
cannot the Europeans take care of themselves? Their GDP is 
larger than ours. Their population is larger than ours. As my 
father said in a different context to me, not since the Roman 
army invaded Europe and quelled the pagans has there been an 
occupying army that stayed in place as long as we have been 
required to stay in place in Europe. Why?
    I believe you and the President in particular are going to 
have to carry that argument to the people, an answer to that 
question. Why can Europe not do this themselves? Why do we have 
to be involved?
    I think I am like that old joke about the Texan who says he 
does not know much about art, but he knows what he likes. I 
feel firmly I know the answer to why we have to be involved, 
but I think until it is explained to the American people, we 
are going to have this shadow debate about a lot of things 
other than why the Europeans cannot do this by themselves. Why 
do we need to be in Europe?
    Secretary Albright. Senator Biden, I think that that is a 
key question that we have to answer. Let me just say here that 
one has to really hark to history.
    First of all, as both you and the chairman said, our 
history is tied to the history of Europe, even before, 
obviously, the 20th century. Our values and a great deal of our 
history comes from Europe and strategically Europe is key to 
the United States in terms of its population, its economy, its 
geostrategic structure.
    But let me also say that what is evident because of those 
aspects, we have found that when we have not paid attention to 
Europe ultimately because those elements are so strong, we are 
drawn into dealing with Europe's problems, always at a much 
greater cost than would have been the case in the first place.
    I believe very strongly that this is a very smart 
additional preventive measure because history has shown us that 
we will go into Europe when we see massive wars that involve 
people that we are very closely related to, and when it 
involves our economic and strategic interests.
    Now, we are not an occupying power in Europe. We are a 
partner, and the point of this is that NATO does in fact bind 
us to Europe in a way that keeps us there as an invited partner 
and not as an occupying power. I believe that if we do not stay 
there now, and say ``let the Europeans do it,'' history will 
show us that we will be back and we will be back at much 
greater cost than if we were to do it now at a lesser cost as a 
partner rather than as someone that has to go dig them out of a 
mess.
    Senator Biden. Thank you, Mr. Chairman.
    The Chairman. Senator Lugar.
    Senator Lugar. Thank you very much, Mr. Chairman.
    Secretary Albright, in my judgment the NATO enlargement 
debate has thus far largely ignored the central question of 
NATO's basic purpose. The Senate's ratification debate over new 
alliance members should start with that question, and I commend 
Chairman Helms for focusing on that theme in this committee's 
initial hearing.
    Many of us within the Congress and the administration have 
been working hard to ensure ratification of the admission of 
Poland, Hungary, and the Czech Republic, perhaps too busy to 
define NATO's purpose. But issues associated with purpose and 
burden sharing will come up in the ratification proceedings. 
The answers will be key to the ratification, but also for the 
future of NATO.
    First, the absence of a clearly defined and understood 
purpose can complicate the implementation of enlargement by 
making it appear as if the alliance's exclusive mission is to 
defend its members against some future, yet ill-defined threat 
from the east.
    While not insignificant, such a preoccupation could in turn 
focus allied militaries on the wrong problem, particularly if 
major strategic threats to the United States and its allies are 
elsewhere.
    Second, the act of enlargement is becoming confused with 
the alliance's reason for existence, and the issue of future 
additional members could either cause further delay in 
addressing NATO's core purpose or be delayed by inadequate 
definition of the alliance's core missions.
    Third, the alliance force planning goals and programs must 
be based on a military strategy which must, in turn, be shaped 
by strategic purpose. Adequate defense spending in the 
modernization and restructuring of outdated forces will not 
occur in the absence of strategic purpose.
    Fourth, the United States' strategy and technology are 
driven by global priorities, while European forces are focused 
on territorial defense and thus are largely irrelevant to U.S. 
priorities. The recent Quadrennial Defense Review does not 
substantially take account of NATO, Europe, or the allies in 
U.S. global strategy and requirements. In short, adjudged by 
the QDR, America's main alliance is not confronting the main 
security problems of the United States.
    Despite alliance emphasis on defense of its members' 
territory under Article 5 of the Washington Treaty and peace 
operations and crisis management under Article 4, NATO is in 
need of strategic direction. This should be accomplished before 
or in parallel with further decisions about forces, command 
structure, and membership.
    To oversimplify, I believe there are at least two strategic 
alternatives that could drive the alliance's core purpose.
    The first is for NATO to be the guarantor of European 
security, and thus NATO's mission is identified with a European 
mission and should dovetail with Europe's danger.
    The second is for NATO to serve as the vehicle by which 
Americans and Europeans protect their common interests wherever 
challenged. While it subsumes the first, it also suggests that 
the Atlantic Alliance can and should confront the rising 
threats to the interest of members beyond Europe. Geography is 
the chief criteria of the first strategy. Interests are what 
matter in the second.
    These two strategic alternatives point toward quite 
different futures and may suggest different approaches to 
future enlargement to further encourage other engagement of PFP 
partners to burden sharing, to structuring forces and commands.
    Secretary Albright, where does the administration stand on 
the definition of our strategic alternatives and what strategic 
direction or rationale will it promote within the alliance?
    Secretary Albright. Senator Lugar, let me say that there 
are two parts to the answer to this question.
    First of all, clearly the basic original objective of NATO, 
which was a collective defense treaty to deal with Europe, 
continues to be in place and in fact is adapted in order to 
deal with the changing security environment and obviously the 
change that has taken place with the end of the cold war. There 
have been studies that have been undertaken internally in order 
to adapt the strategic concept of NATO to the more current 
threats that it faces.
    If I might say, to dovetail on a point that Senator Biden 
made, that those who say it ain't broke, don't fix it, the 
truth is it ain't suitable for what we are doing now. So, it 
needs to be fixed. Europe looks very different, and I would ask 
you to review what I said in my opening statement: What would 
happen if we did not adapt NATO and enlarge it? Because 
otherwise, we would be dealing with the past instead of dealing 
with the future.
    At the same time, Senator, I do think that there has been 
an incredible amount of creativity in terms of developing 
institutional structures such as the EAPC or the Partnership 
for Peace that allows us to look at how to use an enlarged NATO 
or a NATO along with subsidiary organs to deal with 
peacekeeping, and to deal with the potential threats from some 
of the rogue states. I find what is going on is a very good 
exercise in creativity with substantial backing from strategic 
thinkers in terms of how to use what is the best military 
alliance in the history of the world to deal with the new 
threats, both geographically and the ones that you mentioned. 
That process is going on. These are not two mutually exclusive 
goals.
    Senator Lugar. Thank you, Mr. Chairman.
    The Chairman. Senator Sarbanes.
    Senator Sarbanes. Madam Secretary, I want to join with my 
colleagues in welcoming you before the committee. As everyone 
has indicated, this is the beginning of an extended process to 
examine carefully this issue.
    I want to get some sense at the outset about the path that 
we will be placed upon and where it will lead and what the 
timing is, as we move forward. So, I would like first to just 
get a sense of the parameters of the timing. How do you see 
that unfolding?
    Secretary Albright. Well, Senator, as of right now, we are 
dealing both with our allies and the invitees to develop what 
would be their defense plans and the budget that goes with it. 
We would hope that by December there would be the NAC 
ministerial at which the accession protocols would be signed. 
Then our plan would be to submit the treaty to you formally and 
have, in fact, the official debate going on. At the same time, 
there would be a ratification debate going on in the 
parliaments of the other NATO members. Then we would be able 
to, in fact, have the new NATO, the enlarged NATO, at the 50th 
anniversary in 1999.
    Senator Sarbanes. Now, is the December meeting of the North 
Atlantic Council the meeting at which you expect approval of 
the entry of the three countries into NATO?
    Secretary Albright. From the perspective that they have the 
power to do that, the accession protocols would be signed. 
Obviously, it is not final until this is ratified and goes 
through the constitutional processes of each individual 
country.
    Senator Sarbanes. Now, at that point, will the burden of 
the cost be outlined, or will that be something to be developed 
later?
    Secretary Albright. No. The plan is that the comprehensive 
NATO and cost report would be approved by the NATO ministers in 
December.
    Now, I have to stress again, as I stressed in my statement, 
those are to do with the costs in the current environment. They 
would have been worked out as a result of very careful work 
among the allies, as well as what is going on now, Senator 
Sarbanes, in terms of our people going around talking with the 
three invitees about developing their specific defense plans.
    Senator Sarbanes. I am having some difficulty in 
understanding why the 50th anniversary of either the Congress' 
approval of the Marshall Plan or the entry into force of the 
Marshall Plan is relevant as a date by which this process ought 
to move. I wonder if you could enlighten me on that.
    Secretary Albright. Well, we have been celebrating the 50th 
anniversary of everything.
    Senator Sarbanes. Well, I understand that.
    Secretary Albright. Are you suggesting, Senator----
    Senator Sarbanes. I take it that is about the only 
rationale for it.
    Secretary Albright. We believe, Senator, that the debates 
will be going on in the various parliaments. We want to give 
the publics a chance to really be a part of the debate. We 
would like to be early on in the ratification process because 
we are the United States and provide the leadership. We thought 
it would be a nice time, but it could be earlier if everyone 
were ready to go.
    Senator Sarbanes. I take it once that process is completed, 
then the immediate issue before us, as we are moving down this 
path, would be the accession to NATO of other countries which 
are seeking to become members. Would that be correct?
    Secretary Albright. We have said that it is an ongoing 
process. We have not specifically set a date for the next 
tranche, and we will be considering new members. We had said 
hypothetically that it could take place after these members 
were full members, which is where we had put it in 1999.
    Senator Sarbanes. Well, is it not reasonable to assume that 
once these members are dealt with, that that issue will then be 
immediately before us?
    Secretary Albright. It is reasonable to assume that. I 
think that there are countries that wish to be considered in 
the next tranche. There are those that we would like to be 
looking at that are, as part of the Partnership for Peace 
process, already very much involved with what we are doing. We 
are setting up relationships with those countries. So, this is 
an ongoing process, Senator.
    Senator Sarbanes. Well, that would encompass not only, say, 
the two that were considered at Madrid, Romania and Slovenia, 
but I take it other eastern European countries, would it not?
    Secretary Albright. We have said that all those countries 
that met the criteria and the guidelines, are eligible. NATO is 
open to all democracies and market systems which can show a 
real dedication to the development of democratic institutions 
which include civilian control over the military, and which can 
add to the security of NATO. We would not even consider other 
countries that could not contribute generally to the 
enhancement of NATO. That is the basis on which these three 
were invited, and that would be the basis on which others would 
be considered.
    The Chairman. The able Senator from Nebraska.
    Senator Hagel. Mr. Chairman, thank you.
    Secretary Albright, thank you for taking time this morning 
and for your testimony.
    As you mentioned in your statement--and I think your 
statement, Secretary Albright, is a good beginning to this 
debate, but you mentioned clearly that NATO expansion is 
interconnected. It is connected to many variables, many 
interests, economic, trade, national security, Bosnia, Middle 
East, Caspian Sea, and others.
    Is the President of the United States going to set out a 
clear visionary comprehensive foreign policy so that this 
Congress, the American people, the world can understand what it 
is that he thinks is important as we move into the next 
century, including NATO expansion? How does that fit together? 
Will that be forthcoming?
    Secretary Albright. Well, Senator, I believe that all along 
we are giving speeches, as is the President, about the 
direction of our foreign policy. He has made a number of 
statements already. He obviously will continue to do so as will 
the rest of us.
    We are in a period, I think, that is more exciting than any 
that I have witnessed in terms of the possibility of putting 
all those pieces together and explaining to the American public 
what our national interests are and what the stake of each 
American is in all those issues that you have raised. Yes, the 
President will be speaking out, as will the rest of us.
    Senator Hagel. On Bosnia, which you alluded to and did 
mention that obviously Bosnia has in effect, will continue to 
have in effect, as we debate NATO expansion, could you give us 
an update at this point? Where are we in Bosnia? What is our 
course of action? When do we look at pulling some troops out, 
leaving some behind? Where might they be left? Where? Whatever 
you can give us in regard to Bosnia.
    Secretary Albright. Yes. Senator, I think it is very 
interesting. Bosnia has obviously been very much on our minds 
in the last couple of years, and often we focus too much on the 
negative aspect of the fact that the situation has not been 
totally resolved.
    I would prefer to focus on the positive, which is that if 
we go back 3 or 4 years, there were hundreds of thousands of 
people dying. It was impossible for any of us to feel that we 
were doing the right thing in terms of ethnic cleansing. There 
were refugees not only throughout the Balkans, but throughout 
Europe, and there was a question about the survival of the 
whole region.
    Thanks to the resolute action of the United States, led by 
President Clinton, we have in fact been able to reverse the 
tide and not only reverse the tide but take some very positive 
actions.
    First of all, there is a development of the centralized 
institutions within the federation where they are moving more 
and more to those central institutions. We have had municipal 
elections. New elections have now been scheduled in Republika 
Srpska for November. We have managed to see the return of 
refugees. There has been a real change in terms of the economic 
reconstruction. War criminals are going to the Hague. As we 
know, we had 10 of them that the Croats have turned over, and 
we see a genuine change.
    The President has stated, as have I and Sandy Berger, that 
we see the SFOR mission ending in June 1998. But clearly there 
will be a need for continued international presence in Bosnia, 
and that is evident in terms of an economic and political 
presence. We will have to see what kind of a security presence 
will be needed after that time, and that discussion has not 
taken place either in NATO or for us specifically. That is what 
we are turning our attention to now.
    But after a large review of our Bosnia policy last year, I 
do believe that we have new momentum and that we have done a 
great deal to improve the situation for the Bosnian people and 
ultimately, therefore, for the United States because it is in 
our national interest that there not be instability in the 
Balkans.
    Senator Hagel. One additional comment and I would be very 
interested in your thoughts on this, Madam Secretary.
    It seems to me, although I was barely around 50 years ago, 
that one of the reasons that NATO has been such a great success 
is because the leaders at the time had very clear vision that 
called upon the best of our people worldwide, certainly in 
America, and they were able to articulate that and express that 
in not just a grand vision but a realistic vision that called 
upon the best that we as a people, as a Nation, had and as a 
community of nations.
    I would hope that the President will be very engaged in 
this debate because it is very clear that his personal 
commitment and leadership is going to be critical to whatever 
happens here. He, as you suggest, has a tremendous opportunity, 
one of the few opportunities in history, to really put a print 
on the future for the world.
    Secretary Albright. I was 10 years old, but I was on the 
other side of this. I have to tell you, if I might, Mr. 
Chairman, take a minute. I was living in Czechoslovakia at the 
time and it was left out of NATO because there was a communist 
coup and the Soviets had liberated Czechoslovakia and it was 
not allowed to be in this great Western alliance that was there 
to save the West. It did take the leadership of a lot of people 
in the United States to finally realize that in order to stop 
the slide toward communism, it was essential for the American 
people, with our European allies, to draw the line. It took a 
great deal of work by President Truman and by your predecessors 
and by my predecessors.
    I hope very much that that same kind of dedication takes 
place now, and I can assure you that President Clinton and the 
administration is fully with this. I know from listening to all 
of you--and the fact that we have started this now--that we do 
have that kind of commitment and partnership in examining the 
questions in 1997 as they were examined in 1948.
    Senator Hagel. Thank you. Thank you, Mr. Chairman.
    The Chairman. I am obliged to acknowledged that I was not 
barely around 50 years ago.
    Senator Robb.
    Senator Robb. Thank you, Mr. Chairman.
    I was here but I was not concentrating on these particular 
matters at that precise moment in history.
    I join you and other members of this committee in thanking 
the Secretary for coming and being with us this morning and 
thank her for her leadership.
    I might observe, if I may, that a distinguished colleague 
and my senior Senator from Virginia, who is the Ranking 
Republican Member on the Armed Services Committee, has joined 
us this morning. I do not recall recently having had the 
privilege of his visit on this particular committee before, 
although we both serve on the other committee. I do not know 
whether he is going to join the questioning or not, but I am 
delighted that he could join us.
    Madam Secretary, let me just ask a couple of process 
questions or timing questions that are follow up on questions 
that have already been asked in part this morning.
    One of the questions has to do with the basic criteria. You 
indicated in your statement that no new democracy would be 
permanently excluded from NATO membership, but we are not, 
understandably, precise as to exactly how long that whole 
process might be open and inclusive.
    I wonder if you could indicate what your thinking is, at 
least at the moment, with respect to additional accessions. 
Will it be based strictly on the criteria that have been 
established?
    Will it be based on concerns about collective security?
    Will it be based on concerns about threat assessments or 
circumstances as they exist at that particular time?
    Will it be based in part on the success both politically 
and as a matter of creating a more stable relationship of the 
first three accessions or the invitees that presumably will be 
formally accepted sometime in the near future?
    Secretary Albright. Senator, I think that what we have 
based ourselves on as a guiding principle here is that in 
enlarging NATO, we do not wish to diminish its effectiveness. 
As we look at new members, we have to keep in mind that what is 
prime for us is to maintain the cohesiveness of NATO and have 
those that join it be contributors to its strength rather than 
to draw on it and to detract from it. So, that is a guiding 
principle.
    At the same time, we have made very clear that enlargement 
is not a one-time event, that this is a process and that we 
have to have a robust open-door policy in principle, but 
maintain a certain amount of flexibility and nonspecificity as 
we move forward on this.
    I think, as I stated to Senator Sarbanes, we agreed that 
NATO will review the process in 1999. We have made no decisions 
or formal commitments regarding future members. We are going to 
be using the same guidelines as we did for the invitations to 
these three current members.
    Now, obviously the circumstances at the time will be part 
of what we are looking at, but it is our belief that what needs 
to be the guiding principle is to maintain the cohesiveness and 
strength of NATO and have the new members be additions to that 
central goal.
    Senator Robb. Given the criteria that you have suggested 
and the ultimate ability for any democratic state, if they meet 
the criteria and whatever other matters will be considered by 
the member nations in NATO at the time, what would you assess 
is the prospect for the ultimate accession of, say, the Baltic 
states?
    Secretary Albright. Well, I think that again we will have 
to look at it as we move forward and make an assessment as to 
how the situation is evolving and what the first round has 
brought us. But let me specifically address myself to the 
Baltic states.
    We are taking a number of steps in order to ensure that the 
Baltic states are more and more enveloped in European 
institutions and that they are a part of an evolution that 
makes them a part of what we are doing in knitting them in. So, 
for instance, we have done more in terms of knitting them into 
Baltic organizations in northeastern Europe. We are founding 
members of a new group called the BALTSEA which does better 
coordinated donor military assistance. We are also promoting 
closer ties with Nordic states, as well as coordinating efforts 
to promote cooperation between northern Europe and northern 
Russia. We are encouraging the Baltic states in terms of EU 
membership. We are working very hard, I think, to make sure 
that they are very much a part of what we are doing.
    But the major statement, Senator, is that NATO is open to 
all democracies that meet those guidelines that we have been 
talking about. It is not closed to anyone and there is a 
process in train, but I am not going to predict specifically 
what the next group of countries will be.
    Senator Robb. I can understand about not wanting to address 
the question of timing, but clearly for those who have some 
hopes and aspirations for those states, that is precisely not 
ruled out.
    Secretary Albright. Absolutely.
    Senator Robb. Thank you.
    I had another question. My time is expired, however. Thank 
you, Mr. Chairman.
    The Chairman. Thank you, Senator.
    I think all of us welcome the distinguished chairman of the 
Rules Committee.
    Senator Warner.  Thank you, Mr. Chairman.
    The Chairman. I enjoy sitting, where else? To his right on 
the Rules Committee.
    Senator Ashcroft.
    Senator Ashcroft. Thank you, Mr. Chairman.
    Madam Secretary, I thank you for appearing before us.
    You have stated today that there are no parts of Europe 
that face immediate threat and you indicate that one of the 
things we need to do is to enlarge NATO and to adapt NATO. 
Obviously, the NATO enlargement is the subject of the 
discussion.
    Will the adaptation of NATO require us to restate the 
purposes of the organizing documents in some way or is the 
adaptation somehow within the limits of the purposes as stated 
in the document?
    Secretary Albright. We believe that it is within the 
purposes of the document, a collective defense agreement.
    Senator Ashcroft. In terms of collective defense, I'm 
interested in what Senator Lugar mentioned. Defense seems to be 
geographic, at least to defend the soil of those nations that 
are members. Senator Lugar talked about pursuing the interests 
of the member nations.
    Do you see the adapted NATO and the enlarged NATO as 
pursuing the interests of member states, as well as defending 
the soil of those countries?
    Secretary Albright. I do because I think that as I 
mentioned to him, I think that there are increasing interests 
out of area that the NATO countries themselves agree to pursue. 
They are looking at ways to pursue the interests in a way that 
is commensurate with the way that they define them. So, it is 
not overreaching. On the other hand, there are threats that are 
different from the original founding that in fact can be 
subsumed in the way that the treaty is currently outlined.
    Senator Ashcroft. Your use of the phrase ``out of area'' in 
your response is instructive to me. I believe we see an out-of-
area deployment in Bosnia. How wide-ranging would you 
anticipate out-of-area deployments might become under an 
enlarged NATO? For instance, would you see them extending as 
far as the Pacific Rim in the event our interests were 
challenged there? Or would you define it as maybe extending to 
the subcontinent of Asia? Or would you see us as having 
potential out-of-area deployments in Africa, for example?
    I guess then the thrust of my question is, if NATO becomes 
an organization which addresses the interests of NATO nations 
wherever they might take place, is it to be a sort of limited 
U.N. that doesn't require quite as much consensus, or could you 
comment about the potential limits? What would be beyond the 
limit of a NATO which is to respond to the interests of members 
sates rather than NATO's historical purpose of defending the 
European democracies? Is there anyplace in the world to which 
NATO troops might not be assigned?
    Secretary Albright. Well, first of all, while I have said 
it is the prime military alliance of our time, it is not the 
only military arrangement that exists. The NATO Council 
operates by consensus and we are obviously not just one but I 
think people see us as a senior partner within the North 
Atlantic Council. I think that the definition of how far it 
would go is obviously based on that kind of a discussion.
    But let me say what I have been particularly impressed by, 
Senator, in the last couple of years is the creativity of the 
international community in terms of dealing with nonspecific 
threats that we had not heard about before. So, there are a 
variety of ways that issues can be dealt with.
    In the Pacific, we have just published new guidelines in 
our dealings with Japan. We have a whole different way of 
dealing with issues.
    Without making any kind of a statement that rules anybody 
in or out that might cause us problems later on, I would like 
to underline the fact that what is interesting about this era 
is the variety of ways that coalitions of the willing can be 
formed where there is a core group and then there are ways to 
deal with the problem where others join. The Partnership for 
Peace is now viewed as a very creative way of dealing with 
issues.
    Senator Ashcroft. I think I am hearing you say that the 
NATO Council's willingness to agree would be the only limit in 
terms of our ability to enlist the aid of individuals pursuing 
our interests somewhere else in the world.
    Secretary Albright. Not only that, but obviously 
constitutional processes of each of the countries is also 
involved. While we always talk about NATO as triggering this 
Article 5 where an attack on one is an attack on all, there are 
different ways to grade whatever the threat has been and the 
way that a country responds to it in which our constitutional 
processes are the determinative factor.
    Senator Ashcroft. I would like to raise one other issue. I 
see the yellow light is on.
    I am a little bit concerned about our relationships with 
Russia. I think to allow enlargement, without understanding our 
relationship to Russia in the context of it, would be in error, 
and I am sure you are doing that.
    But in one sense it seems like we are isolating a potential 
ally in Russia. We are telling them that you are not a part of 
the European or western oriented group of nations, and that 
troubles me, particularly when it appears to me that the 
administration is beginning to, while isolating a potential 
ally, embrace a new threat--the People's Republic of China--
particularly the administration's consideration of allowing 
nuclear cooperation with China.
    I suppose the other hearings will afford opportunities to 
address these issues, but I think we need to be careful, having 
won the cold war against the Russians, not to turn them from 
Europe and an orientation to the west.
    Secretary Albright. If I might.
    The Chairman. Sure.
    Secretary Albright. On the contrary. I believe that what we 
have managed here is to do a very important balance by, on the 
one hand, asking Russia to join us in the NATO-Russia Founding 
Act which allows them, as I mentioned in my remarks and also in 
answer to Chairman Helms, a way to be part of a discussion 
about issues of mutual interest. At the same time, this will 
leave the door open to them and make it very clear that the new 
NATO is not directed against them.
    So, I feel very strongly that while we need to maintain 
NATO as a guard against any potential resurgence, at the same 
time we have walked this line very carefully in terms of not 
isolating a new Russia from a new Europe and a new NATO.
    The question about China, sir, is that we are very careful 
in our dealings with China, in terms of having a multi-faceted 
relationship with them, and making sure that they are part of 
what we are trying to accomplish, which is a regime that does 
not allow proliferation of any weapons of mass destruction. It 
is important for us to engage with China also in a way that 
does not isolate them as a huge power as we move into the 21st 
century.
    The Chairman. Thank you very much.
    Senator Feinstein.
    Senator Feinstein. Thank you very much, Mr. Chairman.
    Madam Secretary, it is good to see you again. You look 
wonderful, none the worse for wear.
    Secretary Albright. Love my job.
    Senator Feinstein. Well, that helps.
    Let me follow up on Senator Ashcroft's questions. My 
concern about NATO is twofold. One is Russia and the second is 
the cost item. Let me talk just for a moment about Russia.
    I for one see a kind of growing instability there. I see an 
increasing problem with proliferation, certainly a dramatic 
impact in Iran and Iraq with that proliferation. Some have said 
that there might be a response by Russia to NATO, by Russia's 
trying to develop an alliance down south with those countries. 
I do not know whether that is correct or not.
    But when you see Prime Minister Chernomyrdin's comments too 
on the subject that developments in Russia could take an 
ominous turn. He says, I am not afraid that Poland or Hungary 
or anyone else will be within NATO. It is not so dangerous for 
Russia. The thing I am worried about is Russia and what might 
happen in Russia and nothing else. End quote.
    I think as we watch some of these events, I for one see his 
point. I also recognize that START II is pending before the 
Russian Duma. It would be hopeful for its ratification soon. I 
would like your comment on that, and then whether promise 
negotiations for a START III might be able to ease some of 
this. But I think politically what happens in Russia as a 
product of this is a potentially very dangerous thing. I would 
like you to explore that a little further, if you would.
    Secretary Albright. Senator, clearly one of the major 
assignments that we have is managing the devolution of the 
Soviet empire and creating a positive relationship with the new 
Russia. I think we all see that as one of the major priorities 
of this administration.
    There have been all kinds of statements about how we were 
moving with NATO enlargement how it was going to undercut our 
relationship with Russia. It simply has not happened.
    First of all, let me say Russia does not like NATO 
enlargement. There is no question about that, and every time 
that I meet with Foreign Minister Primakov or President Clinton 
meets with President Yeltsin or Vice President Gore meets with 
Prime Minister Chernomyrdin, that point is made clear. 
Nevertheless, it has not harmed us in terms of an ongoing 
relationship with them. As I mentioned, the permanent Joint 
Council meeting went very well. I have had extensive meetings 
with Foreign Minister Primakov dealing with a whole host of 
issues that we deal with on a mutual basis.
    I also think that those who have predicted that NATO 
enlargement would give solace to the hard-line members within 
Russia have been wrong also. The process there in terms of 
democratization is moving forward. I think we are seeing some 
advances in their movement toward a market economy. It is not 
without its problems, but it is not due to NATO enlargement. It 
is due to very serious issues involved in the transformation of 
that society, and our continued relationship with them and our 
ability to support the reform process is something that we must 
make sure continues.
    On START, I was very pleased that while I was in New York 
last week, I was able to sign a protocol to START II with 
Foreign Minister Primakov which is going to make it possible 
for them to move START II in the Duma. The Defense Minister and 
the Foreign Minister now together have gone to the Duma pushing 
for START II ratification. So, we are hopeful on that. They are 
going to take up the CWC Treaty first, but they are going to 
move on that in the next 4 or 5 weeks we have been told. I am 
hopeful on that, too.
    We have said that START III talks would begin after START 
II goes into effect, but there are already expert talks that 
are going on and there is a team in Russia right now that is 
following up on a lot of these decisions.
    So, I think that we are moving along well, not without 
problems, but I think we have to understand that the dire 
predictions about the end of the world if NATO enlarged are not 
coming true. I ask you all to look at the kinds of statements 
that Foreign Minister Primakov has been making when we sign 
these protocols or the kind of discussion we had in the 
Permanent Joint Council. So, the process is moving forward and 
we have to support the reformers in Russia.
    Senator Feinstein. Quickly on the subject of cost. With the 
opening cost being between $27 billion and $35 billion, with 
France's recalcitrance, and the limited means of the European 
Union monetarily, how is this money going to get paid and will 
it be paid?
    Secretary Albright. Well, first of all, as I said, we are 
now going through the process of determining what the cost 
actually will be under the current environment. The NATO allies 
have committed themselves--they did in Madrid--to paying the 
cost, and we are going to make sure that they do. We will pay 
our share and they will pay their share.
    I think for them this is a domestic question--whether they 
reallocate their defense resources in other ways; but they have 
made a commitment to pay for the cost of enlargement.
    Senator Feinstein. Thank you. Thank you, Mr. Chairman.
    The Chairman. Thank you.
    Madam Secretary, the Senator who will question you has a 
fan club in North Carolina. He is the only Senator, past or 
present, maybe not future, who has done heart transplants. He 
flies his own jet plane, and he has done transplants I 
understand at every major hospital in North Carolina and 
probably all the other 49 States as well. Dr. Frist.
    Senator Frist. Thank you, Mr. Chairman.
    Madam Secretary, I join my colleagues in thanking you for 
your forthright comments today.
    I want to turn and shift the focus a little bit on 
expectations of the various parties that are involved and what 
visions that they have. Undoubtedly, the singularity of mission 
has been the glue which in the past has bonded NATO members 
together so effectively since the creation of the alliance. 
However, we all now recognize that that bond and singularity of 
purpose created by the Soviet threat has largely dissolved.
    As we face the challenges of maintaining that alliance and 
at the same time redefining that common bond, something that 
concerns me in this or any other multilateral obligation is the 
difference in expectations of each of the parties, both 
currently at the table and coming to the table.
    The United States seems to believe that NATO can and should 
continue to maintain its original mission of mutual defense and 
include whatever necessary changes there might be to meet new 
evolving European demands.
    As indicated in remarks in Madrid in July, at least some of 
our main European partners view such a mission and a level of 
commitment as either too costly or unnecessary in the current 
environment and that a more loosely defined security should be 
the mission of the alliance.
    The incoming European countries with Soviet domination and 
presence clearly in their minds, really having had Soviet 
troops on their soil just a few years in the past, have an 
understandably even different expectation of NATO, especially 
how it will relate to membership in the European Union.
    I ask you to comment on these different visions and these 
different expectations and ask whether you think such different 
visions among the members and the potential members create an 
internal tension which the alliance simply has never had to 
address in the past, and then beyond that, how you see such 
differences in expectations affecting the alliance.
    Secretary Albright. Well, I think you have stated a very 
interesting proposition, but I am not sure that I totally agree 
with it. I think that the discussions that I have participated 
in and witnessed regarding our current NATO allies is that they 
are dedicated to the NATO they have seen and frankly are also 
proponents of enlargement. Otherwise, we would not have it.
    When we were in Madrid, I think our internal discussions 
there showed a basic dedication to the original purpose of NATO 
and the fact that it should be expanded to cover a certain 
number of countries. The discussion we had was whether it 
should not cover more. There is no one that is now arguing that 
it should not have expanded.
    I think what I have again found so interesting about the 
NATO alliance is its creativity in adapting itself and looking 
at how to restructure itself internally as well as look at what 
a new strategic concept is, and we are going through that 
process.
    As far as the new allies are concerned, I think there is no 
doubt that they see membership in NATO in terms of the 
possibility of being in the world that was denied them in the 
first place, as the chairman was saying, the promise of the end 
of the Second World War that they were cut out of. They do see 
that as a way of rejoining the West that they belong to. 
President Havel, who was in Washington on Friday getting the 
Fulbright Statesman Award, spoke, as is always his way, very 
movingly about what this means to come back to the West.
    At the same time, I think they do see it as an important 
security structure, one, within the original context, and two, 
as a way that is an impetus to them to deal with their current 
instabilities, the instability that we are trying to guard 
against: The problems that we see in Europe of ethnic conflict, 
of instability created as a result of that, and the fact that 
it has driven many of them to signing agreements with people 
and groups that they would never have imagined doing, as I 
mentioned in my statements, Hungarians and Romanians.
    So, they see it as a return to where they ought to be, but 
also a way of dealing with what they see as their security 
problems, not unlike I think what the original NATO group also 
sees.
    Senator Frist. Thank you. The expectations issue is one 
that I hope to continue to explore in our future hearings, but 
thank you for setting that foundation for me.
    We have mentioned Bosnia a couple of times and let me just 
go back because of my own mind. The U.S. has set next July as a 
date certain for withdrawal of at least our ground forces in 
Bosnia. Consequently our European allies have said that should 
the United States leave, withdraw, they too would withdraw. As 
you pointed out in your statement earlier, the implications for 
Bosnia are clear.
    Bosnia stands what realistically could be called the first 
test of an expanded or new mission of NATO, that is, 
peacekeeping or peacemaking beyond the borders of its members. 
Should this specific point of withdrawal become one of the 
major contentions between us and our allies? And if so, what 
are the implications for the so-called new NATO, and what 
implications are there for defining this mission?
    Secretary Albright. Well, first of all, I think there has 
been a meeting now in Maastricht where some of the discussion 
started in terms of how we all operate together as we look at 
Bosnia in the future. Let me just say not so parenthetically 
here that as we begin to think about this decision, obviously 
we will be consulting very closely with all of you.
    I think that what we have seen is that Bosnia in many ways 
has been a very good example of how NATO countries can work 
with non-NATO countries and how there can be the possibility of 
dealing with the kinds of destabilizing conflicts within a new 
context. I would imagine--I would hope in fact--that we would 
look at the lessons of Bosnia as we think about future 
missions, both positively and negatively, and try to see how 
NATO and NATO in coordination with Partnership for Peace 
countries and a wider alliance can in fact deal with different 
kinds of new threats.
    These two discussions are obviously going to intersect and 
we welcome that. I think that it is important for us to see 
that they are on parallel tracks. We cannot equate the 
discussions, but they will be intersecting here and in Europe.
    Senator Frist. Thank you.
    The Chairman. Thank you very much.
    Senator Wellstone.
    Senator Wellstone. Thank you, Mr. Chairman.
    Madam Secretary, thank you for being here.
    I can very honestly and truthfully say that quite often I 
have a real clear view about issues and know where I stand, and 
on this question I am really quite undecided. I would like to 
give you just a little bit of context and then put at least one 
question to you.
    My father was born in the Ukraine, but his family kept 
staying one step ahead of the pogroms. He lived in Russia and 
ultimately he came to this country in 1914 when he was 17.
    He later had a chance to become friends with George Kennan 
and he always used to praise George Kennan not only for his 
wisdom but also for his command of the language.
    George Kennan wrote a piece in the New York Times a while 
ago now, in which he said something like he thought that this 
expansion of NATO could be the most fateful decision. It could 
have consequences that we could not even begin to prophetize. 
So, there you have George Kennan, a real giant.
    I have visited Russia, my father's home, and every time 
there is a delegation that comes here, I try and meet with 
people. I have not met anyone from Russia of any political 
persuasion who is not very much opposed to this. On the other 
hand, there is President Havel and there are you and others who 
have, of course, taken a very different position.
    This is what I do not quite understand. If we are talking 
about the importance of improving the economies and 
democratization of countries like Hungary and Czechoslovakia 
and Poland, there is the European Union. I do not know how a 
military alliance really meets those concerns.
    I do want to mention Senator Feinstein's discussion of the 
Prime Minister's remarks where he said I am not worried about 
Czechoslovakia or Poland or Hungary, but I am worried about 
what is going to happen in the country. You said, well, there 
is no evidence yet. But that is kind of a snapshot of right 
now. The question is where are we heading. We have to look to 
the future.
    If, for example, we are saying that this is not the end. 
The Baltic countries are welcome. Ukraine is welcome. What then 
would be the consequences within Russia?
    I guess all of this leads me to one question, and maybe 
this is my way, as somebody who is trying to sort through these 
issues, of getting closer to what I think would be the right 
position for me to take as a Senator.
    You said that if countries meet this democratic criteria, 
they are welcome. Would Russia be welcome? Maybe that is the 
question I should ask. If Russia meets the criteria, after all, 
all of us hope that they will build a democracy. I mean, it 
will be a very dreary world if they are not able to. This 
country is still critically important to the quality of our 
lives and our children's lives and our grandchildren's lives. 
If Russia meets this criteria, would they be welcome in NATO?
    Secretary Albright. Senator, the simple answer to that is 
yes. We have said that if they meet the criteria, they are 
welcome. They have said that they do not wish to be a part of 
it.
    But let me just say several things to your very well-
articulated question and your legitimate concern. I think all 
of us that have grown up in this era have the concerns that you 
have stated.
    I spent my entire life studying the Soviet Union and now 
Russia and the republics. I think we have to understand that 
Russia is not the Soviet Union and Russia is a different place 
than any of us ever thought it would be.
    All of us have genuflected in front of George Kennan. We 
all have felt that he was kind of the father of the way that we 
had studied the Soviet Union and Russia.
    But with all due respect, I disagree with him on this 
subject. I think that we are in a new era. I have spent a lot 
of time talking with the Russians about this and persuading 
them that if they want us to think about a new Russia, they 
have to think about a new NATO and a new Europe.
    Russia has a long way to go, but it is on a very important 
path. While they are objecting or stating that they do not like 
NATO expansion, we are involved in a whole web of relationships 
with them now in a way that I think is supportive of their 
democratic processes. We do not have time to go into all that. 
But the fact that we are in a set of arms control negotiations 
with them on a completely different approach than being 
adversaries in the way that we were, that there are trade 
agreements and market forces working, that there are democratic 
forces working, that they are part of a discussion about our 
mutual interests in Europe is for me a sign that we are heading 
in a different direction.
    Now, another aspect of this is I cannot understand why we 
would self-limit our desires for central and eastern Europe by 
what the Russians want. That is going back to the post World 
War II era, and I do not think that is correct. It is not 
correct in terms of security and it is not correct in terms of 
the morality that we talked about. Why should we now in 1997 
agree to a line that was created in 1945? I think it is wrong.
    Senator Wellstone. If I could, Mr. Chairman, just in 30 
seconds add, I do not have all of your intellectual capital in 
this area, but a different formulation might be why would we be 
trying to expand a military alliance, which we built, vis-a-vis 
a Soviet Union that does not exist any longer?
    It is not so much a question of our policy being governed 
necessarily by ``paranoia'' in Russia, but it has more to do 
with, as we look to the future, whether or not this could in 
fact invite the very instability that would be I think so 
dangerous to the world that we live in. It is a very 
legitimate, important concern that I think we will have more 
debate on. Again, for myself I still am trying to wade through 
this.
    Secretary Albright. May I, Mr. Chairman, respond?
    The Chairman. Sure.
    Secretary Albright. I would say the following. First of 
all, we had options here. We could say the threat is different, 
so let us just kind of junk NATO and start over. Why do that 
when NATO as a structure has worked very well and is, I think, 
capable of expanding and enlarging in terms of its strategy as 
well as its membership, as I answered to members over here.
    So, I think that the purpose here is NATO, while it 
maintains its central core of being a defensive alliance, has 
the capability of adjusting its strategic concept in a way that 
is not directed against Russia. The threat at the moment in 
Europe is instability and the undermining of the overall 
structure of what we want which is a free, undivided and fully 
united Europe. That is what is a priority for the United 
States, and NATO provides a very good structure for that. It is 
adjusting. It is a new NATO. It is not the NATO that you and I 
grew up with.
    The Chairman. Thank you very much.
    Now, my chairman of the Rules Committee, the Senator from 
Virginia, Senator Warner.
    Senator Warner.  Thank you, Mr. Chairman. I thank you and 
the other Members.
    I will ask but one question, the same question that I have 
debated very lively publicly with Senator Biden. I happen to be 
a very firm skeptic of this program.
    First, a quick answer. If Russia is admitted, I suggest 
that that would be the end of NATO because one of the primary 
missions of NATO would no longer exist. It would be the end 
because when I joined the Senator 19 years ago for the first 5 
years, this senior group up here led the defense against 
withdrawing from NATO, pulling our troops back, predicated both 
on an economic argument and other arguments. We remember very 
well our distinguished Majority Leader Mike Mansfield who led 
that fight. I think if Russia were admitted, that fight would 
start again.
    But my concern, Madam Secretary, goes to the other threat 
that faces all of the new nations that are looking toward 
admission, and that is they are fighting fairly today and 
peaceably for economic survival. By conferring a NATO status on 
the three, it puts the other three in my humble judgment at a 
severe disadvantage in two ways.
    First, they can put in their advertisements for foreign 
capital, come invest here because you will be more secure 
because NATO is here, not unlike the Federal Deposit Insurance 
Corporation when you deposit in your bank.
    Second, these nations will not have to mount their own 
defenses because they will be a part of NATO. I have discussed 
this with the Ambassadors and foreign ministers and defense 
ministers of these countries. They readily admit our cost to 
build that level of defense we think and security that is 
necessary will be one-third or perhaps one-half of what the 
nations that are not admitted will have to cough up.
    All of this to me indicates that you will begin to breed 
dissension. As we know today, part of the security of the 
world, the growing part of it that is threatened, are the 
ethnic strife, the border strife, religious strife, and you 
superimpose on their struggle today for economic survival, 
economic competition NATO status and a less cost for their 
defense, and I think you are sewing the seeds of strife between 
these countries.
    I go back to Harry Truman's biography in which he said his 
two proudest accomplishments were the Marshall Plan and NATO, 
and I fear we may be undoing one of his proudest 
accomplishments.
    Secretary Albright. Senator, I was looking forward to 
coming to see you in your committee.
    Senator Warner.  We will make that opportunity available 
and this record will be a very important part of that 
discussion.
    Secretary Albright. Let me say we have had this discussion 
and we will continue to have it.
    But let me just say on the Russian question, first of all, 
I think that, they have expressed no interest in being members. 
I was answering a question of Senator Wellstone whether it was 
hypothetically possible, and it is because, as we have said, it 
is a process that is open to democracies that meet the agenda.
    But it is a hypothetical question at this stage, and I 
think we need to focus on the fact that we are looking at a 
very different world. Who would have ever expected the things 
that we have seen in the last 10 years? So, I would just leave 
it in the realm of the hypothetical at this stage.
    Now, on your other question, I think that there is no proof 
of the fact that NATO status confers better investment. If you 
just look, for instance, at what we have seen in western 
Europe, NATO membership has not been used over the past half 
century to draw investment, let us say, to Norway. I think that 
there is no historical evidence of the fact that NATO provides 
economic benefits.
    At the same time, having spent a lot of time studying 
central and eastern Europe, I can tell you that the other 
countries, the non-invitees, are working very hard in terms of 
their privatization, their various other institutions that 
would provide good investment climate. They are creating a 
whole web of other relationships with the hope that they will 
be in NATO.
    I also think that we cannot get ourselves into this 
argument of none or all. We have to do what is right for NATO 
which is expand in a way that is good for the central core of 
keeping a cohesive alliance.
    Senator, on your final point, I think that our greatest 
leaders historically have been those who have understood that 
history does not stand still and that there are opportunities 
to be seized. What Harry Truman did with both the Marshall Plan 
and NATO was go against the tide and assume leadership at a 
time when creativity was needed. While one can never speak for 
the dead, one would assume, in looking at his record, that he 
would be the kind of person that would see the opportunities 
that NATO enlargement offers for U.S. national interests.
    Senator Warner.  I thank the witness. I thank the chair and 
the Ranking Member.
    The Chairman. A bit of housekeeping. I ask unanimous 
consent that a statement by Senator Smith of Oregon be 
submitted at the appropriate place in the record.
    [The prepared statement of Senator Smith follows:]
                  Prepared Statement of Senator Smith
    Secretary Albright, thank you for appearing before the Committee 
today to begin the process of advice and consent on the proposed 
enlargement of NATO.
    The United States is engaged in an ambitious effort to reshape the 
political and security structures of post-Cold War Europe. The goal of 
this effort is to build strong states, stable democracies, prosperous 
economies, and friendly governments across the breadth of Europe. We 
are joined in this effort by our NATO allies and by newly democratic 
people yearning for the opportunity to pursue political freedom and 
economic prosperity. Working against us are certain, backward looking 
leaders, historical antagonism between certain states, and ethnic and 
religious intolerance. These challenges that we confront, together with 
our friends and allies, are significant but not insurmountable.
    In recent years, Europe has seen historic changes. On the continent 
of Europe, more people than at any other time in history live under 
democratic government and enjoy the opportunity to pursue freely 
economic prosperity for themselves and their families. This soaring 
accomplishment is offset by the tragedy in the former Yugoslavia, in 
which Europe experienced the most brutal and widespread violence since 
Hitler's armies stalked the Continent.
    These two extremes reflect the significant, competing pressures on 
U.S. foreign policy at this moment in time. The United States is at 
once pressing for the consolidation of the gains of democracy in Europe 
by expanding NATO and with it our country's commitment to European 
security. Simultaneously, we have reluctantly, and with some 
controversy, assigned our soldiers to serve as peacekeepers in Bosnia 
in a mission that is defined less by an exit strategy than an exit 
date.
    These conflicting impulses--to engage and withdraw simultaneously 
from Europe--are manifested as much in our people as in our policies. 
It is absolutely critical that these contradictory inclinations are 
resolved through the leadership of the President, and through the 
development of sensible foreign policies that will gain the support of 
the American people. The Congress can be a partner in this effort, but 
by its very nature it cannot lead the effort

    The Chairman. Also, the record will be kept open for 3 days 
for additional written questions to be submitted to the 
distinguished Secretary.
    Madam Secretary, you have acquitted yourself admirably and 
effectively as always. It has been a pleasure to have you with 
us.
    Senator Biden. Mr. Chairman, before you close, would you 
yield me 30 seconds?
    The Chairman. Certainly.
    Senator Biden. Mr. Chairman, I think the last argument that 
Senator Warner made is the most compelling, which is that these 
nations are going to spend more money to go it alone or to put 
it another way,less money to be part of the west. It seems to 
me that he makes the argument for NATO when he makes the 
argument that in fact they will be spending less money. They 
are going to spend the money. They are going to seek their own 
alliances. Bring them to the west.
    Secretary Albright. I agree with that.
    The Chairman. Do you agree?
    Secretary Albright. Absolutely. That's why when people are 
saying can they meet their obligations, they know that they can 
do better by increasing their defense budgets to be a part of 
NATO and that they will spend less by being a part of it. Yes, 
I do.
    The Chairman. Madam Secretary, is there anything else? 
Sometimes when I make an appearance, driving home I make the 
best speech of my career.
    I think you have done well this morning, but do you have 
any closing note that you would like to add?
    Secretary Albright. Well, the only note that I would like 
to make, Senators, is that I do think we are embarked on a 
great historical partnership here of being able to take what we 
have been watching very carefully, the evolution of Europe, and 
being able to now put our stamp on it and do for the 21st 
century what our predecessors have done for the second half of 
this one.
    I consider it a great honor to be here working with all of 
you on this. I know we are going to have an interesting debate. 
I think the questions are terrific. I do not know about all the 
answers, but I really do appreciate this and I feel that we are 
all making history here together.
    Thank you.
    The Chairman. Very well.
    There being no further business, the committee stands in 
recess.
    [Whereupon, at 12:07 p.m., the committee was adjourned, to 
reconvene at 2:06 p.m., October 9, 1997.]



                   PROS AND CONS OF NATO ENLARGEMENT

                              ----------                              


                       THURSDAY, OCTOBER 9, 1997

                                       U.S. Senate,
                            Committee on Foreign Relations,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 2:06 p.m. in room 
SD-419, Dirksen Senate Office Building, Hon. Jesse Helms 
(chairman of the committee), presiding.
    Present: Senators Helms, Lugar, Hagel, G. Smith, Grams, 
Biden, Robb and Wellstone.
    The Chairman. The committee will come to order.
    We have Members on the way, including the distinguished 
Ranking Member, Mr. Biden. Mr. Biden's representative suggested 
that I proceed. I will do that by welcoming all of the 
distinguished foreign policy people that we have scheduled for 
today, including my friend, and the friend of a lot of people, 
Senator Bill Roth, whom I admire greatly.
    Today we are honored to have with us people on both sides 
of the NATO expansion issue, and that is proper. I might say, 
parenthetically, that what I envision as our role is to get all 
of the facts laid out so that the American people, to the 
extent possible, will understand what the issues are and where 
who stands on what.
    Our first witness is going to be, as I have said, the 
distinguished President of the North Atlantic Assembly and 
Chairman of the Senate NATO Observer Group.
    Senator Roth will be followed by two prominent supporters 
of NATO enlargement, Dr. Brzezinski, whom everybody knows--
nobody needs an introduction to him--and Ambassador Jeane 
Kirkpatrick, who is on the way here. Both have, again, 
generously consented to help Senators acquire a better 
understanding of a complex foreign policy matter.
    After completion of this first panel, the committee will 
hear from two outspoken opponents of NATO expansion, Ambassador 
Jonathan Dean and Professor Michael Mandelbaum.
    Again, on behalf of the committee and on behalf of the 
Senate, I thank each of you for being here and welcome all of 
our guests.
    We will first hear from Senator Roth. We are glad to have 
you and I thank you for coming. You may proceed.

 STATEMENT OF HON. WILLIAM V. ROTH, JR., UNITED STATES SENATOR 
   FROM DELAWARE, CHAIRMAN, SENATE NATO OBSERVER GROUP, AND 
           PRESIDENT, NORTH ATLANTIC TREATY ASSEMBLY

    Senator Roth.  Thank you very much, Mr. Chairman. It is a 
great honor to appear before the Senate Foreign Relations 
Committee to provide my perspective on NATO enlargement.
    I come, as you pointed out, before your committee not only 
as a colleague, committed to sustaining and strengthening the 
Transatlantic Alliance, but as President of the North Atlantic 
Assembly, as well as Chairman of the Senate NATO Observer 
Group.
    Since the fall of the Berlin Wall, the North Atlantic 
Assembly, representing over 40 political parties from the 16 
NATO nations, has given more serious and consistent study to 
the future of NATO than any other transatlantic organization. 
The Senate NATO Observer Group, organized just last May by 
Senators Lott and Daschle, has already held more than a dozen 
meetings to examine the challenges and promise of enlargement.
    My association with both the NAA and the Observer Group 
leaves me firmly convinced that enlargement is not only 
necessary and important to the alliance, but to the United 
States as well.
    Will enlargement be easy? Few things this important are 
ever easy. Will it be worth it? Absolutely. Let me explain why.
    As a leader in the North Atlantic Assembly, I was in Berlin 
shortly after the Wall came down--meeting with many of the 
young, democratic leaders who were emerging in Central Europe. 
On that occasion, I was struck by two oddly opposing insights. 
First, is that the cold war was over. Democracy had, indeed, 
prevailed. My second insight, however, was that the move toward 
democracy alone would not guarantee peace and stability on the 
European continent. Having served in World War II, I was 
painfully aware of just how important peace and stability in 
Europe are to the United States of America.
    As I see it, Mr. Chairman, NATO enlargement is an 
opportunity unprecedented in world history. For the first time, 
we have the chance to be proactive in shaping a strategic 
landscape that will contribute to peace and stability in 
Europe. We are not responding to aggression or disaster, but we 
are building a foundation for a secure future in a region of 
vital interest to the United States.
    Four significant arguments make it clear why NATO 
enlargement is in America's best interest.
    First, a wider alliance is a stronger, more capable, 
alliance. The proposal to grant NATO membership to Poland, 
Hungary, and the Czech Republic will add three democracies to 
the alliance that have demonstrated their commitment to the 
values and interests shared by NATO members: human rights, 
equal justice under the law, and free markets. Each of these 
nations has a growing economy and a military under civilian 
control.
    It is important to note that each also contributed forces 
to Operation Desert Storm as well as our peacekeeping missions 
in Haiti and Bosnia. In that NATO is first and foremost a 
military alliance, the admission of these three democracies 
will enable the alliance to better fulfill its core mission of 
collective defense, as these nations will add another 300,000 
troops to NATO.
    Second, NATO enlargement will eliminate the zone of 
instability that now exists in Europe. Throughout its history, 
Europe has been a landscape of many insecure small powers, a 
few imperialistic great powers, and too many nationalistic 
defense policies, each creating friction with the other. Three 
times in this century these dynamics have pulled America into 
wars on the European continent. As President Havel has said, 
``If the West does not stabilize the East, the East will 
destabilize the West.'' Every time America has withdrawn its 
influence from Europe, trouble has followed. This we cannot 
afford.
    Mr. Chairman and members of the committee, NATO enlargement 
is the surest means of doing for Central and Eastern Europe 
what American leadership, through the alliance has done so well 
for Western Europe. This includes promoting and 
institutionalizing trust, cooperation, coordination and 
communication. In this way, NATO enlargement is not an act of 
altruism, but one of self-interest.
    Third, keeping the above argument in mind, it follows that 
the costs of enlargement are insignificant compared to the 
costs of remaining static. Should NATO fail to follow through 
on the commitments made in Madrid, the alliance would be 
denying what it has stood for and defended throughout the cold 
war. Why? It is because NATO is much more than a military 
alliance. It is also a community of values. Enlargement is not 
only a strategic opportunity, it is a moral imperative. We 
cannot ignore the valid aspirations of European democracies who 
seek to become contributing members of our community.
    Failure to expand must be considered in terms of what it 
will cost as disillusionment replaces hope in Central Europe, 
as nationalism--which enjoyed a renaissance following World War 
II--fills the security vacuum in a region that has given birth 
to two world wars. Costs must also be considered in terms of 
the consequences to Russia and its struggle toward democracy. 
Should Central Europe remain a gray zone of insecurity, such a 
condition would risk reawakening Moscow's history of 
imperialism. NATO enlargement is a critical, nonthreatening 
complement to the hand of partnership that the West and NATO 
has extended to Russia. It insures a regional context in which 
a democratic Russia will have the best prospects for normal, 
cooperative relations with its European neighbors.
    Fourth, and finally, Mr. Chairman, NATO enlargement is 
fundamental to Europe's evolution into a partner that will more 
effectively meet global challenges to the transatlantic 
community. An undivided Europe at peace is a Europe that will 
be better able to look outward, a Europe better able to join 
with the United States to address necessary global security 
concerns. A partnership with an undivided Europe in the time- 
and stress-tested architecture of NATO will enable the United 
States to more effectively meet the global challenges to its 
vital interests at a time when defense resources are 
increasingly strained.
    Mr. Chairman, these arguments make it clear that America's 
best chance for enduring peace and stability in Europe--our 
best chance for staying out of war in Europe, our best chance 
for reinforcing what has been a strong, productive partnership 
with Europe--is to promote a Europe that is whole, free, and 
secure.What better organization to do this than the North 
Atlantic Alliance, an organization that has kept the peace for 
more than 50 years and remains unmatched in its potential to 
meet the security challenges of the future.
    Thank you for giving me this opportunity.
    [The prepared statement of Senator Roth follows:]
                   Prepared Statement of Senator Roth
    It's an honor to appear before the Senate Foreign Relations 
Committee to provide my perspective on NATO enlargement. I come before 
your Committee not only as a colleague, committed to sustaining and 
strengthening the Transatlantic Alliance, but as President of the North 
Atlantic Assembly, as well as Chairman of the Senate NATO Observer 
Group.
    Since the fall of the Berlin Wall, the North Atlantic Assembly 
representing over 40 political parties from the 16 NATO nations--has 
given more serious and consistent study to the future of NATO than any 
other transatlantic organization. And the Senate NATO Observer Group--
organized just last May by Senators Lott and Daschle--has already held 
more than a dozen meetings to thoroughly examine the challenges and 
promise of enlargement.
    My association with both the NAA and the Observer Group leave me 
firmly convinced that enlargement is not only necessary and important 
to the Alliance, but to the United States, as well.
    Will enlargement be easy? Few things this important are ever easy. 
Will it be worth it? Absolutely.
    Let me explain why. As a leader in the North Atlantic Assembly, I 
was in Berlin shortly after the Wall came down--meeting with many of 
the young democratic leaders who were emerging in Central Europe. On 
that occasion, I was struck by two oddly opposing insights. First, that 
the Cold War was over. Democracy had, indeed, prevailed. My second 
insight, however, was that the move toward democracy alone would not 
guarantee peace and stability on the European continent. And having 
served in World War II, I was painfully aware of just how important 
peace and stability in Europe are to the United States. of America.
    As I see it, Mr. Chairman, NATO enlargement is an opportunity 
unprecedented in world history. For the first time, we have the chance 
to be proactive in shaping a strategic landscape that will contribute 
to peace and stability in Europe. We are not responding to aggression 
or disaster, but we are building a foundation for a secure future in a 
region of vital interest to the United States.
    Four significant arguments make it clear why NATO enlargement is in 
America's best interest:
    First, a wider Alliance is a stronger, more capable Alliance. The 
proposal to grant NATO membership to Poland, Hungary and the Czech 
Republic will add three democracies to the Alliance that have 
demonstrated their commitment to the values and interests shared by 
NATO members: human rights, equal justice under the law and free 
markets. Each of these nations has a growing economy and a military 
under civilian control.
    It is important to note that each also contributed forces to 
Operation Desert Storm, as well as to our peacekeeping missions in 
Haiti and Bosnia. In that NATO is first and foremost a military 
alliance, the admission of these three democracies will enable the 
Alliance to better fulfill its core mission of collective defense, as 
these nations will add another 300 thousand troops to NATO.
    Second, NATO enlargement will eliminate the zone of instability 
that now exists in Europe. Throughout its history, Europe has been a 
landscape of many insecure small powers, a few imperialistic great 
powers, and too many nationalistic defense policies, each creating 
friction with the other. Three times in this century, these dynamics 
have pulled America into wars on the European continent. As Vaclav 
Havel has said, ``If the West does not stabilize the East, the East 
will destabilize the West.'' Every time America has withdrawn its 
influence from Europe, trouble has followed. This, we cannot afford.
    Mr. Chairman, NATO enlargement is the surest means of doing for 
Central and Eastern Europe what American leadership, through the 
Alliance, has done so well for Western Europe. This includes promoting 
and institutionalizing trust, cooperation, coordination and 
communication. In this way, NATO enlargement is not an act of altruism, 
but one of self-interest.
    Third, keeping the above argument in mind, it follows that the 
costs of enlargement are insignificant compared to the costs of 
remaining static. Should NATO fail to follow through on the commitments 
made in Madrid, the Alliance would be denying what it has stood for and 
defended throughout the Cold War. Why? Because NATO is much more than a 
military alliance. It is also a community of values. Enlargement is not 
only a strategic opportunity, it is a moral imperative. We cannot 
ignore the valid aspirations of European democracies who seek to become 
contributing members of our community.
    Failure to expand must be considered in terms of what it will cost 
as disillusionment replaces hope in Central Europe, as nationalism--
which enjoyed a renaissance following World War II--fills the security 
vacuum in a region that has given birth to two world wars. Costs must 
also be considered in terms of the consequences to Russia and its 
struggle towards democracy. Should Central Europe remain a gray zone of 
insecurity, such a condition would risk reawakening Moscow's history of 
imperialism. NATO enlargement is a critical, non-threatening complement 
to the hand of partnership that the West and NATO has extended to 
Russia. It ensures a regional context in which a democratic Russia will 
have the best prospects for a normal, cooperative relationship with its 
European neighbors.
    Fourth, and finally, Mr. Chairman, NATO enlargement is fundamental 
to Europe's evolution into a partner that will more effectively meet 
global challenges to the transatlantic community. An undivided Europe 
at peace is a Europe that will be better able to look outward, a Europe 
better able to join with the United States to address necessary global 
security concerns. A partnership with an undivided Europe in the time- 
and stress-tested architecture of NATO will enable the United States to 
more effectively meet the global challenges to its vital interests at a 
time when defense resources are increasingly strained.
    Mr. Chairman, these arguments make it clear that America's best 
chance for enduring peace and stability in Europe--our best chance for 
staying out of war in Europe, our best chance for reinforcing what has 
been a strong, productive partnership with Europe--is to promote a 
Europe that is whole, free and secure. What better organization to do 
this than the North Atlantic Alliance--an organization that has kept 
the peace for more than fifty years and remains unmatched in its 
potential to meet the security challenges of the future.

    The Chairman. Mr. Chairman, thank you so much for being 
here. That is an excellent statement and an excellent 
introduction to what we are going to attempt to do here this 
afternoon.
    We would be delighted for you to say for as long as you 
wish. But with all the things you have on your front burner, 
you may want to depart. But please stay as long as you will and 
as long as you can.
    Senator Roth.  I am on my way to Bucharest for a meeting of 
the NAA. So I thank you for opportunity to be here before I 
leave.
    The Chairman. Well, do not miss the plane.
    Senator Roth.  Thank you very much.
    The Chairman. Thank you.
    Now two names always thought of in this town and across the 
country, for that matter, when foreign policy matters come up 
are the names of Dr. Brzezinski and Dr. Kirkpatrick, who will 
compose our first panel today.
    I might mention that I first met Dr. Kirkpatrick through a 
mutual friend, who later became President of the United States. 
His name was Ronald Reagan. I had a hope then and I continue to 
have the hope that one of these days Dr. Kirkpatrick may be 
Secretary of State or higher.
    Dr. Brzezinski, we will hear from you first. I certainly do 
appreciate your being here.

 STATEMENT OF HON. ZBIGNIEW BRZEZINSKI, COUNSELOR, CENTER FOR 
      STRATEGIC AND INTERNATIONAL STUDIES, WASHINGTON, DC

    Dr. Brzezinski. Thank you very much, Mr. Chairman.
    In my initial comment I will not retrace the ground that 
was covered by your discussion with Secretary Albright on 
Tuesday. It was an excellent discussion and many cogent 
arguments were reviewed regarding the issue of NATO 
enlargement.
    In my brief comments, I would like to touch merely on the 
historic and geopolitical significance of NATO's enlargement, 
as I see it. In my view, that enlargement has truly global 
significance. It is central to the step by step construction of 
a secure international system in which the Euro-Atlantic 
alliance plays the major role in insuring that a peaceful and 
democratic Europe is America's principal partner.
    Hence, NATO's enlargement is about America's role in 
Europe, whether America will remain a European power, and 
whether a larger, democratic Europe will remain organically 
linked to America.
    It is about Europe's historically important self-
definition, whether its scope and security are to be confined 
to the lines drawn arbitrarily in 1945, thus to a rump Europe 
with NATO increasingly anachronistic in the post cold war era, 
or whether NATO's membership should correspond to the 
aspirations of the democratic European nations.
    It is about Russia's relationship to Europe, whether NATO's 
enlargement helps a democratizing Russia by foreclosing to it 
the revival of any self-destructive imperial temptations 
regarding Central Europe.
    Let me also note parenthetically that NATO and the European 
Union have creatively resolved the old question of 
disproportionate German power in Europe. The progressive 
expansion of NATO can similarly resolve the question of 
disproportionate Russian power in Europe. It is noteworthy also 
in this connection that public opinion in key European 
countries is favorable to expansion.
    Moreover, so far, all of the apocalyptic predictions of the 
critics of NATO expansion have failed to come to pass.
    In brief, to me, NATO expansion is not principally about 
the Russian threat for, currently, it does not exist, though 
one cannot exclude its reappearance and, hence, some insurance 
against it is desirable.
    Second, to me, NATO expansion is not primarily a moral 
crusade, meant to undo the injustice the Central European 
people suffered during the half century's long Soviet 
oppression, though one cannot ignore the moral right of the 
newly emancipated and democratic Central Europeans to a life no 
less secure than that enjoyed by the West Europeans, or, I may 
add, ourselves, as well.
    For me, the central stake in NATO expansion is the long-
term, historic, and strategic relationship between America and 
Europe. NATO expansion is central to the vitality of the 
American--European connection, to the scope of a secure and 
democratic Europe and to the ability of America and Europe to 
work together in promoting international security.
    The expansion of the Euro-Atlantic alliance will bring into 
NATO counsels new, solidly democratic, and very pro-American 
nations. That will further deepen the American--European 
kinship while expanding Europe's zone of peace and democracy.
    Such a more secure Europe will be a better and a more vital 
partner for America in the continuing effort to make democracy 
more widespread and international cooperation more pervasive. 
That is why NATO's enlargement, in itself a vivid testimonial 
to the dynamism of the democratic ideal, is very much in 
America's long-term national interest.
    I thank you, Mr. Chairman.
    [The prepared statement of Dr. Brzezinski follows:]
                  Prepared Statement of Dr. Brzezinski
    I would like to comment very briefly on the historic and 
geopolitical significance of NATO's enlargement. In my view, that 
enlargement has global significance--it is central to the step-by-step 
construction of a secure international system in which the Euroatlantic 
alliance plays the major role in ensuring that a peaceful and 
democratic Europe is America's principal partner.
    Hence

   NATO's enlargement is about America's role in Europe--
        whether America will remain a European power and whether a 
        larger democratic Europe will remain organically linked to 
        America;
   it is about Russia's relationship to Europe--whether NATO's 
        enlargement helps a democratizing Russia by foreclosing the 
        revival of any self-destructive imperial temptations regarding 
        Central Europe.

    (Let me note in passing that NATO and the EU have creatively 
resolved the old question of disproportionate German power in Europe; 
the progressive expansion of NATO can similarly resolve the question of 
disproportionate Russian power in Europe. It is also noteworthy that 
public opinion in key NATO countries is favorable to expansion. 
Moreover, so far, all the apocalyptic predictions of the critics of 
NATO expansion have failed to come to pass.)
    In brief, to me NATO expansion is not principally about the Russian 
threat, for currently it does not exist, though one cannot exclude its 
reappearance and hence some insurance against it is desirable.
    Secondly, to me NATO expansion is not primarily a moral crusade, 
meant to undo the injustice the Central European peoples suffered 
during the half-century long Soviet oppression, though one cannot 
ignore the moral right of the newly emancipated and democratic Central 
Europeans to a life no less secure than that enjoyed by the West 
Europeans.
    For me, the central stake in NATO expansion is the long-term 
historic and strategic relationship between America and Europe. NATO 
expansion is central to the vitality of the American-European 
connection, to the scope of a democratic and secure Europe, and to the 
ability of America and Europe to work together in promoting 
international security.
    The expansion of the Euroatlantic alliance will bring into NATO 
counsels new, solidly democratic and very pro-American nations. That 
will further deepen the American-European kinship while expanding 
Europe's zone of peace and democracy. Such a more secure Europe will be 
a better and a more vital partner for America in the continuing effort 
to make democracy more widespread and international cooperation more 
pervasive. That is why NATO's enlargement--in itself a vivid 
testimonial to the dynamism of the democratic ideal--is very much in 
America's long-term national interest.

    The Chairman. Thank you, Dr. Brzezinski. Dr. Kirkpatrick.

   STATEMENT OF HON. JEANE J. KIRKPATRICK, SENIOR FELLOW AND 
    DIRECTOR, FOREIGN POLICY AND DEFENSE STUDIES, AMERICAN 
              ENTERPRISE INSTITUTE, WASHINGTON, DC

    Ambassador Kirkpatrick. Thank you, Mr. Chairman and thank 
you for inviting me today to testify before this distinguished 
committee.
    The Chairman. Thank you for coming.
    Ambassador Kirkpatrick. Mr. Chairman, I believe that the 
subject of today's hearing is exceedingly important and that 
the Senate's decision on NATO enlargement today is even more 
important. I have followed this issue with substantial interest 
since the end of the cold war made it a practical policy 
option.
    I begin with a question: why should we enlarge NATO? I 
believe that the case for admitting Poland, the Czech Republic, 
and Hungary to membership in NATO is not only strong, but that 
it is essentially the same as the case for organizing NATO in 
1947--to provide a security shield behind which the free 
institutions of these more geographically vulnerable European 
democracies can strike deep roots and thrive, to deter 
aggression, and to discourage conflict.
    Of course, there are differences between 1939, 1947, and 
1997. There is no one major threat to peace and security 
throughout the region today. But if the threats of aggression, 
subversion, and conquest are less clear now than they were 
after World Wars I and II, the new democracies' appetite for 
democracy and peace is greater.
    More people understand the benefits of freedom and long to 
share in them, and long for a place in the prosperity and 
security of the West. More associate that freedom, prosperity, 
and security with joining NATO--and the European Union, which, 
unfortunately, is not an issue that we are free to resolve by 
action of this Senate or any other American forum.
    I believe, these candidates that have been proposed for 
membership in NATO, will strengthen that institution. Poland, 
the Czech Republic and Hungary share a history and a 
civilization with the countries of NATO and were engaged in 
parallel patterns of democratic development when first Adolph 
Hitler and then Josef Stalin's expansionist policies abruptly 
strangled their evolution.
    The people in each of these countries share our culture. 
They have demonstrated their vocation for freedom with heroic 
efforts to throw off foreign domination and regain control of 
their own histories. This took place again and again during 
their tragic evolution of this century.
    Poland, the Czech Republic, and Hungary can be incorporated 
into NATO, I believe, without creating any serious disruption 
and without requiring a reorientation of NATO's operations. 
They will ``fit'' in NATO. Their inclusion will not require 
qualitative changes in its purposes, culture, or mode of 
operation. NATO has been and, after their inclusion, will be, a 
military alliance of democratic nations united in the 
determination to preserve their free societies from 
aggression--by force, if necessary.
    The Czech Republic, Poland and Hungary applied for 
membership in the European Union and in NATO years ago. Hungary 
actually applied for membership in the European Union before 
Soviet forces had departed their country. They have met all the 
stated requirements, and have cooperated in all proposed 
projects, including Partnership for Peace. They have 
demonstrated their seriousness.
    Moreover, 4 years have passed since President Clinton said 
in Prague, ``Let me be absolutely clear: the security of your 
States is important to the security of the United States. The 
question is no longer whether NATO will take on new members, 
but when and how.''
    Yet to this day, no country that suffered under Soviet 
dominance has been admitted into either NATO or the EU.
    The post cold war period has seen the emergence of numerous 
threats to the development of a democratic Europe. Resurgent 
anti-democrats have won power in some States and threaten peace 
in others. Serbian President Slobodan Milosevic and Slovakian 
Prime Minister Vladimir Mecias are examples.
    Milosevic sponsored and encouraged Serbian aggression and 
``ethnic cleansing'' against Slovenia, Croatia, and Bosnia-
Herzegovena, in that order. He has attempted to destabilize 
Macedonia and repeatedly violated democratic norms and the 
human rights of the Serbian opposition. He has undermined 
democracy in Serbia and outside it. The violent attacks he 
sponsored have devastated two States--Croatia and Bosnia, and 
have destabilized the region.
    This aggression could happen because he is not a democratic 
president, although he is, in fact, elected. This reminds us 
that not all elected presidents are democratic presidents, 
governing within a framework of law and constitutional rule.
    It is no accident, Mr. Chairman, as the Marxists like to 
say, that in democratic Czechoslovakia, the separation of 
Slovakia from the Czech Republic was peaceful, and that the 
separation of Yugoslavia was violent. The difference was not in 
the preference of the presidents because the President of 
Czechoslovakia also preferred that that country remain united. 
The difference was the respect of those presidents for 
democratic decisions.
    There was in the Czech Republic no will to conquest in the 
government. The Czech Republic is a democracy, prepared to 
accept the democratic self-determination of Slovakia. Serbian 
rulers were not committed to democratic methods and were not 
prepared to accept the democratic self-determination of the 
component States of former Yugoslavia. The result was, first, 
instability, and then aggression and war, which continues to 
this day.
    There is, finally, in my judgment, Mr. Chairman, only one 
reliable guarantee against aggression. It is not found in 
international organizations. It is found in the spread of 
democracy. It derives from the simple fact that true 
democracies do not invade one another and do not engage in 
aggressive wars.
    Numerous studies establish beyond reasonable doubt that the 
best system, the only reliable basis for collective security, 
is that all the governments in an area should be democratic 
governments. Therefore, what reinforces democracy reinforces 
peace. That is the reason that the top priority for the United 
States and NATO should, today, be to preserve and strengthen 
the new democracies in Eastern and Central Europe, and in 
Russia as well.
    Preserving and strengthening democracies in Central and 
Eastern Europe should be the United States' central goal and 
top foreign policy priority in Europe, in my opinion. 
Membership in NATO will help to achieve those goals and 
strengthen the alliance.
    Enlargement of NATO will assuredly expand the zone of 
security, to quote the distinguished Senator who testified 
before me. It will expand the zone of security in Europe and 
will shrink the zone of insecurity and instability.
    Unfortunately, I believe that it is necessary for the 
United States to take a leadership role on this issue, perhaps 
because we have had the opportunity to observe the inadequacy 
of a purely European security framework policy to achieve these 
desired goals. It is not graceful and perhaps not appropriate 
for an American to emphasize the inability of the European 
Union and the WEU or any of the purely exclusively European 
military groups to protect peace and provide collective 
security to Europe. Their failure is manifest, but more so 
because, at the time the Serbs took up arms against Slovenia 
and Croatia, then-President of the EU--and it was the EC, 
then--Mr. Poos, of Luxembourg, said, and I quote, ``This is a 
European problem that will be solved by Europeans. There is no 
role here for Americans.''
    I think President Bush was quite ready to have the 
Europeans take that turn.
    But everyone knows what happened. Presidents George Bush 
and Bill Clinton were more than willing to stand aside while 
first Europe, then the United Nations and Europe worked on the 
problem. Unfortunately, what that experience provided was 
additional and timely evidence of the inadequacy of purely, 
European security arrangements to deal with the problems of 
Europe.
    And UNPROFOR, under Secretary General Boutros Boutros-
Ghali's command provided, I think, definitive evidence on the 
inability of the United Nations to mount an effective military 
operation in Europe or, indeed, virtually anywhere else.
    The passive, inadequate response of the EU, the United 
Nations, the OSCE, and the Western European Union testify to 
the ineffectiveness of a collective defense based only on these 
organizations. NATO has a different and a better record, though 
it, too, was tarnished in Bosnia by its association with 
UNPROFOR. I think it has reestablished its credibility.
    I think we have seen clearly the inadequacy of a U.N. 
response, which I emphasize only because we hear rather 
frequently that peace can be defended by the United Nations and 
peace can be restored by the United Nations. I believe that 
certain lessons of great relevance to European security leap 
out of the Yugoslav experience: that membership in the U.N. 
cannot be regarded as a reliable guarantor of European 
security--we have seen that very clearly, beyond any reasonable 
doubt; that global institutions cannot necessarily provide 
reliable solutions to regional problems; that diplomacy may not 
be able to forestall aggression, whether or not that diplomacy 
is directed from the U.N.; that ``peacekeeping'' is not an 
adequate response to the determined use of military force; that 
the ``peacekeeping'' rules of engagement that the U.N. has 
invoked and imposed in former Yugoslavia may make peace keepers 
hostages without deterring aggressors or assisting victims; 
that effective force is often necessary to repel force.
    NATO can be, and indeed, is, that effective force, Mr. 
Chairman.
    Why should we act now?
    Czech President Vaclav Havel, a man of unusual foresight 
and courage told the ``Economist'' magazine about a year ago 
that he feared the spirit of Munich was returning to Europe. I 
quote, ``I do not have in mind some concrete political act,'' 
he said. ``Rather, I refer to a mentality marked by caution, 
hesitation, delayed decisionmaking, and a tendency to look for 
the most convenient solutions.''
    Havel charged the governments of NATO and the EU with 
excessive caution and worried aloud that the opportunity to 
build a Europe of independent democratic nations would not last 
forever.
    As usual, I think President Havel was right. Years which 
might have been used to integrate the new democracies and to 
reinforce them, to extend the institutions of freedom have 
already been lost through indifference, procrastination and 
timidity. These characteristics--indifference, procrastination, 
and timidity--are not examples of effective foreign policy and 
not examples of the kind of policy that Americans are proud of.
    There has been a persistent question about whether we could 
afford to support our share, our reasonable share, of the costs 
of enlarging NATO. I would like to say Mr. Chairman, that the 
United States spends each year in former Yugoslavia alone 
several times the cost of even the CBO's estimates of enlarging 
NATO. That is very interesting if you think about it.
    No one made a decision to spend that much money in former 
Yugoslavia. I would like to say that it would have been much 
more economical in money and lives, to have taken timely action 
to deter action that conflict.
    Some people might argue that we could save the money by 
simply ignoring the ethnic cleansing and the massacres in 
former Yugoslavia. But the fact is, the United States cannot be 
indifferent to a tragedy in the heart of the civilization of 
which we are a part.
    What about Russia? Mr. Chairman, I believe that NATO is a 
defensive alliance dedicated to deterring and, if necessary, 
defeating aggression. A democratic Russia will pose no threat 
to anyone and a democratic Russia should not fear NATO. The 
most urgent problem in my judgment in U.S. relations with 
Russia is to help the Russian democrats defeat the internal 
enemies of Russian democracy.
    I think our government is working quite hard on that 
problem and, indeed, has since the end of the cold war.
    I think that it should be remembered that President Yeltsin 
himself has on several occasions clearly indicated that he has 
no problem with the inclusion in NATO of these independent 
European neighbors who were formerly members of the Warsaw 
Pact.
    President Yeltsin is himself principally concerned with the 
strengthening of democratic institutions in Russia. We cannot 
help him achieve his goals or Russians achieve the goals of a 
strong, consolidated, democratic government by appeasing the 
extremists and anti-democrats in Russia. We do not help Russian 
democrats by handing the opponents of democracy in Russia a 
victory over NATO, a longstanding symbol of the West's 
commitment to defend democracy
    We can only help by strengthening and moving boldly toward 
the construction of a democratic Europe, which is, indeed, 
wholly consistent, indeed virtually identical, with his goal.
    Mr. Chairman, I believe that Americans understand the 
American stake in a stable democratic Europe. Public opinion 
surveys and studies over the period from the end of World War 
II, the Marshall Plan, and the establishment of NATO, down to 
last week demonstrate that Americans support an active U.S. 
role in Europe and support a strong America and a strong 
democratic NATO. I think that the Senate should do no less.
    Thank you.
    [The prepared statement of Ambassador Kirkpatrick follows:]
              Prepared Statement of Ambassador Kirkpatrick
    Mr. Chairman, thank you for inviting me to testify before this 
distinguished committee today.
    The subject of today's hearing is important. The Senate's decision 
will be more important. I have followed this issue with interest.
Why enlarge NATO?
    The case for admitting Poland, the Czech Republic, and Hungary to 
membership in NATO is not only strong, it is essentially the same as 
the case for organizing NATO in 1949--to provide a security shield 
behind which the free institutions of these more geographically 
vulnerable European democracies can strike deep roots and thrive, to 
deter aggression and discourage conflict.
    Of course there are differences between 1939, 1949 and 1997. There 
is no one major threat to peace and security throughout the region 
today. But if the threats of aggression, subversion and conquest are 
less clear now, as they were after World Wars I and II, the appetite 
for democracy and peace is greater. Still, more people understand the 
benefits of freedom and long to share it--and the prosperity and 
security of the ``West''. And more associate that freedom, prosperity 
and security, with joining NATO and the European Union.
The new members ``fit'' in NATO
    Poland, the Czech Republic and Hungary share a civilization with 
the countries of NATO and were engaged in parallel patterns of 
democratic development when first, Adolf Hitler's, then Joseph Stalin's 
expansionist policies interrupted their evolution. The people in each 
of these countries share our culture. They demonstrated their vocation 
for freedom with heroic efforts to throw off foreign domination and 
regain control of their own histories.
    Poland, the Czech Republic and Hungary can be incorporated into 
NATO without creating serious disruption or without requiring 
reorientation of NATO's operations. They will ``fit'' in NATO. Their 
inclusion will not require qualitative changes in its purposes, 
culture, or mode of operation. NATO has been and, after their 
inclusion, will be a military alliance of democratic nations united in 
the determination to preserve their free societies from aggression--by 
force if necessary.
    The Czech Republic, Poland and Hungary applied for membership in 
the European Union and in NATO years ago (Hungary actually applied for 
EU membership before Soviet forces had departed). They have met all 
stated requirements and cooperated in all proposed projects including 
Partnerships for Peace.
    Moreover, four years have passed since President Clinton said in 
Prague, ``Let me be absolutely clear: the security of your states is 
important to the security of the United States ... the question is no 
longer whether NATO will take on new members but when and how.'' But 
neither they nor any other country that suffered under Soviet dominance 
has been admitted to NATO or the EU.
``Threats'' to a democratic Eastern Europe
    The post Cold War period has seen numerous threats to the 
development of a democratic Europe. Resurgent anti-democrats have won 
power in some states and threaten peace in others. Serbian President 
Slobodan Milosevic and Slovakian Prime Minister Vladimir Mecias are 
examples.
    Milosevic sponsored and organized Serbian aggression, and ``ethnic 
cleansing'' against Slovenia, Croatia and Bosnia-Herzegovenia (in that 
order) and acted repeatedly to destabilize Macedonia. He repeatedly 
violated democratic norms and the human rights of the Serbian 
opposition. He undermined democracy in Serbia and outside it. The 
violent attacks he sponsored devastated two states--Croatia and Bosnia 
and destabilized the region.
    It is no accident, as Marxist liked to say, that in democratic 
Czechoslovakia separation of Slovakia from Czeck Republic was peaceful. 
And that the separation of Yugoslavia was violent. The difference was 
respect for democratic decisions. There was no will to conquest in the 
government of the Czech Republic. The Czech Republic is a democracy 
prepared to accept democratic self-determination of Slovakia. Serbian 
rulers are not committed to democratic methods.
    There is, finally, only one reliable guarantee against aggression--
it is not found in international organizations. It is the spread of 
democracy. It derives from the simple fact that democracies do not 
invade one another, and do not engage in aggressive wars.
    Numerous studies establish beyond reasonable doubt that the best 
system, the only reliable system of collective security is that all the 
governments in an area should be democratic governments. Therefore, 
what reinforces democracy reinforces peace. That is the reason that the 
top priority for the United States and NATO should today be to preserve 
and strengthen the new democracies in Eastern and Central Europe and 
Russia as well. Preserving and strengthening democracies in Central and 
Eastern Europe should be the United States central goal and top foreign 
policy priority in Europe. Membership in NATO helps achieve those 
goals.
The Inadequacy of a purely European Response
    It is not graceful and perhaps not even appropriate for an American 
to labor the inability of the EC and the WEU to protect peace and 
provide collective security to Europe. That failure is manifest, the 
more so because at the time Serbs took up arms against Slovenia 
Croatia, then President of the EC, Mr. Poos of Luxembourg, said, ``This 
is a European problem that will be solved by Europeans. There is no 
role for Americans.''
    Everyone knows what happened. Presidents George Bush and Bill 
Clinton were more than willing to stand aside while first Europe, then 
the United Nations and Europe worked on the problem.
    Unfortunately, this experience provided additional and timely 
evidence of the inadequacy of purely European security arrangements. 
And UNPROFOR, Secretary General Boutros Boutros-Ghaii provided 
definitive evidence on the inability of the United Nations to mount an 
effective military operation.
    The passive, inadequate response of the EU, the United Nations, the 
Organization on Security and Cooperation in Europe, and the Western 
European Union have testified to the ineffectiveness of a collective 
defense based only on these organizations. NATO has a different and a 
better record though it was tarnished in Bosnia by its association with 
UNPROFOR.
The Inadequacy of a U.N. Response
    Certain lessons of great relevance to European security leap out of 
the Yugoslav experience:

   that membership in the United Nations cannot be regarded as 
        a reliable guarantor of European security;
   that global institutions cannot necessarily provide 
        solutions to regional problems;
   that diplomacy may not be able to forestall aggression--
        whether or not that diplomacy is directed from the U.N.;
   that ``peacekeeping'' is not an adequate response to the 
        determined use of military force;
   that the ``peacekeeping'' rules of engagement may make 
        ``peacekeepers'' hostage without deterring the aggressors or 
        assisting the victims; and,
   that effective force is often necessary to repel force;
   NATO can be that force.

Why Act Now?
    Czech President Vaclav Havel, a man of unusual foresight and 
courage, told the Economist magazine about a year ago that he fears the 
spirit of Munich has returned to Europe.
    ``I do not have in mind some concrete political act,'' Havel said. 
``Rather I refer to a mentality marked by caution, hesitation, delayed 
decision-making and a tendency to look for the most convenient 
solutions.'' Havel charged the governments of NATO and the European 
Union with ``excessive caution'' and worried aloud that the opportunity 
to build a Europe of independent democratic nations will not last 
forever.
    As usual, Havel was right. Years which might have been used to 
integrate the new democracies and extend the institutions of freedom 
have already been lost through indifference, procrastination and 
timidity.
Can we Afford It?
    The United States spends each year in former Yugoslavia several 
times the cost of enlarging NATO.
    How much more economical in money and lives it would have been to 
deter that conflict.
What About Russia?
    NATO is a defensive alliance dedicated to deterring and, if 
necessary, defeating aggression.
    A democratic Russia will pose no threat to anyone. The most urgent 
problem in U.S. relations with Russia is to help Russian democrats 
defeat internal enemies of democracy. Our government is working hard on 
that problem.
    It should be remembered that President Yeltsin has repeatedly 
indicated that he has no problem with the inclusion in NATO of these 
independent European neighbors. We do not help Russian democrats by 
appeasing their opponents.

    The Chairman. Thank you very much. Those were two excellent 
statements.
    In doing a little housekeeping arithmetic, I note that we 
have about 8 Senators here. I have to divide the time so that 
we share it equally as nearly as possible. So I suggest that we 
have a 5 minute time period each, at least on the first round.
    Dr. Brzezinski, some critics of NATO enlargement are 
alarmed by the negative reaction of Russia to this policy. If, 
as we are led to believe by those critics, Russia has no 
designs on the territory of Poland, Hungary, and the Czech 
Republic, how does the membership of those countries in NATO 
impact Russian interests?
    Dr. Brzezinski. Mr. Chairman, I do not believe that it 
impacts on Russian interests adversely at all unless Russia is 
of the view that NATO is an enemy and that the United States is 
an enemy. If that is the Russian view, then we have a very 
serious problem, in which case we ought to expand NATO for that 
reason as well.
    Ambassador Kirkpatrick. That's right.
    Dr. Brzezinski. But I don't think the Russians think of 
NATO as an enemy. I don't think the Russians think of America 
as an enemy, though some members of the Russian foreign policy 
elite--in almost all cases, in fact, former members of the 
Soviet foreign policy elite--would like to have the potential 
option in the future of exercising dominant political influence 
in Central Europe. This is why they don't like the expansion of 
NATO.
    In my view, we shouldn't cater to these anachronistic 
prejudices. But we ought to work to create conditions whereby 
Russia is not tempted in that fashion and is, therefore, more 
likely to become really a democracy.
    Let me just quote one sentence from Andrei Kozyrev, the 
former Russian Foreign Minister. He says that to pay too much 
heed to the Russian critics of NATO expansion would play into 
the hands of the enemies of democracy in Russia.
    I completely agree with Kozyrev.
    The Chairman. An excellent answer.
    Ambassador Kirkpatrick--and I like to call you that because 
you did so well at the United Nations--how will the memberships 
of Poland, Hungary, and the Czech Republic in NATO enhance the 
defense of democracy in Europe? What you said addressed this 
very subject. What is the greatest strategic value, do you 
think, of these three countries to the NATO alliance?
    Ambassador Kirkpatrick. I think that their principal value 
to the NATO alliance is to expand in Europe and in an area of 
Europe which has been, historically, one of turmoil and 
victimization, to expand the zone of peace and the conditions 
of peace and stability.
    I believe that Western Europe as well as Central Europe and 
Eastern Europe will, in fact, have enhanced stability and 
confidence in the peace of their region if these countries are 
accepted for membership in NATO.
    Mr. Chairman, I read that you had said that it was an 
historic opportunity. I think it is an historic opportunity and 
I think it is the right thing to do, as well. I think the 
people of these countries, having been denied by accidents and 
tragedies of history that we all know about should be given the 
opportunities for peace, prosperity, and stability that they 
seek and would be very reliable allies. They would, as Dr. 
Brzezinski said, and as I think Senator Roth said, strengthen 
the armies of NATO. They will be enthusiastic, disciplined, and 
effective members of NATO because they have already paid the 
greatest price to join.
    So I think both in war and in peace, militarily and 
politically they would strengthen NATO and the context of NATO 
operations.
    The Chairman. Thank you, ma'am.
    Senator Biden.
    Senator Biden. Thank you, Mr. Chairman. Thank you both for 
being here. You lend a great deal to this discussion.
    I would like to parse this debate arbitrarily into two 
pieces. The political argument up here is going to get down to 
money, in my humble opinion, and whether or not there is any 
use for NATO, period. It's the old Mansfield argument--bring 
the boys home.
    There is a strong strain of isolationism, stronger in one 
party than in the other, but it exists in both, and there is 
the question of why can't the Europeans do this. I mean, what 
do they need us for?
    I will leave that argument aside and focus on the arguments 
that are made by the foreign policy establishment of which you 
are two prominent members--and we are going to hear two 
prominent members after you who are opposed to expansion--and 
the intellectual community. They usually do not talk about 
expansion in terms of money.
    All of you will come up here--and I am a strong supporter 
of expansion--and will say stability is the question. Mr. Dean 
and Mr. Mandelbaum are going to argue that enlargement will 
diminish stability rather than enhance it in Europe. I argue 
that enlargement enhances stability and I think you will also 
be making that argument.
    I would like to lay out, as I have been doing for the past 
6 months, what I think the arguments are devolving to. There 
are only 3 or 4 arguments in opposition to expanding NATO and I 
would like you to comment on them, if you will.
    You mentioned the present President of Russia does not have 
a problem--I might add that I met with Yavlinsky and he had no 
problem. I met with Zyuganov and he had no problem. I met with 
Lebed and he had no problem. I met with Baturin and he had no 
problem. Not a single one of them had a problem in face to face 
meetings each of which lasted a minimum of an hour. Not one of 
them viewed the expansion of NATO as a threat, a physical 
threat.
    They viewed it in terms of being excluded from Europe. They 
viewed it in terms of it having consequences for them 
culturally and politically. They viewed it as a slap in the 
face. They viewed it as an insult to their pride. But none of 
them--and I asked the explicit question, ``Do you view it as a 
threat?'' Not one of them has said that. Not one of the ones I 
mentioned. I think I have covered the various political 
factions.
    Now here is what the arguments against expansion come down 
to, as I see it, and then I would like you to comment. First is 
that expanding NATO will diminish the organization's ability to 
gain consensus on a lot of issues because 3 more countries are 
being added to the 16, making a total of 19. It is hard enough 
to get consensus now, and the added difficulty will unravel 
NATO.
    Second is that expansion will aid the Russian nationalists, 
the Browns and the Reds, although I see no evidence of that. 
This argument had much more saliency 10 months ago. It has 
little now, in my view, in light of the NATO--Russian accord 
that has been reached. But that is a second argument I have 
heard.
    The third argument is that expansion will require us to 
station troops in the new member countries on the border of 
Russia. Not one single head of state in each of these countries 
that I visited, not one single defense minister, not one single 
head of the military, not one single person of any authority in 
any party in any of the 3 countries, has said they want 
permanent troops stationed on their soil. We have all said we 
are not going to permanently station troops. We are not going 
to give Russia the right to veto stationing troops, but 
regardless of that nobody has said we are going to permanently 
station troops in any of those countries. That is the third 
argument that I hear.
    The fourth argument is that these countries cannot pay. My 
counter to that is that if they do not pay to go this cheaper 
route, does anybody think these regions are is going to sit 
around and not try to increase their military capability on 
their own; not try to establish bilateral or multilateral 
relationships in that gray zone? And then aren't they going to 
spend more money?
    The other counter argument is that this power vacuum that 
exists in Europe can be filled by the stability of extending 
the hand of NATO to the east and stabilizing the situation in 
Russia.
    So I would like you to comment on: one, whether expansion 
will diminish consensus; two, will Russian nationalism be 
enhanced; three, are we likely to permanently station American 
troops in those three countries; and, four, is joining NATO 
going to cause them to drain their treasuries where otherwise 
they would not, which is the implication?
    Thank you, Mr. Chairman.
    Dr. Brzezinski. If I may start, Senator, first of all, 
these are very good questions. Second, you have answered most 
of them very well. So I am not sure I can improve. But I will 
give it a try.
    Senator Biden. Well, do you agree or disagree? Maybe I 
should put it that way.
    Dr. Brzezinski. As for diminished consensus, I think you 
are going to get new NATO members who are going to be really 
gung-ho and who are very, very pro-American. I think it is 
going to strengthen the tendency of NATO to be vital. New 
members tend usually to be activists, and these are countries 
which are very pro-American.
    Will it aid Russian nationalism? This is one of these hoary 
arguments that has been made for several years, that Russian 
nationalists will come to power if NATO expands. Well, we have 
announced that it will expand. Have they gained power?
    What about the recent changes in the Russian Government? 
Have they moved them more toward the nationalists or more 
toward the reformers? There is simply no evidence for it.
    All of the evidence we have in terms of public opinion 
polls is that the vast majority of the Russian people don't 
give a damn. This is an issue which preoccupies the Russian 
foreign policy elite, the old Soviet foreign policy elite, that 
hobnobs with some members of our foreign policy elite and tells 
them well, of course, we know NATO is not a threat, but our 
stupid people think it is a threat and, therefore, if you 
expand NATO, they will move toward the nationalists.
    Then they go back home and say to the Russian people that 
NATO expansion is a threat, don't you think? And the most that 
they get is a yawn. So it is a hoary argument.
    The argument that this will bring American troops into 
these countries on the borders of Russia is a particularly 
perplexing argument because Hungary does not have a border with 
Russia, the Czech Republic does not have a border with Russia, 
Poland has a tiny strip of a border with the Kaliningrad 
region, but basically is separated from Russia. So, first of 
all, it is an argument made by people who don't know geography. 
Second, the countries concerned don't want American troops on 
their soil.
    Senator Biden. That's what I think.
    Dr. Brzezinski. All public opinion polls indicate that they 
do not want foreign troops. They want to be part of the 
alliance. They want to contribute to it. But I think they would 
like to have a status, say, like Norway.
    What about that they can't pay? Well, first of all, they 
are growing. They are now beginning to spend more or less on 
the NATO level. Poland I think actually is slightly above the 
NATO average. They know damn well that if they are not in NATO, 
they will have to spend a hell of a lot more.
    Senator Biden. Thank you.
    The Chairman. Dr. Kirkpatrick.
    Ambassador Kirkpatrick. I have now heard two sets of good 
answers to those questions from Senator Biden.
    I think that the concern about consensus, how difficult 
will it be to build a consensus on NATO is not only a valid one 
but a very important one. But I think it is also true that as 
for these three countries, their membership in NATO will 
certainly not complicate or render more difficult the process 
of achieving consensus.
    I believe, as Dr. Brzezinski has just suggested, that these 
countries will make splendid, enthusiastic participants in NATO 
and will, indeed, strengthen American leadership in NATO, 
which, in my judgment, is important and necessary.
    Senator Biden. If you forgive me, Mr. Chairman, I must say 
that it is a pleasure to be agreeing with both of you.
    Ambassador Kirkpatrick. On Russian nationalism, I also 
agree with the view expressed by Dr. Brzezinski, and I think it 
is your view as well, that it would not enhance Russian 
nationalism.
    I think, as Dr. Brzezinski has said, that there is a lot of 
exaggeration of the strength of Russian nationalism by the old 
Soviet foreign policy elite, which looks for new grounds to 
make outrageous demands and support outrageous policies. I do 
not think that NATO's enlargement will have any discernible 
effect. It may have an effect on the argument, but I don't 
think it will have an effect on the strength of Russian 
nationalism. I don't think it is something we should lie awake 
worrying about.
    I think the Russian people have an agenda of their own 
which involves a better living than they have had in their 
lifetime and their history, and more peace and more freedom.
    I don't believe it will bring U.S. troops to the borders of 
Russia. That is for geographical reasons, as Dr. Brzezinski 
made clear. Also it is because it just won't happen. These 
countries don't desire troops just as we would rather not put 
them there. We control our own troops. We don't send U.S. 
troops anyplace that the U.S. Government does not decide to 
deploy U.S. troops.
    It is simply not true that these countries could not pay 
their way in NATO. They could, or if they can't right now, all 
of them soon will be able to, and I think they will be eager, 
in fact, to assume the burdens of full membership in NATO. The 
added security of NATO can only enhance their economic 
prospects.
    I fully expect that they will be very reliable participants 
and contributors and will enhance the strength of NATO.
    The Chairman. Representatives of all three countries with 
whom we met recently indicated precisely what you said.
    Ambassador Kirkpatrick. OK. Good.
    The Chairman. Senator Lugar.
    Senator Lugar. Thank you, Mr. Chairman.
    Dr. Brzezinski, two sentences that you wrote in your 
testimony I thought were really terrific. You talked about the 
relationship to Russia and whether NATO's enlargement helps 
democratize Russia by foreclosing the revival of any self-
destructive, imperial temptation. That is a different argument 
or way of phrasing than I have heard and I think it is very, 
very helpful.
    But I wanted to ask about the preceding sentence as regards 
America. You say that NATO's enlargement is about America's 
role in Europe, whether America will remain a European power--
that is, America as a European power--and whether a larger, 
democratic Europe will remain organically linked to America.
    Now this makes sense, I think, to members of this 
committee, to you, to Dr. Kirkpatrick and to others. But it is 
a basic argument with regard to NATO altogether that we are 
having or that many of us have never had before. In other 
words, as I talk to constituents, they would say why are we a 
European power, why do we want to be a European power and 
organically linked. They say that really stretches the bridge 
too far altogether.
    What is your rationale, just as a help to all of us, 
understanding why NATO is important, as to why America should 
want to be a European power? What advantages are there to us in 
this and if so, of course, this is the basic reason for being 
in NATO. Try to express that, if you can.
    Dr. Brzezinski. Senator, you have raised a very fundamental 
issue. It has been addressed in part by Dr. Kirkpatrick and I 
will follow her lead in that regard.
    Europe is the place in which some of the worst human 
suffering and some of the worst tragedies of this century were 
precipitated. We were dragged into two world wars by the 
dynamics of European politics.
    Some of the worst suffering experienced by people in the 
course of this century was a consequence of these wars.
    We have created a system over the last 50 years which has 
dramatically decreased the probability of war, which has 
deterred aggression, which has created security in a very 
important part of this very large Eurasian continent. I believe 
that our future role in the world and the peace of the world 
depends centrally on the maintenance of that relationship.
    If we were somehow to begin to withdraw from Europe, if the 
relationship with Europe started being loose, vague, 
antagonistic, I think the world would be sliding, maybe if not 
toward new wars since there are no immediate protagonists 
threatening us, but certainly toward anarchy.
    So I do think that the maintenance and enhancement of our 
relationship with Europe and of our presence in Europe is 
central to nothing less than global stability. The American 
people, for all of their hesitations about use of force and 
their uneasiness about casualties still instinctively 
understand that.
    I was struck by the fact that just today, as you have 
launched this very important national debate on the enlargement 
of NATO, a public opinion poll has been released regarding the 
question of the enlargement of NATO. An overwhelming majority 
of the American people favor the enlargement of NATO.
    Well, that certainly does not signal to me a desire to 
withdraw from Europe if at the same time the American people, 
with only 18--18--percent opposing, say that we should enlarge 
NATO. It seems to me that, instinctively, our people understand 
that our fates have become inter linked, our values are the 
same, and we share a common interest in making these values 
more pervasive, in expanding the area that is safe and 
democratic at the same time, that is strong and can, over time, 
attract others, or, if necessary, contain and deter others if 
they are threatening.
    Senator Lugar. Thank you very much.
    The Chairman. Thank you, Senator Lugar.
    I believe Senator Robb is next. Senator Robb.
    Senator Robb. Thank you, Mr. Chairman and I thank our two 
distinguished witnesses. I regret that I had another commitment 
and could not hear Dr. Brzezinski's remarks today. I did have 
the privilege last evening of hearing one of the most 
extraordinary and provocative addresses I have heard in 
Washington in years and I suspect that it is taken directly 
from his most recent book which I would, on the basis of last 
night's remarks alone, commend to others who want to be pushed 
in terms of some of their thinking.
    Dr. Brzezinski. I hope this is being televised nationwide, 
Senator.
    Senator Robb. I am afraid that it is not, so this will have 
limited value in terms of a promotion for the book, but 
certainly for the speech. I won't go on beyond that. I think 
there are matters in there that I hope you will bring and 
repeat before this committee when different subject matter is 
the focus of our attention.
    But I would like to ask just one question of both of our 
distinguished witnesses, if I may. I am not very good at 
leading a friendly witness, which would give you some 
indication of where I am coming from in this particular debate. 
The question of cost is one which is raised frequently and the 
question of cost avoidance is not always factored in. I am not 
sure that it is possible to give precise numbers, even with a 
great deal of study.
    I believe last night and I know previously others have 
alluded to the cost avoidance of Nunn-Lugar funds, for 
instance, in terms of what we don't have to spend on our own 
defense if we reduce the capability and, presumably, the 
potential of a possible enemy at home.
    Ambassador Kirkpatrick made reference to the amount of 
money that we are spending in Bosnia as compared to the amount 
of money that we would spend out of the U.S. Treasury for this 
particular NATO enlargement as things now stand.
    I wonder, if you can, put some sense of a comparative cost 
avoidance to the U.S. Government in terms of the kinds of costs 
that we might otherwise have to spend if we decided not to 
pursue this scenario, if we decided, for whatever reason, not 
to approve of the enlargement of NATO.
    Ambassador Kirkpatrick. Senator Robb, I have thought about 
this quite a bit. We have CBO estimates, which I think, by the 
way, are extremely exaggerated, about the costs of NATO 
enlargement to us and to other NATO powers. I think the costs 
can be kept substantially below those CBO estimates. But I 
don't think we know what they would be compared to.
    It occurred to me that one thing they could be compared to 
is the cost of our military expenditures in non-NATO areas of 
Europe today, and the most outstanding example is the former 
Yugoslavia, and Bosnia quite specifically. I had a research 
assistant who was formerly a member of the U.S. Government, 
working in budget matters, do some very careful research for me 
on the costs of some of the so-called U.N. peace operations. He 
calculated the cost to us--our agreed-to share--as it were--of 
those peace operations in former Yugoslavia.
    I might say that these estimates do not include the very 
large U.S. contributions that were made to what I call off 
budget items, that is, funds or resources spent but never 
submitted to the Congress for authorization or appropriation. 
They were simply provided through the Pentagon.
    The figures that I am about to propose were of expenses 
that were authorized and appropriated in the formal process, 
acknowledged by the administration and all parties. Those 
figures put our expenditures in Bosnia at something around $4.5 
billion between the end of 1992 and 1996. They put at about $2 
billion our expenditures for Bosnian activities in 1996 and 
1995. There is no year that we have participated that the 
expenses have not been at or over $1 billion, which is several 
times greater than anyone estimates the costs of enlarging 
NATO.
    Now why is that a relevant comparison? It is because if 
NATO enlargement will have the effects that several of us have 
suggested, it will enhance the stability and peace in the 
region by both consolidating and strengthening democracies in 
the region, but also consolidating stability in the region and 
expanding the area that no aggressive government would feel 
inclined to attack.
    I cannot be certain that there would not be continued 
efforts by Milosevic, let's say, to take such actions as he has 
in the past. But I believe that an expanded, active, ready 
NATO, who understands that neither the U.N. nor an exclusively 
European security force provides an alternative, will be a big 
deterrent to aggressive power and aggressive action.
    The Chairman. Thank you very much.
    Senator Hagel.
    Senator Hagel. Mr. Chairman, thank you.
    I, too, would like to add my thanks to both of you for 
contributing your distinguished voices to this debate.
    Dr. Brzezinski, I was struck by the first paragraph in your 
statement where you reference the global significance of 
enlargement of NATO. I have thought for some time that this 
might, in fact, be the most significant consequence of the NATO 
expansion issue. All the other issues we have discussed today 
that you both have thought through and written and talked about 
are all critical, such as Russia. But when you really start to 
think about the connection of security and stability as you 
move South and East to Central Asia, to the Middle East, and, 
as you say in your paragraph a step-by-step construction of 
security internationally, I think that has a powerful amount of 
insight into something that we need to really sort through as 
we debate this issue.
    I would very much like to hear in a little more detail from 
you, Dr. Brzezinski and Ambassador Kirkpatrick, your thoughts 
on this one issue.
    Dr. Brzezinski. Thank you.
    If I may, let me just add one footnote to the preceding 
very able answer by reading from a document prepared by former 
Secretary of Defense Perry and Ashton Carter, former Assistant 
Secretary of Defense. They say the following: ``Despite the 
debate over the estimated costs of enlargement, the fact 
remains all estimates of the costs to existing members of 
adding the three new candidate members identified at Madrid 
show them to be a small fraction of existing NATO expenditures, 
the current U.S. burden of supporting its NATO commitments, and 
the U.S. defense budget.'' Then they go on to estimate that it 
will be, in any case, less than 1 percent.
    So I think this cost issue, while important, should not be 
blown out of proportion.
    Now on your very large issue, I think we are entering a 
phase in world affairs in which the long-range choice for us is 
either a slow slide toward some form of international anarchy 
with no new single power emerging as a threat to us the way 
Nazi Germany was or Soviet Russia was, but a slow slide into 
international anarchy, or a gradual expansion of genuine 
international security cooperation by a process of building 
blocks and ink blotting effect, expanding particularly the zone 
of security and democracy.
    Here I think the American--European connection is 
absolutely central. But over time I would hope--and I hope it 
does not sound too illusory--over time, over the next 20 or 30 
years, I would think we would point toward the creation of what 
might be called eventually a Trans-Eurasian or a 
Transcontinental security system in which NATO, in effect, the 
Euro-Atlantic alliance, involving America and Europe, would 
become linked to some sort of cooperative security arrangement 
with Russia, eventually pointing toward China, and America and 
Japan allied together also in a security relationship with 
China. In effect, this would be a kind of transcontinental 
OSCE.
    But we can only get there if we create solid, vital blocks 
of cooperative States committed to the same values and sharing 
the same interests. This is why the argument for constricting 
NATO to a rump Europe--one look at the map today shows that 
NATO really is linked to a rump Europe--is historically 
irrelevant. It is an anachronistic way of looking at the world.
    We are building here a long-term structure, a long-term 
process of creating the architecture of peace across all of 
Eurasia. The way to start is where we can start, with the 
democratic, solidly philosophically committed to the same 
values we are countries, countries that want to be our allies 
and who are committed to the notion of cooperative security.
    So we are engaged here in a long-term process, the first 
step of which is being taken now. But I think it is going to be 
a long-term process well into the next century. That is why 
your task is so historic.
    Senator Hagel. Well, thank you. I think it is significant 
and I think there is no reason why we cannot connect it all the 
way around the world. I think we must.
    Dr. Kirkpatrick, I would be interested if you had any 
thoughts here.
    Ambassador Kirkpatrick. No. In my testimony, I emphasize 
the fact that the countries which are being considered for 
inclusion in NATO are countries that share our culture, our 
values, and our aspirations and goals. I think that is very 
important and I think it is possible, basically, to build 
really strong alliances where there are such shared goals and 
values, and broad agreement on institutional arrangements.
    I believe that an enlarged NATO will insure an enlarged 
zone of security as well as democracy in Europe and that it 
will serve as an even more powerful magnet for Russia and other 
countries in the region who are themselves tending in that 
direction in any case.
    I think this process of building strength, consolidating 
freedom and prosperity, which then serves as a magnet is a 
process by which we can hope for an indefinite expansion of 
this zone of peace and security.
    I think I want to read Dr. Brzezinski's new book before I 
comment on the extension to Asia. I do believe that Asia, some 
countries in Asia, are likely to pose some difficult problems 
to the security of that region. I believe that an active 
American role in Asia is also important to the peace and 
freedom in that region. That is a point, by the way, that was 
made by the Australian minister of defense at a luncheon here 
in Washington just a few days earlier this week. I think that 
is valid as well.
    The Chairman. Thank you very much.
    Senator Wellstone.
    Senator Wellstone. Thank you, Mr. Chairman.
    I know we are going to have testimony from Mr. Dean and Dr. 
Mandelbaum, but the more I try to learn about this, I think the 
more skeptical I become. I want you all to help me work through 
these arguments.
    I am not exactly sure why we are talking about expanding 
NATO. I am not sure what the compelling need is. It certainly 
does not seem to me to be a military threat from Russia, a 
country that cannot even invade itself. It certainly does not 
seem to me to promote economies in democracies because I don't 
see how you do that in a military alliance and, in any case, 
the more I hear the discussion, the more I am attracted to what 
Senator Nunn used to talk about, which is we ought to be 
talking about expanding the European Union. That seems to me to 
be the way in which we focus on promoting market economies and 
democracy and it is win/win from the point of view of what the 
potential consequences are in Russia.
    Moreover, I know that both you, Dr. Brzezinski, and you, 
Dr. Kirkpatrick, are very committed and sincere in your 
viewpoints and are professional and knowledgeable. You put a 
tremendous emphasis on promoting peace and democracy in the 
world and I agree with you. The question is whether this will 
do that.
    I mean, there are people like George Kennan, who is not an 
isolationist, and Paul Nitze, who is not an isolationist, much 
less our panelists to come, who are not isolationists, who 
raise very real questions as to what exactly are we gaining 
from this, what is even the reason to do this, vis-a-vis what 
are the potential consequences or implications of this.
    Now I just want to go a little bit further and get your 
reaction.
    I think that from everything I have read--and there is a 
little bit of disagreement, I guess, with Ambassador 
Kirkpatrick--the democrats in Russia are the most vociferous in 
their opposition. The democrats--not with a large ``D'' but 
with a small ``d''--are the most worried about this, though, I 
must say, it seems to be the case that people of all political 
stripes are very worried about it as well.
    So the question becomes what is the reason to do this. The 
final part of my question, which I raised the other day and I 
want to go back to, is if the focus is on building economies 
and building democracy, the countries we are talking about are 
the most stable. We are talking about Czechoslovakia, Poland 
and Hungary.
    I would think we would be talking about Belarus, we'd be 
talking about Ukraine, we'd be talking about the Baltic States. 
Are we talking about them and if we are, are you going to tell 
me that this does not have any consequences for what happens in 
Russia?
    Finally, shouldn't we be talking about Russia?
    Secretary of State Albright spelled out the criteria for 
choosing new NATO members: ``If we were creating a new alliance 
today, we would not leave a democratic country out in the cold 
because it was once, against the will of its people, part of 
the Warsaw Pact. The only question we would consider is this: 
which democratic nations in Europe are important to our 
security and which are willing and able to contribute to our 
security?'' That was before the Senate Armed Services 
Committee, April 23, 1997.
    Well, by these standards, it is Russia whose citizens 
certainly were not consulted about joining the Warsaw Pact and, 
by the way, whose officials have expressed the wish to belong 
to the Atlantic Alliance. The Secretary said that this was not 
the case, but that is not my understanding at all.
    Senator Biden. She said not NATO.
    Senator Wellstone. Pardon?
    Senator Biden. Excuse me, Senator. I think she said not 
NATO.
    Senator Wellstone. Let me just finish. So wouldn't we be 
talking about Russia? Wouldn't we be talking about Belarus? 
Which countries should we be talking about?
    This is a range of questions. Why are we doing this? What 
is the military threat? How does a military alliance expand 
economy and democracy? What are the consequences within Russia? 
Isn't it true that the democratic forces in Russia are the most 
opposed? Finally, would Russia be eligible, from your point of 
view, to join an expanded NATO?
    Dr. Brzezinski. Well, I can take part of your question and 
then perhaps Ambassador Kirkpatrick can take part of it.
    First of all, that the democrats are most vociferous in 
opposition to expansion of NATO, that, of course, depends on 
one's definition of ``democrat.'' I know that Zhirinovsky is 
vociferous in opposition to NATO. But he is surely not a 
democrat.
    Senator Wellstone. I'm certainly not talking about him.
    Dr. Brzezinski. Zyuganov is vociferous in his opposition to 
expansion of NATO. He is not a democrat. Gaidar is not 
vociferous in opposing the expansion of NATO. In fact, on 
occasion he has indicated that they should not be so worried 
about it and not make such an issue out of it.
    Yavlinsky is not opposed to the expansion of NATO. Kozyrev 
has written eloquently favoring the expansion of NATO. So I 
think the picture is more mixed.
    But there are some Russians who say they are democrats and 
who are opposed to the expansion of NATO. Then I think they 
have to explain what is it that they are really opposed to. Is 
it because they think NATO is an enemy? Is it because they 
think America is an enemy? Or is it just possible that they 
really would like to have a sphere of influence in Central 
Europe, which is exactly what the Central Europeans do not 
want?
    Insofar as the argument that we should be more worried 
about Belarus or Russia than about the new democratic States of 
Central Europe, I think there is something to the argument in 
the sense that we should be worried about where they are 
headed. But it certainly is not an argument for having them in 
NATO.
    I think NATO is an alliance of like-minded States that are 
securely committed to the practice of democracy and share 
common philosophical views regarding the nature of the 
individual and his relationship to society and the State. That 
is what is so discerning about the NATO alliance.
    I do not think Belarus by that standard qualifies for 
membership, though we should be worried about what is happening 
in it. But worrying about what is happening in it I think gives 
more salience to the idea of the adjoining States being 
securely part of Europe.
    What about that we should be expanding EU? Well, the United 
States cannot expand EU. We are not a member of the EU. I would 
like to see EU expand, but it is an infinitely more complicated 
process than expanding NATO. You have to adopt something like 
3,000 to 5,000 laws of the Common Market standard and implement 
them domestically in order to qualify. It is a longer-range 
process. But we encourage it. By the year 2002 or 2003, 
probably the three candidate members that you are now 
considering will be members of the EU as well.
    Insofar as Russian membership in NATO is concerned, first 
of all, it is a fact--and I think Senator Biden is correct--
that no Russian leader has stated clearly and explicitly that 
they would like Russia to join NATO. Joining NATO does have 
implications for them. It means that their armies should be 
subordinated to an integrated command, currently headed by an 
American and so forth. I see no evidence of Russia wanting to 
be part of NATO.
    Beyond that, there are certain objective criteria that 
countries ought to meet to be members of NATO, and on this 
there is consensus between us and the Europeans. They have to 
be stably democratic. Russia is not yet so. They have to have 
effective, working, market economies. Russia does not have 
that, not fully, not yet. They have to have effective civilian 
control over the military. Russia does not. They have to have 
real respect for minority rights domestically. Ask the Chechens 
about respect for domestic rights of minorities. They have to 
have no border conflicts with their neighbors. That is hardly 
true of most of Russia's southern and eastern frontier.
    So simply on the basis of objective criteria, the issue is 
not Russian membership in NATO. But there is a legitimate issue 
about structuring a relationship of stability with Russia and 
of reassuring Russia that NATO is not a threat, by: one, 
promising them not to station American or German forces on the 
soil of new members--we are doing that; no nuclear weapons on 
the soil of the new members--we are doing that by creating 
transparency in NATO, by having the Russians present there; we 
are doing that by having systematic consultations with Russia 
on NATO; we are doing that by having Russia participate in the 
Partnership for Peace. We are doing that.
    So I think we ought to strike a balance. I have advocated 
for the last 3 years not only NATO expansion but a 2 track 
approach: expand NATO and sign some accommodation, some 
agreement, with Russia which reassures the Russians regarding 
their legitimate concerns. But we should not cater either to 
anachronistic prejudices or to hidden geopolitical designs.
    Senator Wellstone. Just a clarification, by the way. My 
argument was not necessarily that if there was going to be 
expansion that Poland is not important, or Czechoslovakia. I am 
just saying that if the concern is about stability and 
democracy, it would seem to me there would be other countries 
as well. I would still raise the question--though I have run 
out of time and will come back to it--as to what exactly is the 
reason for this. Is it a military threat? I don't see it. How 
does a military alliance help these countries economically? I 
don't see that, either.
    Isn't it true--I quite agree with you that some people call 
themselves ``democrats'' in Russia, but they are not. But my 
impression from talking to a lot of people is there is a great 
concern in that country among democrats as to where this is 
going to take Russia.
    The Chairman. I hate to do this, but the Senator's time has 
expired a long time ago.
    Would you like, Dr. Kirkpatrick, to comment?
    Ambassador Kirkpatrick. Just very briefly, Mr. Chairman.
    I would like to say concerning the fact that Russians were 
not consulted about their membership in the Warsaw Pact in the 
previous regime and therefore should not be held responsible 
for that membership, Russians were not consulted about anything 
in the previous regime. This is one of the reasons that that 
regime proved so brittle, I think, in the opinion of all of us. 
Neither was any other member of the Warsaw Pact consulted about 
its membership in the Warsaw Pact. They were not consulted 
about anything.
    I believe, too, that there are a lot of different reports 
about how many of Russia's democrats oppose NATO enlargement 
and how strongly. We know some who don't oppose it. I think it 
is particularly significant, personally, that a very critical 
Russian democrat, Boris Yeltsin, has repeatedly indicated that 
he saw no problem, basically, about the expansion of NATO into 
the area now in question.
    He has from time to time backed off this clearly under 
domestic political pressures as all prudent presidents do from 
time to time. But we all know that there are Russian democrats 
who oppose and Russian democrats who support. I think it is an 
oversimplification to suggest that Russian democrats generally 
oppose the enlargement of NATO. Even if they did, I would 
simply say they have not thought that through because Russian 
democrats have an especially large interest in the 
consolidation of democratic governments and the strengthening 
of stability and peace in Central Europe, which is closest to 
them.
    What are we trying to do and why are we trying to do this? 
I ask myself this. Just as a personal note, I became an 
advocate of the enlargement of NATO in 1992, and began at that 
time to both write and speak about it. I concluded at a certain 
point that maybe the time that we ought to enlarge NATO and 
really work on it had passed and that maybe it was not as 
desirable as it was in 1992, or 1993, or 1994, since the world 
seems to be a good deal more peaceable and stable than we might 
have dreamed--at least the European, the Western world is.
    Why, then, should we do it? I think, Senator Wellstone, 
that, first of all, NATO is a very great asset not for 
Americans exclusively, or perhaps even principally, but it is a 
great asset for democratic civilization and for Europeans who 
have had a lot more trouble in keeping peace than, for example, 
we in the Americas have had. NATO is a great asset, in my 
judgment, to that end.
    I have believed from the very beginning, and the more I 
read and think about it, the more it seems to me that, from the 
very beginning, NATO was a multi functional institution, which 
we political scientists know most institutions are. From the 
beginning it was engaged in the strengthening and consolidation 
of democratic governments and again and again it incorporated 
new democracies and provided and instilled in them the 
reinforcement, training, and experience of the other democratic 
countries. I think that has been particularly important with 
the military establishments in a number of relatively new 
democracies--Spain, Portugal, Turkey, Greece, and other such 
countries, not to mention the initial reorienting of the German 
military.
    I believe it will be important to the new democracies in 
Central Europe and I believe always in conserving one's assets.
    Thank you.
    The Chairman. I thank you very much.
    Dr. Brzezinski, I promised to try to get you out of here by 
3:15. I missed it by 12 minutes for which I apologize, but not 
very strongly because we are glad to have you and appreciate 
your coming.
    The same goes for you, Ambassador Kirkpatrick.
    Senator Biden. Thank you both.
    Dr. Brzezinski. Thank you very much.
    Ambassador Kirkpatrick. Thank you, Mr. Chairman.
    The Chairman. We will pause now momentarily while we set up 
the second panel.
    [Pause]
    The Chairman. We are genuinely grateful to have two 
additional experts here. They are Hon. Jonathan Dean, Senior 
Arms Control Advisor for the Union of Concerned Scientists here 
in Washington, headquartered here; and Dr. Michael Mandelbaum, 
Professor and Director of American Foreign Policy of the Paul 
H. Nitze School of Advanced International Studies at Johns 
Hopkins University. I recognize that I may have mispronounced 
your name, sir.
    Thank you very much.
    Mr. Dean, you may proceed.
    By the way, your entire statements will be printed in the 
record. You may proceed.

 STATEMENT OF HON. JONATHAN DEAN, SENIOR ARMS CONTROL ADVISOR, 
         UNION OF CONCERNED SCIENTISTS, WASHINGTON, DC

    Ambassador Dean. Thank you, Mr. Chairman. I want the thank 
the committee for this opportunity to express my views on NATO 
enlargement.
    Mr. Chairman, I have been closely involved with NATO since 
the early 1950's, when I helped with German entry into NATO. It 
is painful for me personally to speak in opposition to 
enlargement, but necessary. NATO in its present form and 
present membership continues useful and important. But 
enlargement of NATO will be costly, risky, and above all, 
unnecessary.
    The estimates of enlargement costs, and reference has been 
made to that, are still very loose and imprecise. But, even if 
we take the low, $30 billion, total for the first group of 
candidates as estimated by the State Department in its February 
report to the Congress, the United States is likely to have to 
pay the largest part of that total if it is serious about these 
force improvements.
    Neither the European allies nor the candidate States can be 
expected to pay the amounts allocated to them in these 
estimates. Moreover, these estimates cover only the first three 
candidates for membership--the Czech Republic, Hungary, and 
Poland. I believe that if the enlargement process continues, 
the total cost at the end will be from 3 to 5 times this low 
State Department figure of $30 billion for the first group, 
with the United States paying at least half of this overall 
total of $90 billion to $150 billion.
    Nearly all of this expenditure would be, in my view, 
wasteful because the need for the expenditure is created by the 
enlargement program and not by objective factors.
    My estimate here rests on the fact that including the 
Madrid 3, there are now 12 candidates for NATO membership. This 
total of 12 candidates can easily increase to 15 if Austria, 
Sweden, and Finland decide to apply. In fact, I see a 16th 
country, Ukraine, on the horizon.
    Continuous enlargement of this scope and possibly doubling 
NATO's current membership insistently recalls the scenes in 
Disney's ``Fantasia'' about the Sorcerer's Apprentice who cast 
a spell to create a spring of water but ended with a flood 
because he did not know how to say ``stop.''
    NATO has already decided at its Madrid summit to entertain 
the candidacies of five more countries--Romania, Slovenia, and 
the three Baltic States. We very much hope that better wisdom 
will prevail, but if in fact the first group of three is 
actually admitted as NATO members, then there should be no 
doubt anywhere that negotiations on Baltic State membership 
will be seriously pursued.
    If nothing else, partisan political competition in the 
United States will push these negotiations fatefully forward. 
No one will wish to be accused of faint-heartedness in the face 
of certain Russian opposition.
    If the Baltic States do become members of NATO, then the 
costs to present NATO members of making a realistic effort to 
defend these countries, which border Russia at the Eastern end 
of the Baltic Sea, will include very large increases in NATO's 
force projection capabilities, including naval forces and 
combat aircraft, and, quite probably, explicit reliance on 
nuclear weapons, matching a parallel and ominous development in 
Russian nuclear weapons policy.
    There is no room, of course, in the small Baltic countries 
to station outside NATO forces. But defending Romania and 
Bulgaria, if they become members, would, in practical terms, 
probably require stationing large NATO forces there. Possibly 
part of them may have to be United States troops.
    As regards risks, enlargement on this scale would 
dangerously expand the scope of current United States security 
commitments. It would extend United States security guarantees 
to States with traditional mutual hostility, like Hungary and 
Romania, Greece and Bulgaria, not to mention Macedonia and 
Albania.
    Then there is Russia, which still has 20,000 nuclear 
warheads. The Russian public, as has been mentioned here, pays 
relatively little attention to foreign affairs. It has other 
worries. But the political class in its entirety, with very few 
exceptions, from President Yeltsin to Zhuganov, opposes NATO 
enlargement and strongly. This is the group which will form the 
views of the Russian public about the outside world for the 
next generation, with the message that Russia is hostilely 
encircled and has been cheated by the same countries on the 
cold war outcome.
    The NATO-Russia Joint Council is a useful device, but it 
cannot contain the negative Russian reaction to actual NATO 
enlargement, especially if that enlargement includes the Baltic 
States bordering directly on Russia.
    We have, of course, already seen adverse reaction to NATO 
enlargement in the Russian Duma's refusal thus far to ratify 
START II and its general blockage of arms control agreements.
    Mr. Chairman, the main thing that every one of these costs 
and these risks have in common is that they are completely 
unnecessary. They are unnecessary because what Eastern European 
countries most want and most need is a form of membership in 
the Western community that provides support for their growing 
economic, social, and political structures.
    The European Union, as has been mentioned, is preeminently 
qualified to provide this support. Negotiations to enlarge the 
Union will begin next year. Among the first group of candidates 
very likely to be admitted are the Czech Republic, Hungary, and 
Poland, the same three countries who are today the leading 
candidates for NATO enlargement.
    Because of its nature and its mission, the European Union 
can do this job better than NATO. It is significant that public 
opinion in all three candidate countries sees this and shows 
stronger support for European Union membership than for NATO 
membership.
    Moreover, Mr. Chairman, the European Union should do it. It 
is their primary responsibility, not ours, to nurture 
democratic and free market institutions among their European 
neighbors. They can do this without incurring the risks of NATO 
enlargement. European Union enlargement causes no problems with 
Russia.
    It is true that these negotiations for entry to the 
European Union may take considerable time, perhaps, as Dr. 
Brzezinski has mentioned, until 2003 or 2004, or even longer. 
But Eastern Europe has plenty of time for this. It is making 
continuous political and economic progress. There is no crisis 
in Eastern Europe and no military threat to the area to require 
rapid action.
    However, a special, fast track European Union enlargement 
program for the Baltic States is needed as a substitute for 
their NATO candidacy.
    NATO enlargement is also unnecessary because an improved 
Partnership for Peace program provides close bilateral security 
relationships between the candidate countries and NATO.
    Finally, NATO enlargement is unnecessary because NATO, in 
its present form and membership, effectively provides stability 
in Europe, tying the United States to Europe, reassuring 
European countries that a united Germany will not become 
dominant, and providing very adequate residual insurance 
against Russian misbehavior. NATO today performs all three of 
these functions without increasing the possibility of Russian 
misbehavior as the enlargement project does. It performs these 
functions at no extra cost to the United States.
    Mr. Chairman, I believe these circumstances justify a 
request from the Senate to the administration to suspend action 
on its present enlargement program until it has rethought this 
issue and has presented to the Congress and to the American 
public a detailed plan for organizing European security which 
is genuinely comprehensive and which has a specific place in it 
for all of the potential NATO candidates and also for Russia. 
Such a plan would place European security on a far more stable 
footing without the heavy costs and risks of the present NATO 
enlargement program.
    Thank you.
    [The prepared statement of Ambassador Dean follows:]
                 Prepared Statement of Ambassador Dean
    I am Jonathan Dean, adviser on international security issues of the 
Union of Concerned Scientists. I am also speaking on this occasion as a 
board member of the Council for a Livable World.
    I have been involved with NATO since the early 1950s, when I helped 
with German entry into the alliance.
    NATO in its present form and present membership continues useful 
and important. But enlargement of NATO will be costly, risky and, above 
all, unnecessary.
Costs
    The costs to the United States of NATO enlargement have been 
estimated at from two to twenty billion dollars for the first group of 
candidates over a ten to fifteen year period. These estimates are still 
very loose and imprecise. But even if we start with the very low $30 
billion total for the first group of candidates estimated by the State 
Department in its report of February 1997 to the Congress, the United 
States is likely to have to pay the largest part of that amount if it 
is serious about these force improvements.
    A great deal of evidence, including well attested statements by 
French President Chirac and German Chancellor Kohl as well as the views 
of UK, French, German and Netherlands defense ministers reported in the 
Washington Post of October 3, points to the conclusion that current 
NATO members will not pay the shares allocated to them in these 
estimates--and that the United States will consequently have to take on 
a much larger proportion of the enlargement costs.
    For their part, the Eastern European candidate countries are faced 
by a costly and unneeded remilitarization precisely at a time when they 
have to focus their resources on economic and social reconstruction. 
They will not be able to afford these force increases, whose cost has 
been estimated by the Congressional Budget Office at six times their 
current defense budgets. Again, if the U.S. is serious about these 
improvements, it will have to pay for most of them itself.
    Moreover, these estimates cover only the first three candidates for 
membership--the Czech Republic, Hungary and Poland. The total cost of 
NATO enlargement will probably be three to five times this low State 
Department estimate of $30 billion, with the United States paying at 
least half of that total.
    This is because, including these three countries, there are now 
twelve candidates for NATO membership. The others are Latvia, 
Lithuania, Estonia, Slovakia, Slovenia, Romania, Bulgaria, Albania and 
Macedonia. This total of twelve candidates can easily increase to 
fifteen if Austria, Sweden and Finland decide to apply for NATO 
membership. In fact, I see a sixteenth country--Ukraine--on the 
horizon. Internal discussion in Ukraine about applying for NATO 
membership has gone back and forth. If the candidacy of the Baltic 
States appears to be malting progress, then Ukraine will either apply 
for full membership or fall into very serious internal dissension.
    Enlargement of this scope, doubling NATO's current membership, 
recalls the scenes in Disney's ``Fantasia'' about the sorcerer's 
apprentice who cast a spell to create a spring of water but ended with 
a flood because he did not know how to say stop.
The Risks
    NATO has already decided at the Madrid Summit to entertain the 
candidacies of five more countries--Romania, Slovenia, and the three 
Baltic States. We very much hope that better sense prevails, but, if in 
fact the Czech Republic, Hungary and Poland are formally admitted as 
NATO members, there should be no doubt that these negotiations on 
Baltic State membership will be seriously pursued. If nothing else, 
partisan political competition in the United States will propel them. 
No one will wish to be accused of faint heartedness.
    If the Baltic States do become members of NATO, then the costs to 
present NATO members of making a realistic effort to defend these 
states bordering Russia at the eastern end of the Baltic Sea will 
include very large increases in NATO's force projection capabilities, 
including naval forces and combat aircraft, and quite probably explicit 
reliance on nuclear weapons, matching a parallel ominous development in 
Russia. There is no room in the small Baltic countries to station NATO 
forces, but defending Romania and Bulgaria would in practical terms 
probably require stationing large NATO forces there. If this happens, 
part of them will have to be U.S. troops.
    With these points, we also come to the risks of NATO enlargement.
    Holding to the present twelve candidate states, enlargement would 
dangerously expand the scope of current U.S. security commitments. It 
would extend United States security guarantees to states with 
traditional mutual hostility like Hungary and Romania, and Greece and 
Bulgaria, not to mention Macedonia and Albania. More work has to be 
done to resolve the quarrels of these countries, but it is very 
doubtful that internalizing them in NATO is the most productive or the 
safest way to go about it.
    Then there is Russia. The Russian public is confronted by difficult 
problems of daily life. Consequently, it pays relatively little 
attention to foreign affairs. But the Russian political class in its 
entirety opposes NATO enlargement. And this is the group that will form 
the views of the Russian public on its outside environment for the 
entire next generation. Russian policymakers are also worrying about 
the activities of the Clinton administration and U.S. oil companies in 
the Central Asian republics. Together with NATO enlargement, their 
concerns reinforce the image of hostile encirclement that has already 
played such a negative role in Russian history.
    We have already seen negative reaction to NATO enlargement in the 
Russian Duma's refusal thus far to ratify START II and its general 
blockage of arms control agreements.
    The NATO-Russia Joint Council is a useful device, but it will not 
contain the negative Russian reaction to actual NATO enlargement, 
especially if that enlargement includes the Baltic States bordering 
directly on Russia.
    Do we really want to deliberately add a decade of trying to cope 
with this issue to the tasks of Russian governments already tottering 
under the burden of economic and social reforms--in a country that 
still has 20,000 nuclear weapons? It defies common sense to believe 
that applying more and more pressures like this to a weak political 
structure can have positive results.
Costs and Risks Not Necessary
    The main point that every one of these costs and risks have in 
common is that they are completely unnecessary.
    They are unnecessary because what Eastern European countries most 
want and most need is a form of membership in the Western community 
that provides support for growing economic, social, and political 
structures. The European Union is preeminently qualified to provide 
this support. Negotiations to enlarge the European Union will begin 
next year. The first candidates--very likely to be admitted--will be 
none other than the Czech Republic, Hungary and Poland, the same three 
countries who are today the leading candidates for NATO enlargement.
    Because of its nature and mission, the European Union can do this 
job better than NATO. It is significant that public opinion in all 
three candidate countries sees this and shows stronger support for 
European Union membership than for NATO membership (see NATO Review, 
#3, May-June 1997, p. 17). Moreover, it is appropriate that the 
European Union and not the United States take on these economic and 
political responsibilities for the Union's European neighbors. The 
European Union can do so without the risks that arise from foisting off 
this task on a less suitable NATO. It is true that these negotiations 
for entry to the European Union may take considerable time, perhaps 
until 2003 or 2004 or even longer. But Eastern Europe has the time for 
this--it is making continuous political and economic progress, and 
there is no crisis in Eastern Europe and no military threat to the area 
to require rapid action. A special European Union enlargement program 
for the Baltic States is urgently needed.
    NATO enlargement is also unnecessary because an improved 
Partnership for Peace backed by a coordinating Euro-Adantic Council 
provides close bilateral security relationships between the candidate 
countries and NATO.
    And NATO enlargement is unnecessary because NATO in its present 
form and membership provides stability in Europe--tying the United 
States to Europe, reassuring European countries that a united Germany 
will not become dominant, and providing very adequate residual 
insurance against Russian misbehavior. NATO today performs all three of 
these functions without increasing the possibility of Russian 
misbehavior, as the enlargement project does, and it performs these 
functions at no extra cost to the United States.
    In sum, there is no perceptible logic or gain to the NATO 
enlargement project, while the project entails many serious but also 
superfluous costs and risks to this country. I believe these 
circumstances justify a request from the Senate to the Administration 
to suspend action on its present enlargement program until it has 
rethought the issue and has presented to the Congress and the American 
public a plan for organizing European security which is genuinely 
comprehensive and which has a place in it for all of the potential NATO 
candidates and ultimately also for Russia.
    Such a plan would place European security on a far more stable 
footing without the costs and the risks of the present NATO enlargement 
program.

STATEMENT OF DR. MICHAEL MANDELBAUM, PROFESSOR AND DIRECTOR OF 
 AMERICAN FOREIGN POLICY, THE PAUL H. NITZE SCHOOL OF ADVANCED 
     INTERNATIONAL STUDIES, THE JOHNS HOPKINS UNIVERSITY, 
                         WASHINGTON, DC

    Dr. Mandelbaum. Thank you, Mr. Chairman. Let me thank you 
and my friend, Senator Biden, for giving me the opportunity to 
share my views with this committee.
    I have submitted for the record and a copy has been made 
available to all members of this committee a pamphlet I have 
written, entitled ``NATO Expansion: A Bridge to the 19th 
Century,'' which sets out in detail my reasons for opposition. 
In that pamphlet, I make at some length two points that I wish 
simply to state here without elaboration because time is short.
    [See appendix for the material received for the record.]
    Dr. Mandelbaum. First, I believe that we get no benefits 
whatsoever from NATO expansion. All public policy must weigh 
advantages and disadvantages. Whatever the costs of NATO 
expansion--and I will be talking about that--I believe that the 
advantages we incur are zero.
    Second, I believe that the only coherent reason for 
expanding NATO is to contain Russia. This is a military 
alliance. Russia might some day become a threat to its 
neighbors, but it is not a threat now and, therefore, NATO 
expansion, as planned by the administration, is at best 
premature and at worst counterproductive.
    Rather, Mr. Chairman, than dwelling on those points, I wish 
to address five others that I think are important for the 
committee and the Senate to consider: first, the costs of 
expansion; second, the status of the former communist countries 
that are not being included; third, an argument we are likely 
to hear with ever greater frequency, that we must proceed with 
this plan because our credibility is at stake; fourth, some 
alternatives to our current course; and, fifth, some comments 
on how this policy is being managed.
    Let me also state for the record, Mr. Chairman, that I do 
not agree with much of what was said about Russia and Russia's 
attitude toward this policy by the previous panel. I would 
hope, Mr. Chairman, that you and your distinguished colleague, 
Mr. Biden, would convene one or more sessions of this committee 
to hear the testimony on this subject of our best experts on 
Russia, those with a lifetime of study, reflection, and dealing 
with that important country.
    Senator Biden. Mr. Chairman, with your permission, I should 
point out to the witness that we have ordered just such a 
hearing and the very people you are talking about will all have 
a chance to testify.
    Dr. Mandelbaum. Thank you very much, Senator Biden. As 
often, you are ahead of me.
    As for the costs, I believe that the administration has 
dramatically underestimated both the total and the American 
share of these costs. The administration's estimate of the 
total is $35 billion, but the Congressional Budget Office 
estimate is 4 to 5 times that. Moreover, as my colleague, 
Ambassador Dean, has pointed out, the administration's 
estimates presume 3 or 4 new entries, but I believe we are now 
committed in some form to at least 8, with more to come. 
Moreover, the administration assumes that no American troops 
will be stationed in any of these countries.
    But I do not believe, Mr. Chairman, that it will be 
possible to guarantee the security of the Baltic States without 
the deployment of Western troops. That, at least, is a question 
that I hope the Senate will ask the Department of Defense.
    As to the share, the administration forecasts the United 
States paying 15 percent of the fixed costs and 6 percent of 
the total costs. I do not believe that is remotely likely, Mr. 
Chairman.
    The administration foresees the Central Europeans, the new 
members, paying 35 percent of the total costs. I believe they 
will not be able to pay. They have steadily reduced their 
defense spending since their liberation. They have been warned 
by the World Bank and the International Monetary Fund not to 
increase defense spending. In no poll of public opinion in any 
of the three prospective members have I ever seen more than 20 
to 25 percent of respondents say that they are willing to spend 
more on defense.
    As for the Western Europeans paying 50 percent of the total 
cost, as the administration predicts, this reminds me of a 
story about the great Duke of Wellington, the victor at 
Waterloo, who was once approached on the battlefield by a 
junior soldier who did not recognize him and who approached him 
by saying, ``Mr. Smith, I believe.'' The great duke turned to 
him and said, ``If you believe that, you'll believe anything.''
    How do we know that the Western Europeans won't pay 50 
percent of the total cost--because they have said so. At the 
Madrid Summit, Chancellor Kohl, President Chirac and Prime 
Minister Blair all said on the record in one form or another 
that their countries would pay nothing. Nor, Mr. Chairman, do I 
believe that this is political posturing. It is politically 
impossible for these countries to spend more money for NATO 
expansion.
    Germany and France are under enormous pressure to reduce 
government spending in connection with the project of a single 
European currency which, despite all of the claims that have 
been made for NATO expansion, is far more important to them 
than anything having to do with NATO.
    Britain is under similar pressure.
    All the Europeans regard NATO expansion as an American 
initiative for which America will pay. So if we are going to do 
this, Mr. Chairman--and I believe we should not, but if we 
are--let us go in with our eyes open. No one else will share 
the burden which occasions a number of reflections.
    First, it may be that we won't have to spend very much 
money. But if there is no need for more spending, that means 
there is no threat to these countries, in which case there is 
no need to expand NATO.
    Second, whatever the near-term costs, we are undertaking 
the mother of all unfunded mandates here.
    Third, I believe that the refusal of the Europeans to bear 
what we would regard as their fair share of the burden will 
lead to a Transatlantic quarrel within NATO about burden 
sharing which will weaken the Atlantic Alliance, which I favor 
retaining, far more than expanding NATO could strengthen it.
    Fourth, and finally, given that the Europeans will spend 
nothing, this will raise one of two questions in the minds of 
those of us American taxpayers who do have to pay. First, if 
NATO is, indeed, a security organization, why is European 
security more important to Americans than to Europeans? If, on 
the other hand, as the administration sometimes claims, NATO is 
being turned into a social welfare organization, the question 
is why are American tax dollars being used for social spending 
in Europe rather than for social spending, or, as some would 
prefer, tax relief in the United States?
    Perhaps, Mr. Chairman. There are good answers to these 
questions, but I personally have never heard them.
    The next point I would like to address is the status of the 
former communist countries not being included in this 
expansion, notably the Baltic States.
    I believe that expansion as planned confronts the United 
States with a problem with respect to these countries that we 
can neither avoid nor solve. We have promised the Balts 
membership. We have made statements to that effect. They expect 
membership, and if Poland, Hungary, and the Czech Republic are 
entitled to join NATO, certainly Estonia, Lithuania, and Latvia 
are equally, if not more, entitled. Yet the Russians have said 
unequivocally from Yeltsin on down that this is unacceptable 
and that they would respond negatively.
    If they should do so, Mr. Chairman, that would leave us 
with three options, each of which is worse than our present 
circumstance is not having expanded NATO.
    First we could expand NATO membership to the Baltics, 
meaning that we would bring the Western military alliance to 
Russia's border. At the very least, I believe we would have to 
expect a sharp diminution in cooperation with Russia and the 
remilitarization of the line between Europe, between NATO and 
Russia.
    Second, we could try to bring in the Baltic States but fail 
because our Western European allies vetoed this. This, I 
believe, they would do. I believe that Baltic membership is 
unacceptable to the Western Europeans, which means that we 
would have a huge Transatlantic quarrel with our Western 
European allies over this issue.
    Or, the third alternative where the Balts and Ukrainians 
are concerned is that we would fail to expand and thereby do 
precisely what the administration claims NATO expansion is 
designed to avoid. We would renege on a promise. We would give 
Russia a veto over NATO's affairs. We would draw a new line of 
division in Europe and we would strand new democracies on the 
wrong side of it.
    Now some argue privately that we can avoid this issue, that 
we can just expand to these three countries and let it go at 
that. I do not believe that this is feasible, even if it were 
proper, which I don't believe it is.
    First, we are on record as promising the Balts membership. 
Second, they will press us on this issue, and rightly so.
    Third, no American president will ever unequivocally rule 
out Baltic or Ukrainian membership, which means that the 
Russians will always have to assume that we may expand to 
Russia's border, which means at the very least that this issue 
will become a central one in relations between us and the 
Russians as far as the eye can see with no benefit to us.
    Now, Mr. Chairman, I would like to address an argument that 
we have heard already and will hear I think more insistently in 
the future. That argument is that, whatever reservations one 
may have about NATO expansion, it is now too late to turn back. 
The failure to ratify NATO expansion, as indicated by the 
administration, it will be said will shatter American 
credibility and the U.S. position in the world.
    I do not believe this is remotely the case. The argument 
about maintaining credibility was a powerful one during the 
cold war. It was the reason that we fought a major war in 
Korea. It was the reason we stood firm in West Berlin. It was 
the reason that we fought and continued to fight in Vietnam.
    That argument was persuasive because of its context. We 
were engaged in a global conflict with a militant, militarized 
adversary. It was reasonable to fear that retreat in one place 
would invite aggression elsewhere.
    But that context has disappeared completely. The cold war 
is over. The Soviet Union has collapsed. If the Senate decides 
that the course recommended by the administration is not the 
wisest one from the standpoint of American national interest, 
will the Soviet army be in West Berlin the next day? The 
question answers itself.
    I would like also, Mr. Chairman, to address another version 
of this issue, that is that this vote is a test of American 
international commitment and that if we fail to expand NATO as 
indicated, we will be guilty of isolationism.
    Now as a professor of American foreign policy, let me 
assure you that there is not now and never has been a policy of 
isolationism in the United States. No significant American 
figure ever imagined that the United States could or should 
isolate itself from the rest of the world.
    George Washington was not an isolationist. He was a shrewd 
and effective geopolitician. We could use some of his 
shrewdness now.
    More to the point, even if the Senate should decide that 
this particular course is not a wise one, this would not leave 
the United States disengaged from Europe. We would still be 
central to NATO. We would still be central to the Partnership 
for Peace. We would still be central to the unprecedented and 
under appreciated arms reduction treaties designed by President 
Reagan and negotiated by President Bush. We would still be part 
of a multiple series of bilateral and multilateral political, 
economic, and cultural ties with Europe and with the rest of 
the world.
    This would hardly signal a retreat from engagement.
    What is the alternative, then? Well, I echo my colleague's 
injunction that there is certainly no need to do anything 
rapidly, if at all. By the administration's own testimony, 
there is no threat, there is no urgency. If you want to get a 
sense of what is possible with respect to NATO expansion, 
listen to those now urging expansion to Central Europe on the 
subject of the Baltic countries.
    They have said and will say well, there is no hurry. We 
don't have to rush into bringing the Balts into NATO. We can 
devise different arrangements for them.
    Mr. Chairman, it seems to me that whatever security 
arrangements are adequate for the Balts are more than adequate 
for the Poles, the Hungarians, and the Czechs. Moreover, we 
have an excellent security order now in place consisting of 
NATO, the Partnership for Peace, arms treaties, and a Russia 
that is not a threat. We cannot be sure that that will always 
be true. But if circumstances change, we can change our policy, 
and we will have plenty of advance notice to do so.
    We should, I think, concentrate on the real security issues 
in Europe: clearing up the status of the Russian finger on the 
Baltic, Kaliningrad, getting some assurances on the status of 
Belarus, getting START II ratified and proceeding to reduce 
nuclear weapons even further, and proceeding further with the 
reduction begun in the Reagan and Bush administrations of 
reducing non-nuclear weapons in Europe.
    Ironically, NATO expansion is at best a distraction from 
and at worst a hindrance to dealing with the real security 
threats.
    Finally, Mr. Chairman, I would echo my colleague's 
suggestion, first put forward by your distinguished former 
colleague, Senator Nunn, that we harmonize the expansion of 
security guarantees in Europe with European Union membership.
    I have one final set of comments, Mr. Chairman, on the way 
that this policy is being carried out.
    As I have said, I see no benefits whatsoever to this 
policy. But I recognize that there are those whom I deeply 
respect, including the two gentlemen who flank you, one of whom 
is present, also Senator Lugar, who have made important 
contributions to American foreign policy in the past and who I 
hope will in the future, who see things differently, who are 
able to detect what I cannot find in this policy, namely some 
merit.
    But I believe that, even those who do find some merit, 
ought to be concerned, indeed alarmed, about the way this 
policy is being carried forward. I believe that that way is a 
recipe for failure.
    We know from bitter experience, since 1945, that the 
foreign policies of the United States fail when they lack 
public support. Public support, in turn, has three 
requirements, none of which has been fulfilled here. The first 
requirement is clear aims. But they are muddled. Is NATO an 
organization to promote security or social welfare? Are we 
including or containing Russia? Is this the old sturdy NATO or 
an entirely new organization? The American public simply does 
not know what it is being asked to support.
    The second requirement for public support is a clear 
strategy. I do not mean necessarily an exit strategy; I simply 
mean a plan, some sense of how goals are to be achieved. There 
is an old military axiom that says don't take the first step 
without knowing the last.
    In this case, not only do we not know the last step, we 
don't know the next step. I find the way the issue of Baltic 
and Ukrainian membership is being treated by the administration 
particularly disturbing. In response to the question what comes 
next, they simply say well, this process is open ended and we 
won't name names.
    Mr. Chairman, that is not an answer and it's not a policy. 
It is an evasion. It amounts to saying to us, the American 
people and you, our elected representatives, in response to 
what may be the most momentous question hanging over this 
issue, we won't tell you. Well, that means either they know but 
won't disclose the answer or they won't disclose the answer 
because they don't know it.
    The first of these is constitutionally dubious, the second 
strategically alarming.
    The third requirement for attaining public support in any 
major undertaking of the United States is candor about cost. As 
I have said, Mr. Chairman, I believe that the discussion of 
costs is characterized by an absence of candor.
    The failure, finally, to fulfill these three requirements 
has led, bitterly, to failure for the United States--in Vietnam 
in the 1970's, in Lebanon in the 1980's, in Somalia in the 
1990's, and I fear in Bosnia in the future.
    Failure in Vietnam, Beirut, Somalia, and Bosnia was costly 
and tragic. But failure where NATO expansion is concerned, at 
the heart of Europe, involving the two greatest European 
powers, Germany and Russia, and the most destructive weapons on 
the planet, nuclear weapons, failure here, Mr. Chairman, could 
be far worse.
    Thank you.
    The Chairman. I will say to you, sir, that I am very much 
interested in your questions, and that is precisely the reason 
these hearings have been scheduled.
    Now there are at least three more hearings and I can 
guarantee you, sir, that we are going to try to get to the 
bottom of all the questions that you have asked plus the 
hundreds that we have ourselves. So this is no done deal.
    Mr. Ambassador, there is a large volume of public 
information available for anybody who wants to find it that 
Russia is cheating or has cheated on the ABM Treaty, the CFE 
Treaty, the START I Treaty, the Missile Technology Control 
Regime, the Biological Weapons Convention and, already in 
advance, the as yet unratified Chemical Weapons Convention, 
which, by the way, I oppose vigorously.
    With the words of Sam Ervin ringing in my ears, I am going 
to quote him because I thought he had a point. He said, up to 
that time, when he was serving in the Senate, that the United 
States had never lost a war or won a treaty. I think that is 
what you are warning about here, both of you.
    Now with the backdrop of the cheating that I have just 
enunciated, could you be suggesting that the NATO enlargement 
should be put off so that the hard line elements in the Russian 
State Duma will approve the START II Treaty?
    Ambassador Dean. Well, Mr. Chairman, I do expect that the 
Yeltsin Government will make an effort shortly to gain Duma 
approval of the START II Treaty.
    I am not proposing, making the proposal you describe, but a 
different one, which is that the administration should develop 
a comprehensive program for, if you want to call it NATO 
enlargement or for European security, which term I think I 
would use, which has a place in it for all of these candidates, 
including the Baltic States, Ukraine, Romania and all of the 
other present candidates and possible future ones, and also 
which lays out a timetable and requirements for possible 
Russian membership in this system.
    It is not accurate to say, as some have been saying here, 
that Russia has expressed no interest in NATO membership. 
Gorbachev several times suggested this as a possibility. 
Yeltsin has several times suggested it as a possibility. Only 
last year, Prime Minister Chernomyrdin, speaking at Davos, 
again suggested it as a possibility.
    It is true that they have never pressed a specific claim 
for it.
    But what I have in mind is a program which would allow NATO 
enlargement, which would defuse its negative aspects, and 
which, at the end of the road, would have a real prospect of 
Russian membership, but in a situation where they, because they 
had such a prospect, would not object to the membership of 
Baltic States, Ukraine and other potential candidates. That is 
what I find missing from the administration's approach: We 
should either not enlarge, or do it right.
    The Chairman. I am not going to try to play ``gotcha'' with 
you. But back in 1993--and I know you were going to be asked 
about this if you have not been before, and I do it for no 
reason whatsoever except to give you an opportunity to explain 
now for the record what others may ask you--in 1993, you wrote 
an op-ed for the ``Washington Post'' that made one of the best 
arguments I have ever seen in support of NATO expansion. You 
wrote that the inclusion of Poland, Hungary, and the Czech 
Republic would be ``good for them, good for the West''--and I'm 
quoting you--``and good for Russia, too, provided that it is 
accompanied by a clear definition of a new NATO policy toward 
the former Soviet Union.
    [The information referred to follows:]

             [From the Washington Post, September 6, 1993]

                    Open the Ranks To Eastern Europe

                        (By Michael Mandelbaum)

    An event of symbolic significance took place in Warsaw last month 
when President Boris Yeltsin became the first Russian to visit Poland 
as the leader of a free and equal country rather than as an imperial 
master. The Polish government used the occasion to advocate a measure 
with practical consequences for the future, especially for the United 
States. Polish President Lech Walesa issued a joint statement with 
Yeltsin noting Poland's desire to join the North Atlantic Treaty 
Organization, the Western security alliance that had opposed the Soviet 
Union during the Cold War, and stating Russia's understanding of this 
desire.
    The idea is a good one. The inclusion of Poland--and of Hungary and 
the Czech Republic, the two other formerly Communist countries most 
firmly committed to democracy and free markets--would be good for them, 
good for the West and good for Russia too, provided that it is 
accompanied by a clear definition of a new NATO policy toward the 
former Soviet Union.
    Poland, Hungary and the Czech Republic seek full participation in 
NATO along with membership in the European Community as a way of 
anchoring themselves firmly and irreversibly in the West. Their pro-
Western governments wish to strengthen the forces within their 
countries committed to consolidating democracy and building market 
economies.
    Poland, the largest and strategically most important of them, faces 
no immediate threat: It is on cordial terms with its historical 
adversary to the west, Germany, and the collapse of the Soviet Union 
means that, with the exception of the detached Baltic fragment of 
Kaliningrad, it no longer shares a border with Russia, its great 
imperial tormentor to the east. Membership in NATO is, for the Poles, a 
way to ensure that no threat will arise in the event that Russian 
political forces opposed to Boris Yeltsin and democracy and interested 
in recreating the Soviet empire should take power in Moscow.
    Because Poland, Hungary and the Czech Republic face no imminent 
threat, the West would not risk war by admitting these countries to 
NATO. Nor would their membership saddle the alliance with internal 
territorial and political disputes of the kind that set Greece and 
Turkey at odds with each other during the Cold War.
    Including the three Eastern European countries in NATO would bring 
benefits not only to them but to the West as well. It would ensure 
stability on Germany's eastern border. It would extend the zone of 
stability and democracy in Europe eastward, thereby consolidating some 
of the gains of the Cold War. Perhaps most important, NATO membership 
for these three countries would begin the long complicated and 
necessary process of transforming NATO from a defensive alliance 
against a threat that no longer exists into a broader security 
community capable of contributing to the establishment of democracy and 
the maintenance of peace from the English Channel to the Pacific coast 
of Russia.
    Part of that process may well involve undertaking ``out of area'' 
missions, such as policing a negotiated settlement in the former 
Yugoslavia. Here Poland could be particularly useful. As a country with 
a proud military tradition and a strong sense of international 
responsibility, Poland would likely be more willing to furnish troops 
for such operations than many Western European members of the alliance.
    NATO's European members are not unanimously enthusiastic about 
opening their ranks to Eastern Europe. Many in Western Europe want the 
alliance to remain exactly as it is, as an insurance policy against the 
revival of a threat from the east and as a mechanism for preventing the 
``renationalization'' of defense policy, by which they mean independent 
German foreign and defense policies.
    The only way to perpetuate NATO, however, may be to change it. 
Unless the alliance adapts to the new circumstances of the post-Cold 
War world, public support for it, especially in North America, may 
wither. As Sen. Richard Lugar of Indiana, the most influential 
Republican voice on foreign policy and a supporter of expanding 
alliance membership, recently put it, ``The choice is not between the 
current NATO and a new NATO but rather between a new NATO and no 
NATO.''
    Were it to accept the three Eastern European countries, the 
alliance would have to establish a timetable for their accession to 
membership. The most important issue this prospect raises, however, is 
NATO's relationship to the countries to its east. Specifically, 
expansion to the borders of the former Soviet Union unavoidably raises 
the question of NATO's approach to that vanished empire's two most 
important successor states: Russia and Ukraine. The suspicions and 
multiple sources of conflict between them make the relationship between 
these two new and unstable countries, both with nuclear weapons on 
their territory, the most dangerous and potentially the most explosive 
on the planet today.
    An expanded NATO must contribute what it can to promoting peaceful 
relations between them, while avoiding the appearance either of 
constructing an anti-Russian coalition or washing its hands of any 
concern for Ukrainian security.
    There is no more difficult task for the United States and its 
European allies and none more urgent. To the extent that their 
accession to NATO provides an occasion for addressing that task 
seriously, Poland, Hungary and the Czech Republic will have performed 
yet another service for the West.

    The Chairman. Now how should I put this.
    Have Poland, Hungary, and the Czech Republic veered so far 
from the course of democratic and economic reforms in the 
intervening years that you now oppose their membership in NATO?
    As I say, I am not trying to play ``gotcha'' with you. Take 
your time.
    Dr. Mandelbaum. Not at all, Mr. Chairman. It is a good 
question, a fair question, and it bears on your hearings and on 
the process that you and your colleagues are going through.
    I wrote that article in the fall of 1993 when it appeared 
that the expansion of NATO would be acceptable to the Russian 
political class, and you quoted a crucial point in that 
article--provided we could find appropriate arrangements for 
the countries between Poland, Hungary, and the Czech Republic 
and Russia.
    The administration has come up with no such proposals and 
that is what my colleague, Ambassador Dean, was suggesting and 
what I think is needed.
    But let me go further, Mr. Chairman. I wrote that piece and 
then I got detailed responses from people whom I deeply respect 
who said, we think you're wrong. You should rethink this issue.
    Because I respected them so much, I did sit down and 
rethink them, leading, incidentally, to a book that I published 
last year. I concluded that my critics were right and that I 
had been wrong. I believe this is important for the following 
reason, Mr. Chairman.
    This is one of those issues that sounds good at first 
glance. When you first hear about it, you think why not? Let's 
be inclusive. Who could object to that?
    But then, when you look further into it, you discover all 
the snares and pitfalls and disadvantages. So I changed my 
mind.
    If I can change my mind, Senator, so can others. It is 
never too late to be right. I would say to some of my friends 
that if you change your mind on this issue, you will feel 
better and you will be doing your country a service.
    The Chairman. Now you know how I felt about the Chemical 
Weapons Treaty.
    Senator Smith. Mr. Chairman.
    The Chairman. Senator Smith.
    Senator Smith. I wonder if I could follow up your question 
with the gentleman.
    The Chairman. Sure.
    Senator Smith. It seems to me that the NATO--Russia 
agreement provides the very kind of security arrangement that 
you propose that they needed to make this all work. Yet, that 
is one of the things that gives some of us heartburn, that 
maybe it gave them too much.
    Is it defects in that agreement that caused you now to 
change your view?
    Dr. Mandelbaum. No. I changed my mind some time before. But 
I'm glad you raised the NATO--Russian agreement, Senator, 
because I think that does deserve some comment.
    I would make two comments in particular. First, this 
agreement has been put in place on the basis of publicly stated 
and diametrically opposite interpretations by the American and 
Russian Presidents. President Yeltsin said on television, 
publicly, to the Russian people that this gives Russia a veto 
over all the issues of concern to Russia in Europe. President 
Clinton told us just the opposite.
    So I fear that this could be a recipe for misunderstanding.
    More to the point, Senator, President Yeltsin and every 
other Russian has asserted that the NATO--Russia charter is 
null and void if and when NATO expands beyond these three to 
former Republics of the Soviet Union. That is why I say, 
Senator, that the current expansion, as planned, puts that 
second expansion irrevocably on the agenda, presents us with a 
problem that we can neither avoid nor solve, and to no benefit 
to ourselves.
    Senator Smith. Thank you, Mr. Chairman.
    The Chairman. Senator Biden.
    Senator Biden. Gentlemen, in the 24 years I have been here 
I have called on both of you to ask for your advice. I respect 
you both a great deal. I think on almost every issue, certainly 
with you, Mr. Ambassador, we have been in agreement.
    But I think you are dead wrong here. Let me tell you why. I 
think you are unintentionally disingenuous when you assume a 
dynamic situation in Eastern Europe and a static situation in 
Russia. Thank God you are not doing planning from this 
perspective regarding what the future of the United States and 
Europe will be.
    All of the criteria you lay out assume a static situation 
in Russia. All the criteria you set out assume a dynamic 
situation in Eastern Europe.
    Second, you ended, Professor Mandelbaum, with the comment: 
what purpose for NATO if not to contain Russia?
    Well, Ambassador Dean can tell you the purpose. It was not 
merely to contain Russia. It was to harness Germany; it was to 
bring stability in Europe; and it has never, never, never only 
been to contain Russia.
    Now if you accept the proposition you stated, then we 
should not only not expand NATO, we don't need NATO. We don't 
need NATO.
    Third, this idea that all of a sudden all of these arms 
control agreements have been put on hold because of expansion 
is a perversion of recent history. They were on hold before 
they got anywhere, before there was any serious discussion of 
expanding NATO. There wasn't anybody who believed it was going 
to happen.
    I visited Russia on several occasions; sat in the Duma; 
went and spoke to those folks. Mr. Ambassador, they were going 
nowhere fast. The reason is one of the arguments you have 
presented. From the Russian standpoint, they need START III, 
not START II. They cannot afford START II.
    It didn't have a damn thing to do--with all due respect--
with NATO expansion. Also, this idea that we must have clear 
aims, clear strategy, and candor about costs. If the costs are 
as you stated, I am the only one who has stated from the outset 
that there will be no expansion of NATO. We will not vote for 
it--flat out.
    I spent one entire week--and the Polish Ambassador is 
sitting back there and probably remembers that week--
embarrassing people on occasion, sitting with them and saying, 
``if you think you get a first class ticket without paying your 
35 percent, forget it.'' Our State Department folks sat there 
and thought oh, my God, what is he saying?
    Well, it is real simple, real basic. If you are correct and 
if the 15 European members of NATO have not gotten the message 
that they have to pay 50 percent of the cost and the expanding 
countries 35 percent, then there will be no vote here. You 
don't have a thing to worry about. Nothing will expand. I 
promise you that.
    It will not happen.
    The last point regards the projection of force, Mr. 
Ambassador, that was part of a 1991 NATO agreement before there 
was any discussion--any discussion--of NATO expansion. They are 
not meeting their agreement--``they,'' meaning the 15 European 
nations currently in NATO. They are not doing it. But it is not 
because of NATO expansion.
    Now, I could not agree with you all more if the costs are 
as you state, misrepresented and likely to be unmet. I agree 
with you. Expansion of NATO is a dead letter.
    But I find it fascinating to go back to this notion of the 
rationale for NATO in the first place. It is true that no one 
feels a threat. I sat in every Eastern European capital. No, 
that's not true. I didn't get to Romania. But I listened to 
them, all the leadership, opposition as well as elected 
leadership. None of them feels any threat from Russia right 
now. None. Zero. None.
    So if it is the Russian threat that propels the rationale 
for NATO, let's save ourselves $120 billion now. I'll tell you 
what I am more worried about. I am more worried about Germany 
and France 20 years from now. They have not yet established a 
degree of political maturation after over 100 years of being 
nation-states, where they are at peace with one another without 
the United States playing an integral role in Europe. That is 
what I worry about.
    I think that is a more real prediction and I'll bet you, if 
you have a differing view, our grandchildren will read that the 
more likely scenario than the amputated Russian bear lumbering 
across Europe to attack, is that Germany and France are at it 
again 30 years from now--maybe not in open war but in open 
conflict.
    So all these false premises create false choices. The 
choice between knowing now exactly how all of Central Europe 
and Eastern Europe are going to mature, or, without that 
precise knowledge now, doing nothing. You sound like the former 
general and revered figure in America today, General Powell. He 
is the reason why we did not get to the point that you and I 
think we should have gotten to in the Balkans. He said unless 
he could be guaranteed that no American would be killed or 
guaranteed that we could put 500,000 forces there, America 
should do nothing.
    That is a prescription for paralysis.
    You point out that if the rationale for NATO relates to a 
Russian threat only, we should not expand. Well, we should not 
have NATO, I would respectfully suggest, if that is the only 
rationale for its existence. We could save a lot of money.
    Second, what I am curious about is how we got to the point 
where anyone is thinking about permanently stationing troops in 
the Baltics or permanently stationing troops in Romania. You 
are correct, Ambassador, that if there is an open threat, we 
will have to do that. But, guess what? If they are not part of 
NATO, what do you think we are going to do?
    What do you think we are going to do? Are you all taking 
the position similar to what the Brits took in 1937, 1938, and 
1939, which said by the way, if there is a threat, we are not 
going to respond?
    If there is a threat to Romania, if Russian troops are 
massing on the border, or to the Balts, we are going to do one 
of two things. We are either going to capitulate or Europe will 
respond. All the President is saying is wherever we have new 
members coming in, we will put infrastructure in place, no 
permanent stationing of American forces, to accommodate the 
very thing that we would have to accommodate if this threat 
becomes a reality.
    So I think it is somewhat disingenuous to suggest that the 
Duma, because of its reaction--and by the way, I read every 
word of what you write, Doctor, every word; I can probably 
quote some of it from memory--that the Duma didn't go along 
with these arms control agreements because of expansion. 
Malarkey. I think it is disingenuous to suggest that if we are 
going to bring in a country to NATO, it means that we would 
have to permanently station troops there. That assumes that we 
would not react if, in fact, there was a threat to them anyway.
    So look, I think there are problems with expansion. But I 
think the idea of the Russians eventually becoming part of 
NATO, relies on their definition of NATO as an OSCE. It is not 
a NATO like you and I define NATO.
    No Russian leader that I am aware of has said--and it would 
be wonderful if I could stand corrected on this; I will not say 
it again and make the ``mistake'' again--no Russian leader has 
said they are willing to subordinate Russian forces under the 
command of an American general as required by the way NATO is 
now constructed. They have said a redefined NATO, i.e., OSCE, 
is something they could think about.
    So I just think it is real important for such impressive 
people for whom I have such great respect, not to raise the bar 
here in a way that creates a problem. It's a little bit like 
saying to me that if, in fact, in 1949, you couldn't tell me 
exactly whether or not Germany could ever become a member of 
NATO, we should have no NATO because we would be isolating 
Germany like we did after World War I. We are going to put new 
NATO members in that position.
    I think I have talked too much and I apologize.
    Senator Wellstone. Let's hear from the witnesses.
    The Chairman. Have at it.
    Dr. Mandelbaum. If I could respond, Mr. Chairman, certainly 
no one could accuse Senator Biden of lacking candor.
    Let me confine myself to three points by way of 
clarification and rebuttal. First, I do not take the position 
that the only justification for NATO is containing Russia.
    Senator Biden. What is the justification?
    Dr. Mandelbaum. The only justification for expanding NATO 
is containing Russia. But there is a continuing a continuing 
justification for NATO, which I have set out in my 1996 book, 
``The Dawn of Peace in Europe,'' and I would be happy to supply 
you and other interested members of the committee with a copy.
    Senator Biden. Can you summarize in a paragraph what the 
rationale for NATO is?
    Dr. Mandelbaum. The rationale for NATO is three-fold: to 
keep the United States engaged in Europe; to prevent the 
Germans from having to pursue an independent policy; and to 
serve as an insurance policy in case things go wrong in Russia.
    Let me add, since you ask me, Senator, that does not 
require any particular level of force or any particular level 
of expenditure. I remind you that in 1949, when the NATO Treaty 
was first signed, it was envisioned as a guarantee pact, not as 
an integrated military force on the continent.
    I certainly favor keeping that guarantee in place 
indefinitely, and I think that the military force we need in 
Europe, if any, to carry it out really depends on the nature of 
the threat, which depends on Russia. So we should be flexible 
on that as the founders of NATO intended.
    Senator Biden. With all due respect, how is that different? 
I'm sorry. We should debate this later, I guess. I'm sorry.
    The Chairman. Yes.
    Dr. Mandelbaum. I would be happy to return and I have 
presumed on the chairman's patience. Could I have one more 
minute, Mr. Chairman?
    The Chairman. Sure.
    Dr. Mandelbaum. I would like to comment on the widespread 
assertion that NATO is a school for democracy, that being a 
part of the Western military alliance fosters democracy.
    Senator Biden. No straw men. I didn't say that.
    Dr. Mandelbaum. Well, this is widely said, Senator. I don't 
impute it to you, but I believe it is false. I believe there is 
no evidence for it.
    To give you an example, Germany, West Germany became a 
member of NATO in 1954, 9 years after the end of the war, when 
democracy was fully established. So many things are now imputed 
to NATO. In fact, such great claims are made for the 
democratizing benefits of NATO for which, as far as I can tell, 
there is no evidence that I sometimes think that one of the 
great miracles of history is 150 years of democracy without 
NATO membership in the United States.
    But I would like to say for the record that I believe these 
three countries are democracies. They are civilized, Western 
countries. They do not need NATO membership to behave properly. 
They have a wide range of problems, all of which stem from 40 
years of communism, all of which they will deal with 
successfully, none of which has anything to do with NATO.
    Senator Biden. Why does Germany need NATO, then?
    Dr. Mandelbaum. Thank you, Mr. Chairman. Thank you for your 
indulgence.
    The Chairman. Now, Mr. Ambassador, I think you ought to 
have some time, too.
    Ambassador Dean. It would be difficult to respond to all of 
the issues that Senator Biden has raised.
    Senator Biden. Oh, we'd be here at midnight.
    Ambassador Dean. Yes, we would, or something close to it.
    Senator Biden. I apologize, Mr. Chairman.
    Ambassador Dean. However, I did not hear anything in what 
he said which would do anything other than strengthen my point 
of departure, which was that NATO, in its present form, is 
adequate to these tasks without enlargement.
    Senator Biden. I agree. We have not gotten to that. I was 
just pointing out the criticisms you made of expansion. We have 
not gotten to the next piece.
    The Chairman. Very well.
    Mr. Wellstone.
    Senator Wellstone. Mr. Chairman, I want to tell you, when 
that light turns red, I am not going to pay any attention to 
it, either.
    Senator Biden. You have to be here 25 years to do that, 
Paul, or be the Ranking Member, one of the two.
    Senator Wellstone. Then, Joe, I will do it proportionally 
and still won't pay any attention to that light.
    The Chairman. Just try.
    Senator Wellstone. Seriously, there are just a couple of 
specific points I want to pick up on that went back to my 
question earlier.
    As I understand the position that you all have taken--and, 
first of all, I am just trying to find out as somebody who is 
trying to work his way through this and trying to decide what 
is the right position to take, that is, the why of this, why 
are we expanding NATO--I think what I understood your 
testimony, what I think you have said is that it does not 
really make sense if you are trying to think about it from the 
point of view of expanding democracy or stability in these 
countries; and that probably the reason for expanding would be 
for containment; but then the question is who are we trying to 
contain. Am I correct or not correct, just in terms of what you 
said?
    Ambassador Dean. Yes.
    Dr. Mandelbaum. Yes.
    Senator Wellstone. The second point is cost and we will 
come back to that. I think that is a big issue in our country. 
I think we all agree on that. Senator Biden has made it crystal 
clear that, in fact, if some of the estimates of cost severely 
underestimate what we are going to be faced with, or the 
European countries are not going to be paying, then that is 
going to become a big concern in our country.
    But I still want to focus now on this. If there does not 
seem to be a clear reason to do this, let's then go to the 
downside of it beside cost. I want to go back to Russia because 
I keep feeling that what happens in Russia is going to 
crucially affect the quality of our lives and our children's 
lives for better or worse. I want for it to be better. I want 
the forces of democracy to triumph there.
    There are two points. You said, Professor Mandelbaum, that 
you did not agree--at least I thought I heard you say this, but 
you did not get a chance to comment on it--with the analysis of 
opinion, at least among the political class, the positions that 
President Yeltsin has taken, and so on and so forth, in regard 
to expansion. Could you spell that out a little bit more 
because the testimony prior to your testimony was very 
different.
    Dr. Mandelbaum. Yes, Senator. I am delighted to hear that 
you will have a panel in which people who are genuine experts 
on Russia will come and tell you this.
    What I would say is what I believe is a fact is that no one 
in Russia favors NATO expansion, period.
    Now there are many things you can say about this. You can 
say that they can't stop it, which is true. You can say that 
they will get used to it over time which may be true. We simply 
don't know. You can say that NATO expansion is so important 
that it is worth paying whatever price we have to pay with the 
Russians in order to secure it. Of course, I don't agree with 
that because I don't think it is worth anything at all. But 
that is certainly a legitimate position and I assume that the 
two panelists who preceded us would take that position.
    But I do not believe there is any basis in fact for saying 
that any Russian of any political stripe is at all well 
disposed toward NATO expansion. I also believe that it is the 
democrats who are most concerned because they care most about 
cooperating with the West and NATO expansion makes it more 
difficult--not impossible, but more difficult--for them to 
promote the policy that they prefer.
    Senator Wellstone. My final question is this. That, to me, 
is a very important issue. I think that is a serious question 
and one that we need to think deeply about.
    Now my last question is more one for the record because 
Senator Biden did not get a chance to follow up on this and I 
want to do so for him. There is the whole question of the 
definition of NATO and whether or not Russia has said that it 
would like to join an expanded NATO or not. Senator Biden was 
very vociferous in saying that he would like for somebody to 
clarify the record.
    Could one of you do that?
    Dr. Mandelbaum. Well, Senator, in my pamphlet I cite a 
number of published instances where senior Russian officials 
inquired on this and were told in no uncertain terms that they 
were not going to be allowed to join NATO.
    I would add, Senator, that I do not favor bringing Russia 
into NATO. I think we have the best of all possible worlds now, 
and it is only what I regard as the ill-advised plan to expand 
NATO that raises this issue at all. Were there no NATO 
expansion, I don't think the Russians would be interested. 
Given my view of NATO's continuing relevance, I see no purpose 
in Russian membership.
    Senator Wellstone. If there is no expansion, it is a moot 
point. If there is expansion, then the question becomes how 
this is perceived within Russia.
    Dr. Mandelbaum. Let me add one other point, Senator. If we 
expand to Central Europe, then the pressure will be enormous, 
and rightly so, to expand to the Baltic countries and to 
Ukraine. At that point, we may find ourselves in the position 
in which the only way we can honor the promise to the Baltic 
countries is to bring in the Russians at all.
    Now that might or might be a good thing. It might or might 
not be disastrous. But I would regard that as less good from 
the point of view of American national interest to the status 
quo, which I favor.
    Senator Wellstone. Ambassador Dean, is there anything you 
want to ask--and I am out of time?
    Ambassador Dean. Yes.
    Senator Wellstone. I'm sorry. I mean is there anything you 
want to add.
    Ambassador Dean. I think it is quite clear that the Baltic 
State membership issue is the danger line in this entire 
complex of questions. There is no doubt whatever about the 
record there, that both Yeltsin--and Chernomyrdin said it only 
2 weeks ago in Lithuania--feels that this would be a matter of 
the gravest security interest to Russia.
    That is the problem that I see. That is the reason why I 
suggested that there be a fast track European Union method of 
giving membership in the European Union to these three 
countries as a substitute for their membership. I believe since 
they are small and their economies are not large, this could be 
done and should be done.
    The Chairman. The distinguished Ranking Member, Mr. Biden, 
wants 5 minutes, and I tell him that I have the wire clippers 
in my hand.
    Senator Biden. All right and thank you.
    Gentlemen, Mr. Ambassador, I agree with you absolutely 
about the Balts. That is the fault line.
    Really, much of what is being said here is that if, in 
fact, we had said at Madrid only these three and never anybody 
else, concern would be significantly diminished for both of 
you--I think, diminished. You still would not be for NATO 
expansion, but it does not rise to the level that you are most 
concerned about.
    I fully agree with you and made the very point you made 
when I met with our European colleagues. I think when Senator 
Roth and I were with the NATO Observer Group and met with 
European defense ministers and foreign ministers, although they 
could not make such a judgment, we felt that a rapid move 
toward EU membership would really diffuse an awful lot of this.
    Next, would your view change if tomorrow the Duma passed 
the START Treaty and the Chemical Weapons Convention? If a week 
from now or a month from now that happened, what would you say 
then about whether or not this emboldens the Reds and the 
Browns, emboldens the nationalists, and undermines U.S.-Russian 
relations? Would it change your view at all if those arms 
agreements are passed by the Duma? That is for either one of 
you.
    Ambassador Dean. It would change my view as to the present 
impact. But the souring of Russian political opinion toward 
relations with the United States did take place earlier and has 
been a constant. My worry, of course, is about the long-range 
implications of this development over a period of decades.
    Senator Biden. I think that is a legitimate concern. I am 
not dismissing that concern.
    I remind you that 2 plus 4 was the same argument. I just 
want to remind you of that. The same, exact argument was made.
    It does not mean it should not have been made and it does 
not mean the argument should not be made now. My point is about 
dynamic change in Russia.
    The question I have is what do you think happens in the 
gray area? I read with great interest in your piece, Doctor, 
about moving the fault line East. We are just drawing new lines 
in Europe. That's a legitimate point that you made.
    Regarding the Poles and the Romanians who have not been 
invited to joint NATO thus far, what do you think these 
countries in this gray zone now do about their military 
relationships? I am not making the argument now that if we 
don't do this such and such will happen.
    The chairman and I agree. If, in fact, this thing goes down 
for whatever reason, that the idea of American credibility is 
not lost. We have credibility because we are the 10,000 pound 
gorilla. It does not matter what anybody thinks. There is 
credibility, period. I agree with that argument. So I am not 
making that argument in a back door way here.
    But what happens? What do you think will develop? Just as 
you feel it is appropriate to ask the President to be able to 
tell you now how that region is going to develop so that he has 
a comprehensive plan, you tell me how you envision Central and 
Eastern Europe and the former Soviet States evolving in terms 
of their security architecture over the next 10 to 15 years 
absent this move.
    Ambassador Dean. Maybe I could start.
    Absent this move, I think the main slack in the situation 
should be taken by the European Union and its expansion of 
membership.
    Senator Biden. Do you think they will?
    Ambassador Dean. Oh, yes. I do think so. As a matter of 
fact, most experts do agree that the first tranche will be 
accepted by the year 2003 or 2004.
    Senator Biden. Six months ago, those same experts did not 
think there was going to be one. I spent the last 2 years of my 
life doing nothing but this. I read the same experts.
    Ambassador Dean. Yes. But I think it will happen. Maybe the 
timing will be off. I think we realize that Estonia is in this 
first group.
    Senator Biden. That's right.
    Ambassador Dean. And I think there is good prospect that 
the other two Baltic States will get in, too.
    I think NATO in its present form should continue. I think 
the European Union should expand and that, indeed, the OSCE, 
which you have mentioned, should be built up somewhat. I have 
no objection whatever to the NATO--Russian Founding Act. I 
think it is a good thing which should be expanded. So it, too, 
should play a role. Those are the components, I think, of a 
stable European security order.
    Senator Biden. I will leave you with only one thought. The 
red light is about to go on, and I take the chairman seriously.
    I leave you with only one thought. Just as I will entertain 
the argument you have made--and sincerely, because I have an 
inordinate amount of respect for both of you. That is not 
hyperbole. You know that. You know what our relationship has 
been all these years.
    I would like you to think about the dynamism that exists 
within Russia now and why you feel we have to view it in a 
static sense rather than a dynamic sense.
    I cannot predict to you exactly how it is going to turn 
out. But I am prepared to predict, and my political future is 
resting on this prediction, that the dynamism in Russia is a 
dynamism that looks West. Russia sees, or ultimately will see, 
security and stability among its former ``charges'' and will 
moderate, not exacerbate, its attitudes toward dominion. I see 
that dynamic movement.
    I am not suggesting you agree with it. I just respectfully 
suggest you at least entertain the prospect that if past is 
prologue, the recent past, I think there is argument that my 
view is at least as probable as the one you have.
    The last point I will make is this. I have noticed in the 
French legislature, the German legislature, and the British 
legislature, that when it comes to a choice between farmers and 
foreign policy, farmers always win. Did you hear what I just 
said? Farmers always win.
    One thing I do know more about than either of you is 
politics. I mean that sincerely. Just look at the past. The 
reason why there has been any movement, in my view, on the EU 
is because of the movement on NATO.
    The Chairman. As they say it in order, so might it be.
    Senator Biden. Thank you, gentlemen.
    The Chairman. Thank you, all. I hope that we have 
ventilated this. We have tried to. This is the way we want to 
do all hearings.
    The record will be kept open for 3 days for Senators to 
submit written questions.
    Thank you for appearing.
    We stand in recess.
    [Whereupon, at 4:38 p.m., the committee adjourned, to 
reconvene at 2 p.m., October 22, 1997.]



   QUALIFICATIONS OF POLAND, HUNGARY AND THE CZECH REPUBLIC FOR NATO 
                               MEMBERSHIP

                              ----------                              


                      WEDNESDAY, OCTOBER 22, 1997

                                       U.S. Senate,
                            Committee on Foreign Relations,
                                                    Washington, DC.
    The committee was scheduled to meet, pursuant to notice, at 
2 p.m. in room SD-419, Dirksen Senate Office Building, Hon. 
Gordon H. Smith, presiding.
        
    The Foreign Relations Committee hearing on the 
Qualifications of Poland, Hungary and the Czech Republic for 
NATO membership was canceled at 2:00 p.m. on October 22 due to 
an objection under Rule 26, Sec. 5a. Per the unanimous consent 
request of Senator Smith of Oregon on November 5, 1997, the 
testimony submitted for this hearing is included in the written 
record of the hearing on NATO enlargement.
      
                  Prepared Statement of Marc Grossman,
                     Assistant Secretary of State,
                     European and Canadian Affairs

    Senator Smith, Senator Biden, members of the committee It is an 
honor and a privilege to have this opportunity to appear before you 
today.
    On October 7th, Secretary of State Albright appeared before this 
Committee to make the case for NATO enlargement and to ask for your 
consent to the addition of three new members to the Atlantic Alliance.
    Today I hope to help contribute to your deliberations by talking 
about the reasons the United States and our NATO allies extended 
invitations to Hungary, Poland and the Czech Republic. As Secretary 
Albright said here on October 7: ``Let me assure you that we invited 
only the strongest candidates to join the Alliance.''
    NATO membership entails the most solemn security commitment one 
country can make to another--the commitment to come to their defense in 
a crisis. NATO's decision in 1994 to enlarge the Alliance, and the 
Alliance's decision in 1997 to invite Poland, Hungary and the Czech 
Republic to begin accession negotiations were made only after a careful 
review of America's strategic interests and the qualifications of the 
countries involved. In making the decision to invite Poland, Hungary, 
and the Czech Republic to begin the process of accession, we put 
America's interests first.
    Secretary Albright reviewed for this committee the reasons NATO 
enlargement is in America's interests: extending the zone of stability 
which NATO provides to the countries to NATO's east would further our 
goal of a united, peaceful Europe.
    NATO must remain the strong Alliance that has served us so well for 
the last half century. That is why we have said from the onset that we 
will only admit countries that are willing and able to assume the 
responsibilities of membership and whose inclusion will serve the 
overall strategic interests of the Alliance. NATO is not a charity or a 
political club; it is and will remain a military Alliance.
    All aspiring nations must meet each of these two tests: first, they 
must prove that they are willing and able; second, we in the Alliance 
must agree that their membership serves our common interests.
    Before turning to the qualifications of these three countries, let 
me describe why their admission passes the test of being in the U.S. 
national interest.
    The United States is a European power. If we have an interest in 
the lands west of the Oder river, then we also surely have an interest 
in the fate of the 200 million people who live in the nations between 
the Baltic and Black Seas. We fought World War II in part because these 
nations had been invaded. We waged the Cold War in part because they 
were help captive. Had Poland, Hungary, and the Czech republic been 
allowed to choose in 1949, when NATO was first founded, there is little 
doubt that they would have chosen to join the Atlantic Alliance.
    As Secretary of State Albright said yesterday, now that the nations 
of central Europe are free, we want them to succeed and we want them to 
be safe. For if there were a major threat to the security of the 
region, I am certain we would chose to act, enlargement or no 
enlargement. Expanding NATO now is the surest and most cost effective 
way to prevent that kind of threat from arising, and thus the need to 
make that choice.
    Poles, Czechs and Hungarians do not look at NATO as a one way 
street. They are committed to the Alliance's principles of shared 
responsibilities. They want to join NATO for the same reasons current 
allies want to keep it. History has taught them to believe both in a 
strong Alliance and a strong American role in Europe. They want to 
start taking responsibility for their freedom and security. They want 
to contribute to the security of the trans-Atlantic region.
    But recognition of our strategic interest and their aspirations is 
not enough to earn an invitation to the world's most successful 
Alliance. These countries have to demonstrate to all current NATO 
members that they are qualified. NATO is a first class Alliance and we 
expect all new members to make a first-class contribution.
    Decisions on who to include in the Alliance are made by the 
Alliance. There are no set criteria for NATO membership. There is no 
checklist that countries can meet in order automatically to gain entry. 
But there are five basic principles which we have established as 
benchmarks and we have insisted that each prospective member meet. 
These five principles are based on the NATO Enlargement Study of 1995 
and were subsequently laid out by former Secretary of Defense Perry in 
a speech in Norfolk, Virginia in June 1996. They are:

   commitment to democratic reform;
   commitment to a free market economy; good neighborly 
        relations;
   civilian control of the military; and
   military capability to operate effectively with the 
        Alliance.

    Twelve Central and Eastern European Partners have expressed their 
desire to join NATO. Last spring at the NATO Ministerial in Sintra, we 
discussed with our allies which of the aspiring Partners met this twin 
test of being in our strategic interests and being qualified. In the 
run-up to the July Madrid summit, we consulted closely in the Alliance 
on our choice. The discussions were vigorous.
    At the Madrid summit, President Clinton and the allies reached 
consensus to extend invitations to the three countries we are 
discussing today: Poland, the Czech Republic and Hungary.
    Why these three? Because Poland, Hungary, and the Czech Republic 
have not only met the requirements for NATO membership; they have 
exceeded them. Because Poland, Hungary, and the Czech Republic will be 
security producers, not just security consumers. Because Poland, 
Hungary, and the Czech Republic will make the Alliance stronger and 
will enhance European security and stability. And because Poland, 
Hungary and the Czech Republic will make America safer for future 
generations.
    I will address the first four principles, my colleague, Assistant 
Secretary Kramer will address the military capabilities and 
contributions of each of the three invitees.
POLAND:
    Poland has a solid track record of nearly eight years of reform. It 
has just witnessed its second democratic change of government since the 
collapse of communism. It has held seven fully free and fair elections 
at various levels since 1989. The press is free and the government has 
been a strong supporter of human rights. Poland has a new Constitution, 
approved by national referendum in May, 1997, which codifies the 
division of powers among the President, Council of Ministers, 
legislative and judicial branches.
    Poland's economic growth rates since 1993 have been among the 
highest in Europe. Economic reforms in 1989 removed price controls, 
eliminated most industry subsidies, opened markets to international 
competition, and imposed strict budgetary and monetary discipline. 
Poland was admitted to the Organization for Economic Cooperation and 
Development (OECD) in 1996. The government is committed to 
privatization, and the private sector accounts for nearly \2/3\ of GDP 
and employs 60 percent of the workforce. In 1996, Poland spent 
approximately 2.3% of GDP on defense.
    Poland has resolved outstanding differences with its neighbors. 
Last May, President Kwasniewski traveled to Kiev to sign a declaration 
of reconciliation with Ukrainian President Kuchma, and Poland and 
Ukraine are exploring the possibility of establishing a joint 
peacekeeping battalion. Poland has strong economic ties with Russia and 
expressed support for the NATO-Russia Founding Act signed last May. 
Poland's relationship with the Baltic states, the Czech Republic, 
Hungary and with its NATO neighbors, Germany and Denmark, is excellent.
    Poland's new Constitution codifies civilian control of the military 
and Poland is establishing legal and administrative structures to 
ensure such control is effective and provides for parliamentary 
oversight of the military. The 1996 National Defense Law subordinated 
the Chief of the General Staff to the Minister of Defense.
HUNGARY:
    Hungary has had two complete democratic changes of government since 
1989, in fully free and fair elections. All six parliamentary parties 
strongly support Hungary's entry into NATO. The government upholds 
human rights, freedom of expression, the rule of law, and an 
independent judiciary. The government has taken steps to improve the 
conditions of its ethnic minorities and to deal more effectively with 
the growing problem of organized crime.
    Economically, in 1995, Hungary engaged in a successful strict 
stabilization program to cut the current account and budget deficits 
and to accelerate structural reform. Since 1990, Hungary has attracted 
almost \1/3\ of all foreign direct investment in Central and Eastern 
Europe (approximately 16 billion dollars). Hungary has privatized 
almost all of the telecommunications and energy sectors, and has almost 
completed the consolidation and privatization of its banking sector. 
Hungary joined the OECD in May, 1996. In 1996, Hungary spent 1.6% of 
GDP on defense and has committed to increase military spending by .1% 
of GDP per year for the next five years.
    Hungary has also resolved all outstanding differences with its 
neighbors. In 1996, Hungary concluded Basic Treaties on Understanding, 
Cooperation, and Good-Neighborliness with Slovakia and Romania, ending 
long-standing disputes among those countries. Hungary and Austria have 
a joint peacekeeping battalion which is part of the UN peacekeeping 
force in Cyprus, and Hungary and Romania are working to establish a 
joint peacekeeping battalion. Hungary's relations with Slovenia, Italy 
and Croatia are strong. In the last year, Hungary and Ukraine have 
signed bilateral cooperation agreements against organized crime, 
terrorism and drug trafficking.
    Hungary has effective civilian control of the military, guaranteed 
by legislative and constitutional mechanisms which provide oversight of 
the military by the Defense Ministry, and oversight of the Defense 
Ministry by the Parliament. The constitution gives Parliament control 
of the military budget, structure, deployment, fielding, stationing, 
and senior leadership. The 1993 National Defense Law specifies that the 
Minister of Defense, who is a member of Parliament, is the superior to 
the Chief of Staff (Commander) of the Armed Forces.
THE CZECH REPUBLIC:
    The Czech Republic has three fully free and fair elections since 
1989. In 1996, two national elections were held: one for the lower 
house and one for the newly-created Senate. The Constitution provides 
for an independent judiciary and guarantees internationally recognized 
human rights. Freedom of speech, freedom of assembly and freedom of the 
press are fully protected.
    Since 1989, the Czech Republic has engaged in tight fiscal and 
monetary policies, liberalization of trade and prices, and 
privatization of state enterprises.
    Real GDP has been rising since 1994, inflation is controlled, and 
unemployment is low. The Czech Republic has, nonetheless, recently 
faced trade and current account deficits. The government has increased 
capital markets regulation and instituted fiscal austerity measures to 
address these problems.
    The Czech Republic entered the OECD in December 1995 and has 
concluded an association agreement with the EU, as well as free trade 
agreements with the members of the European Free Trade Area and the 
Central European Free Trade Area. The Czech government has committed to 
increase military spending by 0.1% of GDP per year with a goal of 
reaching 2.0% by the year 2000.
    The Czech Republic maintains excellent relations with its 
neighbors. In January 1997, the Czech Republic and Poland agreed to 
harmonize their countries' approaches to NATO and EU membership. 
Relations with Germany are especially strong and Germany is by far the 
Czech Republic's leading foreign investor. Austria and the Czech 
Republic have strong historical and economic bonds and Austria is the 
Czech Republic's sixth largest foreign direct investor. Relations with 
Slovakia are fundamentally sound, although some residual issues from 
the split of Czechoslovakia still remain. But ties and travel between 
the people of the two countries are very strong.
    Under the Czech Republic's constitution, the President is the 
Commander-in-Chief of the military. The Minister of Defense is a 
civilian and the Parliament is increasingly active in defense and 
military issues. Parliament is expected to enact a defense law this 
year that will formally confirm in law the civilian command structure 
mandated by the constitution.
CONCLUSION:
    We chose these three countries because we were convinced they will 
be good allies. They each have a track record that underscores their 
commitment to the values the Alliance is pledged to defend and uphold. 
In the past eight years, these countries have been among America's 
staunchest friends. Their forces fought with ours in the Gulf War and 
are with us today in Bosnia. They have joined with us on issues that 
are of vital importance to us, such as human rights, nonproliferation 
and the Chemical Weapons Convention. They are prepared to meet the 
responsibilities of NATO membership, including paying their share of 
NATO's costs. Our citizens and their citizens share many historical, 
familial, and cultural ties.
    Poland, Hungary and the Czech Republic may not be as advanced as 
other current allies. They have work to do which require sacrifices to 
meet the obligations of NATO membership. They have challenges ahead of 
them.
    But, they know that the benefits of NATO membership outweigh the 
costs. And we know that their membership in NATO will make NATO 
stronger, and America and Europe safer.

                               __________

               Prepared Statement of Franklin D. Kramer,
                     Assistant Secretary of Defense
                   for International Security Affairs

    Mr. Chairman and members of the Committee: I welcome the 
opportunity to testify on the issue of NATO Enlargement, and, in 
particular, on how the military capabilities of the three select 
countries--Poland, Hungary, and the Czech Republic--will contribute to 
the effectiveness of the NATO Alliance and the achievement of security 
and stability in Europe.
    Fundamental to answering this question is a recognition that Europe 
is changing and will continue to change in the 21st century. The 
preservation of security, including through military means, likewise is 
changing. The objective of NATO enlargement is to enhance security in 
the face of, and as part of, this change.
    Now, and in the 21st century, the United States has and will 
continue to have a vital interest in Europe, as critical to preserving 
our own security and stability. We likewise seek to preserve and ensure 
the expansion of freedom and democracy throughout Europe. For these 
reasons, we fought two World Wars and we stayed the course during the 
45 years of the Cold War. To serve these objectives in Europe in the 
century to come, we seek to avoid a power vacuum, the boiling over of 
ethnic divisions, the redress of old hatreds, or the establishment of 
any conditions that would create instability and insecurity and lead to 
future conflict. And we look to be able to perform the military 
missions, with our allies, that the 21st century may bring.
    Those 21st century goals will be achieved and those 21st century 
military missions will be performed by NATO in a changing European 
context where:

   NATO itself is changing, from an Alliance committed to a 
        fixed defense to one that is mobile and can deploy to where new 
        threats may occur;
   Allies are working with Partner countries outside the NATO 
        Alliance, in particular, through the Partnership for Peace;
   But where NATO retains its core capabilities, including, 
        most importantly, its ability to perform collective defense.

    NATO enlargement is part of the process of the adaptation of 
security in Europe. The military capabilities of the three new 
countries therefore must focus on NATO's missions. Let me discuss them 
each, but let me begin with a context, the context of the existing 
capabilities that each country brings:
    It is important to recognize that each of these countries has 
military forces that will add to the Alliance's existing capabilities:

   Poland has a force of 230,000, roughly the size of the 
        forces of the United Kingdom (228,000) and Spain (200,000).
   The Czech Republic and Hungary have forces of 57,000 and 
        60,000, respectively, roughly the size of the armed forces of 
        Portugal (56,000) and Canada (64,830). Combined, the three 
        invitees will add almost 300,000 soldiers, sailors and airmen 
        to the Alliance, including units with unique and specialized 
        capabilities such as chemical decontamination and combat 
        engineering. All three countries have begun training their 
        troops in NATO doctrine in earnest, and all three will be able 
        to make a substantial contribution to the force projection, 
        strategic depth, and capabilities of the Alliance. Put simply, 
        from this perspective, an Alliance with nineteen committed 
        Allies has more to offer than one with sixteen, and a larger 
        Alliance can spread the fiscal and operational burden more 
        evenly.
    It goes without saying, of course, that these three countries need 
to make improvements in a number of areas, including operational 
capabilities, force structure and modernization. I would like to 
address how Poland, Hungary and the Czech Republic plan to improve 
their capabilities and readiness and how they can make their 
contribution to the Alliance most effective.

                 I. CONTRIBUTING TO AN ADAPTED ALLIANCE

    In the 21st century, NATO must be able to deal with the problems of 
instability and insecurity, and each of the new countries has 
demonstrated already the ability to contribute to these new missions.
    With the largest and most capable military in Central and Eastern 
Europe, Poland has brought its 25 years of peacekeeping experience to 
NATO's efforts in Bosnia. Since 1974, Poland has participated in more 
peacekeeping operations than any former Warsaw Pact country, and it 
currently has more personnel in UN peacekeeping, military observer and 
civilian police missions than any other country. These deployments with 
multinational operations have enabled Polish troops to gain experience 
which has greatly enhanced their NATO-interoperability. It currently 
has a 400-person airborne infantry battalion in SFOR's U.S. sector, a 
355-person logistics battalion in the Golan Heights (UNDOF), an 
infantry battalion and military hospital (632 troops) in Lebanon 
(UNIFIL), 53 soldiers in Eastern Slavonia (UNTAES), and troops 
supporting eight UN observer missions. In 1989, they established a 
military training center for UN operations in southeastern Poland. In 
1992, the Poles deployed an infantry battalion with UN forces in 
Croatia. Since then, Poland has shown an increased willingness to 
provide combat forces in support of peacekeeping, as reflected by their 
commitment to IFOR and SFOR. Poland is currently working to establish 
joint peacekeeping battalions with Ukraine and Lithuania, and the Poles 
have contributed to UN efforts in Rwanda (UNIMIR), Georgia (UNOMIG), 
Tajikistan (UNMOT), Iraq/Kuwait (UNIKOM), the Western Sahara (MINURSO) 
and Cambodia (UNTAC).
    The Czech Republic currently has a 620-person mechanized battalion 
in SFOR, and prior to that it contributed an 870-person mechanized 
battalion to IFOR and a 985 person infantry battalion in UNPROFOR. The 
Czechs also deployed a 200-man decontamination unit to DESERT SHIELD/
DESERT STORM and have provided observers to UN observer missions in 
Croatia (UNTAES), the Prevlaka Peninsula (UNMOP), the Former Yugoslav 
Republic of Macedonia (UNPREDEP), Mozambique (UNOMOZ), Georgia (UNOMIG) 
and Liberia (UNOMIL).
    Hungary contributed a 400-500 man engineer battalion to conduct 
bridging and other engineering operations in support of IFOR. This 
battalion, now reduced in number to 200-250, is currently deployed in 
support of SFOR. Hungary's support to IFOR and SFOR also included 
allowing U.S. and NATO forces to transit its airspace, station at its 
airfields and use its facilities. Hungary demonstrated its ability to 
operate as part of the NATO team with every bridge that was built and 
every plane that landed and took off from its airfields. Over 80,000 
U.S. military personnel rotated in and out of IFOR and SFOR assignments 
through the Hungarian airbase at Taszar. U.S. armor units calibrate 
their guns at Hungarian ranges prior to deploying to Bosnia, and again 
upon re-deploying.
    Past Hungarian peacekeeping contributions have included a 39-troop 
contingent in Cyprus (recently increased to more than 100) as part of 
an Austrian battalion assigned to UNFICYP; a 26 soldier and 15 
policemen contingent in the Sinai (MFO); and 20 observers in Iraq/
Kuwait (UNIKOM), Angola (UNAVEM), Cambodia (UNTAC), Mozambique 
(UNOMOZ), Tajikistan (UNMOT), and Georgia (UNOMIG). Hungary may also 
provide forces to the UN Standby Forces High Readiness Brigade 
(SHIRBRIG).
    In short, Poland, Hungary and the Czech Republic are already 
working with NATO and NATO Allies in the field.

                  II. AVOIDING NEW DIVISIONS IN EUROPE

    NATO must also work with the other countries of Europe to keep new 
dividing lines from being created. The Partnership for Peace and its 
recent enhancements are integral efforts in this regard. Each of the 
three new countries has many substantial outreach efforts, including 
significant involvement in the Partnership for Peace, which will 
strengthen the bonds between NATO and those countries not yet selected 
for membership.
    The Czech Republic has served as a political role model for Central 
and Eastern Europe. It has made great progress in establishing broad 
democratic control over its armed forces; it is fully dedicated to a 
free, open market economy and since 1989 it has been a fully 
functioning democracy. The Czech Republic has also cultivated close 
ties with all of its neighbors. No border is in dispute with Germany, 
Austria, Poland or Slovakia, and the Czechs have no conflicts with 
neighboring countries relating to minority ethnic groups. Since the 
Madrid Summit, Prague has also increased its trilateral regional 
defense cooperation with Warsaw and Budapest. The Polish, Hungarian and 
Czech militaries agreed to jointly address the NATO Defense Planning 
Questionnaire (DPQ), air defense, logistics, human resources 
management, and the preparation of delegations to the accession 
negotiations. Bilaterally, the Czechs have also contributed to the 
security of Central Europe by resolving historical disputes and 
developing close ties with Germany. In 1993, they signed a military 
cooperation agreement with Germany, and they have worked closely with 
the German military since then.
    Poland is forming joint NATO-interoperable peacekeeping battalions 
with both Ukraine and Lithuania, efforts which not only improve its 
ability to deploy to peacekeeping operations, but which also reassure 
both Kiev and Vilnius that their future lies with Europe. It is also 
working with Germany and Denmark to form a trilateral mechanized 
infantry corps that would be fully integrated into the NATO force 
structure.
    Outreach initiatives like these, combined with Poland's geographic 
location, will enable Poland to serve as an important ambassador for 
NATO to the East. Poland has also undertaken active defense cooperation 
with the Baltic states, particularly Lithuania, to reassure them of 
Europe's commitment to their security. Poland has also made efforts to 
normalize relations with Moscow, which reinforces the increasingly 
close cooperation between NATO and Russia. Finally, Poland's internal 
reforms, including enhancing civilian control of the military and 
taking steps to strengthen its democratic polity and market economy, 
serve as a role model for other Central and Eastern European states 
which aspire to increased integration into Western political, economic 
and defense institutions.
    Hungary participates in several Central-European regional 
cooperation organizations that indirectly reduce the effects of risks 
and instability. Hungary has concluded more than 170 cooperation 
agreements with its neighbors, encompassing a broad variety of fields. 
Especially noteworthy are agreements with Slovenia and Italy to form a 
trilateral peacekeeping brigade; an agreement with Romania to form a 
combined peacekeeping battalion; and a treaty with neighboring Slovakia 
on good-neighborly relations and friendly cooperation that covers 
everything from protecting the environment, to protecting minorities, 
to pledging never to use force against each other. Hungary is also a 
participant in the U.S.-established secure ``hot line'' network, which 
provides secure communications among most central European Ministers of 
Defense in the event of a crisis.
    Each of these countries' outreach efforts helps to strengthen ties 
with current NATO members, as well as to build bridges from the 
Alliance to important non-NATO allies and Partners. Their efforts are 
thus already contributing to the enhancement of the Alliance.

                      III. ENHANCING THE ALLIANCE

    The three new countries have, as I have already discussed, shown 
the ability and willingness to contribute to the Alliance's new 
missions and to work in Europe to erase old divisions and to bring all 
European countries into an effective security structure. Ultimately, 
however, NATO depends on its ability to perform collective defense. 
Each of the three new countries is taking steps in the right direction 
to perform that collective defense mission. To understand these steps, 
let me again give some context.
    Poland, Hungary and the Czech Republic all maintained their 
militaries for four decades under the Warsaw Pact. Not surprisingly, 
then, the current status of these militaries reflect Warsaw Pact 
doctrines and approaches. In our working with these countries, we have 
sought to make their militaries more like NATO militaries, for such a 
transformation is important to make their inclusion into NATO as 
effective as possible. We recognize that they will not have fully 
transformed militaries by 1999. Instead, we have sought to ensure that 
each country has a plan to effect such a transformation over time. We 
have done so in NATO and also through bilateral efforts, as have other 
members of the Alliance. In NATO, we have focused on interoperability 
through the Partnership for Peace and, since the Madrid Summit, on the 
NATO Defense Planning Process. We have also focused on the key national 
priorities for each country to make it most able to work effectively 
with NATO. As we considered such priorities, we found that there were 
three broad, critical categories: personnel reform; training and 
doctrine; and interoperability, this last with a focus on command, 
control and communications, air defense architecture, logistics, and 
infrastructure to facilitate reinforcement.
    Let me discuss the plans of each of these countries to deal with 
these critical NATO and national issues. Each of the three countries 
has recognized that NATO compatibility depends on the implementation of 
a well thought-through plan. As noted above, these plans include 
involvement with PfP, the NATO Defense Planning Process, and the 
establishment of national efforts.

         A. Interoperability Through the Partnership for Peace

    I have discussed previously the benefit of PfP toward avoiding 
further divisions of Europe. But the PfP program, particularly the 
conduct of military exercises, has also been a training ground for NATO 
enlargement. For example, in 1997 alone, Poland will have participated 
in 22 PfP exercises in which the United States also took part; the 
highlight of these events was exercise BRAVE EAGLE, one of the largest 
and most complex Pfp exercises to date, which Poland hosted. Poland 
also participates in a hundreds of bilateral and multilateral 
exercises, seminars, and other activities with other Partners and NATO 
Allies, all of which contribute to increasing their interoperability. 
The Poles have emphasized military training and tactical exercises in 
their PfP participation.
    Hungary has been an enthusiastic participant in the PfP program and 
the enhanced PfP effort, as the Hungarians believe that PfP activities 
contribute directly to the establishment of NATO interoperability and 
its declared objective of NATO integration. Hungary was, in fact, the 
first Partner to include a PfP line item in its defense budget. Like 
Poland, Hungary has participated extensively in bilateral and 
multilateral military exercises and activities which have produced 
valuable lessons learned. The Hungarians have participated in seventeen 
multilateral PfP exercises in 1997 in which the United States also took 
part, and it will host a major exercise next Spring. The invitation in 
Madrid will gradually alter the nature of Hungary's participation in 
PfP, making Hungary not only a consumer but more and more a contributor 
to the enhanced PfP program. Since the Madrid Summit, for example, 
Hungary has offered to mentor Romania on the DPQ process, and they have 
volunteered to participate in the twelve NATO teams assessing Albania's 
post-conflict military.
    The Czechs participated in eighteen multinational PfP exercises 
with U.S. involvement in 1997. They have also conducted numerous joint 
training activities and joint exercises with a majority of other 
Allies, including Belgium, Canada, Denmark, France, Germany, Italy, the 
Netherlands, Spain and the United Kingdom. They have conducted joint 
company, battalion and brigade training with the French 7h Infantry 
Division and the British Royal Marines, just to name a couple of the 
major training partners. In overall numbers of activities, they have 
been particularly closely involved with Germany, where they signed up 
for 100 joint activities for 1997 alone.
    In addition, during the last three years all three countries have 
participated in PfP's Planning and Review Process (PARP), in which NATO 
established 41 specific Interoperability Objectives (IOs). Examples of 
these objectives include: C3/SAR, ground refueling of aircraft, 
commonality of airfield procedures, use of NATO communications 
procedures and terminology, aircraft IFF system, logistics support, and 
interoperability of communications equipment and of air navigation 
aids. Poland committed to attain all 41 IOs by 1999, Hungary pledged to 
reach 38, and the Czech Republic promised to meet 31.
    As NATO assessment teams have visited each country over the past 
two months they have increasingly discovered evidence that PfP and PARP 
have produced results directly relevant to NATO enlargement. For 
example, when the American general heading the NATO team visiting 
Kecskemet Air Base asked how Hungary would accommodate a squadron of 
NATO F-16s, he was surprised by the precision and level of detail of 
the Hungarian response--and the level of installation readiness 
achieved. He was told that the Hungarians has not just ``planned'' for 
the accommodation of NATO's F-16s--they had done it. Through a PfP 
exercise, Hungary had hosted a squadron of Dutch F-16s for several 
weeks in 1996.
    In many cases, the selectees have used the interoperability 
objectives as guideposts for procurement decisions--decisions they have 
made and implemented--in advance of NATO membership. For example: a 
SHAPE analyst monitoring the NATO Common Fund Cost Study's progress 
noted that even though communications and information systems 
requirements were increasing, the prospective costs to the Czech 
Republic kept dropping. Upon closer inspection, it turned out the 
Czechs had already anticipated the requirements for secure and non-
secure digital communications programs and had applied NATO standards 
to the national programs they are pursuing on their own. In short, 
because of PfP the Czechs have already spent their own money to fund 
some projects that we had assumed would be paid for by NATO as a whole 
through the common budgets.
    All three countries' active participation in PfP activities and 
exercises have helped them understand how to operate with NATO forces 
and are preparing them for the burdens and responsibilities of NATO 
membership. Experience gained through PfP was integral, for example, in 
each country's preparation of its DPQ reply.

                B. Successful Completion of Initial DPQ

    Since Madrid, the three invitees have gone beyond PfP activities 
and worked with the NATO international staff to fill out a special 
Defense Planning Questionnaire (DPQ) as their initial step into the 
NATO Defense Planning Process. These questionnaires, which all NATO 
allies submit annually, are a disclosure of each country's force and 
financial plans. Each of the invitees was visited in July and September 
by the international staff, which delivered and explained the DPQS. 
Teams with the international staff met frequently with the invitees to 
assist their defense ministries in preparing their replies. I am 
pleased to be able to tell you that all three of the invited countries 
submitted their DPQ replies by the deadline of 1 October--a deadline 
that was not announced to them until the Madrid Summit in July. To put 
this in perspective, only four of the current NATO allies met their 
deadline this year--and the United States was not one of them.
    Poland has declared its willingness to commit all of its 
operational military forces to NATO. One-third will be designated as 
``NATO-Assigned,'' meaning they will be fully integrated into the NATO 
force structure and placed under the operational command or control of 
a NATO commander when called upon. These NATO-Assigned forces, which 
include both immediate and rapid reaction forces, are already partly 
capable of joint operations with NATO and should be fully interoperable 
by 2002. The types of units to be assigned to NATO include airborne, 
armor and air defense units, as well as fighter squadrons and transport 
aircraft. Poland will designate the remaining two-thirds of its armed 
forces as ``NATO Earmarked,'' meaning they could be put under NATO 
operational command or control in time of need.
    Since its DPQ submission, Czech officials have noted that they are 
willing to earmark up to 90 percent of their operational forces to NATO 
in times of crisis. The Czech Republic is also expected to assign to 
NATO's force structure elements of both their immediate and rapid 
reaction brigades, as well as fighter and combat helicopter squadrons, 
search and rescue units, chemical defense units, and mechanized and 
artillery brigades. The military and MOD staffs will also continue to 
refine the DPQ Reply with NATO and help develop its Target Force Goals, 
which are due early next year.
    Presently, Hungary has assigned to NATO both immediate reaction and 
rapid reaction forces, consisting of combat brigades and battalions, 
support brigades and battalions, fighter squadrons, artillery units, 
and anti-air, anti-armor and combat helicopter assets. These forces are 
only partially able to conduct joint operations with NATO at present, 
but the Hungarians are working hard to increase capabilities. Hungary 
has also earmarked to NATO a number of air force units.

                          C. National Efforts

    PfP and NATO defense planning efforts are only part of the work of 
these countries to be able to perform the task of collective defense. I 
have regularly worked with the governments of these countries on NATO 
issues. In mid-September, I traveled to Budapest, Prague and Warsaw to 
discuss with senior civilian and military officials the steps which 
these countries are taking to prepare themselves for NATO membership. 
In extremely candid sessions, they provided their assessments of their 
own strengths and weaknesses, and they discussed in great detail their 
plans for improving their interoperability with NATO forces. Remedying 
many of the shortcomings they identified will be costly, and some will 
take time. I was, however, pleased with what I heard. Let me review 
some of their efforts.
1. Military reforms and modernization
    In Poland, I was briefed last month on the wide range of military 
reforms and modernization programs that will reshape Poland's military 
doctrine, restructure the armed forces, and modernize military 
technology and capabilities. The Ministry of Defense has developed a 
comprehensive 15-year plan to modernize the military and make it 
interoperable with NATO, assisted by the defense planning skills 
learned from the processes of compiling Poland's Defense Planning 
Questionnaire Reply and cooperating with NATO Staff on the development 
of Target Force Goals. The initial focus of the long-term plan will be 
on several key areas: command, control and communications (C3); air 
defense and air traffic control; logistics and infrastructure; and 
personnel reform, including a 21 percent reduction in forces and an 
increase in the quality of training provided to those that remain. 
These areas of focus are identical to those we see as critical.
    Hungary has developed its own plan, ``Force 2000'', to better 
prepare it for NATO admission. Its goals are to downsize the armed 
forces, standardize structures along NATO lines, further 
professionalize and increase the volunteer personnel in its force, and 
improve the quality of military life. This plan is scheduled for 
completion in 2001. After 1998, the Hungarians will focus on additional 
NATO adaptation requirements and the modernization of land and air 
force equipment. Hungary has an integrated system of defense planning 
compatible with the NATO system. The new command and organizational 
structure, to be in place by the end of 1997, places the main emphasis 
on establishing NATO compatibility. The medium-term plan priorities 
include the modernization of air defense, reconnaissance, information 
and control systems, the acquisition of modem armored and transport 
vehicles, modernization of aircraft and helicopters, implementation of 
NATO standards, and training and equipment interoperability for NATO 
designated units. Hungary has devoted a large amount of staff time to 
learning the NATO defense planning process. The staff is now turning 
its attention to completing the process and focusing on the development 
of NATO-directed Target Force Goals by early next year.
    The Czech defense leadership is well aware that their process of 
creating a new defense establishment is far from complete. They know 
that they need to take steps to increase public support for membership 
(and recent polls do show much increased support); that serious, 
effective military personnel reform must take place; that a series of 
defense acts must be passed by parliament to legalize the reforms being 
implemented in the Czech Armed Forces; and that interagency 
coordination on defense issues must be improved. They realize that they 
have much work to do in these areas; while they are working with us and 
other Allies to overcome them, the Czechs know that they will have to 
do the majority of work themselves. The Ministry of Defense will be 
working hard to implement the recommendations of its recently-approved 
long-term defense plan, ``National Defense Concept 2005,'' which 
addresses most of the Czech Republic's crucial defense reform 
challenges.
2. Allocating Sufficient Resources
    The reforms called for in each country's long-term modernization 
plan will not come cheap, and each country has pledged to commit the 
resources required to achieve their objectives. Poland has carefully 
thought through the financial implications of the broad reforms in its 
15-year plan, which calls for annual increases in defense spending 
which are pegged to the levels of GDP growth to cover the necessary 
costs. Based on a conservative estimate of 4.2 percent annual growth, 
defense spending will increase approximately 3.2 percent annually. In 
1996, Poland spent 2.3 percent of its GDP on defense, a higher 
percentage than half of current NATO Allies.
    Hungary has also focused on the need to provide adequate resources 
for defense. The total national defense budget for 1997 is about $800M, 
which represents about 1.8% of projected GDP. Hungary has stated that 
it plans to link defense spending growth to the rate of GDP growth and 
to increase the percentage of GDP dedicated to defense by 0.1 percent 
annually for the next five years. If so, Hungarian defense spending may 
increase in real terms by three to eight percent annually during the 
next four years. Between 80-85% of future planned defense budgets will 
be dedicated to the maintenance of the Hungarian Defense Forces (HDF), 
and 15-20% will be allocated to its development. Hungary assesses that 
this budget may not provide the necessary funds for a significant 
degree of modernization in the armed forces. Until the end of 1998, 
Hungary will allocate 12% of its military budget to procurement and 
modernization; in 2001, Hungary plans to increase the amount allocated 
to 25%. Lacking sufficient overall fiscal resources for modernization 
of the entire force, we can anticipate that Hungary will concentrate 
its efforts in specific areas such as modernizing air and air defense 
forces, modernizing C41 capabilities and preparing selected ground 
units capable of operating alongside NATO forces in peacekeeping and 
out-of-area operations.
    Czech military, defense, foreign affairs and parliamentary 
officials assured me in September that the Czech Republic plans to 
increase its defense budget by 0.1 percent of GDP for each of the next 
three years, bringing defense spending up to 2.0 percent of GDP by the 
year 2000. For 1998, using Czech Defense Ministry figures, this would 
raise total defense spending from approximately $900 million to $1.1 
billion dollars. Such a decision is a positive sign, particularly in 
light of the devastation caused by the recent floods, which hit about 
one-third of the country. I am confident that their determination to 
implement crucial reforms and their decision to devote substantial 
resources to the restructuring and modernization of the armed forces 
will help make the Czech military a net provider of security by 1999.

               D. CORE CAPABILITIES AND INTEROPERABILITY

    The Czechs, Poles and Hungarians are all focusing on the 
deficiencies that we believe present the greatest challenges: 
personnel; training and the adoption of NATO doctrine; and 
interoperability.
1. Personnel
    We have made it clear to all three that serious, effective military 
personnel reform must be accomplished as soon as possible within the 
Armed Forces, and all three have begun to take the necessary steps. The 
Czechs agree that they need to create a Western structured military, 
reliant on an effective Non-Commissioned Officer corps, with quality, 
well-trained forces that are properly recruited, paid, housed, and 
retained. To accomplish these goals, they understand that they need to 
dedicate the required resources and, in some cases, pass appropriate 
legislation.
    Personnel reforms will encompass perhaps the most drastic and the 
most difficult changes to the Polish military. The military has 
announced plans to cut total forces from 230,000 to 198,000 by 1999, 
and to 180,000 by 2004. It will increase the number of career soldiers 
from 36 percent to 50 percent of total troops, and it plans to improve 
the junior-to-senior officer ratio from its current 50:50 to a more 
appropriate 70:30 by the year 2012. To reflect better the reliance by 
NATO militaries on a skilled, professional NCO corps, Poland plans to 
increase the number of NCOs to one-third of its total forces and to 
invest heavily in their training.
    Difficult personnel reforms are also needed in Hungary. Hungary's 
priority areas for personnel also include improving the ratio of junior 
to senior officers and of officers to NCOS, but they also plan to 
address quality of life issues for the military, win a 23% pay raise 
for the military in 1998 (Parliament votes on this issue in early 
December), and enact legislation on pay standards (scheduled to take 
effect on January 1, 1999). The military has stated that it will cut 
ground forces personnel from the present 59,715 to 34,000 by 2005, and 
Air Force personnel from the current 17,500 to 14,000. Hungary hopes to 
have a 60:40 professional to conscript ratio by the end of the century. 
Another important objective is to increase the present one-to-one 
proportion of NCOs to officers to two-to-one, and ultimately three-to-
one. The length of service for conscripts will be reduced from 12 to 9 
months.
    Like Poland and Hungary, personnel reforms will be perhaps the most 
drastic and most difficult change for the Czech military to implement. 
The Czechs assured us during a recent visit to Prague by Assistant 
Secretary of Defense for Force Management Policy Fred Pang that 
personnel reform is their number one military priority. They pledged to 
develop, with our support, a concrete action plan that will address and 
correct their personnel deficiencies.
    The Czechs began the process of implementing personnel reform back 
in March when it approved the National Defense Concept. The primary 
objective of the concept is to reorient the military away from the 
heavy, manpower-intensive Soviet-style corps of the Warsaw Pact and 
toward smaller, more mobile, NATO-compatible units in both the Czech 
Ground Forces (Army) and Air Forces. The plan aims to downsize the 
armed forces to 55,000; develop a professional cadre of career 
soldiers; standardize structures along NATO lines; improve the quality 
of military life; and, most importantly, develop a professional NCO 
corps. The implementation of this plan, which started on July 1, is 
scheduled for completion by the end of 1998.
2. Training and NATO Doctrine
    Each country has begun to aggressively adopt NATO doctrine and 
incorporate it into their training programs. Within the PfP framework, 
all have obtained NATO Standardization Agreements (STANAGS) and 
regulations and are translating them as fast as they receive the 
documents from Brussels. All three have also set up NATO Integration 
departments in the Ministries of Defense and Foreign Affairs, as well 
as in the General Staff, to help achieve their prioritized 
interoperability goals and facilitate their swift operational 
integration into the Alliance.
    Training will become a crucial element of each country's 
integration plans. The operational experience gained through active 
participation in PfP exercises has greatly improved the ability of all 
three invitees to operate jointly with NATO forces. Each country is 
conducting staff exchanges with the United States in such areas as 
acquisition, budget and finance, logistics, public affairs and 
legislative affairs.
    The one million dollars Poland received from the United States 
under the International Military Education and Training (IMET) program 
has provided training in such key areas as English language skills, NCO 
development, and logistics. Poland has also received training from 
other Allies in logistics, English language, C3, and defense planning. 
English language proficiency is a critical element of NATO 
interoperability. and Poland plans to have 25 percent of officers in 
NATO-designated units proficient by 1999. Over 1,100 officers per year 
are currently studying NATO languages (primarily English).
    The Hungarians have placed a great deal of emphasis on training. 
Two of Hungary's highest priorities are to increase English proficiency 
and to improve the quality of professional training, and the one 
million dollars in IMET funds which the United States provided in 1997 
has been spent wisely in both areas. NATO Allies also provide training 
to Hungary in NATO doctrine, recruitment, defense planning, and force 
modernization.
    Training provided by the United States and Allies has directly 
impacted both Hungarian operational capabilities and senior-level 
defense planning and reform. The Chief of the Defense Staff and 
Commander of the HDF is the first officer of his grade and 
responsibility from all of Central and Eastern Europe to attend the 
U.S. Army War College. His First Deputy Chief of Staff is also a U.S. 
War College graduate. Together, based on their U.S.-training, they have 
successfully restructured the Hungarian General Staff and Service 
Staffs along NATO lines to be more compatible and interoperable with 
NATO.
    The Czech Republic rightfully views the Partnership for Peace (PfP) 
program as the most direct path to achieving NATO compatibility, and 
its participation with the United States and other Allies have enabled 
it to begin developing the capabilities needed for it to operate with 
NATO forces. Active PfP participation, coupled with its peacekeeping 
activities, already allows Prague to contribute well-trained and 
seasoned personnel that are familiar with NATO procedures and 
operations. The Czechs have used the $800,000 in IMET funds provided by 
the United States in 1997 for training in such areas as English 
language skills, NCO development, and defense planning. The Czech 
Republic has also received training from other Allies--the United 
Kingdom, France and Germany, among others--in C3, logistics, air 
defense, and air traffic control.
3. Interoperability
    The third broad area of national effort for each of these countries 
is interoperability with a focus on C3, air defense architecture, 
logistics, and infrastructure. All three invitees will be making 
significant investments to infrastructure improvements--some of which 
they would have made whether they were invited to join the Alliance or 
not--and they know that those improvements will be costly. We are 
finding, however, that some of the infrastructure inherited from the 
Warsaw Pact is adequate and does not require significant modifications 
for NATO use. When a SHAPE assessment team visited Poland in September, 
for example, they asked a Polish major familiar with the details of a 
particular rail complex whether we could reasonably expect to transport 
a NATO armored division through it in one week's time. The amused major 
replied by asking the SHAPE general how many Soviet heavy divisions he 
thought they planned on moving through the same location when the 
trains were heading west.
    All three countries are also moving quickly ahead on initiatives to 
improve interoperability in key areas. For example, sweeping reforms to 
existing air defense and air traffic control systems have greatly 
improved the three invitees' ability to defend and manage their 
airspace. When their Air Sovereignty Operations Centers (ASOC) come 
online in 1998, Poland, Hungary and the Czech Republic will have 
consolidated control of their civilian and military air traffic control 
networks into one streamlined system and be ready to establish a future 
link with NATO's air defense system when the political decision to do 
so is made. Hungary has already completed the installation of 
``identification-friend-or-foe'' (IFF) transponders to their modem 
combat aircraft, and Poland and the Czech Republic plan to do so by 
1999.

                                 POLAND

    Poland has ensured that most senior unit commanders are familiar 
with NATO command, control and communications procedures by 
incorporating NATO C3 procedures into its training, by participating in 
C3-related Partnership for Peace exercises, and by adopting NATO 
command structures, military maps, and hundreds of standardization 
agreements (STANAGs). U.S. Warsaw Initiative funds are being used to 
acquire NATO-interoperable communications equipment, and a U.S. Air 
Force team conducting a C3 interoperability study reported that Poland 
already has ``an excellent foundation for achieving NATO 
interoperability objectives'' in this area.
    Poland has selected two air defense squadrons for full NATO 
interoperability, and it is working to implement NATO air defense 
doctrine across the board. Improvements made under the Warsaw 
Initiative-funded Regional Airspace Initiative (RAI) have enabled 
Poland to cut air defense personnel from 110,000 in 1991 to 56,000 in 
1997, and it is striving ultimately to bring this number down to 
38,000.
    Poland's ports, airfields, rail and road networks and other 
infrastructure are already largely capable of receiving NATO troops and 
materiel, and its logistics forces are working to improve their ability 
to support NATO troop deployments to Poland and Polish troop 
deployments abroad. Poland has identified specific areas where 
improvements continue to be required, and it has included them in its 
15-year modernization plan. Poland's defense infrastructure includes 
nine training facilities that are available to NATO, several of which 
have already been used by NATO Allies.
HUNGARY
    Along with the Poles and the Czechs, the Hungarians are moving 
ahead with their new NATO-interoperable Air Sovereignty Operations 
Center. Force modernization is required in all services but will take 
many years due to lack of available funds. Approximately 70-80% of 
major equipment is becoming antiquated, for example, and the current 
air defense capability is limited.
    In the area of command, control, and communications (C3), the 
Hungarians have incorporated NATO C3 procedures into training, ensured 
that all major unit commanders are familiar with NATO C3, stressed 
English language training, and made very effective use of the funding 
Congress has made available through the International Military 
Education and Training program. All Service schools and academies 
include NATO C3 in their curricula. Active participation in C3-related 
PfP exercises has helped them adopt NATO-compatible procedures. They 
are using over $3 million in Warsaw Initiative funding to acquire NATO-
interoperable communications equipment, and plan on spending more this 
fiscal year.
    In the area of Air Defense and Air Traffic Control, the Hungarians 
are in the process of merging civilian and military air traffic control 
networks. They hope to see the ASOC operational in 1998 and already 
have aircraft equipped with IFF systems, as previously mentioned. In 
addition to the U.S., Belgium and the Netherlands are providing Air 
Traffic Control assistance.
    In the area of infrastructure, the Hungarians are well on their way 
toward the creation of a NATO-compatible air base at Taszar that can be 
used as a staging base. Their assistance has allowed us to throughput 
more than 80,000 U.S. military personnel for rotation into and out of 
IFOR/SFOR assignments, and Hungary will continue to provide such host 
nation and transit support for Allied forces.
    As far as logistics are concerned, the Hungarians have set a 
medium-term objective to improve interoperability and the capability to 
receive NATO troops and materiel. They hope to have NATO fuel 
classification and increased distribution capabilities by 1999. They 
have established a NATO logistics liaison unit in the General Staff, 
and the U.S.-contracted Logistics Management Institute conducted a very 
successful logistics exercise last month.
CZECH REPUBLIC
    The Czech modernization program also focuses on C3; air defense and 
air traffic control, and infrastructure. In the area of C3, the Czechs 
have incorporated NATO C3 procedures into training; all major unit 
commanders are familiar with NATO C3 and they have stressed English 
language training. All Service schools also include NATO C3 
instruction. In the area of Air Defense and Air Traffic Control, the 
Czechs are in the process of merging their civilian and military air 
traffic control networks (considered state-of-the-art), a process which 
will be completed with the introduction of their Air Sovereignty 
Operations Center (ASOC) in 1998.
    In the area of infrastructure, the Czech Republic's airfields, rail 
and road networks, as previously mentioned, are already capable of 
receiving some NATO troops and materiel. It is also working closely 
with NATO to make sure its infrastructure will be NATO-compatible.
    As far as logistics are concerned, the Czechs, like the other two 
invitees, have set a medium-term objective to improve interoperability 
and the capability to receive NATO troops and materiels They are 
working with NATO on a number of key issues, including plans to 
increase their distribution and storage capabilities by 1999. They have 
also established a NATO logistics cell in the General Staff. They have 
flexible and redundant distribution networks for petroleum, oil and 
lubricants; are increasing their links to western oil and gas 
pipelines; and possess sufficient munitions for their current weapons 
systems.

                               CONCLUSION

    Reforming military doctrine, overhauling personnel systems, and 
modernizing weaponry and equipment are not small tasks, and all three 
countries' armed forces certainly have hard work ahead of them. It goes 
without saying that much still needs to be done to turn their plans 
into reality. However, their Political and military leaders are firmly 
committed to their integration with the West and to their membership in 
NATO. They have promised to dedicate the necessary resources to improve 
their military capabilities, and the defense establishments of the 
United States and other NATO Allies will continue to help them achieve 
their objectives by providing training, advice and material assistance. 
I am fully confident that, with the reforms and strategies currently 
being implemented in all three countries, Poland, Hungary and the Czech 
Republic will be both reliable allies and net Producers of security to 
the North Atlantic Alliance.
    Thank you.









             Prepared Statement of Dr. Stephen A. Cambone,
           Senior Fellow, Political-Military Studies Program,
             Center for Strategic and International Studies

    Mr. Chairman, it is an honor to appear before this Committee to 
discuss with you my judgment of the military capabilities of Poland, 
Hungary and the Czech Republic, each of which have been invited to 
accede to the Washington Treaty and become members of the North 
Atlantic Treaty Organization.
    My judgment of the candidates' military capability is based on two 
factors. First, the strategic objective of the United States in seeking 
the enlargement of NATO. Second, on an estimate of the contribution to 
be made by the military capabilities of the enlarged alliance to the 
achievement of that objective. I will define both factors, briefly, 
because I derive the criteria for judging the military capabilities of 
the candidates from them.
Strategic Objective of Enlargement
    By enlarging NATO to include Poland, Hungary and the Czech 
Republic, the US can reasonably assure itself that economic, political 
or military developments in the heart of Europe will not provide the 
occasion, as it has repeatedly in the past, for tension, crisis and 
war. Those occasions in the past have been rooted in what seem to be 
two, immutable, facts of European history, over the last three 
centuries. The first is the inherent weakness of the states within the 
Central European region. The second is their location between the 
powerful states of Europe to their west and east. Over those three 
centuries it is possible to trace the origins of Europe's major wars, 
in whole or in part, to these two immutable facts.
    We enter the fourth century of Europe's modern history with the 
facts of European political, economic and military life fundamentally 
unchanged. Western Europe possesses political and economic power 
unimaginable only fifty years ago and far in excess of what any state 
in Central Europe can hope to approach for a generation or more. 
Russia, while weak as it recovers from the ravages of communism, it is 
not without substantial political, economic and military potential. 
That potential is fully within its reach and if realized its power 
would dwarf the states in the Central European region within a 
generation. We are hopeful that these facts will not lead to tension, 
crisis and war in the coming generation. We also are hopeful that the 
states of Europe have renounced war as an instrument of state policy.
    But prudence dictates that we not rely on our hopes and that we 
ought not to allow chance the opportunity to play its fickle role in 
our affairs. This is especially so when we have at hand the means to 
assure, so far as it is possible, that the immutable facts of 
political, economic and military power in Europe do not follow their 
historical course. The enlargement of NATO to the states of Central 
Europe can provide this assurance. Through enlargement the members of 
the alliance, and none more than the US, can assist the candidate 
states to complete their transition to modem liberal states and 
establish friendly relations with their neighbors. But more than this, 
the enlargement of NATO creates the conditions under which these states 
are shielded from pressures from their east while permitting the US and 
its allies to extend through them a liberal and liberating influence 
into the Baltics, the Balkans and eastward toward Minsk, Kiev and 
Moscow.
    For those schooled in the old concept of geopolitics, enlargement 
consolidates in Europe the political victory of the democracies over 
tyranny in the Cold War, deters those who might seek to exploit the 
real and potential disparities of power on the continent and defends 
the still nascent civil society of Europe against aggression of any 
form. For those schooled in the new concept of preventive diplomacy, 
enlargement further reduces the likelihood of conflict today, protects 
the newly founded liberal regimes in the heart of Europe and increases 
the possibility that nations further to the east will find in the 
success of their immediate neighbors examples worthy of emulation.
The Military Contribution to our Strategic Objectives
    The achievement of our strategic objective requires a combination 
of political, economic and military initiatives. Our attention here is 
on the contribution to be made by our military capabilities to 
achieving our objective. With respect to those capabilities, the US 
chose to ally itself through the Washington Treaty and to combine its 
forces in NATO with those of its allies in order to assure that in 
Europe sufficient military capability would exist to accomplish the 
following missions.

   a defense by each ally of its borders and its air and sea 
        approaches,
   collective defense among the allies to maximize their 
        individual deterrent and defense capabilities,
   and, in the aftermath of the Cold War, ``out of area'' or 
        peace support operations by any combination of allies operating 
        as a combined force.

    This mission list remains the priority listing for allies within 
NATO. The priority is dictated by the requirement of a sovereign state 
to see first to its own security, to that of its allies and then to 
that of the regional or international system. But if the list reflects 
the obligations of states to their citizens, circumstances dictate how 
best to accomplish these missions. During the Cold War each ally had to 
provide substantial forces to defend its borders and air and sea 
approaches. But each ally understood that no member of the alliance was 
capable of providing for its security alone. The collective 
capabilities of all were needed to lend to each the confidence that 
together they could defend themselves should deterrence fail.
    The decisive victory of the Cold War has made it possible for the 
allies individually and the alliance as a whole to pursue these 
missions in ways different than they did during the Cold War. Today, 
the maintenance of the collective defense capabilities of the alliance 
remains essential to the defense of each ally. But today, and into the 
future, the absence of a massive, imminent and direct hegemonic threat 
means that the requirements imposed on each ally to defend itself are 
substantially lower than they were during the Cold War. Yet the risks 
to allied nations have not disappeared by any means. A few examples 
illustrate the point. Kaliningrad is still a depot for a large number 
of competent troops that could be used to influence affairs in the 
Baltic region or in Belarus, with direct consequences for Poland. 
Ukraine and Russia are closer today than at any time in the post-Soviet 
era. But Ukraine has embarked on a security policy that is not entirely 
coincident with that of Moscow. Tension between Russia and Ukraine will 
affect Poland, Hungary and the rest of NATO. We have seen how crisis 
and conflict in the Balkans can threaten allied security. Iraqi and 
Iranian arms build-ups pose a threat as well. So, too, do developments 
along the African littoral. Again, these are not threats of the same 
kind as posed by the Red Army and the USSR. But they are threats to the 
territory of NATO's member states that must be addressed by a 
combination of national defense establishments and collective defense 
efforts.
    In this reduced threat environment all allies have agreed that 
their security depends more today than in the past on their ability to 
conduct military operations on or beyond the periphery of the alliance. 
A reactive defense doctrine does not meet the strategic conditions of 
the day. Based on this assessment, and given the logic and the habits 
of allied cooperation the allies have reached agreement on two points. 
First, they will continue to maintain collective defense capabilities 
to deter the lower but not insignificant probability of a direct and 
massive attack on one or more of them. Second, some or all of them may 
draw on those capabilities to conduct operations on or beyond the 
periphery of the alliance to deter or defeat threats that each of them 
believe undermine their security.
    It is into this newly revised framework for collective defense that 
the national capabilities of new members of the alliance must be 
fitted, And it is in the context of that framework, and the 
requirements for collective defense and power projection that it 
imposes on the allies that the contributions of the new members should 
be judged.
NATO's New Standards
    Mr. Chairman, it is not so long ago that we measured the military 
capability of NATO in terms of armored division equivalents. But such 
measurements have been rendered anachronistic by two developments. The 
most obvious is the absence of an immediate and massive armored threat 
to NATO. The second, and more important, is that modem military power 
is no longer measured in the terms associated with armored division 
equivalents--general defense positions (GDPs), forward edge of the 
battle area (FEBA), echeloned forces, etc. In today's combat 
environment the silicon chip has all but conquered rolled homogenous 
steel. Precision strikes, launched by platforms in the air, on land and 
at sea, are replacing massed forces. High speed, secure communications 
to relay information to combatant forces are now rivaling traditional 
lines of communication as the essential arteries of combat operations. 
While seizing and holding territory may remain the key to securing the 
aims of a war, it is now possible to think of winning battles and 
campaigns by destroying an enemy's forces and supporting infrastructure 
from long range and without having to mass friendly forces on the 
adversary's soil.
    Whether one views these changes in warfare as a revolution or as 
the natural progression in technology and tactics over the last twenty 
years, the fact is that the military forces required to conduct 
operations today and into the future are very different from those 
fielded in the past. Among the allies, the US has moved swiftly to 
exploit these new technologies and tactics. The reasons for this are 
complex but may boil down to this: Americans have a penchant for 
adapting to new technology and a pressing need to increase the 
effectiveness of our forces to meet our unique global commitments in an 
age of fixed military budgets.
    Our allies have not moved to exploit the new technologies and 
tactics as quickly as we have, but they have made substantial progress 
nonetheless. Like us, each of them has taken the difficult steps of 
reducing their manpower overall, reducing the proportion of their 
forces made up of conscripts and making the transition from military 
capabilities designed in the late 1970s to those designed for the next 
century. The pace of this transition, begun later than ours, is 
hampered by the fact that allied defense spending is not directed by a 
central authority, but by the governments of each ally. The result is 
that the efficiency of spending on new technology and the adaptation of 
their forces for new tactics is degraded.
    That said, the allies are confident enough in their own progress to 
have adopted a new approach to NATO defense planning. Instead of the 
fixed GDPS, FEBAS, etc., of the past, the alliance has decided to plan 
its defense around ``projection forces.'' That is, rather than suffer 
the expense of maintaining large numbers of troops for deployment to 
pre-planned defense positions when the threat does not demand such 
deployments, the alliance has agreed that it would rely on the rapid 
assembly and deployment of forces to conduct both traditional 
collective defense missions as well as newer, out of area and peace 
support operations. As a result smaller, more professional forces 
supported by advanced C41SR (command, control, communications, 
computational, intelligence, surveillance and reconnaissance) 
capabilities and armed with more lethal weapons for ground-, air- and 
sea-based combat are being introduced into national forces and assigned 
to NATO to meet allied mission priorities.
Converting Cold War Forces
    The United States has led the way in converting its forces from its 
Cold War emphasis on national defense and contributions to allied 
collective defense forces. A few example suffice to make the point.
    In 1985, the US spent 6.5% of its GDP on defense. By 1995 spending 
had fallen to 3.8% of GDP. In 1995 constant dollars, this means we are 
spending $90 billion less a year than we spent in 1986. 
This absolute decline in spending is reflected in the forces. Over the 
same period the armed forces were reduced by some 600,000 personnel. 
The number of active army divisions shrank from 18 to 10; the number of 
navy combatants from nearly 600 to less than 350 and the number of 
active air force fighter wings from 25 to 12. Equally important, 
weapons acquisition spending has been cut in half, from about $150 B in 
the mid-1980s to about $80 B today with only half of that in 
procurement. Procurement is slated to increase after the turn of the 
century, but for much of the 1990s the US bought only a handful of 
tanks, aircraft and ships.
    Allied military capabilities have been adjusted as well. In 1985, 
allied spending amounted to 3.1% of GDP; by 1995 it was 2.3%. In 1995 
constant dollars the decline in allied spending is not so great as that 
of the US: today the allies are spending $10 billion less 
in a year than they did in 1985. The armed forces shrank by about 
600,000 troops as well. Weapons acquisition spending in 1996 was about 
$40 B, down from about $50 B in 1990. Substantial efforts are being 
made in national and multinational programs to bring on line modern 
fighter aircraft (France: Rafale; IT/GER/UK: EFA), transport aircraft 
(UK: C-130J, others: FLA), communications and surveillance satellites 
(UK; FR/GER/SP); new transport and attack helicopters and self-
propelled artillery, new frigates, minehunters, amphibious ships (UK 
and FR) and an aircraft carrier (FR). These efforts are being slowed by 
domestic budgetary restrictions and the difficulties experienced by the 
Europeans in multinational program management.
    It is the case that the US and its allies are presently out of 
phase with respect to modern military capability. The reason is the 
high level of procurement spending by the US in the 1980s which was 
nearly three times that of its allies. These so-called legacy systems--
displayed to such effect in Iraq--were designed in the late 1970s and 
early 1980s and began coming on line in the mid-1980s and early 1990s. 
They will carry us through the 1990s and will form the backbone of US 
forces until 2005-2010. New technology forces--advanced C41SR systems 
and processes, the F-22, the digitized army, new navy ship designs, 
more accurate and lethal stand-off weapons, etc.--will begin to come on 
line in large numbers post-2010.
    The advent of new technology systems in the US will occur about the 
time allies are completing the process of fielding the systems they are 
currently procuring. These systems, designed in the mid- to late-1980s 
for the most part, will not possess the most advanced ``stealth'' 
characteristics of American aircraft, be able to provide the 
situational awareness available to US Army forces or be able to provide 
the volume and variety of firepower US navy ships will be able to 
project from the sea. But for all that, allied forces will be not be 
interior to anticipated threats and will be interoperable with US 
forces. The silicon revolution and constant training makes it possible 
to do with software and tactics what hardware would otherwise prevent.
    The more troubling aspect of the modernization efforts of the 
current allies is the lack of funding for those assets that operate 
above the corps level--C4ISR, long-range air transport, air refueling, 
hospital units, engineering units, logistics and supply capabilities. 
That is, the allies are not investing as heavily as they might in those 
elements of military power essential to the sustained projection of 
military power. The allies are conscious of their shortfall and, within 
what they believe are real constraints related to enlarging the EU and 
bringing about European monetary union, are doing their best to 
overcome it.
    France is determined to develop in the next ten years the ability 
to project 40,000 troops at a distance of 2,000 km and sustain them 
indefinitely. This effort is hampered by its need to shed itself of 
thousands of conscripts and its determination to equip the force out of 
European industry. The UK is procuring amphibious ships and shorter-
range C130Js to give them greater lift and mobility. Its desire to 
balance procurement between the US and Europe, however, leads it to 
hesitate to commit to a buy or lease of a US C-17 capability so long as 
there is a reasonable prospect of the future large aircraft being 
launched by its European industrial partners. Germany is putting 
together a KRK or crisis reaction corps of 50,000 men for projection 
missions. But it is reluctant to provide it with above corps echelon 
capability because it does not want to give the impression that it is 
able to conduct modern military operations independently of its allies.
    The projection shortfall of our major allies can be overcome. But 
it will require a political agreement between the US and them on a 
major issue--defense industrial base reform and long-term procurement 
practices. This is beyond the scope of NATO enlargement, but it is 
critical to its success.
Candidate Member's Capabilities
    Mr. Chairman, in providing insight into the capabilities of the 
candidate members it is always helpful to have a few static figures in 
mind. These figures do not by themselves tell us enough about the 
potential of candidates. But they are useful for comparative purposes.
    Poland:  In 1985 Poland had some 320 thousand personnel in the 
armed forces. It spent about $7.8 billion (in 1995 dollars) or 8.1% of 
its GDP on defense. Today, Poland deploys about 215 thousand personnel; 
it spends about $3.6 billion or 2.4% of GDP. Its plans call for it to 
further reduce its armed forces to around 180 thousand and to maintain 
spending at the current level of 2.4% of GDP. The EIU estimates GDP in 
1997 at about $136 billion and real growth at an average of 5.7% 
between 1996 and 2004. Thus, a roughly $163 billion GDP should yield 
about $4.0 for defense in 2001, an increase of $600 million in 
comparison to today.
    Hungary: In 1985 Hungary had some 106 thousand personnel in the 
armed forces. It spent about $5.2 billion (in 1995 dollars) or 7.2% of 
its GDP on defense. Today, Hungary is reducing its armed forces to 
about 44 thousand personnel; it spends about $630 million or 1.4% of 
GDP on defense. Its plans call for it to increase spending at a rate of 
0.1 percent of GDP per year until it reaches 1.8% of GDP. The EIU 
estimates GDP in 1997 at about $43 billion and real growth at an 
average of 4.5% through 2001. Thus, a roughly $60 billion GDP should 
yield about $1.0 for defense in 2001, an increase of $400 
million in comparison to today.
    Czech Republic:  Figures for the Czech Republic are not comparable 
due to the ``velvet divorce'' between it and Slovakia. Under the 
settlement the Czech Republic took a roughly 2:1 share of defense 
assets. Today the Czech Republic deploys about 60 thousand troops, it 
spends about $850 million or 1.7% of its GDP. Its plans call for an 
increase in spending to 2.0% of GDP by 2000. The EIU estimates GDP at 
about $50 billion today and real economic growth through 2001 at about 
3.3% Thus, a roughly $60 billion GDP should yield about $1.2 billion 
for defense in 2001, an increase of $350 million in comparison to 
today.
    These figures should not be viewed as predictions and some 
variations in the numbers are possible, depending on deflators, which 
elements of the budget are counted against defense, etc. Nevertheless, 
what then, tell us is that, all else being equal, the three candidate 
countries in 2001 could have, in comparison to 1997, some $1.3-1.4 
billion a year among them in additional funds to spend on defense. This 
suggests that the cost of enlargement, reasonably defined, are 
certainly affordable.
    But the availability of funds is not an indicator of a willingness 
to spend those funds or to spend them in ways that make sense from the 
perspective of the military capabilities of the alliance. With respect 
to a willingness to spend, we can only take the word of the ministers 
and parilaimentarians of the three countries. With respect to spending 
in ways that make sense, that depends on a close collaboration between 
national authorities and those of NATO. And in this regard developments 
tend to support the view that these nations have begun to make concrete 
decisions that will yield substantial military capability for 
themselves and the alliance in about a decade's time.
    Manpower: I have already indicated that each of the candidates has 
dramatically reduced their overall manpower. Now they are taking, or 
about to take, two very difficult decisions. The first is to reduce the 
overall ratio of senior officers to junior officers and to raise the 
percentage of quality of non-commissioned officers. The surplus of 
officers and lack of trained NCOs is a product of their Warsaw Pact 
heritage when command structures were oriented to top-down orders to 
execute set-piece battle plans. NATO armies have always favored 
initiative by junior officers and NCOS. The new technology and tactics 
require that these junior officers and NCOs have a great deal of 
responsibility. To improve the ratios of officers and the competence of 
NCOS, Hungary introduced mandatory retirement at age 55, leading to a 
reduction of 25% of existing general officers in 1995. An additional 10 
generals were expected to retire in 1996. The Czech Republic has 
promised to reverse the 2:1 ratio of officers to NCOs and began that 
process in 1996. The issue is more sensitive for the Poles, but they 
have committed to make the changes. In order to bring up new talent, 
they are offering retirement at 15 years and 40% pay to currently 
serving officers.
    The second significant manpower-related decision is to increase the 
ratio of professionals to conscripts in the armed forces. Poland and 
Hungary plan their forces to be 60% professional; the Czech Republic is 
moving to a 50% ratio. In all three cases the increased ratio does not 
represent a dramatic increase in the total number of professionals 
because in all three cases the dramatic cut in armed forces personnel 
since 1985 has occurred in the conscript ranks. But what it does mean 
is that the per soldier cost will rise. In return, each will have a 
professional-based units available for NATO operations.
    Modernization:  Existing stocks of weapons in each nation, except 
perhaps for aircraft, are not so inferior in age or technical 
capability as compared to those of other NATO powers. All three are 
committed to upgrading their C41 capability, air defense forces, and 
ground force components, the last primarily through upgrades of 
existing equipment. To be sure, each of the three is faced with the 
need to replace the bulk of their fighter aircraft. However, 
appreciating the cost of aircraft and in light of NATO assurances that 
Brussels is not expecting the candidates to invest heavily in new 
platforms (specifically aircraft), all three nations have delayed 
making firm plans or commitments to new purchases. Nevertheless, Soviet 
MiGs and Sukhols will eventually need to be replaced (more on this 
below). But in keeping with the overall commitment to make the less 
glamorous and often unseen changes to infrastructure first so that the 
effects of subsequent modernization can be maximized, all three nations 
have committed to bringing a modem regional air control system on line. 
The military and civilian systems inherited from the Warsaw Pact were 
unacceptable to NATO. The new regional air control system will both 
improve civil and military air traffic control and improve safety while 
making the next step in the process--settling on IFF (identification 
friend or foe) codes and procedures--easier and quicker to implement. 
Thus, when replacement aircraft are deployed, they will operate in a 
NATO-compatible environment.
    Military Contributions: The internal reform of the armed forces and 
their modernization are intended to make the military forces of the 
candidates capable of operating alongside their NATO allies. But none 
of the three has waited for NATO membership to contribute.
    The Czech Republic offered chemical warfare detection vehicles to 
the coalition forces in the Gulf War. It has deployed a mechanized 
infantry unit of some 850 men to Bosnia as part of IFOR/SFOR. This unit 
is made up of volunteers from the Czech rapid deployment brigade, which 
is already considered to be NATO compatible. It is also the view of 
many that the Czech infrastructure--roads, rail nets and stations, 
pipelines, airports, etc.--is already adequate to support NATO's rapid 
reaction corps.
    Hungary has made its airspace and its base as Taszar available to 
NATO forces to support operations in Bosnia. And given the modest 
amount of upgrading needed at Taszar, its infrastructure may prove, 
like that of the Czech republic, to be in better condition to support 
allied forces than has previously been thought. The allied use of 
Hungarian airspace has resulted in its completion of efforts to equip 
all of its aircraft with NATO-compatible IFF. In addition to its 
airspace and bases, Hungary has also made available a 450 man 
engineering battalion for service with IFOR/SFOR. Individuals from this 
unit are now reconstructing the bridge in Mostar. By 2005 It is 
expected that Hungarian reforms and modernization will allow it to 
deploy as many as three rapid reaction brigades fully NATO compatible.
    Poland, like the Czech Republic supported the coalition in the 
Gulf, allowing transit rights and sending medical teams to Saudi 
Arabia. It has contributed an airborne battalion of troops in Bosnia 
under IFOR/SFOR, deployed as part of the multinational Nordic Brigade. 
(It also has a battalion in Syria as part of the UNDOF.) The Poles have 
made at least two brigades and a field hospital unit available to NATO 
in 1997 and plans to have two more brigades sufficiently NATO 
compatible to conduct peace support operations by 2000. Observers 
believe its infrastructure generally adequate to support all elements 
of NATO's rapid reaction corps.
    All three are full and eager participants in PFP. Since 1995, all 
three have participated in a dozen or more PFP exercises. Hungary funds 
its PFP activities outside the military budget, a sure sign of its 
commitment. Poland has become a favored location for armored training 
by the UK.
    In summary, Mr. Chairman, it is evident that the candidates will 
have the financial resources to meet their anticipated obligations, 
they have made significant efforts to reform their military forces, 
began modernization efforts and are contributing to allied military 
operations.
Looking to the Future
    Does this mean that all is in hand and we can rest assured of a 
successful outcome? No. Economic forecasts are notoriously unreliable 
and growth projections could fall short. But even if their economies 
grow less than suggested earlier, the combination of force draw downs 
and reform and real economic growth should provide the three together 
with additional defense funds to meet their new obligations to NATO.
    There are four additional factors which, if managed with a clear 
eye on our ultimate goal, could smooth the integration of the candidate 
nations into the alliance and substantially enhance the capability of 
its member states to provide for modern national defense forces, to 
contribute to collective defense and cooperate in ``out of area'' 
missions. They are listed in increasing order of importance:

   the evolution of the transatlantic defense industrial base 
        and national procurement policies. US industry has a 
        substantial lead on its European counterparts in the process of 
        down sizing and consolidation. European efforts are hampered by 
        the complicating issues of policy within the EU. But the 
        introduction of the Euro (European Monetary Union) will speed 
        the process in Europe as fiscal and budgetary policies are 
        harmonized in the Euro's wake. This will affect the candidate 
        members as well, all of whom are also EU candidates. The US and 
        the EU need to put in place soon the laws and regulations that 
        will allow for two consolidated defense industrial bases to 
        maximize their comparative advantages while minimizing 
        politically disruptive economically unproductive competition.
   the candidate states have been given assurances by NATO that 
        they are not expected to undertake large, near-term purchases 
        of expensive defense equipment and platforms. This assurance 
        makes good sense in light of the earlier discussion. 
        Nevertheless, the obsolescent state of their air forces will 
        require that each of them put in place soon a long range plan 
        to reduce their force structures, upgrade units where feasible 
        and plan for the financing of replacement aircraft. It will be 
        important that the effort be financed in a business-like way. 
        ``Give away programs'' will not, in the end, provide the 
        necessary incentives to the West to moderate their offers or 
        for the candidates to ration their acquisitions. Loan 
        guarantees, ``lease-to-buy'' and other arrangement using US FMS 
        funds or other programs need to be explored.
   the progress of the next round of the Conventional Forces in 
        Europe (CFE II) needs to be monitored for its potential effect 
        on the force goals and structures of new alliance members. The 
        assurances given by NATO that it would not deploy a large 
        number of NATO forces on new members' territory was based on 
        current and foreseeable circumstances. Those circumstances 
        could change. We must be careful not to convert current 
        requirements into legally binding restrictions. Otherwise, we 
        could find ourselves in the future in the embarrassing position 
        of wanting to take a decision in Brussels to deploy forces to 
        allied territory but deterred by the prospect that the 
        deployment would require the receiving ally to reduce its own 
        force structure to remain compliant with CFE II.
   NATO's current Strategic Concept, drafted in 1991, is under 
        review and likely to be revised in the next year or two to take 
        account of the changing strategic circumstances in Europe and 
        the addition of new allies. It is important that the final 
        document preserve as the core mission of the alliance the 
        collective defense of its members and the European region for 
        two reasons.
   Each ally bases a significant fraction of its 
        national military requirements on that mission statement and 
        NATO's military components derive their own requirements from 
        it. As noted earlier, modern technology and tactics have made 
        it possible to satisfy the collective defense mission in the 
        coming decades with forces smaller in size, higher in mobility 
        and more lethal in their effects than was imagined just a 
        decade ago. It is from the collective defense capabilities of 
        the alliance that the means for conducting ``out of area'' 
        missions are drawn. No ally, including the US, has yet to 
        identify ``out of area'' requirements in such a way that they 
        yield forces adequate to meet either the collective defense or 
        national military requirements.
   Apart from the impact of the collective defense 
        mission on technical military capabilities, focusing on it 
        rather than the ``new'' missions of the alliance is important 
        for political reasons. We are only in the earliest stages of 
        defining the ``new'' missions of the alliance. We have not yet, 
        at the current sixteen or the projected nineteen, taken time to 
        assess the strategic situation outside the NATO area, compared 
        our interests in the Middle East, the Persian Gulf and beyond, 
        and agreed on a common political and military agenda. The 
        successful conclusion of such an effort is surely a long way 
        off and its outcome should not be prejudged by a near-term 
        revision of the alliance's strategic concept.
Conclusions
    An assessment of the military component of the qualifications of 
Poland, Hungary and the Czech Republic must be conducted in two 
dimensions, The first is the contribution, today and anticipated in the 
future, of the current allies to the security of Europe. Each of them, 
including the US, has experienced a sharp draw down in military 
spending and reductions in force sizes. At the same time each has made 
a longer-term commitment to modernize its forces and take a new 
approach to meet their enduring Article 5 obligations. Past approaches 
have been made obsolete by the collapse of the USSR and the advent of 
new technology. The new approach will depend less on the prior 
deployment of massive forces by each ally than the rapid projection of 
highly lethal ground- air- and sea-based multinational task forces to 
perform all alliance missions. The modernization of US forces is well 
advanced and noticeably ahead of its allies. But the allies are making 
a sustained effort to close that gap. This effort may, in the end it 
may require that they increase their defense spending modestly.
    The second dimension is the capability of the candidate members, 
Poland, Hungary and the Czech Republic. Like the current 16, each of 
them has experienced a sharp reduction in manpower and funding for the 
military. But their forces are not so old or incapable that they cannot 
make a contribution to NATO's capabilities, even today. All three have 
troop contingents in Bosnia. All three are reforming and retraining 
their troop structures and units. All three are taking a measured 
approach to the upgrading and modernization of their forces.
    Most importantly, all three have economies that are expected to 
grow in the coming years by an average 4.5-5.0% per year. As a result, 
on present plans their base defense budgets could be as much as $1.3-
1.4 billion higher in 2001 than in 1997. This growth, even if it should 
slow some in succeeding years, in combination with military reform, 
ought to allow them to meet the costs of enlargement.
    Mr. Chairman, the success of the candidate member's efforts, and 
therefore to the enlargement of the alliance, rests in an important way 
with the US Senate.
    The advice given to the president by the Senate ought to insist 
that the new allies be provided by NATO with realistic defense planning 
guidelines and time lines informed by the collective defense mission of 
the alliance. The Senate should make clear its preference that the plan 
stress infrastructure improvements, the installation of modern C41 
capabilities, near-term upgrades of critical platforms and systems and 
on internal reform and that these take precedence over major platform 
purchases and drastic restructuring. Such an insistence will help set 
the expectations of the US in this matter and help to bound within 
reasonable parameters the military requirements of the new members. The 
combination ought to set the stage for a successful enlargement of the 
alliance.
             Prepared Statement of Dr. F. Stephen Larrabee,
                                  RAND
                             Washington, DC

    Mr. Chairman, Members of the Committee, I welcome this opportunity 
to testify today on the issue of NATO enlargement. This is an issue of 
vital importance--both for the United States and for European security 
more broadly.
    In my view, NATO enlargement is clearly in the U.S. national 
interest. It will lead to a more secure, more stable and more 
integrated Europe, one that can act as a more reliable partner in 
helping to manage the challenges the U.S. and the Alliance are likely 
to face in the coming decades.

                NATO ENLARGEMENT IN BROADER PERSPECTIVE

    Before discussing the qualifications of the three candidates for 
membership in NATO--Hungary, Poland, and the Czech Republic--I would 
like to make a few preliminary remarks designed to put the issue of 
NATO enlargement in perspective.
    First, NATO enlargement cannot be seen in isolation. It must be 
seen as part of a much wider comprehensive strategy to enhance security 
in Europe. The goal of this strategy is to project stability to the 
East. For this a multiplicity of institutions is needed. No one 
institution alone can provide this type of comprehensive security. NATO 
has an important role to play. But it is not the only institution. 
Other institutions such as the EU, WEU, and OSCE, also have a role to 
play. Together they are part of the larger process designed to enhance 
stability in an expanded Euro-Atlantic space.
    Second, membership in the European Union (EU) will contribute to 
enhancing stability in Eastern Europe. But EU integration alone is not 
enough. EU integration must be complemented by a security framework. 
The main institution providing that security framework is NATO. Only 
NATO can provide ``hard security''--as developments in Bosnia have made 
clear.
    Third, NATO enlargement is not being carried out because there is a 
specific military threat but as part of a broader process of promoting 
stability and integration. The goal is to anchor the countries of 
Eastern Europe in a broader European and transatlantic framework and 
prevent a ``return to history.''
    Historically, Eastern Europe has been a region marked by 
instability and a geopolitical bone of contention, especially between 
Russia and Germany. The Western goal is to prevent a return to the old 
19th Century geopolitical rivalry and nationalism that led to 
instability--and eventually to two world wars. This can best be done, 
if Eastern Europe is integrated into a broader transatlantic and 
European framework rather than being left as a political gray zone. 
Leaving Eastern Europe as part of such a gray zone would only encourage 
the type of geopolitical rivalry and maneuvering that has created so 
many problems in the past.
    It is well to remember that the three candidates for NATO 
membership--Hungary, Poland, and the Czech Republic--were historically 
part of Europe. Prague, after all, is further West than Vienna. The 
Cold War artificially separated these countries from their historical 
and cultural roots. These countries now want to return to their roots 
and join Euro-Atlantic institutions.
    NATO is the keystone of this Euro-Atlantic structure. If they meet 
the qualifications for membership, they should become members. This is 
the best guarantee that these countries will develop healthy economies 
and democratic institutions and avoid becoming the objects of 
geopolitical rivalries of the past. The Western goal should be to 
project stability into the area and help those countries develop stable 
democratic institutions--that is, the type of political institutions 
and culture that developed in Western Europe after World War II.
    Some may ask, if the aim is to promote stability, then why not 
admit Ukraine or the Balkan countries first, since they need stability 
even more than Poland, Hungary, and the Czech Republic. The answer is 
that prospective new members need to have achieved a certain degree of 
political, economic and military maturity before they can become 
members. They need to be ``contributors to security'' not just 
``consumers'' of it. Otherwise, NATO and the EU would simply become a 
collection of economic and political basket cases and both 
organizations would be unable to function effectively.
    Indeed, NATO membership provides an incentive for reform. Aspirants 
know that they will be considered for membership only when they have 
achieved a certain level of economic and political reform and have 
resolved their internal problems, including minority problems. This has 
given aspirants--especially the three prospective new members--a strong 
incentive to carry out the political and economic reforms necessary to 
qualify for membership.
    The prospect of membership has also provided an incentive for these 
countries to regulate their relations with their neighbors. The desire 
for EU and NATO membership, for instance, was a major factor behind 
Hungary's efforts to sign the bilateral treaties regulating its 
minority problems with both Slovakia and Romania. The same is true for 
Poland, which has signed important bilateral treaties with Ukraine and 
Lithuania regulating long-standing territorial disputes and differences 
over minority issues.
    The importance of these treaties should not be minimized. They 
represent an important contribution to stability in the region. And 
they would not have taken place--certainly not with the same speed and 
impact--if the West had not made clear that a regulation of territorial 
and minority problems was prerequisite for entry into NATO.
    This is not to say that integrating the new members into NATO and 
transforming their militaries so that they can function effectively 
with NATO forces will be easy--either for NATO or the new members 
themselves. But the United States--and the Senate--should not lose 
sight of what is at stake. We have a historic opportunity today to 
stabilize Eastern Europe and prevent a return to old 19th Century 
nationalism and a rivalry that was so destructive and led to two world 
wars. History--and our grandchildren--will not forgive us if we fail to 
seize this opportunity.
    NATO membership alone will not do this. But together with EU 
enlargement it provides a prudent insurance policy against a return to 
history.
    However, as NATO enlarges, we need to ensure that NATO's core 
functions--particularly collective defense--are not weakened. New 
members must be able to contribute to carrying out NATO's core 
functions as well as be able to participate in NATO's new missions 
elsewhere on NATO territory and, if required, beyond it. In order to 
perform these missions, the forces of new members need to be capable of 
working effectively with NATO forces.

                 THE QUALIFICATIONS OF THE NEW MEMBERS

    Now let me turn to the issue of the qualifications of the 
prospective new members. How qualified are the three countries for NATO 
membership? Will they contribute to Alliance security?
    I believe the answer to both questions is clearly ``yes''. This 
does not mean that there are no problems or that the three countries do 
not have a lot of work to do to modernize their military forces and 
make them compatible with NATO forces. They do. But all three countries 
have demonstrated that they are committed to the values of the Alliance 
and are willing to undertake the reforms--economic, political and 
military--necessary to qualify for membership.
    Since 1989 the three prospective new members have made significant 
progress in four important areas:

                           DEMOCRATIC REFORM

    All three countries have established stable democratic political 
systems based on the rule of law. Democracy, to use Juan Linz's phrase, 
has become ``the only game in town.'' All the major political forces in 
the three countries accept the democratic rules of the game and are 
prepared to abide by them. In addition, there is a broad consensus in 
all three countries about the basic strategic directions of policy, 
whether it be market reform, membership in the EU, or membership in 
NATO. These goals are espoused not only by the former democratic 
opposition but also by the post-communist parties. Indeed, in Poland 
and Hungary these post-communist parties have pursued EU and NATO 
membership just as aggressively as their noncommunist predecessors.
    The recent elections in Poland illustrate this growing political 
maturity. The elections in September 1993 led to the formation of a 
left-wing government led by former communists. On most major issues, 
the post-communist government continued the basic policy of its non-
communist predecessors. In, September of this year, the non-communist 
forces were returned to power. This alteration of power illustrates the 
health and viability of the new democratic political system. In short, 
politics in Poland--as well as Hungary and the Czech Republic--is 
increasingly beginning to resemble politics in Western Europe.

                            ECONOMIC REFORM

    The three countries have also made significant progress in 
implementing market reforms. Today nearly 80 percent of the Polish and 
Czech economy is in private hands; the figure is only slightly lower in 
Hungary. Last year Poland's growth rate was 6 percent--one of the 
highest in the Western industrialized world--far higher than in most 
countries in Western Europe. After several years of slow growth, 
Hungary has begun to emerge from the recession that characterized its 
economy in the last years. The Czech economy has begun to witness some 
problems lately but it still maintained a very respectable growth rate 
of about 4 percent last year.

                       MINORITY AND HUMAN RIGHTS

    All three countries have also made substantial progress in 
regulating their relations with their neighbors and in assuring the 
rights of minorities. Hungary has signed bilateral treaties with 
Slovakia and Romania, which provide important provisions for minority 
rights. Poland has signed similar treaties with Lithuania and Ukraine. 
These treaties have served to enhance stability and significantly 
defuse potential tensions in the region. All three countries have also 
become members of the Council of Europe.
    This does not mean that there are no minority problems in these 
countries. But these differences have diminished significantly since 
the signing of the bilateral treaties and are not of such a magnitude 
as to pose a threat to regional security.
    The prospect of NATO membership played an important role in this 
process. Indeed, without the prospect of NATO membership the bilateral 
treaties might not have been signed. All three countries knew that they 
had to regulate their minority problems if they were to have any hope 
of entering NATO. Thus NATO has already contributed in important ways 
to enhancing stability in Central Europe.

                            MILITARY REFORM

    At the same time, the three candidate members have also begun to 
undertake important military reforms designed to restructure their 
militaries and make them more compatible with those of NATO.
    They have also taken important steps to establish civilian control 
over their militaries. For instance, in Poland the 1996 National 
Defense Law clearly subordinates the Chief of the General Staff to the 
Minister of Defense. Similarly, in Hungary the 1993 National Defense 
Law specifies that the Chief of Staff of the Armed Forces is 
subordinate to the Minister of Defense.
    Some critics have expressed concern that the East European 
countries will be consumers rather than producers of security and that 
they will require a massive assistance program in order to bring their 
militaries up to NATO standards. This is not the case. The three 
prospective new members do face important challenges in the military 
field but these challenges are by no means insurmountable if the 
countries implement prudent defense policies.
    These countries do not face a major military threat in the 
foreseeable future. In order to modernize their armed forces they do 
not need--and should be discouraged from embarking on--crash military 
programs that might weaken their economies. What is needed in each case 
is a well thought out and well designed long-term defense program over 
the next 10 to 15 years to modernize their military forces and bring 
them up to NATO standards.
    The basic problem these countries face is to increase the quality 
of their forces while reducing the quantity. The manpower levels of the 
prospective new members are significantly above those of NATO members 
of comparable size, while their quality does not match that of NATO. 
The new members can significantly reduce the size of their forces and 
still fulfill their defense requirements to join NATO. The money saved 
from the reductions can then be reinvested to improve the quality of 
their forces.
    Again, the answer to this dilemma is not a crash military program 
designed to bust the budgets of these countries. But rather a prudent 
long-term defense program designed to increase the quality of their 
forces in key areas--modernization, readiness, logistics support, 
technical compatibility, and interoperability--while reducing the 
quantity of their forces, in some cases by 30 to 40 percent.
    Doing this will not bankrupt the economies of their countries. 
Their economies are growing at an average rate of about 4 percent a 
year. This is higher than the growth rate of most of our West European 
allies. They do not have to allocate a far larger share of GIDP to 
defense in order to restructure their militaries. They can retain the 
current share, while steadily elevating defense spending as their 
economies grow.
    Indeed, one of the great attractions of NATO membership to these 
countries is that it will allow them to keep their defense expenditures 
modest and to focus their resources on economic reconstruction. 
Alliances save money. If they were not members of NATO, they would have 
to spend even more money for national defense.
    This does not mean that NATO membership will be a free ride. On the 
contrary, NATO membership will require these countries to spend their 
resources differently than they otherwise might if they had to provide 
for their own defense using national means, and to increase spending in 
some areas while decreasing it in others. But it will allow them to 
purchase a greater degree of security at a much lower cost than would 
otherwise be the case if they were not members of NATO.
    Moreover, the types of changes needed to make the forces of the 
three prospective new members compatible with those of NATO do not have 
to be built overnight. As noted, what is needed is a prudent long-term 
defense modernization program. During the Cold War, NATO had to begin 
to build a posture in Central Europe almost from scratch in 1950. It 
took three decades for the Alliance to meet many of its military 
objectives, but it managed to do so gradually in a step-by-step fashion 
by laying out prudent defense modernization programs. A similar result 
is achievable in Eastern Europe over the long run.
    The three prospective members have already begun to take steps to 
modernize their militaries and make them better able to work 
effectively with the forces of NATO.
    Poland has advanced the farthest in this regard. Poland recently 
presented a detailed 15-year plan for the modernization and reduction 
of the Polish armed forces. The plan calls for a reduction of the armed 
forces to 180,000 men, with a complete overhaul of the officer corps 
structure, and the introduction of professional NCOs and warrant 
officers. Under the new plan the Polish forces will be systematically 
upgraded in order to meet NATO standards of readiness and 
interoperability.
    In addition:

   Poland is currently preparing two airfields, two ports, and 
        two large depots for operations with NATO.
   It has established national military centers for language 
        education.
   more than 100 officers a year are enrolled in courses at 
        Western higher military schools and universities (including 
        West Point and the National Defense University).
   Poland has also set up a joint peacekeeping battalion with 
        Ukraine (operational by Summer 1998) and Lithuania (expected to 
        be operational in 1999).

    The Czech Republic has also begun to modernize its military forces. 
The Czech government recently pledged to increase defense spending by 
.1 percent of GDP a year for the next three years. This commitment is 
reflected in the new budget and was maintained despite the severe 
floods this Summer that caused millions of dollars of damage. As a 
result, defense spending will rise 17 percent this year. While the 
Czech government still has a way to go, this increase reflects the 
government's commitment to take the steps necessary to modernize the 
Czech military and make it more compatible with NATO forces.
    Hungary has also committed to increase defense spending by .1 
percent of GDP a year over the next five years. It has introduced a 
comprehensive military reform designed to restructure the Hungarian 
armed forces and make them compatible with NATO. In the process its 
forces have been reduced from a little over 100,000 in 1985 to 48,000 
today.
    In addition, Hungary plans to set up a peacekeeping battalion with 
Romania and a Hungarian Italian-Slovenian peacekeeping brigade. Indeed, 
military-to-military relations between Romania and Hungary are 
excellent. This underscores the way in which NATO can contribute to 
promoting peace and stability among once antagonistic neighbors.
    Perhaps most important, Hungary has made facilities available for 
U.S. troops in Bosnia. This is a very strong indication of Hungary's 
commitment to NATO. Hungary may not yet be in NATO, but NATO is already 
in Hungary.

                     PUBLIC SUPPORT FOR MEMBERSHIP

    There is also strong public support in all three countries for 
joining NATO In all three countries, support has remained steady or 
increased. Support is highest in Poland (83 percent), followed by 
Hungary (65 percent), and the Czech Republic (59 percent). \1\ In 
addition, publics in all three countries have expressed a willingness 
to continue with political and economic reform that would allow these 
countries to qualify for NATO membership.
---------------------------------------------------------------------------
    \1\ Figures are based on USIA opinion data taken in the Spring and 
Fall of 1997. See 'NATO Enlargement: The Public opinion Dimension,' 
office of Research and Media Reaction, United States Information 
Agency, October 1997.
---------------------------------------------------------------------------
    This support, moreover, is likely to grow as the publics in these 
countries come to better understand the benefits and obligations of 
NATO membership. One of the reasons for doubts on the part of some 
parts of the population in the Czech Republic and Hungary is ignorance. 
Many Czech and Hungarian citizens do not really know what NATO is; for 
others, the idea of an alliance has a negative connotation. They 
associate it with domination and loss of sovereignty--their experience 
as members of the Warsaw Pact. However, the governments in Hungary and 
the Czech Republic have undertaken efforts lately to better educate 
their publics and this has led to a rise in support for NATO in both 
countries.

                               CONCLUSION

    In sum, Mr. Chairman, I believe the three prospective members are 
fully qualified to become members of NATO. Their inclusion in NATO will 
contribute to a stronger, more stable and more secure Europe, one that 
is a more reliable partner for the United States. Such a Europe is 
clearly in the U.S. national interest.
    Thank you.

                               __________

               Prepared Statement of Dr. John S. Micgiel,
                               Director,
                     East Central European Center,
                          Columbia University

    Mr. Chairman, thank you for inviting me to address this 
distinguished body today on the matter of extending membership in NATO 
to the Czech Republic, Hungary, and Poland.
    Two world wars began in the region between Germany and Russia in 
this century. After World War II, NATO provided a shield against 
aggression behind which Western European states could build a community 
of democracies, prosperous market economies, and civil societies. 
Postwar arrangements effectively barred the Czechoslovak, Hungarian, 
and Polish nations from being able freely to elect governments, from 
participating in the Marshall Plan, the 50th anniversary of which we 
are celebrating this year and, in short, from acting as sovereign 
states.
    The implosion of the Soviet system and the emergence of 
democratically elected governments in most of the states in the region 
beginning in 1989 resulted in those governments pursuing European and 
Euro-Atlantic policies, joining Western multilateral organizations like 
the Council of Europe and the Organization for Economic Cooperation and 
Development, and being invited to enter into accession talks with the 
European Union and NATO.
    The mere prospect of membership in the latter has acted as a 
catalyst for political reform and served a point of reference for 
decision makers. In Poland, for example, prospective membership in NATO 
resulted in the clear establishment of civilian control over the 
military. The precondition of friendly relations with neighboring 
countries has had a dramatic impact throughout the region. Poland has 
Good Neighbor Treaties with all seven of the states that now adjoin it: 
Belarus, the Czech Republic, Germany, Lithuania, Russia, the Slovak 
Republic, and Ukraine. Hungary concluded Basic Treaties with Ukraine, 
Romania, and Slovakia. Following its peaceful separation from Slovakia 
in 1992, the Czech Republic concluded a much awaited Treaty with 
Germany, The prospect of being included in the first group of countries 
invited into NATO also caused the Romanians to conclude controversial 
Basic Treaties with Hungary and Ukraine. And the very tone of political 
discourse and culture has changed, with much less anti-Russian rhetoric 
in evidence today than just a few years ago, a sure sign of increasing 
political maturity and self-confidence,
    The three prospective member countries have each taken a proactive 
role in cooperating with their neighbors and sometime former 
adversaries. Poland, the only country among the three bordering on 
Russia, has led the field here by engaging the Germans and Danes in 
plans for a European Corps, and it has engaged the Lithuanians and 
Ukrainians separately in the establishment of joint battalions. Poland 
has also begun a wider political strategic partnership with both 
Lithuania and Ukraine. Hungary and Romiania are cooperating militarily, 
and the Czech Republic is now cooperating with Poland and Hungary on a 
regional air defense network.
    The desire to demonstrate the ability to cooperate regionally 
resulted in the establishment of the Central European Free Trade 
Agreement, and what is now known as the Central European Initiative, 
both of which have brought politicians on various levels together at 
regular intervals to discuss trade issues, the reduction of tariffs, 
and the development of infrastructure throughout the region. And trade 
within CEFTA doubled between the organization's inception in 1993 and 
1996, as economies grew and tariff barriers dropped. The declaration by 
the Czech, Hungarian, and Polish ministers of defense regarding plans 
for joint military procurement are another logical step in the 
direction of increased regional cooperation.
    Inclusion in multilateral organizations, and the concomitant 
legislative, political, and economic reforms have played and continue 
to play a great role in attracting direct foreign investment (FDI). 
Hungary, in particular, has been successful in obtaining investments of 
over $16 billion, while in Poland, FDI jumped from $6 billion in 1995 
to $14 billion in 1996. Each has obtained an investment grade rating 
and is making progress in meeting the economic criteria for European 
Union membership. Much progress has been made in constructing viable 
market economies, all of which have demonstrated growth despite 
occasional setbacks. Current account deficits in Hungary and the Czech 
Republic resulted in the implementation of difficult and generally 
unpopular stabilization measures. Yet each country has declared its 
ability and willingness to adequately support its membership in NATO. 
The Czech Republic has announced that military spending will rise in 
each of the next three years to a level of two percent of GDP in 2000, 
while Hungary's defense budget will rise from 1.4 percent of GDP in 
1996 to about 2 percent by 2001. Poland is already devoting and will 
continue to devote about 2.5 percent of GDP. As the economies grow, the 
funds devoted to the military will grow substantially in absolute 
terms. In the Polish case, for example, the economy has grown an 
average of seven percent over the last 3 years, and if that tempo were 
kept up, the amount in absolute terms would double in a decade.
    Each of three candidate countries has adopted different 
modernization strategies for their armed forces. They share, however, 
several commitments: to implement and drop below CFE limits; to 
reorganize and restructure units to bring them into alignment with NATO 
standards; and to cooperate with NATO in PfP exercises, in Bosnia, 
Eastern Slavonia, and other Unapproved operations. Each candidate 
country has a modernization plan that aims toward enhancing the 
interoperability of its armed forces with NATO, All three are reducing 
their armed forces, by 40 percent in the Czech case, 35 percent in the 
Polish case, and nearly 60 percent in the Hungarian case.
    And following the third round of discussions between Poland and 
NATO in Brussels earlier this month the Poles declared their 
willingness to contribute 1-9 percent of the current NATO budget. It is 
worth noting that seven of the current sixteen members of NATO make 
lower contributions.
    Are Czech, Hungarian, and Polish citizens in favor of joining NATO? 
A Hungarian public opinion survey taken in September 1997 indicated 
that 75 percent of those people who indicated that they would 
participate in a referendum on NATO would vote in favor of joining 
NATO; they will have an opportunity to do so on November 16 when a 
referendum on NATO accession will be held. A USIA survey of Czech 
citizens in May 1997 indicated that 60 per- cent favored entering NATO. 
Polish surveys have consistently reported approval ratings of above 83 
percent.
    The fact is that these countries share Western values and 
principles and want to contribute to, not merely benefit from, the 
stability and security that accompanies NATO membership. Suffice it 
here to mention Czech and Polish participation in Desert Shield/Desert 
Storm, Polish action on behalf of American interests in Iraq following 
the war, active participation in SFOR by Poland and the Czech Republic, 
and Hungary's support of SFOR by permitting NATO bases to be 
established in Hungary, and allowing NATO troops to pass through and 
over Hungarian territory to and from Bosnia.
    At present, no real major threat to the peace and security of any 
of the three candidate countries exists, including Russia. However, the 
perception of a Russian threat, still exists in Poland and Hungary, 
based on a shared historical experience and, in the Polish case, the 
proximity of a quarter million Russian troops in Kaliningrad blast and 
the establishment of the recent Russian-Belarusian Union. NATO is seen 
as being the only ready and tested structure that can effectively 
discourage potential trouble before it occurs.
    Despite the posturing we see in some Russian circles, NATO 
expansion does not pose a threat to a democratizing Russia that, after 
all, has a special relationship with NATO. According to a recent Brown 
University poll Russian elites express greater fear of Chinese 
demographic pressure and Islamic fundamentalism. Nonetheless, the 
failure to ratify the accession treaties would be perceived as a clear 
signal of U.S. disinterest in a region over which the United States had 
waged a forty-year struggle against the Soviet Union. That would result 
in a grey zone, a security vacuum, and temptation for the radicals that 
today are on the fringes of Russian politics.
    With dynamic economies, solid democratic values, excellent 
relations with neighbors, strong moral and political support for and a 
record of cooperation with NATO, and strongly pro-American attitudes, 
the three candidates have much to offer the Euro-Atlantic community. At 
a meeting of the New Atlantic Initiative on September 9, 1997, former 
National Security Adviser Anthony Lake spoke of the relatively low 
priority that NATO expansion holds for the average Russian, and 
concluded that enlargement ``is the opportunity of a generation and it 
would be the shame of our generation if we do not now seize it.'' The 
overwhelming majority of the 60 million inhabitants of the Czech 
Republic, Hungary, and Poland, the 11 million co-nationals residing 
here in the U.S., and the many more Americans who see a safer America 
in an enlarged NATO, would only echo that assertion.



   COSTS, BENEFITS, BURDENSHARING AND MILITARY IMPLICATIONS OF NATO 
                              ENLARGEMENT

                              ----------                              


                       TUESDAY, OCTOBER 28, 1997

                                       U.S. Senate,
                            Committee on Foreign Relations,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 10:15 a.m. in 
room SD-419, Dirksen Senate Office Building, Hon. Jesse Helms 
(chairman of the committee), presiding.
    Present: Senators Helms, Hagel, Biden, Robb, Feinstein and 
Wellstone.
    The Chairman. The committee will come to order. I would 
say, for the record, that we are in the midst of the end of 
session frustration. At the moment, the Senate is trying to get 
a quorum, which may take a while. They may have to go to a live 
quorum to get a vote on it.
    And then, we have at least one vote to follow immediately 
after that. So rather than have the witnesses sit here all 
morning, not to mention the guests, I am going to start it and 
I think we can get pretty far down the road before anything 
happens on the floor.
    In any case, let's see what we can do.
    Now, we'll begin for the record.
    The Foreign Relations Committee today continues its 
examination of the critical issues surrounding the proposed 
expansion of NATO. This morning, the subject for our discussion 
will be the cost, the benefits, the burden sharing, and the 
military implications of NATO enlargement.
    Maybe you recall that during Secretary Albright's recent 
appearance before this committee, I mentioned that the issues 
that we would consider this morning may very well be the issues 
that would determine whether NATO enlargement will succeed or 
fail in the Senate.
    Now our first panel will consist of the Honorable Walter 
Slocombe from the Department of Defense who is here and I have 
already greeted him. Mr. Slocombe will discuss the military 
implications of NATO and will present the administration's 
analysis of how much NATO enlargement will cost.
    Now, Mr. Slocombe will be followed by a private panel 
consisting of Dr. Richard Kugler of the National Defense 
University; Dr. Ivan Eland of the Cato Institute; Mr. Stephen 
Hadley, a former Defense Department official during the Bush 
administration. By the way, Mr. Hadley is now with the law firm 
of Shea and Gardner.
    Now, all of these gentlemen have checked the 
administration's mathematics, and are here to tell us whether 
anything has been missed in putting together the 
administration's estimate of how much NATO enlargement will in 
fact cost the American taxpayers, as well as how this policy 
will benefit the national interests of the United States.
    So I say to you, Mr. Slocombe and the other gentlemen who 
will follow you, we welcome you, we deeply appreciate your 
coming, and we look forward to your comments. You may proceed, 
Mr. Slocombe.

   STATEMENT OF THE HON. WALTER SLOCOMBE, UNDERSECRETARY OF 
                       DEFENSE FOR POLICY

    Mr. Slocombe. Thank you very much, Mr. Chairman. I'm 
honored to have the opportunity to appear before this committee 
on behalf of the administration and the Department of Defense 
to address the military implications and costs of NATO 
enlargement.
    I want particularly to express our appreciation for the 
fact that the committee has chosen to have these series of 
hearings early on as we begin to define the issues and open the 
debate on this fundamental question.
    Nowhere are American concerns more vital or are efforts 
more focused than in the case of Europe. The United States 
maintains a commitment to Europe in terms of troops on the 
ground, in terms of capacity to reinforce as needed, and in 
terms of political engagement in seeking to resolve problems. 
America makes this commitment not as an act of charity, but 
because the security of Europe is vital to our own security as 
events in this century have shown.
    As a result of the success of freedom and the collapse of 
communism and the end of the cold war, we know have a chance to 
build a security system for all of Europe. We need to do so, 
for, unfortunately, while the massive Soviet threat has 
evaporated, we continue to face problems as well as 
opportunities--threats to stability and security can still 
arise from old national and ethnic hatreds, from home-grown and 
state-sponsored terrorism, from threats from unstable regions 
outside Europe, and from the prospect of the threat of weapons 
of mass destruction.
    In the new European security system we seek to build, the 
key instrument is NATO. NATO enlargement is the most 
publicized, but not the only part, of a much broader strategy 
to create a peaceful, undivided, and democratic Europe. In my 
full statement, I outline the other elements of that effort.
    Enlargement, which is the focus of this committee's and, 
indeed, the country's attention, will serve the common security 
interests of all the member NATO--all the member nations of 
NATO, including the United States. Adding nations to the 
alliance in a gradual and careful way as they meet the 
standards for membership will, first of all, foster stability 
throughout Europe and the world by providing for stability, 
which has historically been a principal source of conflict in 
Europe.
    Second, it will make NATO stronger by creating a larger 
circle of like-minded nations prepared to work together in the 
common defense.
    Third, it provides an institutional setup for improving 
relations among the region's states, both members and non-
members. Indeed it is--the prospect of NATO enlargement has 
already had an important positive effect in that direction.
    Fourth, it will broaden the number of countries that can 
participate in burden sharing within NATO, both in financial, 
in manpower, and in strategic terms. It will create a better 
environment for trade, investment, and economic growth in 
Eastern and Central Europe because it is as true in Europe as 
it is in other parts of the world that without basic security 
and stability, free economies cannot prosper.
    It will help secure the historic gains of democracy in 
Central and Eastern Europe by providing the security in which 
those newly free societies can flourish. It will help all of 
Europe become a stronger partner for the United States in 
political, economic, and security affairs.
    Thus, the enlargement will serve American interests and 
American principles just as it will serve those of all of 
Europe, both old and new members, states inside and outside the 
alliance.
    As you are, of course, aware, at the Madrid Summit this 
summer, the NATO alliance, the NATO countries decided to invite 
Poland, Hungary, and the Czech Republic to begin negotiations 
toward an accession agreement, which we expect to have signed 
in December.
    The main focus of my testimony this morning is with regard 
to the military implications of the accession of those 
countries and the associated costs.
    With respect to military implications, NATO's first task 
now and as an enlarged alliance will be the so-called ``Article 
5'' defense of the territory of its members. This core function 
will not be diminished with enlargement, or indeed with other 
changes in the alliance.
    Back in 1991, NATO adopted a new strategic concept that 
recognized the end of the cold war and shifted from the cold 
war program of position forward defense to place new emphasis 
on flexibility and mobility and an assured capacity for 
augmentation.
    Applying this concept to enlargement, NATO does not need, 
in the existing strategic environment, to permanently station 
combat forces of any substantial numbers on new members' 
territory. Instead, the military forces of the new members will 
be made capable of operating with NATO forces, supplemented by 
the capability of current members, to provide appropriate NATO 
reinforcements in a crisis if necessary.
    Thus, the defense posture associated with enlargement will 
apply to those new members the same concept of regional 
reinforcement that it applies to current members. Similarly, 
NATO has agreed that while new members will be expected to 
support the concept of deterrence and the essential role that 
nuclear weapons continue to play in the alliance strategy, 
enlargements won't--enlargement will not require a change in 
NATO's current nuclear posture.
    For this reason, the alliance has stated that it has no 
intention, no plan, and no reason to deploy nuclear weapons on 
the territory of new members nor does it foresee a future need 
to do so. But with respect to this statement as well as the 
statement about stationing forces, these positions depend on 
current conditions and could, of course, be reviewed where 
conditions have changed.
    NATO will also, of course, expect new members to be able to 
contribute to non-Article 5 missions, including being able to 
participate in out-of-area deployments and, indeed, it is 
relevant that all three of the countries which have been 
invited to join are active participants with forces in Bosnia, 
and, indeed, in other operations.
    With respect to costs, of course NATO enlargement areas 
cost. Security is not free. It is a price well worth paying but 
it is not free. Analysis of the financial costs of enlargement 
can, I think, usefully be broken into three components.
    First, there are the costs to new members; that is, to 
Poland, Hungary, and the Czech Republic to develop military 
forces that are better able to contribute to their own defense, 
to the defense of other NATO members, and to other NATO 
operations.
    Second, there are the costs to current members so that they 
can improve their forces' mobility, deployability, and 
flexibility--in short, to proceed with the efforts they are 
already committed to and needed to meet the defense 
requirements of NATO's current membership.
    These first two categories of costs are for actions that 
the countries concerned would need to take to provide for their 
own defense whether or not NATO added members. Indeed, to get 
comparable levels of security without NATO enlargement, new 
members and, arguably, even current members, would have to 
spend more than they will have to spend with an enlarged 
alliance.
    And finally, there are the costs to both new and old 
members of integrating the new members into NATO or building 
the links that make the alliance a real working military 
alliance.
    From one point of view, these direct costs could be 
considered the only real costs of NATO enlargement, since they 
are the only costs that are uniquely associated with 
enlargement--the only costs that would not be incurred if NATO 
did not add new members. But we have thought it appropriate to 
count all three categories of costs to present a complete 
picture of what the requirement will be.
    But these direct costs are associated with enhancing 
interoperability. They include improvements in communications, 
air command and control, logistics, infrastructure, and 
conducting the program of exercises necessary to be sure that 
this linking system works. As you know, earlier this year the 
Department of Defense had prepared and submitted to the 
Congress are--an initial analysis of what the costs would be.
    It's important to understand the assumptions that lie 
behind this or any projections of cost. Our estimated assumed 
that while there will be a need for serious defense 
capabilities for an enlarged NATO just as there is now, there 
is currently no threat of large-scale conventional aggression 
in Europe, and that any such threat would take years to 
develop.
    That is, of course, the same assumption that we make in the 
United States for our own national planning and that NATO makes 
in planning for the defense of its current members. That 
assumption includes a recognition that there is no guarantee in 
an absolute sense that that threat could not arise, and that we 
have to hedge against the possibility and NATO provides an 
important basis for the hedge.
    Total costs, as we estimated them for all three categories 
aggregate, was $27-$35 billion over the period from now through 
2009; that is, 10 years after the planned accession of the new 
members.
    Let me give you a brief breakdown of how those costs were 
allocated. First, new members costs for restructuring their own 
national forces. Those costs were estimated at between $10 and 
$13 billion over that timeframe or around $1 billion a year.
    Those costs amount to some 10-30 percent of the projected 
defense budgets for the prospective new members over that 
period of time. Now, that is a significant part of the total 
budgets for those countries. On the other hand, it represents 
the investment that they will need to make in making a 
fundamental new direction in their own national defense.
    To meet those costs, they will have to increase their 
defense budgets to some degree and they will outline plans to 
do that. But we and they expect that a substantial part of the 
costs will be met by savings from reducing the size of the 
three nations' current forces.
    I also want to emphasize that all of these costs would be 
borne by new members, except to the likely very limited extent 
that the American Congress, or indeed, other NATO parliaments, 
decided to continue the limited support that we now have for 
some of the Central European militaries.
    For example, as you know, the United States now provides 
about $100 million a year through the so-called Warsaw 
Initiative to fund PF--Partnership For Peace countries and to 
support their participation in PFP.
    These costs for the three new members will be the cost of 
moving from their own Soviet-style forces, which were little 
more than auxiliaries of the Red Army, to militaries 
appropriate for independent democracies in a free alliance.
    But it's important to recall that these countries do not by 
any means start from zero. Indeed, they have per capita rather 
larger militaries than most NATO allies; probably in terms of 
just number of people, larger than they need.
    What they need to do, and we have made clear the priorities 
for this, is first to invest in quality personnel. Make sure 
those personnel are trained. Achieve a real degree of 
interoperability with NATO, which means upgrading 
communications, logistics capability, infrastructure, and 
integrated their air defense with that of the alliance as a 
whole.
    It is certainly the case that each of the invited nations 
will have to modernize its equipment in the years ahead. But it 
is our view and theirs that acquiring large amounts of high-
tech weapon systems should not be the highest priority.
    These countries are already working hard to demonstrate 
that they are ready for membership in NATO. Assistant Secretary 
of Defense Cramer and Assistant Secretary of State Grossman 
are, as I understand it, prepared to testify before this 
committee next week. They were scheduled last week and it was 
canceled--postponed regarding these preparations, so I will not 
go into them in detail beyond noting that each nation 
acknowledges the need both to restructure and increase their 
defense effort.
    The second broad category is the current allies' cost; that 
is, the cost to improve deployability. I want to begin by 
noting that our cost estimates to date do not anticipate any 
added costs to the United States in this category--that is, 
ability to deploy--because the United States forces are already 
highly deployable and sustainable at long distances.
    Their requirement to deploy to meet contingencies in places 
like Korea or Southwest Asia is actually more demanding than a 
hypothetical crisis in Central Europe. U.S. costs of 
enlargement are relatively low because we've already provided 
for the force's projection missions that the new NATO requires.
    But it is certainly the case that the other members of the 
alliance need to improve their capabilities to deploy. Now we 
have estimated that the costs of meeting the requirements will 
be in the range of $8 to $10 billion, or around $600-$800 
million per year.
    Now, these are a very modest share of the total defense 
budgets of the non-U.S. NATO allies, on the order of 1 percent. 
For the most part, they represent efforts already under way to 
adapt their forces to new postcold war needs and missions.
    These costs would all be borne by current allies and not by 
the United States. As this committee is well aware, for decades 
now, the United States has made no financial contribution to 
NATO allies' defense budgets except for the limited amounts for 
loan support to Greece and Turkey.
    We believe that our current allies can and should do more 
to increase their capability for the sort of mobile, flexible 
operations that NATO will need to be ready for in the future. 
But it is important to recognize that most of these countries 
have already made improvements and are committed to make more, 
and detailed examples are set forth in my statement.
    Finally, turning to third category, the direct enlargement 
costs for linking new and old allies, those were estimated at 
about 9 to $12 billion over this period, or about $700-$900 
million per year. This, again, is the cost of things like 
communications reinforcement, reception infrastructure, and 
other interoperability measures.
    We estimated that about 60 percent of these costs, or about 
$5.5 to $7 billion in total, would be paid for out of the NATO 
common budgets over the 10 years following accession. The 
remainder would be paid almost entirely by the new members.
    Now, this number is particularly important because this is 
the only number to which the United States would have to 
contribute. As you know, the United States pays approximately 
25 percent of each of the three NATO common budgets. We expect 
that this relative cost share will stay the same--the ratio of 
three European to one U.S. in the period when NATO is meeting 
these requirements.
    With these assumptions, the U.S. share would be about $150-
$200 million per year. Now, that is simply our share of the 
common budgets.
    These are, certainly, manageable costs. Obviously, $200 
million is a lot of money, but it is only a fraction of a 
percentage point of the entire U.S. defense budget, which is 
$266 billion this year.
    We are still discussing whether or what portion of those 
direct costs of enlargement, which would be paid for from 
common budgets, will represent a net increase overall in the 
common budgets, but whether some can be offset by reductions in 
lower priority programs. Now, there will be certainly be some 
reprioritizing of projects, and, therefore, less than dollar 
for dollar increase. The United States continues to expect that 
additional resources will be required.
    Having explained the numbers that we provided earlier this 
year, I now want to talk about them, the next step, to get more 
refined estimates. Our estimates earlier this year were 
necessarily preliminary, if only because we didn't know what 
nations would be invited to join, and we certainly didn't know 
the detail of the steps needed to link them into the alliance.
    Immediately after the Madrid decisions, NATO started a 
detailed review of the military implications, the miliary 
requirements, and the costs of meeting those requirements that 
are associated with enlargement.
    The present NATO costing effort is highly specific and 
focused on individual installations. In an effort to better 
understand requirements as well as the current capabilities of 
the three invited nations, members of NATO's international 
military staff have been conducting cite visits at various 
military facilities in the invited countries. They actually go 
out and look at the air field, at the rail head, at the 
communications' facility, and the air defense radar stations to 
identify what changes will be necessary in order to bring those 
facilities up to the required standard.
    They will then cost these requirements and prepare a 
proposed schedule on which they will be met. That work is to be 
completed in time for approval at the December NATO 
ministerials. This--and those cost estimates based on these 
detailed analyses will, therefore, be available to Congress 
simultaneous with the signing of the accession agreements and 
well before any vote on enlargement.
    Based on what we know now, we expect that the NATO cost 
estimates will be somewhat lower than those you received from 
us in February. First of all, the initial U.S. cost estimate 
assessed that four, not three, new members would be admitted, 
so there is some reduction simply from that.
    Second, and this is important in terms of the debate, 
remember that the number which NATO will come up to is 
comparable to the $5.5 to $7 billion that we estimated for the 
costs to the common budgets. NATO will only be estimating the 
costs to the common budgets, not the other categories.
    But we also expect that the NATO cost estimates will be 
lower because some of the things in these countries are better 
than we expected. It is clear that there is a lot for them to 
do, but we believe that the additional investment required to 
prepare for membership will be less than initially anticipated. 
My detailed statement gives some examples of our experiences 
showing why this is the case.
    In general, we found that the old Soviet-style 
infrastructure, while having lots of defects, provides a sound 
base on which to build and perhaps, more important, that the 
prospective new members have been making good use of the time 
and opportunities that the Partnership For Peace and nearly a 
decade of freedom has afforded in their ability to improve 
their--the capacity of their militaries to work as a part of 
the NATO team.
    There is on--this is a question of making the estimates. 
Then there is the matter of finding the money. Once the 
military requirements and cost estimates are agreed, we will 
move forward to make good on the commitments taken by--
undertaken by the leaders of the alliance in Madrid that, 
quote, ``The resources necessary to meet the costs of 
enlargement will be provided.''
    At Maastricht earlier this month at the informal Defense 
Ministerial, Secretary of Defense Cohen reminded his colleagues 
that all of the allies have acknowledged that the admission of 
new members will involve the alliance providing the resources 
which enlargement will necessarily require.
    There was no disagreement on this point. Of course, until 
we know the detailed costs and the proposed schedules, we will 
not able to determine the net increase in NATO common budgets 
as British Defense Minister George Robertson noted last week in 
an article published in the American press.
    Because enlargement is a high priority for NATO, we may 
have to delay some lower priority subjects. As I said, there is 
a question whether the enlargements costs to common budget can 
be fully offset.
    But Minister Robinson added, ``If additional spending is 
requiring, Britain will pay its share. We are confident that 
that will, in the end, be the position of all the allies. We 
will keep you informed over the coming months as this 
discussion continues.''
    Finally, I want to emphasize that these estimates of the 
cost of enlargement relate to capabilities required in the 
security environment that we in fact or see. Nation's need 
serious defense capabilities, which we have to hedge against 
the possibility things turning bad, in which there is no 
immediately threat of large-scale conventional aggression and 
whether any threat would take years to develop.
    Of course, a fundamentally different and far more demanding 
set of requirements for defense, in NATO and worldwide, would 
arise if trends in Russia or anywhere else developed in such a 
way such as to renew a direct territorial threat to NATO 
members.
    Because such a threat is hypothetical, it's impossible to 
estimate with any precision the costs of meeting it. But there 
can be no question that those costs would be substantial--they 
would be affordable, but they would be substantial. Remember 
that just 10 years ago, the United States and most of its 
allies were spending nearly twice as much as a share of GNP on 
defense as we do today.
    There can, however, be no question that if we ever had to 
meet such a threat, we could do it more effectively and less 
expensively in an expanded alliance than in a Europe still 
divided along cold war lines. In such a circumstance which we 
do not expect and hope never to see, the added manpower, 
military capability, political support, and strategic depth 
afforded by NATO enlargement would amply justify whatever 
additional costs there were at having additional members within 
the alliance's security umbrella.
    But perhaps the most important point to be made about cost 
is that there would be greater cost and greater risks in not 
enlarging. If we fail to seize this historic opportunity to 
help integrate, consolidate, and stabilize Central and Eastern 
Europe, we would risk a much higher price later.
    The most efficient and cost-effective way to guarantee 
stability is to do so collectively through NATO. That was true 
in the cold war; it is true now; it will be true in the future. 
The costs of doing so are manageable for all concerned. 
Alliances save money. Collective defense is both cheaper and 
stronger than solely national defense.
    A decision to defer enlargement, much less to withhold it 
altogether, would send the message to Central and Eastern 
Europe that their future does not lie with NATO and the West. 
It would falsely validate the old divisions of the cold war. 
The resulting sense of isolation and vulnerability would be 
destabilizing in the region, and would encourage nationalists 
and disruptive forces throughout Europe.
    NATO would remain stuck in the past, in danger of 
irrelevance, while the United States would be seen as 
inconstant and unreliable in its leadership, withdrawing from 
its responsibilities and its interests in Europe and in the 
world.
    The years ahead will be challenging ones in Europe in 
trans-Atlantic security. NATO enlargement is an essential 
feature of adapting the Western military and security 
organization to efficiently and effectively meet the challenges 
ahead. While there will be costs, they are manageable.
    Most important, for the United States, for our allies, for 
our partners, the costs--not just the financial costs of a 
strong, effective, and engaged North American alliance pale in 
comparison to the costs that would be implicated by stagnation, 
instability, and failure of leadership in Europe. I appreciate 
the committee's attention and I look forward to the chance to 
answer your question.
    [The prepared statement of the Mr. Slocombe follows:]
                   Prepared Statement of Mr. Slocombe
    Thank you. I am honored to be invited to appear before this 
Committee to address the security and military aspects of NATO 
enlargement. I would like to address first the rationale for NATO 
enlargement in the context of the European security framework and then 
talk about the military implications of enlargement, including the 
aspect of costs, which I know has been of interest to this committee, 
the Senate, and the public at large.

                    I. American Interests in Europe

    As Secretary Albright made clear in her appearance before this 
Committee, nowhere are American concerns more vital, and our efforts 
more concentrated, than in Europe. We will maintain our commitment to 
Europe in troops on the ground, in capability to reinforce as needed, 
and in political engagement in seeking to resolve problems. America 
makes this commitment not as an act of altruism, but because the 
security of Europe is vital to our own, as events in this century have 
repeatedly shown.
    And we have an historic opportunity before us. President Clinton 
said recently, ``Taking wise steps now to strengthen our common 
security when we have the opportunity to do so will help build a future 
without the mistakes and the divisions of the past, and will enable us 
to organize ourselves to meet the new security challenges of the new 
century.''
    Twice before in this century, America had the opportunity to help 
build a system of European security. The first time, after WWI, we 
foolishly held back from the responsibilities our interests required we 
assume. The second time, after WWII, 50 years ago, Western Europe and 
the United States together chose a path of reconciliation and 
reconstruction through the Marshall Plan, and together moved from 
terrible destruction to unprecedented prosperity and security. However, 
Eastern Europe and Russia did not participate because of Stalin's 
paranoia and relentless expansionism.
    We now have a third chance . . . this time to build a security 
system for all Europe that will:

   Solidify the place of the newly free nations in a secure 
        Europe linked to the U.S.;
   Maintain U.S. leadership and engagement;
   Foster growing European integration;
   Ensure that Russia will play a constructive role, 
        commensurate with its importance and weight in European 
        affairs; and
   Preserve and strengthen NATO as the core instrument of 
        military security in Europe.

    And, unfortunately, we face problems as well as good opportunities. 
The end of the Soviet threat, while very welcome, has not meant the end 
of threats. Threats to stability and security can still arise from old 
national and ethnic hatreds, home-grown and state-sponsored terrorism, 
threats from unstable regions outside Europe, and the prospect of the 
spread of weapons of mass destruction.

                       II. NATO in the New Europe

    In the new European security system we seek to build, the key 
instrument is NATO. NATO is the only effective, continuing multilateral 
military alliance in the world. It has risen to the challenge of 
providing a critical instrument to promote peace in Bosnia. The best 
evidence of NATO's continuing relevance is the eagerness of many 
countries to join it--and the determination of its current members to 
keep it strong and to shape it to respond to the new challenges and 
opportunities we face. Countries want to join NATO because of what it 
is--a strong military alliance, with strong U.S. leadership. It will 
remain so.
    To that end, we have embarked on an historic program to build a new 
NATO. NATO enlargement is the most publicized, but not the only, part 
of a much broader strategy, to help create a peaceful, undivided and 
democratic Europe. That strategy has included many other elements: 
support for German unification; fostering reforms in Russia, Ukraine 
and other new independent states; assistance to the withdrawal of 
Russian forces and nuclear weapons from newly independent states; 
negotiation and adaptation of the Conventional Forces in Europe Treaty; 
and the evolution and strengthening of European security and economic 
institutions, including the European Union, the Organization for 
Security and Cooperation in Europe, the Council of Europe and the 
Western European Union, and working toward the creation of a European 
security and defense identity within NATO.
    With regard to NATO itself, NATO enlargement is also part of a much 
broader series of steps to adapt the Alliance to the post-Cold War 
security environment, including adaptation of NATO's strategy, 
strategic concept, command arrangements and force posture; 
strengthening its ability to carry out new missions beyond NATO's 
territory, as it has in Bosnia, while maintaining its core function of 
collective defense; and the creation and enhancement of the Partnership 
for Peace (PFP). As part of this broad series of steps, NATO 
enlargement aims to help the United States and Europe erase outdated 
Cold War lines and strengthen shared security into the next century.

                         III. NATO Enlargement

    The impulse for so many of the nations of Central and Eastern 
Europe to wish to join NATO stems from their desire for thorough, 
permanent inclusion in the broad Atlantic community and for the sense 
of living in the secure neighborhood that NATO has brought to its 
current members. They want to be irreversibly part of the West, and we 
want to help them in this endeavor.
A. Benefits of Enlargement
    Enlargement will serve the common security interests of all current 
NATO members. Adding nations to the Alliance in a gradual and careful 
way as they meet the standards for membership will:

   foster stability throughout Europe by providing an 
        institutional stability for Central Europe, which has 
        historically been a principal source of conflict in Europe;
   make NATO stronger by creating a larger circle of like-
        minded nations devoted to collective defense, both for 
        protection of their own territory and for mutual action when 
        their security is threatened by events outside their territory;
   improve relations among the region's states--both members 
        and non-members--as in the historic reconciliation of Germany 
        and the Czech Republic, and of Hungary and Romania;
   broaden burden-sharing within NATO;
   create a better environment for trade, investment and 
        economic growth in Central and Eastern Europe;
   help secure the historic gains of democracy in Central and 
        Eastern Europe by providing the security in which their free 
        societies can flourish and the hatred of the past be 
        permanently buried, just as it did for Western European nations 
        such as Germany, Italy, and Spain; and
   help all of Europe become a stronger partner for the United 
        States in political, economic and security affairs. This will 
        serve American interest and American principles, just as it 
        will serve those of all of Europe, both old and new members and 
        states inside and outside the Alliance.
B. The Choice of Prospective New Members
    Of course, the process of enlargement must be carefully prepared. 
Formal membership in NATO carries with it both political and military 
obligations of a special character--what President Clinton has called 
``the most solemn security guarantees.'' Enlargement must not, and will 
not, dilute the Alliance's military effectiveness, nor its political 
cohesion. The broader context of European security, including impact on 
Russia, on Ukraine, and on nations that remain outside NATO, must be 
taken into account.
    Sincere aspiration to join cannot alone be enough for membership. 
New members must be ready to accept the obligations of membership. They 
must demonstrate a commitment to democracy and the rule of law, to an 
open market economic system, to civilian constitutional control of 
their militaries, to peaceful resolution of disputes with neighbors, to 
respect for human rights and the rule of law, and to a gradual 
development of military capabilities that are congruent and 
interoperable with NATO systems.
    After extensive discussion with allies, with candidate countries, 
with members of Congress, and within the Administration, the President 
decided this year that the US would support Poland, Hungary, and the 
Czech Republic for first round invitations. In Madrid, NATO invited 
these three new democracies to begin accession talks to join the 
Alliance. This decision was based on our conclusion, shared by the 
military and our allies, that the three invitees--Poland, Hungary and 
the Czech Republic--have made sufficient progress on military, 
political, economic, and social reforms. They are clearly ready to take 
the next steps to becoming full members, accepting all the rights and 
responsibilities of membership.
    Nine other European states had also declared their desire to join 
NATO, and many of them are making excellent progress in preparing 
themselves for membership. The United States and the Alliance 
recognized the arguments in favor of several other candidate countries, 
including Slovenia and Romania. We concluded, however, that the 
alliance should extend an invitation now only in the clearest cases, 
where there is a broad consensus that the candidate countries have 
already demonstrated readiness for membership on all relevant 
standards. Inviting accession is a profoundly significant action, which 
carries heavy obligations both for new and old members. Where there is 
reasonable doubt about whether a nation has yet made sufficient 
progress, the prudent course is to defer invitations. This approach is 
all the more appropriate, given that the door to membership will remain 
open, so that there will be ample opportunities to invite additional 
members.
    The key non-selects--Slovenia, Romania, Bulgaria, and the Baltic 
states--have naturally all expressed disappointment at their non-
selection. But all have also indicated that, far from abandoning the 
course of integration, NATO membership will remain a top foreign policy 
goal for them. They are committed to continuing and accelerating 
reforms. They are prepared to make the necessary sacrifices. In 
addition, all aspirants have expressed their intentions to participate 
in enhanced PFP and the EAPC.
C. Military Implications
    NATO's first task is ``Article 5'' defense of the territory of its 
members. NATO's adoption of a new Strategic Concept in 1991 shifted 
from the Cold War program of positioned forward defense to place a new 
emphasis on enhanced flexibility and mobility and an assured capability 
for augmentation when necessary. Consistent with this concept, NATO 
does not see a need in the existing strategic environment to 
permanently station substantial combat forces on new, members' 
territory. Instead, it envisions an effort to make the military forces 
of new members capable of operating with NATO forces, supplemented by 
the capability of current members to provide appropriate NATO 
reinforcements in a crisis.
    Thus, the defense posture associated with enlargement will apply to 
new members the same concept of regional reinforcement that it applies 
to current members, relying on the capability of new members' forces to 
operate with and be reinforced by NATO units. The same forces and 
capabilities needed to meet today's needs will apply to meeting those 
associated with the new members.
    Similarly, NATO has agreed that while new members will be expected 
to support the concept of deterrence and the essential role nuclear 
weapons play in Alliance strategy, enlargement will not require a 
change in NATO's current nuclear posture. For this reason, the Alliance 
has stated that it has no intention, no plan, and no reason to deploy 
nuclear weapons on the territory of new members; nor does it foresee 
any future need to do so.
    NATO will also expect new members to be able to contribute to 
NATO's non-Article 5 missions, including being able to contribute to 
out-of-area deployments.

                        IV. Costs of Enlargement

    Of course, NATO enlargement carries costs. Security is not free.
     There are new financial costs to enlarging, but these costs are 
affordable. They are modest compared both to our total defense 
spending--and to the costs and risks of not enlarging. The most 
important costs--like the most important benefits are non-financial. 
The United States and its allies will, by enlargement, extend solemn 
security guarantees to additional nations. NATO members must provide 
the capability, with that of the new members, to back those guarantees. 
The Madrid Statement acknowledges that the Alliance will need to find 
the needed resources.
A. Categories of Enlargement Costs
    Analysis of the financial costs of enlargement can be broken into 
three components:
    First, there are the costs to new members to develop military 
forces to contribute to their own defense, to the defense of other NATO 
members, and to other NATO operations. While they currently make some 
contribution, in order to be greater producers of security, the new 
members must over time re-build, re-equip, and re-train their forces. 
They must have smaller, better equipped, better supported, and better 
led forces, and those forces must be better able to operate with other 
NATO forces.
    Second, there are the costs to current members to improve their 
forces' mobility, deployability, interoperability, and flexibility--in 
short, to proceed with the efforts already committed to and needed for 
NATO's current membership.
    These two categories of costs are all for actions that the 
countries concerned would need to take to provide for their own 
defense, with or without NATO enlargement. Indeed, to get comparable 
levels of security without NATO enlargement the new members would have 
to spend more. Similarly, existing members would need to meet their 
commitments to improve their forces' flexibility and deployability 
whether or not NATO added members. But with enlargement, the 
capabilities that these other costs will fund will be needed all the 
more. So it is important that the commitments actually be met, and we 
have thought it right to identify the first two categories of costs 
that will need to be paid to ensure that an enlarged NATO is able to 
meet its obligations.
    Finally, there are the costs to both new and old members of 
integrating new members into NATO. These direct costs to enlarging 
could be considered the only true costs of NATO enlargement, since they 
are the costs that would not be incurred if NATO did not add new 
members.
    These costs are associated with enhancing interoperability in 
communications, reinforcement, exercises and air operations. They 
include:
Communications:
   Refurbishment/renovation of new members' existing 
        headquarters facilities to accommodate a NATO C2 element 
        (including necessary intel & comms equipment).
   Extension of communications interfaces to all new member 
        forces.
   Education in NATO languages & procedures for new members' 
        officers.
Air Command and Control:
   Acquisition of interoperable air traffic control 
        capabilities and weapons engagement capability.
   Interoperable aircraft avionics (IFF).
Logistics:
   Acquisition of interoperable fuel facilities and other 
        support equipment at reception sites.
   Host-nation support planning and procedures for arranging 
        routine logistics support.
Infrastructure:
   Improvements to new members' airfields, road and rail links, 
        ports, and staging areas to accommodate NATO reinforcements.
   Enhanced fuel storage and distribution capabilities.
Exercises:
   Upgrades to existing exercise facilities to ensure 
        compatibility with NATO safety standards.
   Transportation and operating costs for incremental combined 
        exercises tied specifically to enlargement.
B. Initial U.S. Cost Estimate
    As you know, the Department of Defense has prepared a notional 
estimate of the costs of enlarging. This estimate was part of the 
report, requested by the Congress, that the President submitted to you 
in late February of this year.
    Our initial estimate assumed that, while there would be a need for 
serious defense capabilities for an enlarged NATO, there is currently 
no threat of large-scale conventional aggression in Europe, and that 
any such threat would take years to develop. This is, of course, the 
same assumption that we make for our own national planning, and that 
NATO makes in planning for defense of its current members.
    Total costs for achieving all three categories were estimated as 
$27-35 billion. These costs would be spread over the 13-year time frame 
of 1997 through 2009--ten years after the planned accession of new 
members.
    Now, using the breakdown for these costs which I just outlined for 
you, let me give you what we estimated each group would have to bear 
for each of the three categories of costs:
1. New Members' costs for restructuring their national forces.
    Prospective new member costs for restructuring their militaries 
were estimated at about $10-13 billion over that time frame or about 
$800 million to $1 billion per year. These costs amount to some 10-30% 
of the total current defense budgets of the prospective new members.
    New members will be expected to increase their defense budgets to 
some degree, and they have outlined plans to do so. But we expect a 
substantial part of these costs will be met by savings from reducing 
the size of the three nations' current forces. These costs would all be 
borne by the new members, except to the limited extent Congress decides 
to continue limited support to Central European militaries. (As you 
know, the U.S. now provides about $100 million in Warsaw Initiative 
funding to all PfP countries combined to support their participation in 
PfP.)
    These will be costs of moving from their old Soviet-style forces, 
which were little more than auxiliaries of the Red Army, to militaries 
appropriate for independent democracies. These countries do not start 
from zero. Indeed, they have, per capita, rather larger militaries than 
most NATO allies. They each are contributing to NATO's force in Bosnia. 
They have begun restructuring their forces, which are poorly equipped, 
trained, and manned.
    We have, since our first analysis, discovered some unanticipated 
capabilities in the three invitees; however, as our study continues, we 
will, of course, likely also find some deficiencies--especially 
regarding personnel, specialized training, communications, and force 
modernization. While the three cannot be expected to ``fix'' everything 
by 1999, each must have a serious program that lays out a defined path 
toward the enhancement of their defense capabilities.
    We have told each invitee that its highest priority should be 
investing in quality personnel. They must develop effective systems for 
recruiting and retaining good troops. Key to this is the development of 
an effective NCO corps. The next priority is training, including 
English language training, for personnel and equipment are meaningless 
without adequate training. The next priority is achievement of a real 
degree of interoperability with NATO, including communications, 
logistics, infrastructure for reinforcement, and air defense. In all 3 
cases, the outcome will be smaller, but more capable forces.
    While it is clear that each of the invited nations must undergo 
modernization of major weapons systems in the years ahead if it is to 
remain a contributor to overall alliance security, acquiring high tech 
weapons systems should not be the highest priority.
    These three countries are working hard to demonstrate that they are 
ready for membership in NATO. Right after the Madrid Summit, Secretary 
of Defense Cohen met with the three Ministers of Defense to explain 
what they would need to do and to hear their plans. After the Madrid 
Summit, Secretary Cohen traveled to Budapest while the President and 
Secretary Albright traveled to Warsaw and Prague. We made these trips 
not only to congratulate them but to remind them that the journey to 
Alliance membership had just begun, not ended.
    In the past month, Assistant Secretary Kramer has traveled to each 
of the invitees' capitals to discuss their preparations for membership. 
He and Assistant Secretary Grossman will testify before you next week 
regarding these preparations, so I will not go into them in detail, but 
it bears saying that each of these nations wants to be a contributor 
to, not just a consumer of, security. They are already contributing to 
the security of Europe by restructuring and modernizing their 
militaries to operate with NATO, by serving with our soldiers in 
Bosnia, and by helping to make a success of the Partnership for Peace.
    Each country has some work to do. The Czechs, for example, in their 
original DPQ responses to NATO, did not, commit enough of their forces 
to NATO missions, but their most recent response commits virtually all 
of their forces to NATO. Their future budgets need to allocate greater 
resources for defense; they have promised to increase their defense 
budget, currently 1.7% of GDP, to 2% by the year 2000. While both 
Poland and Hungary have had similar deficiencies they are overcoming 
them. Hungary has increased its budget and Poland has an extensive 
fifteen year plan. I am encouraged by the rapid Czech response to our 
and NATO's constructive criticism during the past few weeks.
2. Current Allies' Costs to Improve Deployability.
    Current allies' costs for NATO regional reinforcement upgrades were 
estimated at about $8-10 billion, or about $600-800 million per year. 
These are a modest share of their total defense budget--less than 1%--
and for the most part, represent efforts already underway to adapt 
their forces to new post-Cold War needs and missions.
    These costs would all be borne by the current allies. For decades 
now, the U.S. has made no financial contribution to Allies' defense 
budgets (except for some loans to Greece & Turkey).
    It is important to note that our cost estimates to date do not 
anticipate any added costs to the U.S. in this category because U.S. 
forces are already readily deployable and sustainable. The requirement 
to deploy to meet a contingency in places like Korea or Southwest Asia 
is more demanding than a hypothetical crisis in Central Europe. US 
costs of enlargement are relatively low because we have already 
provided for the forces' projection missions that the new NATO 
requires.
    Both the U.S. and our NATO allies have made big cuts in our defense 
budgets since the end of the Cold War. But, using the key indicators of 
burdensharing, as set by Congress, most of our NATO allies still make 
very substantial contributions to the common defense. For example, more 
than two-thirds of the troops participating in SFOR are non-U.S. 
forces.
    We believe the allies can and should do more to improve their 
capability for the sort of mobile, flexible operation NATO will need to 
be ready for in the future. But is it important to recognize that most 
have already made improvements, and are committed to more. For example, 
Britain provides NATO's only rapidly-deployable corps headquarters 
committed to NATO and British forces are the backbone of the Allied 
Command Europe (ACE) Rapid Reaction Corps (ARRC). The U.K. also has the 
capability to deploy and sustain a division-sized force of 20-25,000 
personnel in a Gulf War-style scenario.
    France, in general, is restructuring its armed forces to be more 
mobile and easily deployable. The French are establishing a Rapid 
Action Force (FAR) designed for rapid response in both European and 
overseas contingencies. France also participated heavily in IFOR 
efforts to implement the Dayton peace accords in Bosnia and 
Herzegovina. With nearly 10,000 troops, France was the third largest 
troop contributor, after the U.S. and Britain, and was responsible for 
one of the three geographic sectors--and continues to be in SFOR.
    Likewise, Germany is standing up a Rapid Reaction Force of some 
53,000 fully-equipped troops from the Army, Navy and Air Force. The 
first units stood up in 1996 and the force will be fully capable in 
1998. In general, German armed forces are in the process of re-creating 
themselves into a mobile, deployable--rather than static home defense--
force.
    The smaller European nations are also improving their forces. For 
example, the Royal Netherlands Navy and Air Force have improved both 
their transport and air defense capabilities with new procurements such 
as: two KDC-10 transport/tankers (the Dutch can now deploy their own F-
16s without reliance on the U.S.); an amphibious-lift ship to make the 
marine brigade self-deployable; and upgrades to their F-16 fleet and 
their Patriot systems.
3. Costs to Link NATO and New Members.
    Turning to the third category of direct enlargement costs for 
linking new and old allies, those were estimated at about $9-12 
billion, or about $700-900 million per year. This again, is the cost of 
items such as communications, reinforcement reception infrastructure, 
and other interoperability measures. We estimated that about 60% of 
these costs, or about $5.5-7 billion, would be paid for out of NATO 
common budgets over the ten years following accession, with the 
remainder paid by new members. We further assumed that the U.S. would 
pay its current approximately 25% share of the NATO common budget.
    In 1997, total NATO common budget spending totaled about $1.8 
billion. The total U.S. contribution to the three budgets was about 
$485 million, while the allies contributed the other $1.3 billion. We 
expect these relative percentage cost shares will stay the same three 
European to one U.S.--in the period when NATO is meeting the 
requirements of enlargement.
    With these assumptions, the U.S. share of the direct costs of 
enlargement would be about $150-200 million per year, representing our 
share of the NATO common budget that would be applied to the linking of 
new and old members.
    These costs are manageable. Projected U.S. requirements to meet 
direct enlargement common budget costs amount to only a fraction of a 
percentage point when compared with total U.S. defense spending ($266 
billion in 1997).
    Still under discussion is whether that portion of the direct costs 
of enlargement which are a shared responsibility and funded from the 
common budget will result in an overall increase in the NATO common 
budget--or whether some can be offset by reductions in lower priority 
programs currently in the common budget. While there will certainly be 
some reprioritizing of projects, and therefore a less than dollar-for-
dollar increase, we continue to believe that additional resources will 
be required.
C. Ongoing NATO Work to Help Refine the Cost Estimate
    As noted, our February estimates were necessarily preliminary, if 
only because we did not know what nations would be invited to join, nor 
the detail of steps needed to link them to the Alliance. Immediately 
after the Madrid decisions, NATO started a detailed review of the 
military implications and costs of enlargement, what new members will 
bring to the Alliance, and any additional requirements for current 
allies. The U.S. has long argued that any NATO cost estimate must be 
driven by the military requirements of enlargement. We were successful 
in pressing. that argument in the Alliance, and a review of the 
military requirements is currently underway by the NATO staff.
    These reviews are ongoing at NATO this fall, with recommendations 
to be completed in November for consideration by ministers in December. 
The invitees worked with the NATO international staff to fill out a 
special Defense Planning Questionnaire (DPQ) response as their initial 
step into the NATO Defense Planning Process. All NATO allies respond to 
the DPQ annually.
    The present NATO costing effort is highly specific and focused. In 
an effort to better understand requirements as well as the current 
capabilities of the invited nations, members of NATO's international 
military staff have been conducting site visits at various military 
facilities in the invited countries this summer. They visited airfields 
and railheads in each country. They checked out communications 
facilities and visited air defense radar stations. This month they are 
visiting other facilities in each country to try to ensure that the 
first facilities they inspected are representative of the condition of 
the majority of facilities in that country.
    The international staff of NATO will then cost those new 
requirements. They will also help determine a schedule by which to meet 
requirements. That is part of the work that is to be completed in time 
for the December ministerials. This level of detailed information was 
obviously not available to us when we did our first cost study, and it 
is still being formulated. But cost estimates based on these detailed 
analyses will be available to Congress well before any vote on 
enlargement.
NATO cost estimates may be lower
    Based on what we know now, we expect that the NATO cost estimates 
will be lower than those that you received from us in February. First, 
the initial U.S. cost estimate assessed four, not three, new members. 
Further, the NATO estimate will address only the direct, common-funded 
costs, which, as explained above, OSD estimated at $5.5-7 billion over 
10 years. National costs borne by each ally or prospective ally are 
separate from, and will not be estimated by, the NATO work.
    But we also expect the NATO cost estimates will be lower because 
some things are better in the invited nations than people thought. As a 
result of assessments NATO planners and logisticians have been 
conducting, we believe the additional investment required to prepare 
each of these nations, their military forces, and their infrastructures 
for full NATO membership will be less than initially anticipated.
    Let me share some examples of our experiences during these 
assessments to show why this is the case.
Interoperability Progress by the Invitees
    When the American General heading a small NATO team visiting 
Kecskemet Air Base asked his Hungarian host how he might accommodate a 
squadron of NATO F-16s, he was surprised by the precision and detail of 
the Hungarian response--and the level of installation readiness already 
achieved. He commented that the Hungarians had done some excellent 
research. He was told it wasn't just research. Hungary had hosted a 
squadron of Dutch F-16s for several weeks in 1996, and a United States 
Air National Guard squadron was scheduled to arrive the week after the 
general's visit. The Dutch and American planes were in Hungary as part 
of a series of PfP exercises designed to improve interoperability. Thus 
Hungarians are already capable of handling NATO aircraft at some of 
their airfields. There is less work that needs to be done--and in 
turn--less money to be spent to improve these airfields than we had 
estimated earlier this year. This example also shows how PfP has 
contributed in direct and practical ways to preparing for NATO 
membership.
    In another example, an analyst monitoring the NATO Common Fund Cost 
Study's progress noted that even though communications and, information 
systems requirements were increasing, the prospective costs to the 
Czech Republic kept dropping. Upon closer inspection, it turned out the 
Czechs had already anticipated requirements for secure and non-secure 
digital communications programs and had applied NATO standards to the 
national programs they are pursuing on their own. In short, the Czechs 
had already spent their own money to fund some projects that we had 
assumed would be paid for by NATO as a whole through the common 
budgets.
    Finally, an American general asked a Polish major familiar with the 
details of a particular rail complex whether we could reasonably expect 
to transport a NATO armored division through it in one week's time. The 
amused major replied by asking the general how many Soviet heavy 
divisions he thought they planned on moving through the same location 
when trains were going the other way?
    These examples demonstrate an important point. When we conducted 
our initial cost study, we assumed a very substantial need for 
improving military bases and equipment to support interoperability and 
reinforcement. As we spend more time on the ground in the countries of 
each of the invitees, learning the details of their military forces and 
infrastructure, we are gaining a better appreciation for just how well 
prepared they were to fight against NATO, and for how much effort they 
have subsequently dedicated to preparing to integrate into NATO. Of 
course, we will also find deficiencies, but the new members will be 
modernizing from a relatively robust foundation. We will not be 
building airfields from scratch. In fact, NATO will be inheriting a 
great deal of usable infrastructure. Accordingly, the direct costs of 
enlargement will likely be less than we originally estimated.
    During the Cold War these levels of capabilities would have been 
bad news stories, but today they are all good news stories. What I am 
attempting to demonstrate is that we are increasingly impressed by the 
levels of readiness, understanding, and initial success of the invitees 
in working toward NATO interoperability. These capabilities will 
contribute to driving down the need for NATO common-funded improvements 
once they become members of NATO. These capabilities are generally 
higher than we assumed in our February study on the requirements and 
costs of enlargement. I'm convinced, as we delve deeper into the 
circumstances in these countries, we will discover more examples of 
infrastructure capabilities either inherited from the Cold War or built 
up over the past three years through the Partnership for Peace.
    The NATO staff work I have been outlining for you, when forwarded 
to Ministers in December, will provide the basis for a more refined 
assessment of the costs associated with NATO enlargement. In order to 
support the Congress' review of issues associated with enlargement, we 
will, as Secretary Cohen stated in his 16 October letter to Senator 
Stevens, provide you with an update based on these NATO efforts in 
early 1998.
D. Finding the Resources
    Once the military requirements and cost estimates are agreed to in 
December, we will move forward to make good on the commitment 
undertaken by national leaders at Madrid that, ``the resources 
necessary to meet [the costs of enlargement] will be provided.''
    In Maastricht, at the informal NATO defense ministerial, Secretary 
Cohen led the discussions on this issue. Secretary Cohen reminded his 
colleagues that at our defense ministerial in June, we all pledged to 
play our full part: (1) in preparing the nations invited to join NATO 
for their future roles and obligations as Alliance members; (2) in 
providing sufficient resources to maintain the Alliance's ability to 
perform its full range of missions; (3) in implementing the Alliance's 
decisions to further enhance its relations with partners; and (4) in 
acknowledging that, ``the admission of new members . . . will involve 
the Alliance providing the resources which enlargement will necessarily 
require.'' These commitments were reaffirmed at the Summit in Madrid, 
where our Heads of State agreed: (1) that there will be costs 
associated with the integration of new members; (2) that these costs 
will be manageable; and (3) that the resources necessary to meet these 
costs will be provided.
    There was no disagreement on this point in Maastricht. Of course, 
until we know the detailed cost and proposed schedule of action, we 
will not be able to determine how much net increase in the NATO common 
budgets will be needed. And, as British Defense Minister George 
Robertson stated last week, ``[b]ecause enlargement is a high priority 
for NATO, we may have to delay some lower priority projects.'' But, 
Minister Robertson added, ``if additional spending is required, Britain 
will pay its share.'' We are confident that will, in the end, be the 
position of all the allies.
    We will keep you informed over the coming months as this discussion 
continues.
E. The Effect of a Greater Threat on Costs
    Finally, it is important to understand that these estimates of the 
cost of enlargement--and of keeping NATO capable in new conditions--
relate to the capabilities required in the European security 
environment that we in fact foresee--one in which nations need serious 
defense capabilities, but in which there is no threat of large scale 
military conventional aggression and where any such threat would take 
years to develop. Of course, a fundamentally different--and far more 
demanding--set of defense requirements would arise if trends in Russia 
or elsewhere developed in such a way as to renew a direct territorial 
threat to NATO members. Such a threat does not exist, nor is there an 
expectation that it will reemerge. Moreover, the United States and its 
allies would have years of warning and preparation time in the very 
unlikely event such a dramatic change in the European security 
environment were to occur.
    Because such a threat is hypothetical, it is not possible to 
estimate with any precision the costs of meeting it. But there can be 
no question that the cost of responding to such a threat would be 
substantial. Just ten years ago, for example, the United States and 
most of its Allies were spending nearly twice as much of GDP on defense 
as today.
    There can, however, be no question that, if we had to meet such a 
threat, we could do so more effectively and less expensively in an 
expanded alliance than in a Europe still divided along Cold War lines. 
In such circumstance, the added manpower, military capability, 
political support and strategic depth afforded by NATO enlargement 
would amply justify whatever additional cost there were in having 
additional members in the Alliance.
    Perhaps the most important point to be made about the costs of 
enlargement is that there would be greater costs and risks to not 
enlarging. If we fail to seize this historic opportunity to help 
integrate, consolidate and stabilize Central and Eastern Europe, we 
would risk a much higher price later. The most efficient and cost-
effective way to guarantee stability in Europe is to do so collectively 
through NATO. The costs of doing so are manageable for all concerned. 
Alliances save money. Collective defense is both cheaper and stronger 
than national defense. A decision to defer enlargement, much less to 
withhold it altogether, would send the message to Central and Eastern 
Europe that their future does not lie with NATO and the West. It would 
falsely validate the old divisions of the Cold War. The resulting sense 
of isolation and vulnerability would be destabilizing in the region and 
would encourage nationalist and disruptive forces throughout Europe. 
NATO would remain stuck in the past, in danger of irrelevance, while 
the U.S. would be seen as inconstant and unreliable in its leadership 
and withdrawing from its responsibilities in Europe and the world.

                             V. Conclusion

    The years ahead will be challenging ones in European and 
Transatlantic security. NATO enlargement is an essential feature of 
adapting the Western military and security organization to efficiently 
and effectively meet the challenges ahead. While there will be costs, 
they are manageable. More important, for the United States and its 
allies and partners, the costs--and not just financial costs--of a 
strong, effective and engaged North Atlantic Alliance pale in 
comparison to the costs that would be implicated by stagnation, 
instability and failure of leadership in Europe.

    Senator Hagel (presiding): Mr. Slocombe, thank you. We 
appreciate your appearing here this morning. Chairman Helms 
went to vote, if you wondered what was going on up here.
    Mr. Slocombe. He explained.
    Senator Hagel. I know you are no stranger to this. He will 
be back, and in the interest of time, I will proceed with 
questions and then ask Senator Feinstein for her questions.
    Mr. Slocombe, in light of the news this morning about the 
present--or at least it appears to be a present shakeup in the 
Czech government, have we anticipated problems that might occur 
with the three new invited nations into NATO--government 
problems, financial problems? And if we have anticipated those 
problems, for example, on the financial assistance side, if one 
of these new nations is unable to finance its share of its 
membership, what is plan B?
    Mr. Slocombe. I think that whatever shape of the 
governments in any of these three coun--the short answer to 
your question is yes, we have looked at the political stability 
of these three governments. One of the requirements was that 
any country that was going to be seriously considered for an 
invitation would have to have clearly established a democratic, 
stable system.
    And that is certainly true for these three. It's true for 
other countries in Central Europe, but that was a necessary but 
not a sufficient condition. I think it is clear that any 
conceivable government in any of these three countries will be 
dedicated to NATO membership and to paying the costs that are 
necessary to do that.
    Now, they may have economic ups and downs. The possibility 
of occasional blips in the economic structure is not confined 
to Central and Eastern Europe. But I think the base--their 
basic commitment to NATO membership and to paying the costs 
will be met.
    The problems in the Czech Republic--and I have to confess, 
Senator, that in the time that I had been getting up here, 
whatever's happened in the Czech Republic has happened. I can't 
comment in any detail. There have been some special issues in 
the Czech Republic and I think they have had a wakeup call and 
they understand they need to make a stronger effort. We expect 
they will make that.
    Senator Hagel. Let me delve into this a little more 
specifically. Would members, current NATO members, do you 
believe, step up their assistance in order to cover the nation 
or two or three invited nations if there was a shortfall or a 
problem in their commitment to financially support their 
involvement in NATO?
    Mr. Slocombe. We have made clear from the beginning that on 
the whole, NATO is a club in which you pay your own dues. The 
United States has had a modest program for all of the 
Partnership For Peace countries, although a large part of it 
goes to these three countries, to support participation in the 
Partnership For Peace.
    A number of the other European countries have small 
programs of their own that work on particular focused areas. 
But except for that very limited and very focused effort, there 
is no contemplation by anybody that there will be financial 
assistance to meet the basic defense budgets of any of these 
countries.
    Senator Hagel. Thank you.
    The Congressional Budget Office and the RAND Corporation, 
as you know, both estimated NATO expansion costs, but came up 
with dramatically different numbers. How would you explain the 
differences? If the major difference is in the threat 
assumption, what threat assumptions underlie the 
administration's projections?
    Mr. Slocombe. The answer to that question differs for the 
two studies. The CBO study, at least its big number--the $120 
billion, which gets all the attention--assumed a dramatically 
larger threat and assumed that we would need to recreate in 
Central Europe the sort of forward positional defense which we 
had in the middle of Germany during the cold war.
    Obviously, if you make that assumption, the costs are going 
to be very substantially higher--whether they're $120 billion, 
for all I know, could be low. But it is a--that is an 
assumption about a threat which does not exist now, which there 
is no prospect of existing in the future in the sense of any 
indications, and which even if you make the most pessimistic 
possible assumptions about Russia, could not exist without 
years of warning.
    The--I'm sure you're aware, the committee is aware, that 
the Russian army--leaving aside the geographic problem--the 
Russian army is in a state of considerable trouble, and to put 
it mildly, is not sitting on the border of Poland or--Poland is 
the only country that would be relevant here--threatening 
anybody. That's the main difference for the assumptions in the 
CBO study.
    I also want to be clear, and I understand that the 
principal researcher on the CBO study is also the man who did 
the recent study for Cato. He also has very different views 
about what you would need to do to meet the current threat. It 
has essentially to do with the level of current threat and the 
response.
    Now, with respect to the RAND study, that--those numbers 
are obviously a lot closer to the ones which we reached in the 
Department of Defense. Indeed, the range in the RAND study 
overlaps with the range in the Department of Defense study. The 
principal difference there is a relatively technical one about 
the number of divisions that you would need to provide for 
reinforcement.
    I believe that Mr. Kugler, Dr. Kugler, who did the RAND 
study, is going to testify on the second panel and you'll have 
an opportunity to ask him in more detail. But my understanding 
is that the RAND study and the Defense Department study made 
essentially similar assumptions and came to essentially similar 
conclusions.
    Obviously, these estimates have a--are notional estimates, 
and until we have the NATO analysis--as I say, going down and 
looking at the particular facilities, the particular ports, the 
particular communication centers--that's when we'll be able to 
say, ``Yes, this is the work which is going to need to be 
done.''
    Senator Hagel. Thank you. Those NATO allies who were also 
members of the European Union are currently, as you know, 
working with us and attempting to meet strict budgetary 
requirements for the proposed European Monetary Union.
    Could you give us your sense of how likely it is that this 
effort, as well as domestic political factors, will constrain 
their willingness or lack of willingness, or their ability to 
increase defense spending sufficient to accommodate an expanded 
NATO?
    Mr. Slocombe. There's no question that in all of the 
countries in the EEL that are trying to meet the financial--the 
fiscal criteria for the European Monetary Union, there are 
pressures on public spending and that includes pressures on 
defense spending. That is, perhaps, particularly dramatic in 
the case of France and Germany.
    So their defense budgets are constrained--I mean, 
everybody's defense budget is constrained in some sense. But 
these countries are clearly going to continue to have serious 
defense budgets, serious defense efforts.
    And most important, they are all of them--all of the 
principal European allies, not just France and Germany--are 
embarked on an effort to restructure their forces so that they 
shift from forces that were essentially oriented toward 
territorial defense toward forces that are more mobile, more 
deployable, more able to do what we need to do in the future.
    I think there's no question that the European defense 
programs will be--well, they'll be constrained to use your 
term. They will be constrained by the requirements to meet the 
EMU criteria, but they will not be gutted, they will not become 
ineffective. They will continue to work toward this goal of a 
more flexible, more deployable force.
    Senator Hagel. Have we had--I assume we have in-depth 
conversations with our allies on this point?
    Mr. Slocombe. We have indeed. The most important 
conversation, in a sense, that we have with the allies is the 
conversation that takes place through the NATO defense planning 
process.
    Every year, every member of the alliance, including the 
United States, responds to the so-called Defense Planning 
Questionnaire and lays out its defense program. That program is 
then reviewed and discussed.
    Now, it's always up to national governments to decide what 
they will do, but the--this provides a formal process for 
exchanging views on our respective national defense programs.
    In addition, of course, we have--particularly through the 
Department of Defense--we have continuing discussions about our 
respective defense programs, about where the emphasis ought to 
be, about meeting common needs.
    I think it's in the nature of these things that no defense 
establishment is ever convinced it has completely and 
thoroughly met all of the things it would like to do. But all 
of these countries have serious defense programs and will 
continue--particularly will continue this really historic shift 
in emphasis from territorial defense to deployability, and you 
see that in Bosnia.
    I mean, the--almost all the NATO countries, certainly all 
the principal ones, have larger relative contributions to their 
population, total size of armed forces, in Bosnia than we do. 
That's been an important--in addition to other reasons it's 
been important--that has been an important experience for them 
in sustaining forces outside their national territories, and 
that's essentially what we're talking about in terms of 
reforming.
    Senator Hagel. Mr. Secretary, thank you.
    Mr. Slocombe. Thank you, sir.
    Senator Hagel. We have been joined now by the--both the 
chairman and the distinguished ranking minority member. So it 
is a high honor for me indeed to--is that all right to pass the 
baton over here, Mr. Chairman?
    The Chairman. (presiding) Thank you.
    The fact is, Mr. Secretary, I voted against these new 
trolley cars and every time I get on one it seems it breaks 
down, and you cannot do a thing in the world about it. You sit 
there.
    Mr. Slocombe. Well, at least it's not a Defense Department 
system.
    The Chairman. They cost $23 million bucks, and the excuse 
for them was they would save 10 seconds or something for the 
Senators to get over there. I said, ``They ought to start 
earlier, keep the old ones.''
    I have only one question--well, maybe I have more than one.
    Have you had yours?
    Senator Biden. No, but you go ahead.
    The Chairman. No, no!
    Senator Biden. No, no, no! I just arrived. Go ahead, 
please.
    The Chairman. So did I.
    Senator Biden. It would give me a chance to figure out what 
he had to say.
    The Chairman. I was interested in one statement you made. 
Of course, what you said was true. You said ``Certainly''--in 
effect--``Certainly, there are going to be additional costs. 
It's not free. But it's well worth paying.'' And that is what 
we are trying to determine.
    But my point is that Uncle Sugar--Uncle Sam--should not be 
forced to pick up the tab on this to protect Europe. Anyway, 
representatives of the three new members were here, and they 
assured me and other Senators that they were perfectly willing 
and prepared to pay their fair share.
    And as far as Germany and France and all the rest of them, 
they ought to ante up a little bit more because we have sent 
men over to die and spent billions of dollars saving their 
bacon twice in this century. So I do not have very much 
sympathy for their unwillingness to pay the cost.
    Now, the United States and its NATO allies are in the 
middle of an effort to identify the specific costs. Did you 
make clear exactly the answer to the question ``Will NATO have 
an agreed estimate by December of this year?''
    Mr. Slocombe. Yes. That, as the statement explains in sort 
of bureaucratic detail, we're in the middle of a process----
    The Chairman. And I assume you did.
    Mr. Slocombe. [continuing]. to produce that by December.
    The Chairman. Was it different from the Clinton 
administration's estimate?
    Mr. Slocombe. We expect that it will be somewhat lower.
    The Chairman. Somewhat lower?
    Mr. Slocombe. Yes.
    The Chairman. And, now, the other 15 members--since we are 
talking about fair share. Are they going to help pay the cost 
of bringing new members into the alliance?
    Mr. Slocombe. Yes, they will, Senator. Mr. Chairman, the--
one thing which is not in dispute is that the common budgets 
will continue to be distributed essentially as they are now.
    Obviously, the percentages will change slightly because the 
three new members will pay a contribution. Given their relative 
size and relative economic position, it'll be quite small, so 
that everybody's absolute percentage will go down a little bit.
    But the most important point is that the relative shares 
will not change and that's three European dollars for every 
American dollar. The United States pays about a quarter of the 
European--of the NATO common budgets and the other members of 
the alliance pay the other three quarters.
    And there is no proposal that I have heard about--and I 
think I would have heard about it--there is no proposal to 
change that ratio.
    The Chairman. Well, I am going to have one or two more 
questions which will be of an arithmetical nature and I will 
file those in writing and you can respond in writing in order 
to save time.
    Mr. Slocombe. If I could, Mr. Chairman, there is one point 
that I think it is important to have in mind as we think about 
what the NATO estimate will be.
    NATO is estimating what the cost to the NATO common budgets 
will be. The number that we estimate for that is not the $25--
$27-$35 billion. It is about $5.5 to $7 billion, which is 
embedded within the larger estimate, but it is important that 
we be clear what NATO will be estimating is the cost of common 
budgets, not the estimates for the whole range of costs.
    The Chairman. Good point. Senator Biden?
    Senator Biden. Thank you, Mr. Chairman--a good point that 
no one understands.
    I'm not being facetious.
    Mr. Slocombe. This is a----
    Senator Biden. No, no, no--see--Walt, you know this place, 
Mr. Secretary. You know this place extremely well. I am not 
being solicitous when I suggest that you have the respect of 
both sides of the aisle here.
    You have been here awhile. You have been here in more than 
one administration. One of the things that I think is very, 
very important for those of us who support expansion is to make 
sure that we are able as clearly as possible to delineate for 
our colleagues and for our constituencies the difference in the 
additional cost that would be required as a consequence of 
expansion, and the difference as a consequence of plans and 
agreements already made within NATO to modernize and upgrade 
NATO capacity and capability even if we did not expand NATO.
    Mr. Slocombe. Exactly, sir.
    Senator Biden. And so I hate to ask you to do this, but in 
light of what you have just stated, the common budget that you 
just referred to, what does that common budget speak to? What 
elements does it take into account? Does it take both those 
elements into account--the element of the cost of expansion of 
the additional three nations and the element of the cost of 
modernization that we had already agreed to, I guess, what, 
more than 2 years ago?
    Mr. Slocombe. It does not include any of the costs of 
modernization in that--in the sense to which you refer.
    Senator Biden. Right.
    Mr. Slocombe. Those are paid, they have been paid for--
again, with the special exception of Greece and Turkey, they 
have been paid for by the NATO members for the last--right at 
the beginning of NATO, there was some direct grant assistance.
    But for decades, those costs have been--national costs paid 
for by--the Belgian taxpayer pays for the Belgian army, the 
German taxpayer pays for the German army and so on.
    Senator Biden. Right.
    Mr. Slocombe. And the American taxpayer pays for the 
American armed force.
    There are--and that will continue to be true.
    In a sense, the answer to the question is if those costs 
are not met, we may have a problem, but we will not have a 
bill.
    Senator Biden. Right.
    Mr. Slocombe. We may have a problem in the sense that our 
allies will not have done what we think is necessary for the 
common defense.
    Senator Biden. Or what they agreed to do.
    Mr. Slocombe. Or what they agreed to do or what they 
proposed to do.
    Senator Biden. Right.
    Mr. Slocombe. In general, they have proposed to do all 
this. We may have a problem, but the one thing which we will 
not do is write a check to the German government.
    Senator Biden. Right.
    Mr. Slocombe. And that is not going to happen.
    Senator Biden. Good. I am sorry, go ahead.
    Mr. Slocombe. Now, you asked if--you asked what the NATO 
common budgets cover. There are--and this gets complicated. 
There are three of them.
    One is the civil budget, which essentially--one is the 
civil budget, which essentially pays for the NATO headquarters, 
science program, a few things like that.
    Senator Biden. Now, if I can stop you on that one. The 
incremental cost to that common budget as a consequence of 
adding three nations is relatively small, is it not?
    Mr. Slocombe. I do not have a breakdown as to----
    Senator Biden. No, I am not asking you for a specific 
breakdown.--I mean--in relative terms----
    Mr. Slocombe. It would be very small.
    Senator Biden. It would be small.
    Mr. Slocombe. It should be very small.
    Senator Biden. Here is the point I am driving at in each of 
these, at some point, we have to, on the floor of the Senate, 
be able to parse out for our colleagues that when they hear 
``common budget,'' they are going to hear a big number, a 
bigger number.
    Mr. Slocombe. It is going to be a few billion dollars.
    Senator Biden. Right. And a lot of people, even well-
informed people or informed people, are going to assume that 
amount is what we are talking about the United States having to 
pay.
    And so, it would be a useful thing for DOD or whomever to 
break out for us on the common budget number we are going to 
hear the three categories, you are about to tell me. One 
relates----
    Mr. Slocombe. Civil, military, and what we used to call 
``NATO infrastructure,'' now called ``NATO Security Investment 
Program.''
    Senator Biden. If you could, when that common budget is 
agreed upon, break out for the committee the incremental 
increase in each of those categories as a consequence of adding 
three additional nations, that would be helpful.
    And, further, whether or not that expansion--I think it is 
self-evident, but--if that expansion cost is being shared on 
the same basis among the 16 nations as the underlying cost is--
or as the base cost is.
    My terminology may not be correct.
    Mr. Slocombe. You mean the present NATO common----
    Senator Biden. The present NATO common budget.
    Mr. Slocombe. Right.
    Senator Biden. You follow me?
    Mr. Slocombe. Yes, exactly.
    Senator Biden. Because you are going to have people 
focusing on two things--one, what is the total cost to the 
American taxpayer in writing additional checks to anything 
related to NATO as a consequence of expansion? And, two, of 
that additional cost, does that reflect a fair share of what 
other people are paying?
    And, so, we are going to have to be able to answer those 
questions. I am not being--again, to use the phrase twice--
facetious on this point.
    Mr. Slocombe. I understand.
    Senator Biden. We are going to have to be able to put up a 
big old chart on the floor, a colored chart, and say, ``Now, 
look, this is the total cost of adding these three nations. 
These are the categories into which it falls. We are paying 
this amount, and the other 15 nations are paying this amount of 
that expansion cost.''
    Because you are going to get people very upset--not you, 
us. Those of us pushing expansion are going to get people very 
upset here if a) the cost is real high, which I believe it will 
not be, or b) even if it is not high, we are paying a larger 
proportion of that bill than seems fair relative to what the 
breakdown to date has been in terms of sharing costs for NATO.
    Are you with me?
    Mr. Slocombe. Absolutely.
    Senator Biden. If you have any other better ways of doing 
it, I am open. I do not pretend to have the best way of 
presenting that. But we are going to have to be able to present 
that in fairly concrete terms.
    So I will not bore you anymore with it now. But if you 
could have your staff work on that notion for me, for us, and 
maybe you could assign one of your staff members to actually 
just give me a call. I am sure everybody is interested.
    But in addition to the committee, I would like to sit down 
with----
    Mr. Slocombe. To make it----
    Senator Biden. [continuing]. somebody to actually go 
through that process.
    Mr. Slocombe. To add to its baroque complexity, the three 
NATO military budgets are funded in three separate 
appropriations bills for the United States.
    Senator Biden. Exactly, exactly. But we can handle that 
piece, in my view--in terms of the debate.
    One last question--my time is up. I realize I may make your 
negotiation a little harder by this question, but it will make 
my negotiations easier, so--better you because you are a better 
negotiator.
    What is not reflected, I do not believe--correct me if I am 
wrong--is the benefit that may flow to American taxpayers in 
jobs and equipment--sales of military equipment and 
infrastructure possibly from--as a consequence of this 
expansion.
    Is there any estimate as to what benefit may flow to the 
economy as a consequence of selling products, communication 
systems, whatever?
    Mr. Slocombe. The--there will certainly be some such 
benefit because a fairly substantial part of what the new 
members will be paying is to improve their own equipment.
    Now, I do not want to oversell this because we are--this 
is--we are sometimes accused from the other side----
    Senator Biden. Of it being everywhere.
    Mr. Slocombe. This is just a trick by the Americans to go 
peddle a whole lot of fancy stuff these countries do not need 
and it will bankrupt them and so on.
    But, they will have to re-equip their forces. A lot of that 
equipment will be--some will be produced domestically because 
almost all of these countries have some kind of defense 
industry of their own.
    A lot of that will be produced in partnership with U.S. 
companies--they are increasingly doing teaming arrangements, 
and that benefits the U.S. economy.
    To some degree, they will buy end items in the United 
States, and that obviously benefits the U.S. economy.
    I want to make the point, though, that the real economic 
benefit is stability in Eastern and Central Europe.
    Senator Biden. Oh, I agree with that.
    Mr. Slocombe. This is a--an area that is doing quite well 
economically. It has every prospect in a decade of becoming--
probably take longer than that before they get to be like 
Switzerland--but of becoming major regular, developed, 
European-style economies. Those are big export markets for the 
United States.
    And the only way you get big export markets on a 
sustainable basis, especially where you are talking about an 
industrialized society, is with security and stability. That is 
the--I want to be clear. I will try to answer your question 
about the----
    Senator Biden. I could not agree with you more.
    Mr. Slocombe. That is the real economic benefit.
    Senator Biden. And I think we who support this all agree 
that stability is the rationale for expansion--economic, 
political, and otherwise. But that little bit would help.
    Thank you, Mr. Slocombe.
    Mr. Slocombe. Thank you, sir.
    The Chairman. I know Senator Robb will forgive me, but 
Senator Feinstein has been here quite awhile. If it would be 
all right, I shall call on her first, and then the Senator from 
Virginia.
    Senator Feinstein. Thank you very much, Mr. Chairman. 
Welcome, Mr. Slocombe.
    I--you mentioned that the allies--allied costs would be 
about $9-$12 billion. But I think you also mentioned that 
modernization costs are separate and not included in that. Is 
that correct?
    Mr. Slocombe. No. If I gave that impression, I--in all the 
confusion and numbers.
    Senator Feinstein. Could you correct just what this is?
    Mr. Slocombe. Our estimate is that the costs for the 
current members, to improve their deployability, their ability 
to move--their ability to move forces and deploy them like we 
already are able to.
    Senator Feinstein. You call that modernization. That is----
    Mr. Slocombe. It is modernization. Our estimate for that is 
$8-$10 billion.
    Senator Feinstein. All right.
    Mr. Slocombe. The $9-$12 billion is actually our estimate 
of the costs, all of the costs, of linking the new members into 
the alliance. We anticipate that of that $9-$12 billion, about 
60 percent will be funded through the NATO common budgets, and 
the remainder--virtually all of it will be paid for by the new 
members.
    Senator Feinstein. And, so, the new members cost is what?
    Mr. Slocombe. The new members cost is that--what? $3--$4 
billion,--which is for linking to the alliance, plus the cost 
of modernizing their own forces, which is also on the order of 
$10 billion.
    One way just to remember--the way I remember it all----
    Senator Feinstein. So you add those two together? So it 
is----
    Mr. Slocombe. Yeah. The way I remember all this is that it 
is three categories and it is about $10 billion a category.
    But the NATO common budgets are only 60 percent of the 
link--what I call the linking cost.
    The three--three categories. One of the new members have to 
pay for their own military modernization.
    Senator Feinstein. Which is considerable.
    Mr. Slocombe. Which is around $10 billion over the whole 
period. Or do current members have to pay--current European, 
and Canada--members have to pay to be able to deploy, to meet? 
There are already existing commitments to the alliance, to the 
alliance's new strategic concept.
    And third, what do--what does everybody have to pay to link 
the new members to the existing members?
    And that latter category is further broken down. About 60 
percent of it would be paid for by common budgets. There are 
complicated rules which determine what you can get paid for out 
of the NATO common budget and what has to be paid for 
nationally.
    And about 40 percent of that would be paid for nationally 
by the new members.
    Senator Feinstein. And so you are saying each category is 
about $10 billion?
    Mr. Slocombe. Each category is $10 billion, and the last 
category is divided 60/40--60 percent coming out of the NATO 
common budget, 40 percent--almost all of it, a little bit would 
be paid for by current members.
    But almost all of it would be paid for by the new members 
because it is for facilities and activities in their countries. 
It is for exercises, that sort of thing.
    Of the--60 percent share, a quarter, or 15 percent, would 
be paid for by the United States because that is our share of 
the NATO common budgets. We pay about a quarter and the other 
allies pay the other three quarters.
    It varies very slightly among the three different 
categories.
    Senator Feinstein. Thank you, that is helpful. Now 
everything I have been reading about our allies, particularly 
France and Germany, is negative with respect to the increased 
costs.
    Is this just their spin for the present time? Are there 
specific commitments that they will pay their fair share--I 
think particularly, President Chirac has been rather verbal 
about it. What specific commitments do you have that the allies 
will pay this increased share?
    Mr. Slocombe. The argument on this point has to do with the 
NATO common budget. The European allies--the Germans, the 
French, everybody else--is committed to a serious defense 
program for the future which will restructure their forces to 
make them more mobile.
    That is, as we were saying in response to Senator Hagel's 
question--like everybody else, their defense budgets are under 
pressure. But that part is not in dispute--I do not argue with 
that.
    What they are saying is with respect to the NATO common 
budgets that we all pay together. The shares are agreed--
whatever it is, three to one, European to American.
    They are saying in effect ``We understand there will be 
costs of building the facilities for enlargement. But let us 
meet those costs by cutting back on existing programs''--by 
what they call ``reprioritizing.'' And clearly, there is going 
to be some of that.
    The number we have estimated it, gross cost, to be--and to 
the degree you do not do projects in Western Europe, you can do 
projects in Central Europe.
    This argument is over whether or not there is a net 
increase in the common budgets. Until we know in detail the 
size of the requirement for the common budget, we will not 
know--and what somebody's proposal is for what you are going to 
reprioritize out of, you are kind of arguing in the air.
    The Europeans are certainly saying, ``We think we can do 
these improvements at''--it is partly scale. It is partly pace. 
It is partly how much can you reprioritize out of other 
projects?
    Senator Feinstein. Just one quick question, Mr. Chairman 
if--it requires a ``yes'' or ``no'' answer.
    In your best professional judgment, do you believe there is 
a full commitment that however this works out, that your--our 
present European allies, the present NATO members, will pay 
their full share?
    Mr. Slocombe. Yes.
    Senator Feinstein. And that the three new members will be 
able to pay their share?
    Mr. Slocombe. Yes.
    Senator Feinstein. Thank you very much.
    The Chairman. Senator Robb?
    Mr. Slocombe. Those ``yeses''--one of the problems with a 
``yes'' or ``no'' answers is that yes covers a lot of 
assumptions, but I am confident that those are the answers when 
the smoke clears.
    Senator Feinstein. Thank you.
    The Chairman. What he means is ``Yes, but.''
    Mr. Slocombe. No, sir. I mean ``Yes because.''
    The Chairman. OK. Senator Robb?
    Senator Robb. Thank you, Mr. Chairman. Mr. Secretary, the 
asterisk was appropriately noted in your last answer, and Mr. 
Chairman, I do thank you.
    And let me just observe--I appreciate your yielding to 
Senator Feinstein. As one who sat on the end of the dais for 
many, many years and would constantly see somebody come in just 
ahead and realize that I had been there for 2 or 3 hours 
acknowledging the differences in terms of when we arrived, it 
still makes sense and it is appreciated.
    I would have been here at the start but I had two judges 
who were finally up for confirmation and that was important 
that I be there to introduce them so I am a little bit late. I 
apologize to Secretary Slocombe for missing his opening 
statement.
    I do not know that these questions have been asked, but I 
have just a couple that relate in part to questions that you 
have addressed, at least.
    The IMF has recommended that the three NATO invitees avoid 
large defense spending increases and I was just wondering what 
your view of the IMF recommendations was.
    Mr. Slocombe. First of all, we understand--and when I say 
we, I mean the U.S. Government and the Defense Department--
understands that for all of these countries, the first priority 
is to solidify their democracy and establish market economies. 
Nobody is talking about increasing their defense budgets at a 
rate which will jeopardize that.
    These countries spend actually not too far off the NATO 
norm. They could all do with a little increase and they are all 
pledged to an increase in terms of the percentage of GDP spent 
on defense.
    More important, as their economies grow, the amounts that 
they spend on defense, obviously, will grow if the percentages 
increase.
    I do not see any--in any sense an irreconcilable conflict 
between doing what they need to do to attend to what is rightly 
their first priority, their internal economic stability and, in 
a sense, really, to become mature market democracies, and doing 
what they need to do for defense.
    In general, for these countries, what they need to do is to 
restructure what they have in terms of defense. As the 
statement says, basically, these countries had armies which 
are, in some sense, too big--too many people which were 
auxiliaries of the Red Army which were there to support a 
Soviet assault on Western Europe.
    They have already begun this process, but it is a--you can 
appreciate. It is a long and complicated process to take a 
military establishment which was aimed at this and convert it 
into the kind of military establishment for medium-sized 
European countries that is appropriate for what they need and 
for how they can contribute to the alliance.
    For example, each of these countries will make substantial 
cuts in the total number of people in the military. They will 
begin for the first time to have serious professional non-
commissioned officers corps. They will probably, all three of 
them, keep conscription, but they will substantially increase 
the percentage of professionals in the forces. They will go 
away from large mobilization-based forces to more deployable, 
more capable forces. They will begin to build the links--
indeed, they have already begun the links--through the 
Partnership For Peace and so on back to NATO.
    So it is not fundamentally an issue of massive increases in 
amount. There are going to be some increases, but it is not 
massive increases in amount.
    In a sense, a sum which may almost be harder to re--it is 
massive changes in the way they do business in their 
militaries. Hey, you are either talking about militaries with 
an officer structure, which even after, what, 8 years, is still 
largely a holdover from the old days at the senior level? You 
are talking about military cultures that are still, to some 
degree, holdovers, and those have to be changed.
    Senator Robb. Mr. Secretary, the Ambassadors, and in some 
cases, the ministers from the countries have been in or will be 
in to continue to both brief individual members, reassure on 
some of those questions.
    But, as my time is about to expire, let me just ask you the 
``what if'' question. What if, for whatever reason, one of the 
new members is simply unable to meet their expansion related 
program? What happens then?
    I realize none of them contemplate facing a difficulty nor 
do you contemplate facing a difficulty, but----
    Mr. Slocombe. And I do not--I think it is an extremely 
unlikely possibility that they would. The arguments about 
whether or not they made their one-tenth of a percent increase 
in a particular year, something like that--that is an issue of 
pace and direction, not of absolute capacity.
    The one thing which I think is clear is that it is--no one 
is talking about substantial scale, direct assistance to these 
countries. It is not--it is a little bit like I said in the 
more general problem. We may have a problem but we will not 
have a bill--a bill in the sense of anybody expecting the 
United States to meet that payment.
    And these countries obviously will have problems. But there 
is every reason to expect that over the next decade, which is 
the period we are talking about, their economies will continue 
to grow, maybe not in a straight line, but they will continue 
to grow.
    And they are all, as I think you will know from talking to 
their spokesmen, they are all deeply committed. They see this 
as a huge opportunity to do something of absolutely fundamental 
historic dimension for these countries--that is, to become 
firmly a part of the trans-Atlantic system and for the first 
time in their history, solve their security problem. They are 
going to give that a very high priority, even if they fall into 
economic difficulty.
    The Chairman. Thank you, Mr. Slocombe.
    We appreciate your coming.
    Mr. Slocombe. Thank you.
    The Chairman. Let me just add this thought. I had the 
impression that there was no dancing in the streets in Paris or 
in London about this, but am I wrong about that?
    Mr. Slocombe. Dancing--it takes a lot to get either the 
British or the French to dance in the streets these days. But I 
think it is----
    In all seriousness, I think all of the European countries, 
all of the European members of the alliance, understand that 
this is something which is very much in NATO and Europe's long-
term interest.
    The Chairman. Well, thank you very much.
    The second panel of distinguished witnesses this morning--
and I apologize to them because of the high jinks of the trying 
to fit this in the Senate schedule.
    As I said earlier, Dr. Richard Kugler, the distinguished 
research professor, Institute for National Strategic Studies of 
the National Defense University; Dr. Ivan F. Eland, Director of 
Defense Policy Studies at Cato; and the Honorable Steve Hadley, 
a partner in Shea and Gardner in Washington, D.C.
    Mr. Kugler?
    I would emphasize again how grateful we are to each of you 
gentlemen for being here and for your patience.
    We have a little bit of a time problem. We want all of your 
statements, and they will be included in the printed record and 
they will be distributed. I am not going to run any clock on 
you, but as close as you may come to 5 minutes would be 
beneficial. Then we could all get out of here in a reasonable 
length of time.
    But do not feel like that is an absolute necessity. Do what 
you need to do to make your point and state your case.
    And I thank you very much. Sir, if you will proceed.

    STATEMENT OF DR. RICHARD KUGLER, DISTINGUISHED RESEARCH 
 PROFESSOR, INSTITUTE FOR NATIONAL STRATEGIC STUDIES, NATIONAL 
                       DEFENSE UNIVERSITY

    Dr. Kugler. Thank you, Mr. Chairman, Senators. It is a 
pleasure to be here. I hope to make a contribution. I 
particularly will address RAND's cost estimate as it compares 
to DOD's cost estimate. I was a RAND employee at the time and 
helped prepare the RAND estimate. I am currently a DOD 
employee, but I am speaking for myself and not for DOD or RAND.
    Obviously, I support enlargement. I agree with the 
testimony given by Secretary of Defense Cohen and Mr. Slocombe 
recently. In fact his points were almost identical to mine in 
so many ways.
    Let me be very brief. Mr. Chairman, you asked earlier 
whether the administration has its mathematics about the costs 
correct and the answer is ``yes, roughly.'' That is my opinion.
    And so that is my testimony.
    I will now go through the cost issue in more detail. I have 
a written testimony that I shall submit.
    Why do not I just go directly to this RAND/DOD cost 
estimate and discuss that for a couple of minutes?
    The RAND study--this is important--preceded the DOD study. 
It came before and so it was, by definition, an independent 
estimate. As a matter of fact, it came before any other study. 
It was an original.
    And so we did not have an opportunity to be biased or 
prejudiced. There was no other study: There was nobody else to 
be biased or prejudiced against at the time.
    Both the RAND study and the DOD study are merely initial 
forays into a new and complex issue. As a result, both are 
notional estimates. They are aimed at identifying the costs and 
defense measures of enlargement in approximate terms. They are 
both well-done, but they are not meant to be definitive.
    When RAND did its study, we were responding to Defense 
Department guidance. We initially looked at a very wide 
spectrum, including options that fell outside NATO's strategy, 
both less and more ambitious. So this generated a very wide 
range of costs.
    Then we looked at options that were consistent with NATO's 
strategy, and our cost estimate for that, for about the same 
period of time, was $30-50 billion. So, as Mr. Slocombe says, 
this RAND estimate overlaps the DOD estimate of $27-$35 
billion.
    RAND then looked at an illustrative option that we deemed 
to be sensible, a sound one. The cost of that option was 
estimated at $36-$42 billion. So we have here a RAND estimate 
of a single option of $36-$42, and a DOD estimate of $27-$35, 
and you see how close they were.
    There are 30 different measures in both estimates, and the 
studies are not absolutely consistent in how they deal with 
each measure. They vary somewhat from one measure to the next. 
RAND has higher air defense costs than DOD; DOD has higher 
infrastructure costs than RAND: There are many similar 
technical differences, but they do not have a big impact on 
total cost differences.
    The key difference is in the NATO reinforcement postures, 
as Mr. Slocombe said. RAND assumed a NATO reinforcement 
posture, of 5 divisions and 10 wings because this is a standard 
U.S. practice for reinforcement of the various regions--5 
divisions and 10 wings.
    DOD assumed a smaller commitment of four divisions and six 
wings because this is NATO's practice. So RAND was using DOD's 
practice, and DOD was using NATO's practice. The two postures 
have exactly the same strategic intent. So that is where the 
primary cost difference came.
    Now, if you went into the RAND estimate and inserted DOD's 
reinforcement posture, RAND's estimate would have been $28-$34 
billion and the Pentagon's is $27-$35--the two estimates would 
have been identical.
    So that is the end of the issue of RAND versus DOD over 
costs--they are singing from the same sheet of music here, and 
they are in the same strategic ballpark. So that is my opinion 
on that matter, and I hope I have laid that issue to rest.
    A couple of final points. The DOD plan, in my view, is not 
sacrosanct. Some say it is too high, others too low. Others 
would change its internal details. We will be fighting about 
these issues for years.
    But seen in perspective, the DOD plan makes political and 
military sense. It is a good launching pad for considering how 
to enlarge. The Pentagon got the costs about right in my 
opinion, and I have been studying this issue for 3 years.
    Another point is that the DOD plan, in my view, is not 
susceptible to far higher or lower costs unless its theory of 
requirements is greatly altered in one direction or another. 
Let me explain why this is the case.
    Again, there are 30 separate measures in the DOD plan and 
the RAND plan. So the total expanse is determined by adding 
together a large number of measures, each of which is very 
moderate in cost.
    In the RAND study--and I suspect the DOD study is similar--
for each measure, there is a range of uncertainty from high to 
low. When I performed this analysis, it was a very thorough and 
detailed analysis; it took a long time--I basically took the 
midpoint for each measure.
    So, for each measure, there is a somewhat higher range and 
a somewhat lower range. For example, the mid-point for one 
measure might be $1 billion; the high range $1.25 billion; and 
the low range, $75 million.
    But in order to get a much higher aggregate total cost, all 
30 measures, or the vast majority of them, would all have to 
cost a lot more than the mid-point.
    What we are likely going to get here is some measures being 
higher than DOD estimated, other measures being about what DOD 
estimated, and others being lower. If so, there will be an up 
and down and offsetting dynamic that I think, in the end, is 
going to keep the final estimate to within the range of what 
DOD is estimating.
    Mr. Slocombe also said correctly that there is a 
forthcoming NATO cost estimate which will be lower than DOD's 
estimate because NATO is looking at common funding and common 
infrastructure. Even so, there is a common theme among all 
three studies here, and the common theme is that the costs of 
NATO enlargement are going to be affordable and moderate.
    This should be the case as long as we maintain political 
control over these measures and as long as we plan and carry 
them out carefully.
    So my expectation is that this effort is going to end 
happily, that we will, in fact, carry out an effective 
enlargement, and that we will, in fact, do it ways that are 
affordable. Clearly one goal is to minimize costs, and another 
goal is to do enlargement right so that we carry out credible 
security guarantees.
    We have 50 years of working with NATO in this context. By 
and large, NATO has gotten it right most of the time, and I 
think that is what is going to happen here. Thank you.
    [The prepared statement of Dr. Kugler follows:]
                    Prepared Statement of Dr. Kugler
    Mr. Chairman and Senators, it is a pleasure to be here.
    I Hope to make a contribution to your hearings.
    I have been asked to provide testimony on the costs of NATO 
enlargement.
    My testimony will include how RAND's cost estimate compares to 
DOD's estimate. I was a RAND employee at the time, and I helped prepare 
its estimate.
    I speak only for myself, not for DOD or RAND.
    Obviously I support NATO enlargement, and I agree with the 
testimony given by Secretary of Defense Cohen.
    For the record, I am submitting two short ``Strategic Forum'' 
papers recently prepared at the National Defense University.
    The first, written by myself, explains why the costs of a sound 
defense program are likely to be moderate and affordable.
    The second, prepared by David Gompert, explains why such a defense 
program will produce major strategic benefits.
    I will be brief, but I will gladly answer questions about the 
technical issues. My testimony consists of seven key points.
    Key Points
    First: The strategic purpose of a defense program for enlargement 
is not to deter a threat, but to meet NATO's preparedness standard for 
peacetime.
    It is vitally important that a gradual, long-term program be 
carried out so that enlargement will be safe and successful.
    What we want to achieve is new members that are defended as 
effectively as old members.
    What we want to avoid is a purely political enlargement and a 
hollow commitment.
    Second, the exact costs and requirements of a sound defense program 
are uncertain and will remain so for some time.
    But we do know enough to judge that if this program is well-
managed, it can be both affordable and effective.
    Third: the RAND estimate is a little higher that the DOD estimate, 
but seen in perspective, the two estimates are similar.
    They are in the same strategic ballpark.
    Fourth: the DOD plan is not sacrosanct. Some say it is too high, 
and others, too low. Others would change its internal details. But seen 
in perspective, it makes political and military sense.
    It is a good launching pad for considering how to enlarge.
    Fifth: The DOD plan is not susceptible to far higher or lower costs 
unless its theory of requirements is greatly altered in one direction 
or another.
    A less-ambitious plan is unwise, and a bigger plan is unneeded 
unless a major threat emerges. Such a threat is not anticipated.
    NATO's forthcoming cost estimate likely will be lower than DOD's 
estimate, but in limited ways because it focuses only on common 
infrastructure and related items.
    The effect is not to invalidate DOD's plan, or to greatly lower its 
overall sense of goals and capabilities.
    Seventh, hopefully enlargement can be carried out at even less 
expense than DOD has estimated. But although cost reduction is an 
important aim, it is not the only aim.
    We also need to work with NATO and our allies to ensure that DOD's 
plan--or a reasonable facsimile of it--is launched and carried out.
    With these points in mind, I will now briefly discuss the RAND and 
DOD cost estimates.
    The RAND study preceded the DOD study. Both are merely initial 
forays into a new and complex issue. As a result, both are notional 
estimates.
    They were aimed at identifying the costs and defense measures of 
enlargement in approximate terms.
    They are both well-done, but they were not meant to be definitive.
    Rand considered a wide spectrum of options, including some that lie 
outside NATO's strategy. To carry out NATO's strategy, RAND portrayed a 
set of options costing $30-50 billion. The option that RAND deemed most 
appropriate costs $36-42 billion, for all of NATO, through 2010.
    This option includes 30 separate measures. Roughly one-half of the 
expense is needed to prepare the forces of new members and their 
military infrastructure. The other half is needed to improve NATO's 
forces for projection missions in the CEE region and elsewhere.
    An important point is that the RAND study includes only measures 
that are required by enlargement. As a result, it counts only about 20% 
of the total defense efforts of new members.
    It treats the remainder as national programs. These programs are 
important for the overall health of new-member military postures, but 
they are not counted as part of enlargement, per se.
    When this study was first briefed to the executive branch and NATO 
officials, the common reaction was relief that the costs are low.
    The primary reason for low costs is that no new forces must be 
created. Instead, the task is merely one of improving forces that 
already exist.
    The DOD study focused on a similar, but not identical, set of 
measures. Its estimate is $27-35 billion, or a little lower than RAND's 
option of $36-42 Billion.
    The two estimates differ in their internal particulars, but the 
primary difference is their treatment of NATO's reinforcement posture.
    Rand assumed a posture of 5 divisions and 10 fighter wings because 
this is consistent with U.S. practice. DOD assumed a smaller posture of 
4 divisions and 6 wings because this reflects NATO's practice.
    If RAND had used DOD's posture, its estimate would have been $28-34 
billion--identical to DOD's estimate.
    The DOD cost estimate can cause sticker shock, but when it is seen 
in perspective, it comes across as genuinely moderate.
    It is less than the cost of buying and operating a single ground 
division or a carrier battle group.
    It is similar to the cost of a single normal modernization program.
    The annual cost is only $2-3 billion. Of this, NATO's new members 
will pay about $1 billion or a little more, the West Europeans together 
will pay about $1 billion, and the United States, only $150-200 
million. These are not onerous amounts.
    The new members will need to increase their defense spending in 
order to fund their measures and otherwise prepare their forces. But 
their growing economies will permit them to gradually elevate their 
spending in the necessary amounts, without greatly increasing the share 
of GDP allocated to defense.
    NATO's current members will need to allocate only 1% of their 
current budgets to enlargement. They can fund most of their measures by 
reallocating their budgets in small ways, rather than increasing their 
spending.
    The burden on the United States will be small. It will be only 
about \1/10\ of 1% of DOD's budget, and the costs of stationing U.S. 
forces in Europe will not rise appreciably.
    To put things in perspective, the average U.S. citizen will have to 
pay only 67 cents annually, and the average west European, only $2.60. 
This is hardly an onerous expense for building a new and better NATO, 
and a stable and democratic Europe.
    I doubt that anybody regards the DOD plan as fixed in concrete. It 
is merely a starting point, and it clearly will evolve as more analysis 
becomes available.
    But it makes strategic sense because it embraces sound goals, 
identifies the correct types of measures, and points NATO in the right 
direction, with fair burden-sharing.
    It will enable NATO to carry out its new security commitments in 
the CEE region, and to become better at projecting power elsewhere.
    Let us also remember that if NATO does not enlarge, the cost of 
defending the CEE region will be far higher: perhaps double the DOD 
estimate.
    To me, the DOD plan is an immense strategic bargain. It is 
equivalent to finding a new Rolls-Royce on sale at Filene's Basement 
for $1000. Let's buy the car first, and quibble about the price second.
    Obviously some parts of the DOD plan may prove more costly than 
estimated. But UMR parts likely will be less expensive.
    For example, costs for air defense may rise. But costs for 
infrastructure and reinforcement measures may fall.
    The effect of this ``up-and-down'' dynamic likely will be to keep 
the cost in the general vicinity of DOD's estimate, and perhaps less.
    Regardless, the costs will be ours to determine. We will not be 
captured by an inflating dynamic beyond our control.
    NATO's estimate will be lower than DOD's estimate primarily because 
its focus on common infrastructure and related items accounts for only 
10-20% of the overall plan.
    Even if some infrastructure items cost less, the overall plan will 
decline by only a few billion.
    Costs for the entire program will not be known for some time, and 
these issues probably will be studied and debated for years.
    What can be said is that although enlargement is not going to be a 
free lunch, its cost will be moderate and affordable.
    In summary, we clearly should minimize costs and resist unnecessary 
expenses.
    But we also should guard against any unwise dilution of an already 
inexpensive defense program that is vital for enlargement's success.
    A principal challenge is to mobilize the multinational political 
consensus and willpower needed to fulfill a sound plan
    Strong U.S. leadership and hard work by all countries will be 
needed.
    The future is uncertain, but NATO's history provides confidence 
that while the result may not be perfect, it will get the job done.
    Thank you. I will be happy to answer questions.

                               __________

                            STRATEGIC FORUM

                      National Defense University

                Institute for National Strategic Studies

                        Number 128--October 1997

                       COSTS OF NATO ENLARGEMENT

                        Moderate and Affordable

                          by richard l. kugler
Conclusions
   NATO must pursue a sound defense program as it enlarges--not 
        to prepare for a threat, but to meet its peacetime preparedness 
        standard.
   DOD's cost estimate of $27-35 billion for all NATO 
        enlargement measures through 2009 causes sticker shock to some, 
        but it is moderate: only about 1% of NATO's total defense 
        spending.
   This estimate is now low-sided or prone to major inflation. 
        it is similar to the RAND estimate, and lower than the CBO 
        estimate because CBO embraced a higher threat and theory of 
        requirements.
   The United States will not be carrying unfair burdens. Its 
        expense may be no more than $2 billion through 2009. The cost 
        of stationing U.S. forces in Europe will not rise appreciably.
The Cost Issue in the Enlargement Debate
    Cost has become an important factor in the NATO enlargement debate. 
It will influence the Senate's vote on ratifying the admission of three 
new members in 1999-Poland, the Czech Republic, and Hungary. NATO's 
willingness to fund key defense measures will influence whether 
enlargement unfolds safely and effectively.
    This Strategic Forum explains the costs of NATO enlargement in 
clear terms. Strategic Forum #129 by David C. Gompert addresses the 
benefits of a sound defense program. This paper focuses on seven key 
issues:
  1. Why pay costs if no threat exists?
  2. What is DOD's cost estimate and its rationale?
  3. Is the cost affordable or excessive?
  4. Is DOD's estimate accurate or vulnerable to inflation?
  5. Is DOD's estimate lower than other estimates, and if so, why?
  6. Will enlargement require bigger defense budgets?
  7. Will the United States have to carry an unfair share of the 
        burden?
Why Pay Costs If No Threat Exists?
    The answer is that NATO needs strong defenses even though its new 
borders today face no major threat. NATO's ``peacetime preparedness 
standard'' needs smaller forces and budgets than during the Cold War, 
but it is still demanding. As NATO enlarges, it must avoid a two-tier 
alliance in which new members receive less security than old members.
    Strong forces are required for peace support missions, minor 
crises, as well as other interventions. These forces will help build 
partnership relations with non-NATO powers, deter threats from 
emerging, and prevent destabilizing trends. Members must be assured of 
their security in the event relations with outside powers sour. NATO 
also needs to promote sound planning and integration. Members can 
decide upon defense efforts and multinational involvements only if they 
are given a clear definition of NATO's commitments to their security. 
NATO must ensure that the forces of new and old members are sufficient 
both now and for the future.
What is DOD's Cost Estimate and Its Rationale?
    In February 1997, the Clinton Administration issued a study judging 
that the costs of NATO enlargement will be $27-35 billion for the years 
1997-2009. This is the cost facing the entire alliance. The United 
States will pay only a small portion of it--perhaps no more than $1.5-
2.0 billion. The average annual cost will be $2.1-2.7 billion for NATO 
as a whole, and $150-200 million for the United States over the decade 
following accession. The primary reason for the low U.S. expense is 
that the United States already has paid the cost of developing forces 
for projection missions.
    This DOD estimate is notional, but it was a product of a serious 
review that employed sound methods. It was prepared before NATO began 
assessing defense requirements for enlargement. It also was prepared in 
advance of validated cost data for some specifics. Its purpose is not 
to be definitive, but instead to gauge costs in approximate terms. It 
is a starting point for designing NATO's defense relationships with new 
members. Doubtless it will be refined as NATO develops better 
information.
    It should be viewed as a basis for judging broad policy and 
strategy, not as precise tool for programming and budgeting.
    DOD's estimate grows out of NATO's strategic concept and defense 
strategy. It presumes that new members will take primary responsibility 
for their self-defense, and that NATO's current members will provide 
necessary reinforcements. Because it judges that adequate levels of 
combat forces already exist, it focuses on steps needed to make 
existing forces capable of carrying out enlargement.
    Some of these measures are already underway, and many arguably 
would be needed irrespective of enlargement. The DOD estimate divides 
costs into three categories:

1. New Members' Military Restructuring. This category costs $10-13 
        billion during 1997-2009. It includes force structure 
        adjustments and enhancements by new members so that they 
        improve their self-defense capability. It includes measures to 
        upgrade modernization, readiness, and sustainment.
2. NATO Regional Reinforcement Capabilities. This category costs $8-10 
        billion. It deals with steps for upgrading NATO's capacity to 
        deploy forces eastward in peace, crisis, and war. It includes 
        measures to enhance deployability, logistics, and sustainment. 
        It assumes a NATO reinforcement posture of four divisions and 
        six fighter wings.
3. Direct Enlargement Costs. This category costs $9-12 billion. It 
        includes measures directly tied to enlargement so that the 
        forces of new members and old members can operate together. It 
        includes such measures as improved C3I, infrastructure (e.g., 
        roads and rail), reception facilities, training sites, and 
        storage areas.

    This estimate is based on assumptions that first establish an 
``initial capability'' and culminate in a ``mature capability'' by 
2009. It calculates that new members will pay $13.0-17.5 billion, the 
non-U.S. NATO members will pay $12.5-15.5 billion, and the United 
States, the remainder. Because this estimate includes only enlargement-
related measures, it does not include the larger defense preparations 
that all NATO countries will be pursuing. The costs for new members 
will consume 15%-25% of their future defense spending of $65-100 
billion; the remainder will be used for national programs.
    This estimate is based on a ``middle-ground'' theory of 
requirements. It is not minimalist. It is not a bare-bones estimate 
aimed at minimizing costs at the expense of necessary capabilities. It 
does not reflect a high theory of requirements that acquires all 
plausible capabilities. It is not threat-based, and it does not expect 
trouble with Russia. It reflects a normal NATO peacetime preparedness 
standard in which the goal is to acquire essential capabilities at an 
affordable price.
Is the Cost Affordable or Excessive?
    To some, DOD's cost estimate of $27-35 billion causes sticker 
shock. Seen in a broader perspective, it is moderate and affordable:

   It is similar to the cost of normal defense departures of 
        this type: e.g., a U.S. air modernization program or defense of 
        another region.
   It imposes a high financial burden only on new members, who 
        will gain big strategic benefits.
   For the West European members of NATO, it will cost only 
        about 1% of the $2 trillion that they will be spending on 
        defense.
   For the United States, it will cost only about one-tenth of 
        1% of DOD's future spending of $3 trillion. The cost of 
        stationing U.S. forces in Europe will not rise appreciably (by 
        my estimate 2-5 percent or less).

    Other comparisons reinforce the conclusion of moderate costs:

   The cost of $27-35 billion for all of NATO is equal to the 
        full expense of a single U.S. active division or carrier battle 
        group for a similar period.
   The annual cost is about 30% of what the United States and 
        NATO spend on military construction, and 40% of their expense 
        on family housing.
   The cost is equal to what they spend on revolving accounts 
        and management funds--small accounts that fluctuate upward and 
        downward.

    For the average citizen, the costs are affordable (see Table 1: A 
Comparison of Enlargement Costs). For the average American, the annual 
cost is equal to the price of a candy bar. For a West European, it is 
equal to that of a McDonald's hamburger. For the CEE citizen, the cost 
would pay for one dinner at a restaurant.
    Given the immense strategic benefits of NATO enlargement, all are 
getting their money's worth. Moreover, alliances save money. For all 
participants, NATO enlargement lowers the cost of integrating and 
defending the CEE region. If NATO does not enlarge, the costs could be 
double that of enlargement.
Is DOD's Estimate Accurate or Vulnerable to Inflation?
    Can DOD's estimate be trusted as accurate? Is there a risk that DOD 
is underestimating? These questions are being asked because many 
previous defense programs became far more expensive as they unfolded. 
When the details are considered, the DOD estimate merits confidence--
provided its underlying plan is not changed in a wholesale way.

               Table 1: A Comparison of Enlargement Costs               
------------------------------------------------------------------------
                   Cost To:                     Annual Cost   Total Cost
------------------------------------------------------------------------
Average U.S. Citizen..........................        $0.67        $8.75
Average West European Citizen.................        $2.60       $34.15
Average New-member Citizen....................       $21.00      $272.50
------------------------------------------------------------------------

    The DOD estimate is based on judgments about more than 30 measures. 
No single measure dominates. If the true cost is radically different 
from the DOD estimate, it will occur because several measures are 
pulling in that direction, not just one measure. As a result, the 
primary determinant of costs is not the expense of individual items, 
but strategic decisions about requirements.
    The actual costs for each measure might prove to be different than 
DOD has estimated. This owes to potential variations in both costs and 
the measures themselves. For example, the cost of a single prepared 
airbase might be higher or lower than DOD estimated. Alternatively, 
NATO might decide to acquire fewer or more airbases. But unless the 
totality of measures is greatly expanded or contracted, the final cost 
for the entire plan likely will be similar to the DOD estimate. Higher 
costs for some measures probably will be balanced by lower costs for 
others. For example, acquisition of Patriot rather than I-Hawk could 
elevate costs for air defense improvements, but pursuit of less costly 
measures for airbases and other facilities could offset this increase. 
This up-and-down dynamic likely will keep the cost in the $27-35 
billion range.
    The actual costs will not be known until NATO's force planning 
process for enlargement is finalized. NATO may decide to trim or delay 
some of DOD's measures. Moreover, NATO develops cost estimates only for 
common-funded programs (e.g. infrastructure). These factors may lower 
NATO's estimate, below the DOD estimate. The real issue is not these 
narrow costs, but instead costs for the entire defense program when it 
is complete.
    When the dust settles, the costs could be somewhat lower than DOD 
has estimated. The specific needs of the three invitees might change, 
thus lowering the cost a little. Another reason is that some measures 
(e.g., reception facilities) may cost less than estimated by DOD. Even 
so, the total cost could be far lower only if the major features of 
DOD's estimate are scaled back sharply. This step is inadvisable 
because it could result in a weakened effort that fails to meet future 
requirements.
    The cost could rise above $35 billion, but the DOD estimate is 
vulnerable to major cost inflation only if its theory of requirements 
is elevated far upwards. The DOD estimate does not develop new 
technologies, which can be a principal source of cost inflation. Costs 
could surge if NATO commits to a much larger reinforcement posture or 
if new members buy more expensive equipment than envisioned by DOD. 
Such measures could be needed if a threat emerges, but not in today's 
setting. NATO will be able to control costs, for they are largely a 
product of strategic decisions.
Is DOD's Estimate Lower Than Other Estimates?
    DOD's estimate is in the same ballpark as RAND's estimate. For the 
same defense strategy, RAND estimated a cost of $30-52 billion. RAND's 
mid-point estimate of $42 billion is higher than DOD's estimate 
primarily for a single reason. Whereas RAND costed a NATO reinforcement 
posture of five divisions and 10 wings (a typical U.S. force practice), 
DOD costed four divisions and six wings because this commitment 
reflects NATO's practice. Had RAND costed the DOD program, its estimate 
would have been $28-34 billion: virtually identical to DOD's estimate.
    The General Accounting Office (GAO) has assessed the DOD estimate 
and, despite questioning specifics, pronounced its assumptions as 
reasonable. The Congressional Budget Office (CBO) tabled a higher 
estimate of about $125 billion, but the differences are readily 
explained. About $30 billion of the difference owes to CBO's inclusion 
of new-member measures that DOD deemed as falling outside the NATO 
enlargement account. The remaining difference owes to CBO's decision to 
embrace a higher theory of threats and requirements. CBO costed a NATO 
reinforcement posture of 12 divisions and 12 wings, a difference of 
nearly $30 billion. CBO also included more robust measures for C3I 
systems, munitions, and facilities. To CBO, these measures make 
military sense. DOD's estimate judges that they are not needed.
Will Enlargement Require Bigger Defense Budgets?
    If the DOD estimate is carried out, new members will need to 
increase their defense spending in order to fund enlargement measures 
while also improving their forces. NATO membership will allow them to 
downsize their currently large postures because they will be receiving 
security guarantees. This downsizing will generate savings to help pay 
for many enlargement measures. These countries need to increase their 
defense spending not only because they are joining NATO, but because 
the quality of their forces has eroded in recent years. If they do not 
gain membership in NATO, their defense budgets will need to rise far 
faster. As they join NATO, economic recovery may allow higher spending 
without allocating greatly increased shares of GDP to defense.
    NATO's current members can fund enlargement by increasing their 
defense budgets, or reprioritizing, or both. Increased spending avoids 
the need to pare defense assets elsewhere. Reprioritization is always 
painful, but the amount required to fund NATO enlargement is feasible--
only about $1 billion annually split among all current members.
    If the West Europeans choose to reprioritize, they could trim 
spending on operations and maintenance. Alternatively, retiring a few 
units would not compromise their security.
Will the United States Have to Carry an Unfair Share of the Burden?
    The DOD commitment to defense of new members is one division and 
one fighter wing, or about 25% of NATO's reinforcement posture. The DOD 
funding commitment of $1.5-2.0 billion is only about 10% of the expense 
for enlargement facing NATO's current members. The West Europeans and 
NATO's new members will be carrying the bulk of the burdens in forces 
and money.
    The U.S. expense could rise if other NATO members fail to carry 
their fair share of the burden, or if the United States decides to aid 
new members by giving them security assistance.
    The U.S. costs could rise moderately and still be affordable. The 
United States will have control over the expense. If it chooses to 
spend more, it will act because the strategic benefits are worth the 
added cost--not because of circumstances beyond its control.
Summary
    The costs are moderate and, as Gompert argues, the benefits are 
compelling. To gain these benefits, an appropriate set of defense 
measures must be implemented. NATO has carried out many similar 
innovations before, but such efforts are never easy. Careful management 
and sustained political commitment will be needed. The outcome will 
influence the enlargement's success.

Dr. Richard L. Kugler is a Distinguished Research Professor in INSS. He 
focuses on NATO and U.S. defense strategy. He can be reached at (202) 
685-2328. Opinions, conclusions, and recommendations expressed or 
implied in this paper are solely those of the author and do not 
necessarily represent the views of the Institute for National Strategic 
Studies, National Defense University, the Department of Defense, or any 
other government agency.

The ``Strategic Forum'' provides summaries of work members and guests 
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                               __________

                            STRATEGIC FORUM

                      National Defense University

                Institute for National Strategic Studies

                        Number 129--October 1997

                            NATO ENLARGEMENT

                    Putting the Cost in Perspective

                          by david c. gompert
Conclusion
    Fundamentally, Europe is now more secure than it has been in a 
century--one of the most secure regions on Earth. Our strategy should 
be to: (1) keep it that way; and, (2) get more contribution from 
Europeans to strengthen security in Europe and elsewhere. The 
investments needed to implement NATO enlargement directly support this 
strategy:

   The U.S. share of $150-200 million per year will update the 
        security infrastructure of Europe, thus helping to ensure that 
        recent progress is made permanent.
   The new members' share of about $1 billion per year--which 
        they willingly, democratically, are choosing to accept--will 
        transform their ex-communist militaries into lean and competent 
        organizations fully answerable to civilian leadership.
   The old members' share of about $1 billion per year will 
        give the United States added security and reduced strain by 
        augmenting U.S. power projection capabilities for use not only 
        in Europe but beyond, where more acute dangers lie.

    The security of Europe, after a century of unprecedented violence, 
is so vital that we need not expect a specific future threat to justify 
this investment. Moreover, if some new threat arose, we would surely 
feel compelled to defend European democracy, as we did in the past 
whether or not NATO has been enlarged. Rather than ``costs of 
enlargement,'' these payments should be considered an investment in the 
future of democracy in Europe and in the ability of our allies to bear 
more of the burden of common defense in Europe and elsewhere.
Introduction
    Congress faces two questions about the cost of admitting Poland, 
Hungary and the Czech Republic to NATO: (1) How much will it cost? (2) 
Is the cost worth it? In Strategic Forum #128, Richard Kugler explains 
that, based on reasonable and consistent assumptions, the Clinton 
Administration's figures--$2.1-2.7 billion per year for NATO as a 
whole, with $150-200 million per year the U.S. share--are sound. The 
debate should now shift to whether this would be a good investment.
    Although the U.S. cost is small, it is important for Congress to 
understand the justification. The Pentagon's budget is already tight: 
planned reductions in U.S. military infrastructure will barely pay for 
needed modernization of forces in the years to come. With so little 
slack, every new obligation must make sense. Moreover, the young 
democracies about to join NATO are still going through a difficult 
economic transition and cannot afford any unnecessary military outlays. 
Finally, most of NATO's current European members are struggling to live 
within more austere national budgets in order to qualify for the 
European Monetary Union; they, too, are pinching their francs, lire and 
deutchmarks.
    As Richard Kugler explains, the ``costs of enlargement'' are minor 
compared to total current U.S. and European defense budgets. There is 
no need to beef up forces to defend Europe from some new threat. But 
there is a need for NATO members, new and old, to invest in peacetime 
preparedness. This paper identifies three strategic dividends from that 
investment:
1. Insurance that Europe will be fundamentally secure in the twenty-
        first century--quite a change for the continent that produced 
        two world wars and one cold war in the twentieth century.
2. The creation within the new members of military establishments that 
        are streamlined, competent, accountable, and integrated into 
        NATO--a crucial step on the road to permanent democracy.
3. Improvement in the capability of our current West European allies to 
        bear more responsibility and burden for security in Europe and, 
        just as significant, the defense of common interests beyond 
        Europe, e.g., the Persian Gulf.
Insuring the Security of Europe
    Because there is no specific threat to Europe on the horizon, this 
is the least concrete strategic gain from the proposed investment. Yet 
in a sense, it is the most basic. In this new era of uncertainty and 
flux, those charged with responsibility for their citizens' security, 
be they American, German or Polish, cannot neglect defense capabilities 
in hopes that new threats will not arise. Indeed, a consensus exists in 
the United States--among Democrats and Republicans, the President and 
Congress, the government and voters--that prudence demands a capable 
military even when the country is unthreatened. The same reasoning 
should apply to the security of Europe, scene of the worst violence in 
world history. To be sure, European security has improved dramatically 
over the last decade. Our strategic goal is to lock in that progress.
    Historically, central Europe has been the fuse of European 
conflict. Two world wars were ignited there; a third might have been, 
but for NATO. Reasonable American voices now ask: Would we risk the 
lives of our sons and daughters to defend Poland, Hungary or the Czech 
Republic? But surely a threat of aggression against the new democracies 
of central Europe would have to be regarded as a threat to Europe 
itself. To presuppose a future attack on Poland that we would not 
consider a threat to Europe flies in the face of both experience and 
geography So the fairer question is: Would we defend Europe? Three 
times in 80 years, Americans answered yes.
    If our answer remains yes, we would defend Europe (and thus 
Poland), it follows that we would be wise to make that intent clear by 
admitting these countries into NATO, thus reducing the likelihood of 
actually having to do so. It follows, as well, that we should invest in 
the peacetime preparedness of Europe, including the new democracies. 
Failing to do so would suggest that the security of half but not all of 
Europe is important to us. In the remote event that the threat of 
aggression reappeared, we would rue our failure to make our position 
clear and to make at least minimal preparations. Conversely, the return 
on this investment, in that admittedly unlikely event, would be 
incalculable.
    The expectation of a future Russian threat is not necessary for 
this commitment and this investment to make sense. We should take a 
longer view of the safety of Europe, the security of this part of 
Europe and the value of NATO. The Cold War and the former Soviet threat 
were but one episode in a continuing history of a continent at once 
blessed with promise and cursed with conflict, whose future, like its 
past, will affect the United States and the rest of the world. Being 
purely defensive, this investment in peacetime preparedness will help 
insure a far safer century for Europe, and thus for us, than the one 
now ending.
    In a practical sense, $150-200 million per year should also be seen 
as the cost of upholding the principle that NATO must have military 
integrity--a principle championed by the United States. If we decline 
to make this contribution to NATO's infrastructure, and our current 
allies followed our ``lead,'' as they surely would, we would be 
signaling an indifference to NATO's military underpinnings, 
contradicting and weakening our insistence that this is not a hollow 
alliance, with commitments it cannot fulfill. At best, this would 
suggest that we stand behind the security of the alliance's old members 
but not its new ones. At worst, it would lead to the erosion of NATO's 
entire military foundation. This investment will reinforce the 
discipline that enabled NATO to prevail in the Cold War, to become the 
world's most credible alliance, and to respond to the security 
challenges of the new era.
Transforming the Militaries of the New Democracies
    A military establishment that is integrated into NATO will never be 
the same. NATO ``denationalized'' the militaries of the original West 
European members, which had previously warred with each other on a 
regular basis. It helped reform the armed forces of several current 
members that were once undemocratic: Spain, Portugal, Turkey and 
Greece. And now it can help Poland, Hungary and the Czech Republic 
develop militaries that lend strength and add confidence to democracy's 
future.
    Their inclusion in NATO's military organs, their streamlining and 
modernization, and their use of NATO's physical infrastructure will 
rivet the armed forces of the new members to a model that has worked 
extraordinarily well for the rest of the alliance. This, too, should be 
considered a strategic return on the proposed investment, since the 
success of democracy depends on military reform, and the United States 
has a huge equity in democracy's success. For the country that stood, 
for many decades, for the right of Poles, Hungarians and Czechs to 
become democratic, the cost of transforming their militaries to 
strengthen democracy should not seem too large.
    No one is more mindful of the need to reform and integrate the 
military establishments of Poland, Hungary and the Czech Republic than 
the countries themselves. When communism ended, the old militaries--
overfed, unresponsive to democratic direction, environmental polluters, 
mismanagers of public resources--were unacceptable. In the years that 
followed, military reform was disappointingly slow compared to the rest 
of their political and economic metamorphosis. Creating new 
militaries--trim, professional, accountable, efficient, respected--is a 
high priority.
    There are already signs of progress in anticipation of NATO 
membership. Civil-military relations have begun to improve; plans to 
streamline forces and ready them for NATO are being drawn up; the 
vestiges of the old Warsaw Pact militaries are vanishing. With 
ratification and subsequent integration, the transformation will be 
accelerated and finished.
    One hears from American skeptics of NATO enlargement, or of bearing 
the costs, that the new democracies have better things to do with their 
money than to remold their armed forces. This point of view 
underestimates the importance of having a professional, apolitical 
military establishment in making democracy succeed. Perhaps because 
U.S. democracy is so secure and the U.S. military is so able, we take a 
responsive military for granted. In any case, who is in a better 
position to understand whether the cost of joining NATO is worth it 
than the countries that are joining? Suggesting that these countries 
cannot make the right decisions on matters as weighty as their own 
security and the path of their own transformation is not helpful. We 
must show confidence in them and their democracy.
    Moreover, it is by no means clear that the cost of restructuring 
their armed forces within NATO will be greater than the amounts they 
would spend over time--inefficiently, no doubt--on national defense if 
they were excluded from NATO. Becoming members of the world's strongest 
alliance, led by the world's strongest country, is bound to improve 
their security, perceived and real. So Poland, Hungary and the Czech 
Republic, if excluded, would either end up spending more on security or 
else feeling less secure. In any event, without the military and 
management discipline provided by NATO, they could waste their 
resources and squander their chance for permanent security. If we are 
genuinely concerned about the wise and economical allocation of 
resources on defense by the new democracies, NATO membership is not the 
problem but the solution.
Improving West European Contributions to the Defense of Common 
        Interests
    The third strategic dividend from the proposed NATO investment is 
potentially the biggest for the security of U.S. interests. Unlike the 
United States, which is highly capable of projecting military power, 
the bulk of West European forces are suitable mainly for border 
defense--a holdover from the Cold War. If another Gulf War occurred 
today, the NATO allies would be no more able to contribute major forces 
to a U.S.--led coalition than they were in 1990, when they provided 
less than 10 percent of the force (by the most charitable measure). If 
we could increase this to, say, 20 percent, the benefit for the United 
States would be great. The allies could share more in the cost and 
risk--and, in the worst case, the casualties--while giving the 
coalition more overall muscle. In peacetime, the allies could take some 
of the strain off the U.S. force structure, which is now laboring hard 
to meet the need for peacekeeping while also remaining ready for major 
conflict.
    What has NATO enlargement to do with the defense of the Persian 
Gulf and other common interests? A great deal. The military strategy to 
provide for the security of the new members does not call for permanent 
forward defense, Cold-War-style. There is no need to base U.S. and West 
European forces on the soil of the new members. Provided the necessary 
NATO infrastructure improvements are made--which depends on the United 
States and the other allies making the investment--we can refrain from 
deploying forces eastward unless and until a need arises. This strategy 
will not require any improvement in U.S. forces, which are already 
highly mobile. (This explains why the U.S. share of the cost of 
enlargement is less than Western Europe's.) But major improvement is 
needed in the ability of German, French, British and other West 
European forces to deploy and operate at a distance. Enlargement gives 
our current allies not only a motivation but an obligation to enhance 
their forces in this direction.
    As they do, they will be able to help more in defense of shared 
interests not only in Europe but in more dangerous adjacent regions, 
including the unstable but critical swath of lands from North Africa 
through the Middle East to the Persian Gulf. This would lessen the 
burden and risk of the United States and make the current $250 billion 
defense budget go much further. In this sense, the nearly $1 billion 
per year the West Europeans should spend on improving their forces--
roughly 40 percent of the total investment--can be seen from the U.S. 
perspective not as a cost at all but as a direct benefit.
    But can the current NATO allies afford this? Absolutely. 
Collectively, the European members of NATO spend about $160 billion per 
year on defense, second only to the United States. By reprogramming $1 
billion, they can improve significantly their ability to project 
forces. We should be concerned less about whether the allies increase 
their total defense spending than about how they intend to spend it. 
The key is for them to invest more of their money on forces that can 
conduct distant operations. Some allies understand the need for this: 
the British and French, and to a lesser degree the Germans, have begun 
to point their defense programs away from stationary defense and toward 
the ability to protect far-away interests. But their progress has been 
slow, and enlargement should provide the needed impetus.
    Congress should focus not on whether the current European allies 
are going to increase defense spending but on whether they are going to 
modernize their forces in this strategically beneficial way. And the 
Clinton Administration should direct its energies to ensuring that 
allied plans are adequate. If they are, congressional concerns about 
fair burden-sharing should be satisfied. It would be reasonable for 
Congress to ask NATO's Supreme Allied Commander to confirm that the 
defense programs of our current allies are sufficient to increase their 
share of the burden of defending NATO's new members and other common 
interests.
    Let's not underestimate the potential of the new members to 
contribute in the future to the security of common interests other than 
their own territory--especially as they develop more modern armed 
forces that work with ours through NATO. They helped as best they could 
during DESERT STORM, and they are helping in Bosnia. As their 
confidence in their own security and future gains strength, we should 
count on them to join the rest of the European allies in shouldering 
more of the responsibility and burden of protecting common interests.

David C. Gompert is a Distinguished Research Professor at INSS, on 
leave from RAND, where he is vice president. He was Senior Director for 
Europe and Eurasia on the NSC staff of the Bush Administration. He can 
be reached at (202) 685-2355. Opinions, conclusions, and 
recommendations expressed or implied in this paper are solely those of 
the author and do not necessarily represent the views of the Institute 
for National Strategic Studies, National Defense University, the 
Department of Defense, or any other government agency.

The ``Strategic Forum'' provides summaries of work members and guests 
of the Institute for National Strategic Studies and the National 
Defense University faculty. These include reports of original research, 
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    The Chairman. Dr. Eland?

    STATEMENT OF DR. IVAN ELAND, DIRECTOR OF DEFENSE POLICY 
            STUDIES, CATO INSTITUTE, WASHINGTON, DC

    Dr. Eland. Thank you, Mr. Chairman. Yes, I would like to 
deal with some of the things that have come up during the first 
couple of speakers here.
    There seems to be a repositioning of estimates--DOD and 
RAND versus the CBO estimate, which I originally did as you 
know. It seemed that DOD first criticized the CBO estimate, 
which had five options--a range of $61-$125 billion--as being a 
cold war estimate that was based totally on a resurgent Russian 
threat.
    Well, in my Cato policy analysis, I have made it directly 
comparable to the administration's plan of four divisions and 
six wings in projection, so they can no longer say that.
    [See appendix for Dr. Eland's Policy Analysis, ``The High 
Cost of NATO Expansion: Clearing the Administration's Smoke 
Screen.'']
    Today, Mr. Slocombe said, that my estimate had a very 
different opinion of what needed to be done under the current 
threat. This is a different argument, now that I have 
normalized my estimate to make it comparable with DOD.
    So I guess I would have to plead guilty of that to some 
extent because I think DOD did so little in its estimate. For 
instance, just to give you an example, both infrastructure and 
weapons. They took it very light on the infrastructure. The DoD 
analysts said that they felt constrained in how much 
infrastructure they could put in these countries or assume that 
they would put into these countries.
    They did not say whether the constraints were based on 
Russian sensitivities or Congressional sensitivities about 
cost. Anyway, they felt constrained.
    Here is an example. They put in one reception facility for 
one division and when they are moving four divisions. Well they 
actually put in two divisions region-wide, but they spread them 
out so that the most reception facilities put in any one 
country was Poland--three brigades or one division.
    When you have four divisions descending on a facility meant 
for one division, in time of crisis that could be a bottleneck 
that the enemy could have fun with, so to speak.
    Mr. Biden was saying earlier, ``Well, we have got to stack 
the costs of NATO expansion into different categories. What 
will the U.S. really pay?''
    Well, DoD did include the category of the cost for new 
member weapons. But they had a very low amount--they had $1.6 
to $1.8 billion. In my original CBO study, I had $11.5 billion.
    Now, what they got for that amount was one squadron of 
boneyard aircraft for each of the three countries. That is 18 
aircraft per country. In contrast, these countries are planning 
to buy over 300 new aircraft. So, some of their assumptions are 
not very realistic.
    The other thing that went into that $1.6-$1.8 billion was 
what they called ``a level of effort'' which was basically 
picking a number for the amount of anti-tank, air-to-air, and 
air-to-ground weapons that they purchased with the amount.
    They did some ground modernization that was outside of that 
amount, but again, they did a level of effort. Basically what I 
am saying is that they did not do very much in the way of 
upgrading or modernizing to new members' forces, even though 
they count it as a category. They also did not include very 
much infrastructure.
    The other problem that I have is that the DOD has been 
offering the possibility of discounts, leases, and other types 
of financing arrangement for foreign military sales, but they 
do not include that in their cost estimate, either. That could 
mean additional costs.
    So I think I do more in my estimate in a certain sense, but 
only because they do less.
    In my original study, I assumed very modest buys for these 
countries. We bought rudimentary precision guided munitions. We 
have upgraded existing weapons and then bought new ones in the 
long term. In the long term, a 13 to 15-year estimates is what 
we are talking about here. These countries are going to have to 
buy new weapons by 2005. They are not going to have air forces 
if they do not.
    So I think, to some extent, DOD has understated the costs 
of what they need to do to meet the current threat. So I do not 
believe their numbers at all.
    Also, I have an observation about the RAND number. If you 
refer to the Potomac Foundation Report, they compare the RAND 
and the DoD numbers using comparable categories and they do not 
come out the same.
    To the extent that they appear to coincide, they do so 
almost by coincidence because they had different methodologies. 
RAND had a requirements-based, detailed estimate, whereas DOD 
picked these numbers and did not give a rationale or detailed 
costing information for them.
    I think you have to add in weapons costs. RAND did it as an 
add-on, whereas DoD had included the new member weapons costs 
in their estimates. So the numbers come out to be the similar, 
but it is a different analysis and a different methodology. So 
I think there has been a repositioning of some of the estimates 
here.
    I would just respond to a couple of other things and then I 
will give it back to the chairman.
    The statement was made, ``alliances save money.'' But the 
question is for whom does it save money? It is going to save 
money for the countries that are getting in. Whether it will 
save money for us is another story.
    As Mr. Biden was saying, ``Well, we need to detail who is 
paying for what,'' but if the new members cannot pay this, the 
you have one or two choices. You can either provide security 
assistance or other types of assistance. There is a precedent 
for this under PFP in small amounts that grow bigger with NATO 
enlargement. Or you will have the problem if these 
improvements, both to the existing member allied forces and the 
new member allied forces, do not get made. This problem will 
occur some years down the road when a threat arises. I am not 
talking about a resurgent Russian threat. I am talking about 
maybe a Serbia attacking Hungary.
    You are not going to have many mobile forces from the 
allies or you are not going to have any new member 
capabilities. Who are people going to call? Well, the United 
States, of course, because we have the only very potent forces 
that have strategic and tactical mobility. My bottom line is 
that the U.S. could end up paying a large share of these 
expenses either now through helping these countries or later 
because we have to come and intervene when the--threat changes.
    I project that the new countries are going to have to pay 
$34 billion, which is almost a 60 percent increase in their 
defense budgets. Undersecretary Slocombe said 10-30 percent 
increase; I project a 60 percent increase. That is going to be 
a problem for them to pay.
    And so I think it is difficult to segment these things 
because you have to say, ``Well, what would these countries 
have done anyway?'' That is very hard analytically, and any 
analyst who tells you that they can actually figure that out 
with certainty is trying to mislead. These countries have an 
incentive to say, ``Well, we would have done that anyway.'' And 
so, I think that the U.S. could be in for bigger costs than we 
are planning at this time.
    I think you want to include these countries' militaries' 
costs for a very important reason: If they cannot pay it, you 
may have to pay it. Also, if you sell these countries weapons, 
there is going to be pressure to provide security assistance. 
Such security assistance and that was not figured into the DOD 
estimate. You are going to have to add that in.
    Plus, these nation's budgets have been declining since the 
end of the cold war up until recently when they wanted to get 
into NATO. They have not done much. Also, the existing allies 
have not done much to improve their projection of power. So you 
say, ``Well, what is the base line? What would they have 
done?'' I say ``Not much.''
    DOD itself has said that the expanded NATO will not be 
effective if these improvements, both to the new member forces 
and to the existing allied forces, are not made.
    So those are just some thoughts. Thank you, Mr. Chairman.
    [The prepared statement of Dr. Eland follows:]
                    Prepared Statement of Dr. Eland
    Mr. Chairman and members of the committee, I am pleased to be here 
today to talk about the real costs of NATO expansion. When I was at the 
Congressional Budget Office, I wrote its cost study on NATO expansion. 
I have recently moved to the CATO institute. I am submitting the CATO 
Policy Analysis entitled, ``The High Cost of NATO Expansion: Clearing 
The Administration's Smoke Screen,'' for the hearing record. It 
provides a detailed critique of the administration's cost estimate and 
makes the original CBO cost analysis directly comparable to it.
    I believe the United States will pay a large share of the expenses 
for expansion, either now or later. And U.S. costs will be at least 
three to five times as great as the administration claims.
    Under the administration's defense concept of projecting four 
divisions and six wings eastward to reinforce these nations in time of 
crisis, I project U.S. costs to be at least $7 billion, compared with 
the administration's $1.5 to $2 billion estimate. The words ``at 
least'' are very important because I believe, based on my work at CBO, 
that the $7 billion is a conservative estimate. If the potential new 
members cannot afford all of the $34 billion that will be their 
responsibility, U.S. expenses could increase dramatically,
    Potential new members will probably be unwilling and unable to pay 
the $34 billion. That sum amounts to roughly a 60% increase in their 
collective defense budgets at a time when their economies are in 
transition. Also, because these nations realize that President Clinton 
has staked his prestige on NATO expansion and is unlikely to retract 
the offer, we have lost much of our leverage in getting them to pay a 
significant amount. Polls indicate that their populations don't want to 
increase defense spending.
    The United States is likely to get stuck picking up the tab for new 
members because key NATO allies--such as France and Germany--have 
already indicated that they will not pay more than they are now.
    I am always struck when people say, ``I support expansion, but we 
must make our allies pay their fair share.'' Well, they are not going 
to!!! Even during the cold war, when the Soviet threat was severe, we 
complained that our European allies were not paying their fair share. I 
had one Air Force general say to me once, ``as long as we care more 
about European security than the Europeans do, they won't pay up.'' In 
the post-cold war world, they will be even less likely to pay up. The 
threat is drastically reduced, the Europeans are under pressure to 
lower government spending for the EMU, and NATO expansion was our idea. 
They will say and are saying, ``you pay for it.''
    Of course, some people have suggested privately that we shouldn't 
worry that nobody will pay for expansion, because we can skimp on 
military improvements. After all, the threat environment is currently 
relatively benign. We must consider what will happen if some years down 
the road a significant threat appears. And I'm not talking about a 
resurgent Russia. Let's say Seribia attacks Hungary or Belarus becomes 
a problem for Poland. If European forces have not been augmented to 
project power and new members' forces and infrastructure are still 
inadequate, there is only one place to turn.
    The United States, of course. It is the only nation with potent 
forces that have the tactical and strategic mobility to get to the 
conflict relatively quickly. This unilateral intervention will be 
costly in American lives and dollars because military preparations and 
improvements will not have been made. That's why I say the United 
States will pay for a large share of the expenses for expansion sooner 
or later. So if the Senate is concerned about the U.S. paying too much, 
it has no other choice but to vote expansion down.
    The costs will also be much higher than the administration claims. 
The administration projects $27 to $35 billion in total costs, with 
$1.5 to $2 billion accruing to the United States. Some have said that 
other estimates are no more reliable than the administration's. That's 
ridiculous!!! The administration, unlike CBO and RAND, failed to do a 
bottom-up costing of the detailed military improvements needed for 
expansion. In many cases, they simply chose an amount of money that 
they wanted to spend on a broad category of items--for example, 
logistics improvements. They often picked a number without providing a 
military analysis of what was needed or many details on the 
improvements made or costs incurred. In essence, DOD's estimate is not 
a requirements based cost analysis but an estimate of what is 
affordable--that is, the costs the administration believes the Congress 
will accept.
    In other cases, DOD used very questionable assumptions. Here are 
some egregious examples:

   Even though their analysis stretched 13 years into the 
        future, to lower their estimate, they assumed that each nation 
        would purchase the outdated I-Hawk air defense system. The I-
        Hawk, originally deployed in the late-1960s, is being phased 
        out by the Army and will likely be phased out by the Marine 
        Corps.
   Another example is tactical aircraft. They assumed that each 
        nation would buy one squadron of worn-out F-16s from the 
        boneyard. Yet, over the long-term, potential new member 
        countries plan to purchase almost 300 new aircraft.

    DOD analysts also admitted to me that they felt ``constrained'' in 
the amount of military infrastructure that they assumed would be built 
or upgraded in new member nations. It's possible that they felt 
constrained by Russian sensitivities, or even more likely, 
congressional sensitivities to cost. In either case, their estimate was 
not based on what military improvements would be required for NATO 
expansion.
    Finally, despite the fact that DOD is holding out the possibility 
of grants, discount loans, and free leases to encourage new members to 
buy U.S weapons, the Department did not include the costs of any U.S. 
security assistance in its own estimate.
    In short, the administration's estimate is flawed and substantially 
understates the cost of NATO expansion. In my policy analysis, I made 
CBO's original study, which had five options for expansion costing from 
$61 to $125 billion, comparable to the administration's very specific 
plan. The administration's plan, which projected four divisions and six 
air wings east to reinforce new members, did not compare exactly with 
any of the five CBO options, but tended toward the lower end of the 
range. For the total costs of the administration's plan, instead of 
DOD's $27 to $35 billion estimate, I project the cost to be almost $70 
billion, or at least double that amount.
    For U.S. costs, instead of DOD's $1.5 to $2 billion, I project at 
least $7 billion (with emphasis on the ``at least''). Therefore, my 
estimate is at least 3 to 5 times greater than that of the 
administration.
    I spent 15 years at GAO and CBO evaluating government programs in 
the defense and foreign affairs area. The vast majority of government 
initiatives cost significantly more than their initial optimistic cost 
targets. Given the flawed cost estimate of the administration, cost 
escalation is especially likely to happen with NATO expansion. After 
all, the Clinton administration's original cost estimate for the Bosnia 
operation was only $2 billion. Even if the United States pulls out in 
June 1998--which is unlikely--costs will have escalated to over $6.5 
billion.
    Also, the total costs of expansion could increase to as much as 
$125 billion, or in the extreme case--$167 billion, if Russia again 
became a threat.
    Furthermore, I am pessimistic that the Congress will get any better 
cost numbers from the administration or NATO before the ratification 
vote. Conveniently, NATO will not decide how much to increase its 
common budgets and who will pay for any increases until June 1998, 
months after the ratification debate set for early next year. Perhaps 
Congress should delay the ratification vote until then so that it can 
demand a more rigorous estimate of costs from NATO and get a better 
idea of who will pledge to pay them. Otherwise, Congress is being asked 
to write a blank check for expansion.
    The cost estimate that NATO is currently conducting will be a 
political deal. Even more so than the negotiated settlement reached 
between the White House and DOD over what administration cost figures 
the Congress would accept.
    The United States rejected the original NATO estimate for its 
faulty assumptions and costs that were too low. then administration 
officials realized that the Europeans would refuse to pay a lot of 
added costs. Secretaries Albright and Cohen have already begun to say 
that the administration's already low estimate of $27 to $35 billion is 
probably too high. They are beginning to sound like contestants on the 
``price is right.''
    Last week, the Secretaries suddenly found the military 
infrastructure in new member nations to be better developed than they 
thought. When I did the CBO study, however, I received an unclassified 
intelligence briefing that said that the military infrastructure, the 
armed forces, and the road and rail systems of the new member states 
were in terrible shape. Finally, theNATO estimate will leave out the 
substantial costs to correct shortfalls in new member and allied 
forces. In short, don't look for the cost estimates to get any better. 
In fact, it looks like they're going to get worse.
    But high costs are not the only reason that the Congress should 
reject expansion of the alliance. Expansion impairs the flexibility of 
U.S. foreign policy in an uncertain post-cold war world. We could be 
tied down in Europe when the major challenges may come in Asia. Also, 
we might benefit from Russia's help if China becomes a rising, 
aggressive power. Why needlessly antagonize Russia for ill-defined 
security gains in a non-strategic region of Europe, when we might want 
its cooperation on other issues that are more critical to U.S. 
security, Russia is still the only nation that can completely devastate 
our homeland with nuclear weapons and NATO expansion is impeding 
strategic arms reduction.
    If the NATO military alliance is so good at ensuring stability, and 
the real goal of expansion is to stabilize this part of Europe, why 
have so few proponents considered admitting Russia. It is the nation 
which is the most crucial to stabilize. Instead there is euphemistic 
talk of ``consolidating the gains of the cold war,'' which implies that 
expansion is really aimed at a future Russia that is resurgent and 
aggressive. This pessimistic scenario is not a given. Besides, what's 
the rush to expand? We have plenty of warning time to spot the rise of 
a future peer competitor.
    Finally, an Article 5 defense guarantee to new members could 
involve the United States in regional quagmires in an unstable and non-
strategic area--future Bosnias. Yet, we are expanding both the 
territory and the missions of the alliance at a time when western 
defense budgets have been declining.
    That concludes my prepared remarks. I will be happy to answer any 
questions.

    The Chairman. Thank you very much. Mr. Hadley?

    STATEMENT OF THE HON. STEPHEN HADLEY, PARTNER, SHEA AND 
                    GARDNER, WASHINGTON, DC

    Mr. Hadley. Thank you Mr. Chairman, members of the 
committee.
    In my statement, I suggest that we get too quickly in this 
debate into dueling dollar figures and details of costs, and 
not enough talking about what are the requirements associated 
with the admission of these three countries in NATO and what 
are the military capabilities needed to meet those 
requirements?
    In that connection, let me just make a few points here.
    One, I think we can all agree that the security guarantee 
that comes with NATO membership for these countries must be 
credible. We do not want to make commitments that we cannot 
deliver on. I think that is a starting point.
    So then the second question becomes are we doing that if we 
bring them into the alliance? I think the answer is no. You are 
going to want to hear testimony from current military leaders 
on this subject, but my understanding is there is a fairly wide 
consensus that it is a benign security environment in Europe 
today and that the current forces deployed in NATO are adequate 
to defend this territory today.
    That raises a question, of course----
    Senator Biden. Excuse me, point of clarification, Mr. 
Hadley.
    Mr. Hadley. Sir?
    Senator Biden. The credible guarantee--were you talking 
about the guarantees required by the Atlantic alliance, or by 
the Atlantic treaty? In other words, the Washington treaty--
that we would go to the common defense?
    Mr. Hadley. Right, article 5.
    Senator Biden. And you are saying that is not credible?
    Mr. Hadley. No. I am saying that it is very important that 
that be credible and to make it credible, we have to have real 
military capability to stand behind it.
    No one wants to give that guarantee----
    Senator Biden. I see. I am sorry.
    Mr. Hadley. [continuing]. and not have the wherewithal to--
and I think that is a point of departure for all of us here.
    So there--the question then becomes if in the current 
security environment, we are not extended an incredible 
guarantee, but in fact, the guarantee is credible, what about--
what is the likelihood in the requirement if there is a major 
threat down the road to NATO and to these three countries?
    And, of course, for such a change--threat to emerge, it 
would probably come from Russia. It would require a change of 
policy in Russia. It would require a major reconstitution of 
their conventional military capability. That will take time.
    The United States would have to--and NATO, its NATO 
allies--would have to do a lot of things to respond to that 
kind of threat. Again, while I think it is a question for 
senior military leaders to talk about, my own view is that 
having these three countries in NATO would not add 
significantly to the burden of what the United States and NATO 
would have to do in light of that eventuality.
    Indeed, I would think that because of the forces these 
countries would have and the strategic significance of the 
territory they occupy, we would be glad to have them in NATO 
should that eventuality arise.
    So it raises the question about the military requirements 
that result from the entry of these three countries into NATO 
for both the countries themselves, for, as Secretary Slocombe 
talked about, the common funding programs, and for our existing 
allies. Let me just make, if I could, three points about that.
    First, I think it is important to emphasize that there is a 
normal NATO planning process that is going to identify the 
answers to all of these things--what is required for the NATO 
common funding, what these countries need to be doing in terms 
of their own forces. There is a process under way to do that.
    One of the elements is the cost of integrating these 
countries and their militaries into NATO. The estimate placed 
by the OSD people was that is a $9-$12 billion item over a 10-
year period.
    I would agree with the GAO report of August 1997 that this 
really is the true cost of NATO enlargement, the cost that but 
for enlargement, you would not be incurring. My own judgment is 
those kinds of numbers over a 13-year period is a small price 
to pay for the benefits of NATO enlargement.
    Now, there is the issue of the requirements for these 
countries, these three countries who would join NATO. It has 
been made clear that is a national responsibility out of 
national budgets.
    Concern was raised earlier in the questioning as to whether 
this is an unreasonable burden to impose on these countries. I 
would simply say we have to recognize these are not bombed-out 
economies in the post World War II period. These are robust 
economies, they are expected to expand.
    What we are really talking about is getting them to the 
point where they would spend 2 to 3 percent of their gross 
domestic product on defense. That is not an unreasonable 
number. It is what we have tried to get our other allies to do.
    And I think these countries have indicated that they are 
willing to do it, and that because of their histories, they 
understand the price the--that freedom requires and I think 
they are liable to pay it. I do not think it is an unreasonable 
burden.
    Finally, there has been a lot of talk about the requirement 
of the existing NATO allies to improve the ability of their 
forces to go out of area, to deploy and be sustained. I would 
just point out that is a requirement that predates NATO 
enlargement. It came in 1990 and 1991 timeframe when we 
revising NATO's strategy at the end of the cold war.
    It is not, in my view, fairly a cost of NATO enlargement. 
That is not to say it is not important for our European allies 
to do this--it is. We should push them.
    But rejecting the applications for membership from Poland, 
Hungary, and the Czech Republic will not somehow make it more 
likely that the Europeans will undertake these expenditures. 
Rejecting membership of these three will not make NATO any 
safer if the Europeans fail to undertake these expenditures.
    On balance, I am optimistic that they will. I think the 
Germans are critical on this point. I think you are going to 
want to talk with German government officials, but my 
conversation with them suggests that they understand that the 
security of these three countries is essential to the security 
of Germany, that NATO's ability to defend Poland is essential 
to the defense of Germany, and I think that gives them the 
incentives to do what needs to be done.
    Thank you very much, Mr. Chairman.
    [The prepared Statement of Mr. Hadley follows:]
                    Prepared Statement of Mr. Hadley
    Mr. Chairman, Members of the Committee. I appreciate very much the 
opportunity to appear before you today on the question of the costs, 
benefits, and military implications of bringing Poland, Hungary, and 
the Czech Republic into the North Atlantic Treaty Organization 
(``NATO'').
    Recent public debate on the issue of NATO enlargement has focused 
increasingly on the issue of the cost. You have my sympathies as you 
try to come to grips with this difficult issue. I believe the public 
debate has perhaps disserved you a bit by moving too quickly into a 
battle of competing estimates and different dollar figures. Before we 
get into the details of the cost issue, it may be useful to step back a 
minute and ask ourselves the question: what are the military 
requirements associated with NATO membership for Poland, Hungary, and 
the Czech Republic, and what military capabilities are needed to meet 
these requirements? I will try to walk briefly through the kinds of 
questions that present themselves when one begins the cost debate from 
this starting point.

                 Requirements, Capabilities, and Costs

    But before doing so, there is one point of principle on which I 
would hope everyone involved in this debate can agree. That is, that 
the security guarantee that comes to these countries with NATO 
membership must be a credible one. It must be backed up by real 
military capabilities which would allow NATO, if necessary, to make 
good on its defense commitment to these new members. We do not want an 
alliance with two tiers of members--the secure, and the less secure.
    With that as a starting point, the first question is simple:
What are the military requirements for making credible the security 
        guarantees extended to the three new members as part of NATO?
    The answer to this question requires an assessment of the current 
security situation. In brief, with the important exception of Bosnia, 
the security situation in Europe is probably the most benign that it 
has been at any time in this century. There is no immediate threat of a 
major attack on our NATO allies and no prospect of one in the 
foreseeable future. The Committee will want to hear testimony from 
current U.S. military leaders on this subject. But my understanding is 
that there is a fairly widespread consensus that NATO's current 
military forces deployed in Europe are adequate to insure the security 
of NATO's current members and these three countries in the current 
security environment.
    The question that logically follows from this conclusion is this:
What additional military requirements would result from bringing these 
        three countries into NATO if a major conventional military 
        threat were to arise at some point in the future?
    Perhaps the most readily identifiable source of such a potential 
threat would be Russia. I would argue that one of the benefits of NATO 
enlargement is precisely that it makes such a future Russian threat 
less likely by stabilizing Central Europe, an area that has played a 
central role in two World Wars and one Cold one. The effort to develop 
a positive relationship with Russia and to bring Russia into a variety 
of political and economic relationships with Western nations are all 
designed to reduce the prospect of such a threat. For such a threat to 
emerge, it would require not only a major change in policy on the part 
of the Russian government but also a major reconstitution of Russian 
conventional military capabilities. This would require a major effort 
that Russia cannot now afford, and could only arise over a period of a 
decade or more. I believe this conclusion reflects the consensus of 
most analysts who have looked at the question.
    The emergence of such a threat would require a major response from 
the United States and NATO in upgrading and expanding their military 
forces. The United States and NATO would have to act decisively based 
on evidence of such an emerging threat and build up their own forces 
within the timelines of the force buildup of their potential adversary 
in order to try to deter a conventional conflict. While it is a 
question for the nation's senior military leaders, I would be surprised 
if they would conclude that the presence of Poland, Hungary, and the 
Czech Republic in NATO would add significantly to the burden that the 
United States and NATO would otherwise have to bear in order to meet 
such a reconstituted Russian threat. Indeed, because of the forces that 
these countries will themselves have, and the strategic significance of 
the territory they occupy, I believe that should such a threat arise, 
we will be very glad that we had included them as members of NATO.
    This leads to a third question:
If we do not need to be prepared today to deal with a major 
        conventional military threat, what standard should we apply in 
        judging NATO's military requirements?
    One might think of a standard that would call for sufficient 
military capability:
   To provide security and reassurance within Europe in the 
        current relatively benign security environment;
   To provide highly capable military forces able to move 
        rapidly to areas of crisis in the event that some unexpected 
        military threat arises; and
   To provide a solid military base on which NATO can build in 
        the event a major conventional military threat should 
        materialize.
How would one identify the military requirements that result from this 
        standard as applied to the entry of Poland, Hungary, and the 
        Czech Republic into NATO?
    The process of identifying these requirements is already underway 
within NATO as part of the traditional NATO force planning process, now 
expanded to include these three potential member countries.
    The first part of this force requirement process will be to 
identify those military facilities and capabilities required for these 
three countries to operate as part of the NATO alliance. This involves 
such things as airfields that can receive, refuel and service NATO 
aircraft, communications equipment that will allow the military forces 
of these three countries to talk to other NATO forces, and 
participation in the NATO air defense network. NATO is engaged right 
now in defining these requirements and will have its results in 
December. The great majority of the costs associated with these 
requirements will be funded out of three so-called ``common funded'' 
programs to which all NATO members contribute. These costs are spread 
among NATO members using a well-established formula, with the current 
U.S. share being 24 percent.
    The point here is that there is an existing procedure for obtaining 
NATO consensus on what these requirements are, what it will cost to 
meet them, and how that cost will be shared among the NATO allies. How 
much if anything NATO members will be asked to contribute over and 
above what they have already committed to these three common funds will 
depend on the requirements actually identified by NATO, the cost of 
meeting those requirements, and whether those costs can be met by 
taking funds from existing lower priority projects. The study prepared 
by the Office of the Secretary of Defense (``OSD'') last February 
estimated these costs at between $9 and $12 billion over a ten year 
period. Secretary Albright and Secretary Cohen have indicated that the 
actual number might turn out to be significantly lower. The U.S. share 
of the OSD estimate would be about $150 to $200 million per year.
    I would agree with the General Accounting Office in its report of 
August, 1997, that these are the true costs of NATO enlargement--costs 
that NATO would not incur but for the admission of these three 
countries into the Alliance. It seems a small price to pay when 
compared to the benefits of NATO enlargement in terms of enhancing 
stability in Europe, strengthening the NATO alliance, contributing to a 
more stable relationship between NATO and Russia, and maintaining U.S. 
leadership and influence in Europe.
    That said, however, the three new states will be joining a military 
alliance and will assume an obligation, like the other members of that 
alliance, to contribute their fair share to the common defense. But 
this is hardly a cost of NATO enlargement. This is the cost that every 
nation incurs in providing for the common defense of its citizens.
    Which leads to the fourth question:
What are the requirements for the militaries of the three new members 
        of NATO?
    Generally, these nations need smaller forces, of higher quality, 
that are interoperable with those of NATO. NATO will help these 
countries turn this principle into specific military requirements and 
the kinds of military capabilities best suited for meeting those 
requirements. This will be done as part of the normal force planning 
process in which all NATO members participate. But as is the case for 
all NATO members, the cost of fielding the forces needed to meet these 
requirements will be a national responsibility, funded out of the 
national budgets of these three countries. It will not represent an 
additional cost for NATO or its current members.
    Some have suggested that these costs pose an unacceptable burden 
upon these three countries. The studies I have consulted and the 
experts I have talked to do not agree with this assessment, however. 
Because of the relatively benign security environment in Central 
Europe, these countries should have a considerable period of time over 
which to improve their forces. They will have the flexibility to trade 
off meeting military requirements against other budgetary priorities. 
All three countries have robust, expanding economies projected to grow 
at a rate of about four to five percent per year into the next decade. 
They have indicated that they believe they can ultimately afford 
defense spending at the level of two to three percent of their gross 
domestic product--the level that is expected from NATO members 
generally. This level of spending should provide sufficient financial 
resources to meet NATO requirements. While such expenditures do reflect 
an economic burden, I believe these countries would be the first to say 
that this is a relatively small price to pay for preserving their 
newly-won freedom. And it is certainly a lower price than they would 
have to pay if they were outside the NATO alliance.
    That is not to say that our NATO allies, and the United States, 
have not in the past or will not in the future decide voluntarily to 
provide some assistance on this score. But I do not believe, as some 
have suggested, that these countries need a military ``Marshall Plan.'' 
These are not ruined economies recovering from the devastation of war 
and facing an imminent, overwhelming military threat. They have the 
time to upgrade their militaries, and the economies from which to fund 
it.
    Which leads to the fifth question:
What are the military requirements of NATO enlargement for our existing 
        NATO allies?
    In addition to paying their prescribed share of the NATO ``common 
funded'' programs (such as the NATO Infrastructure Program), our NATO 
allies should continue, as they have already been doing, to work 
bilaterally with these three countries to help prepare them for the 
responsibilities of NATO membership. There are a number of examples of 
what our allies have undertaken in this regard, the most recent being 
an effort to create a joint multinational military unit among the 
Danes, Germany, and Poland. This is the kind of ``burdensharing'' that 
we can rightly ask our allies to undertake in connection with NATO 
enlargement.
    It has been suggested in the public debate, however, that part of 
the cost of NATO enlargement are expenditures by our NATO allies to 
enhance the re-enforcement and the sustainment capability of their own 
forces--the ability to maintain those forces outside of their home 
territory on military operations for a sustained period of time. I 
believe strongly that our NATO allies need to make the expenditures 
required to give their forces this capability. But I do not believe 
these expenditures are properly viewed as a cost of or a prerequisite 
to the inclusion of Poland, Hungary, and the Czech Republic in NATO. 
These force requirements had their origin in the NATO force planning 
process during the 1990-1991 timeframe as a result of a change in NATO 
strategy to reflect the end of the Cold War. NATO changed its defense 
concept from one of fixed forces defending the NATO homeland against a 
known threat to increasingly multinational forces able to deploy 
flexibly to meet contingencies within NATO territory or outside its 
borders. While these forces would be used to reinforce Poland, Hungary, 
and the Czech Republic in the event of a major conventional threat (of 
the kind that presently seems quite unlikely in Central Europe), the 
requirement predates NATO enlargement and would exist even if NATO were 
not to expand. Therefore, it seems unfair to assess this as a cost of 
NATO enlargement.
    Let me be clear. These are expenditures that our European allies 
should make as part of their contribution to the common defense 
regardless of NATO enlargement. But rejecting the applications for 
membership from Poland, Hungary, and the Czech Republic will not make 
it more likely that the Europeans will undertake this expenditure. 
Quite the contrary.
    On balance, I am optimistic that our NATO allies will carry out the 
commitments they have made to upgrade the reinforcement and sustainment 
capability of their forces. The Germans are key in this regard. I hope 
the Senate will have an opportunity to hear senior German governmental 
officials on this point. But my conversations with German officials 
suggest that they clearly view the security of Poland as essential to 
the security of Germany--that NATO's ability to defend Poland is 
essential to the defense of Germany. This increases the incentive that 
force enhancements useful in defending this territory will in fact be 
made. In addition, the U.K., Germany, and France all have programs 
underway to create rapid reaction forces of various kinds. These plans 
result not just from their NATO commitments but also from their desire 
to enhance European defense capabilities as part of an emerging 
European defense and security identity. This gives these countries an 
added incentive for carrying out these plans.
The Benefits of Enlargement
    It seems unfair to address the costs of NATO enlargement without 
also addressing the benefits--or, to put it another way, without 
addressing the cost of not expanding NATO. If the OSD cost study is 
even close to right as to the direct cost of NATO enlargement--$9 to 
$12 billion over 13 years--and even considering the additional cost 
associated with modernizing the forces of the three new entrants and 
upgrading the forces of our remaining NATO allies, the benefits of 
expanding NATO to include Poland, Hungary, and the Czech Republic more 
than outweigh these costs.

   It will make Europe more stable, not less stable, and will 
        reduce the risk of military competition or conflict.
   It will strengthen NATO, not weaken it, and will make NATO a 
        better instrument for protecting the security of Europe.
   It will contribute in the long run to a more stable 
        relationship between NATO and Russia by eliminating a potential 
        area of competition.
   It will help to maintain U.S. leadership and influence in 
        Europe.

    Let me elaborate on these points:

                           Stabilizing Europe

    The experience of Western Europe after the Second World War has 
shown that encouraging greater integration among the countries of 
Europe is the best way to overcome a long history of military 
competition and conflict among European states. That is why since the 
end of the Cold War it has been the policy of both Republican and 
Democratic administrations to bring the nations of Central and Eastern 
Europe into a closer political and economic relationship with the West.
    We know from history that leaving these nations in a geopolitical 
no-man's land in Central Europe has contributed to two World Wars and 
one Cold one. Membership of these three countries in NATO will 
eliminate the future possibility that they will be caught in a 
geopolitical competition between a unified Germany and a potentially 
resurgent Russia. In this way, we can eliminate an historic area of 
instability and one of the few that in my judgment could present the 
risk of a serious and renewed military confrontation in Europe.

                           Strengthening NATO

    The addition of these members will strengthen, not weaken, the NATO 
alliance. These three nations, and Poland in particular, already 
possess significant military capability that exceeds that of a number 
of existing NATO nations. They have already shown a willingness to 
shoulder the responsibilities of collective defense by contributing 
military forces during the Gulf War and the Yugoslav crisis. Because of 
their histories, these are countries that take security seriously.
    In NATO, these countries will be a force for stability in Europe. 
Just the prospect of NATO membership has been a real incentive to these 
states to resolve border disputes with their neighbors and to establish 
frameworks for managing their relations with ethnic communities located 
within the territory of their neighbors. These nations have made real 
progress in building democratic societies and have reached a level of 
maturity that I believe should provide confidence that they will 
continue to make a positive contribution to security in Europe and will 
not, as some would suggest, use their position within the Alliance to 
provoke or bully their neighbors. The best way to encourage their 
continued democratic evolution and maturation is to bring them into the 
NATO family of democratic states, not to put them through the domestic 
political trauma of turning down their bid to join NATO.

                    Improvinig Relations with Russia

    Expanding NATO to include Poland, Hungary, and the Czech Republic 
does not exclude Russia from Europe and is not intended to do so. Both 
Republican and Democratic administrations since the end of the Cold War 
have sought to support democratic and free market reform in Russia and 
to include Russia in Western political and economic institutions. In 
addition, Russia has been included in the NATO force in the Balkans, 
has been included in NATO's Partnership for Peace program, and now has 
its own special relationship with NATO as reflected in the Founding Act 
signed in Paris last spring.
    Despite the concern expressed by some that enlargement of NATO 
would lead to a crisis in relations between Russia and the West, it has 
not done so. While even Russian democrats cannot be seen to sanction 
NATO enlargement publicly, opinion polls in Russia suggest that 
bringing Poland, Hungary, and the Czech Republic into NATO is just not 
an issue of concern to the bulk of the Russian population. Even General 
Lebed has recently said publicly that inclusion of these three 
countries in NATO does not present a threat to Russia but is only ``the 
legal formalization of the historically developed community of western 
civilization.'' NATO enlargement in the long run will support democracy 
in Russia by making clear to more reactionary elements that a ``return 
to greatness'' by reestablishing a Russian sphere of influence in 
Central and Eastern Europe is simply not in the cards.
    There is great uncertainty about the future direction of Russia, 
but what Russia becomes in the future will be determined by what 
happens inside Russia, particularly to its economy. What is important 
is for us to impress upon the Russians that we welcome a democratic 
Russia as part of the West and that we take Russia's legitimate 
security concerns seriously. Our goal should be to cooperate closely 
with Russia on issues of common interest, while at the same time 
providing reassurance and stability to Russia's Central and Eastern 
European neighbors and discouraging any inclination in Russia toward 
trying to reassert a military sphere of influence there. This is a 
sophisticated policy, hard to sustain. But despite some evidence to the 
contrary, I believe that a U.S. foreign and security policy can 
successfully pursue both of these policies at the same time.

                      Insuring American Leadership

    Since the end of World War II, the United States has expended 
enormous effort and trillions of dollars in seeking to build a unified 
Europe composed of free and democratic states at peace with one 
another. For the first time since the end of World War II, we have a 
realistic possibility of achieving this objective. It is important that 
the United States not turn its back on this great European project but 
continue to provide the commitment and leadership required to see it 
through. For the reasons I have already suggested, inclusion of Poland, 
Hungary, and the Czech Republic in NATO substantially advances this 
goal.
    The United States needs a vital, robust NATO as not only an 
instrument for assuring long-term stability but also for deterring or 
dealing with those security crises that are likely to emerge in Europe 
(such as Bosnia), on the periphery of Europe (such as in North Africa), 
or from outside of Europe (such as the Persian Gulf). If NATO does not 
adapt to the changes that are occurring in Europe--including most 
particularly the emergence of these three Central European nations as 
free, independent, and democratic states--then NATO will become 
irrelevant to Europe.
    It is true that America has important interest elsewhere in the 
world and that the threats to those interests are in some sense more 
acute--whether it is the possibility of a nuclear Iran or uncertainties 
about the intentions of an emerging China. But precisely because of 
these other interests and potential threats, it is critical that Europe 
remain a zone of relative peace and stability so as to give the United 
States the freedom of action it needs to exercise its power and 
leadership to deal with crises and problems outside of Europe. The 
absence of an immediate threat in Europe is precisely the time to take 
those actions that will help to ensure that a threat to stability in 
Europe does not arise in the future.

    The Chairman. Senators, suppose we take 5 minutes apiece. 
Let us see how we do on that.
    Senator Biden. OK.
    The Chairman. And then have two or three rounds in case 
somebody else comes in.
    The one I hear most from my constituents who discuss this 
expansion--not many of them are discussing it. They have got 
things closer to home.
    But they said that, ``Well, everything is peaceful in 
Europe now. No Hitlers in sight,'' and so forth.
    ``But our problem,'' they have said, ``lies in the other 
direction over in the Pacific.'' And I guess what they are 
asking me is does the NATO alliance offer the United States any 
benefits beyond Europe, especially in the event of war in the 
other side? You want to address that?
    I had a young group of people ask me that, and I did the 
best I could with it, not knowing the answer to it, and I am 
sure you do not, either. But what is your speculative answer to 
it?
    Mr. Hadley. I think they can help us in those situations. 
We had a number of our NATO allies, almost all of our NATO 
allies, with us in the Gulf War. We also had a number of these 
three countries in the Gulf War. So I think there is an 
advantage, and they can help us in those contingencies.
    But I think it is also important to emphasize that Europe 
is secure and stable right now and we have an interest to 
keeping it stable and secure.
    And that is why I think NATO enlargement is important 
because with a NATO--with a Europe that is safe and secure, we 
have the freedom and flexibility to use our forces to deal with 
some contingencies in other areas where it is--where we have 
real interests and where those interests may seem to be more 
imminently threatened such as places like the Gulf, with a 
potentially nuclear Iran, or uncertainties about China.
    But it is precisely stability and security in Europe that 
is going to both free us to deal with those problems, and I 
think also, give us some allies to help us.
    The Chairman. OK. Now, Dr. Eland, another thing that comes 
up in the conversation with not only the folks back home, but 
people I meet from other states. Considering the estimate--your 
estimates of the costs involved in this expansion, do you think 
the United States continues to derive sufficient benefits from 
the NATO alliance with or without expansion? And if you were 
asked that question by a group to which you just addressed, 
what would you say?
    Dr. Eland. Well, I would say that the NATO alliance and, 
especially, an expanded NATO alliance, somewhat impedes our 
flexibility in foreign policy. I think it may tie us down and 
take a lot of resources when we may want more flexibility in an 
uncertain world.
    For instance, we might want Russia's help in containing an 
aggressive China if one comes up--I am not predicting that.
    The other thing is it may take a lot of resources that we 
should be saving for other theaters. Maybe we will be too 
concerned with Europe and not enough with Asia. I think those 
are issues of flexibility.
    This was originally a cold war alliance, and the cold war 
is over now. So I think you really have to assess whether it 
impedes your foreign policy flexibility to some extent.
    The Chairman. Are you asking that question--I know you make 
a lot of public appearances. Are you asking the--essentially 
the same question that I just asked you? Is that the answer you 
give--to the question?
    Dr. Eland. Well, I do not make a lot of public appearances, 
really. So I really have never given that answer before.
    But I think it is a good answer.
    The Chairman. All right. Dr. Kugler, very quickly. If we do 
not proceed with the expansion, do you have any estimate of 
what the potential cost to the United States would be if 
tensions should rise in Europe?
    Dr. Kugler. Yes, Mr. Chairman. I earlier did an analysis 
for the Pentagon. It was not focused so much on the cost of 
rising tensions. Instead, it was focused on this issue: If we 
do not admit these countries into NATO, how much will it cost 
to defend this region without having them in NATO? And my 
estimate was that the cost would double--in peacetime.
    Now, if we got into a crisis confrontation, and these 
nations are in NATO, the RAND estimate put forth an estimate of 
about $110 billion. But if they were not in NATO, the estimate 
would be far higher.
    The Chairman. I see.
    Dr. Kugler. Yes.
    The Chairman. Thank you very much. Senator Biden?
    Senator Biden. Thank you. Mr. Hadley, I think the way you 
approach this really kind of sets out the issues, how we should 
be looking at expansion--and people can reach a different 
conclusion than you and I reach on this.
    But this notion of credible guaranteeing, what Dr. Kugler 
is talking about, and that is--what would it cost to defend 
these countries were they in or not in NATO in a different 
circumstance?
    Interestingly I think that--and Mr. Eland, I suspect you 
would agree with this as well; maybe the only thing we would 
all agree on--is that right now, if you asked the 100 United 
States Senators ``Would you respond with aid if Poland were 
invaded by Russia?,'' I think you would get 99 ``yeses.''
    I may be wrong, who knows? But I think there would be an 
overwhelming sense, whether it is official or not, that we 
would not tolerate another invasion of Czechoslovakia--I mean, 
excuse me, of Hungary. We would not tolerate Russian troops 
moving back into the Czech Republic, and so on.
    Part of this debate is kind of surreal because we talk 
about it in terms of whether we are going to defend, be part of 
defending those countries, or we are not going to defend them 
when, in fact, our stated public policy--and I cannot imagine 
it changing from this president to a Republican president--
would be to say, ``No, no to either option. That is we will 
make our decision when an invasion occurs.''
    Now, granted, treaties are serious business, so when you 
sign the treaty, you are pledging the sacred honor of this 
country that you will do it. So I am not diminishing the 
significant difference in actually being in the treaty and not 
being in the treaty.
    But it kind of confuses me, in terms of the way the debate 
is conducted. If we could all kind of start from a basic 
premise, the same basic premise, we could construct a syllogism 
here that might serve us well.
    Do you start, Dr. Eland, from the premise that the United 
States either commits to defending those countries if it is in 
NATO, if they are in NATO, or if they are not in NATO, we make 
no such commitment?
    Do you address that in your threat assessment? You went 
through a threat assessment based upon what the world will look 
like in your view, and it is a reasonable view. I mean, I am 
not criticizing the assessment of what the world looks like 
today and what Europe looks like today, what Europe will look 
in 10 years from now or 15 years from now.
    You conclude that our European--that the three countries in 
question will have to do something we did not with any other 
admittees--with Spain, for example. You suggest they have got 
to be up to snuff with modern precision aircraft within that 
10-year period.
    Dr. Eland. No, they say that.
    Senator Biden. Pardon me?
    Dr. Eland. They are planning on doing that, in the long 
term.
    Senator Biden. Yeah. They are saying that, but you and I 
both know that they do not have the money to do that.
    And the question is whether or not it is reasonable--well, 
whether or not that will be demanded of them by NATO.
    In other words, there are two issues here. You sit down and 
you talk to the Poles, as I did in Warsaw, and they say what 
they would like their military to look like in 10 years is--it 
may or may not be what is a minimum requirement for them to be 
a contributor to NATO.
    If we look at Spain and Spain's accession to NATO and the 
manner in which it modernized its military, the speed with 
which it did it, the proficiency with which it acquired that 
capability--that expansion is significantly different.
    And they are a great ally--I am not in any way belittling 
their contribution. But we did not look at them and say, ``Now, 
look, here is the deal. You have to do what, quote, some in 
Poland are saying they would like to do.''
    So is there a distinction between what the Poles, for 
example, say they plan on doing, and what is required to meet 
the Perry principles for Poland to have to be able to do to be 
a contributor to NATO? Is there a difference there?
    Dr. Eland. Well, I think if you want them to do peace-
keeping exercises, you give them a few radios and that is 
pretty much it.
    But if you want them----
    Senator Biden. They are already doing peacekeeping 
exercises.
    Dr. Eland. Right--under PFP. So just admit them and have no 
costs at all then.
    But I think that these countries are going to buy these 
aircraft over time.
    Senator Biden. Yeah.
    Dr. Eland. This is a 13 to 15-year window.
    Senator Biden. Right.
    Dr. Eland. And in my estimate, I did not gold plate this at 
all. I mean, we rewired existing MiGs, we rewired T72 tanks, 
and then over time we only replaced one-third of the T55 tanks 
which do not work today.
    So as far as my estimate goes, there is no disconnect 
between those two. I think it was pretty modest because we 
assumed that basic precision weapons would be purchased. We did 
not gold plate the estimate.
    And they are going to have to buy some aircraft because in 
2005, they are not going to have an air force if they do not do 
that. All of these estimates are over a 13 to 15-year period.
    So I think it depends on how effective you want them to be, 
but DOD says that they must have a basic defense capability. 
Their militaries are not in very good shape.
    DOD includes these costs to improve new member's weapons. 
As I mentioned before, you probably should include these costs. 
``What would they have done anyway'' is basically what your 
question is.
    Senator Biden. No, no, no. That is not my question. My 
question is what is needed for them to do to be a contributing 
member to NATO, what is needed for them to do over the next 
decade, versus not what they would do, what they want to do, or 
what they will do. What is needed for them to do to be a 
contributing member?
    Mr. Kugler would like to--is it all right with you, Mr. 
Chairman? May he respond to----
    The Chairman. Well, let me say this. We need to wind this 
up.
    I was going to say, beginning with Mr. Kugler, each to have 
a--3 or 4 minutes, if you need it, for a postscript to answer a 
question or extend a comment or whatever. We will begin with 
you.
    Dr. Kugler. This is the question that I want to answer: The 
difference between what the new members should do and what they 
will do. The difference will be only 7 percent. Let me explain.
    Subsequent to this RAND work that I have talked about here, 
I have been working on an additional study on this issue. I 
performed this study for the Pentagon--it contained about 40 
different dimensions--that identified where we will want these 
new members to go in terms of NATO military capabilities.
    The basic goal was to make them average and normal for NATO 
as a whole--not at the top of NATO and not at the bottom, but 
in the middle--thus, solid and capable of carrying out NATO's 
defense plans.
    Now, subsequent to that, I have gotten access to the Polish 
defense budget and where they are going.
    We did a study at RAND for Poland and they are doing 
excellently. They literally--given what they plan to spend and 
what is in their budgets--will draw within 7 percent of, on 
average, of the goal of making them solid and normal. This is 
well within the range of adequacy.
    So, the Poles in my view get a grade of A. If we can have 
all of our allies like the Poles, we will have an excellent 
alliance. I cannot speak so much for the other two countries; I 
have not looked at them in as much detail. But, anyway, that is 
my answer. You, Senator, have asked the proper question: where 
should we drive the new members, where are they going, and is 
there a difference between the two?
    And in the case of Poland, there is not much difference.
    The Chairman. OK. Mr. Hadley, let us jump down to you for a 
postscript.
    Mr. Hadley. I would like to pick up on Senator Biden's 
point because I think he has asked the right question.
    If you think, and if 99 Senators think that we would come 
to the defense of these three countries, I would argue that 
that is a very strong argument for bringing them into the 
alliance and making that clear. I think it is the right answer 
because I see defense of these three countries as an extension 
of our commitment to defend the current allies.
    But you want to make that clear so that the Russians 
understand it are not--do not--we do not have any 
miscalculations here, and so that these three countries 
understand it and know where their place is. So I think that is 
a good place to start this debate.
    The Chairman. Thank you. Dr. Eland?
    Dr. Eland. Well, I would just like to say that if we are 
going to defend these countries then that is a national 
decision whether we do that or not if we have not admitted them 
into the alliance.
    To admit them there are also going to be additional 
expenses for interoperability and things that we are going to 
have to pay as well. So I think the costs are going to be 
greater to admit them in the alliance.
    The other thing is what is a basic defense? I mean, we may 
differ on that, I think. I received an unclassified 
intelligence briefing when I was doing the study, that 
concluded their armed forces and their military 
infrastructure--for example, their road and rail system--are in 
very poor shape.
    I would also like to respond to one other thing. I made the 
statement that the NATO alliance and especially expanding the 
NATO alliance, might impede your flexibility. I mentioned Asia.
    But you can also get pulled into things in which you do not 
want to be involved. As you were saying, Senator Biden, there 
is a difference between saying, ``Well, we are going to give 
you aid'' and actually being committed to defend and put troops 
on the ground.
    I think the costs will increase dramatically. What I think 
is going to happen here is that we are going to let these 
countries in. The new countries are not going to pay very much 
to improve their militaries and infrastructures and the 
existing allies are not going to pay very much either. And the 
United States is constrained by budgetary constraints. We think 
we do a lot in NATO already.
    So what happens then if, say, Serbia attacks Hungary down 
the road or Belarus becomes a problem for Poland? We are going 
to have to come to the rescue. That is going to be a lot of 
lives and dollars, and that is going to increase the cost.
    Even if you vote in favor of expansion, you should get the 
Department of Defense to provide a better cost estimate. I have 
gone into the details and I just do not think it is a very good 
cost estimate.
    Senator Biden. You are opposed to expansion unrelated--in 
addition to your concern about costs?
    Dr. Eland. Well, when I did the study, I worked at the CBO, 
and I made an honest attempt to not gold plate the thing just 
to----
    Senator Biden. I am not suggesting you did. I am just 
asking your view of expansion. Do you support expansion, 
assuming the costs were able to be met?
    Dr. Eland. I am opposed to expansion and not just on the 
basis of costs. I think there are a lot of other reasons.
    Senator Biden. Thank you.
    The Chairman. Thank you, gentlemen. This has been a very 
enlightening morning for me, and all of this will be printed 
and made available to the media and to others.
    Now, we will submit some written questions--Senators who 
were not present, and I am sure you will not mind responding to 
them.
    There being no further business to come before the 
committee, we stand in recess.
    [Whereupon, at 12:04 p.m., the hearing was adjourned, to 
reconvene at 9:32 a.m., October 30, 1997.]



                    NATO-RUSSIA RELATIONSHIP--PART I

                              ----------                              


                       THURSDAY, OCTOBER 30, 1997

                                       U.S. Senate,
                            Committee on Foreign Relations,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 9:32 a.m. in room 
SD-419, Dirksen Senate Office Building, Hon. Jesse Helms 
(chairman of the committee), presiding.
    Present: Senators Helms, Hagel, Smith, Grams, Frist, Biden, 
Robb, and Wellstone.
    The Chairman. Good morning, Dr. Kissinger. It is great of 
you to come after having had such a late evening last night. It 
is a pleasure to welcome you on behalf of the committee. The 
subject this morning, of course as everybody knows, is the 
NATO-Russia Relationship.
    Now, Henry Kissinger needs no introduction by me, or for 
that matter by anybody else in the world. He is that well 
known. The Secretary and I have sometimes had slightly 
different views during the decades that we have known each 
other, but I have always respected Dr. Kissinger and 
particularly his appraisals of important foreign policy 
matters. So I say to you, sir, in addition to good morning, 
your views on NATO enlargement and specifically the NATO-Russia 
relationship will be enormously helpful to this committee.
    I see the Ranking Member will be here shortly, but I 
suggest that you proceed.

STATEMENT OF HON. HENRY A. KISSINGER, PRESIDENT, KISSINGER AND 
                 ASSOCIATES, NEW YORK, NEW YORK

    Dr. Kissinger. Mr. Chairman and members of the committee, I 
have submitted a formal statement and I stand by all of it, but 
in order to permit more time for questions I will just read 
some extracts from it and then respond to your questions.
    It is an honor to appear before this committee on a matter 
of such importance to America's future. If this century has 
taught any lesson, it is that our security is inextricably 
linked with Europe's. NATO, the institution expressing this 
conviction, has successfully deterred war in Europe for 50 
years. Now that Soviet power has receded from the center of the 
continent, NATO needs to adapt itself to the consequences of 
its success.
    Let me add here a comment which is not explicitly in the 
text. Whatever we believe about the evolution of other parts of 
the world, I believe that the rock bottom organization and 
grouping which we must foster is that of the nations which 
share our democratic tradition and much of our history. So I 
believe that the relationship of the democracies in the North 
Atlantic and in the Western Hemisphere should be the key 
building block of the future American foreign policy. Therefore 
of course a key question is, what is this Europe? What is this 
North Atlantic area to which we want to relate ourselves, to 
which we must relate ourselves? I think it is essential that 
the nations of Eastern and Central Europe, which were excluded 
from their historical traditions by the arrangements that were 
made at the end of World War II, find their place in the 
relationship of the democracies.
    Now, critics of NATO enlargement argue that the admission 
of Poland, the Czech Republic, and Hungary threatens prospects 
for the democratic evolution of Russia, and therefore magnifies 
perils rather than allays them. I hold the opposite view. The 
Russian Defense Minister, Rodionov, explained Russian 
opposition to NATO enlargement on the ground that it deprives 
Russia of a buffer zone in Central Europe. Were NATO to fall in 
with this argument, it would perpetuate the injustice of the 
Soviet satellite orbit by condemning the recently liberated 
nations of Central Europe to institutionalized impotence, and 
it would store up endless future troubles.
    Basing European and Atlantic security on a no man's land 
between Germany and Russia runs counter to all historical 
experience, especially that of the interwar period. It would 
bring about two categories of frontiers in Europe, those that 
are potentially threatened but not guaranteed, and those that 
are guaranteed but not threatened. If America were to act to 
defend the Oder but not the Vistula, 200 miles to the east, the 
credibility of all the existing NATO guarantees would be 
gravely weakened, nor would this exclusion of traditional 
Central European nations from the common defense achieve its 
purpose. Once Russia succeeded in establishing a military 
buffer zone, it would logically follow with demands for a 
political corollary that would imply a veto over foreign 
policy.
    If the eastern border of Germany is defined as the limit of 
Western Europe, and the western defense, Germany will be driven 
to doubt America's leadership and to try to influence the 
security position of the buffer zone on a nationalist basis. 
Failure to enlarge NATO would thus risk either collision or 
collusion between Germany and Russia. Either way, American 
abdication would produce a political earthquake threatening 
vital American interests.
    Considerations such as these have transformed the great 
Czech president, Havel, into a strong advocate of early NATO 
enlargement. An ardent human rights activist, he surely 
appreciates the argument for encouraging a democratic evolution 
in Russia, but he obviously believes that even the most 
optimistic outcome will take longer than is safely compatible 
with the establishment of a vacuum in Central Europe. I know no 
leader of Central Europe who does not share this view.
    NATO expansion therefore represents a balancing of two 
conflicting considerations: The fear of alienating Russia 
against the danger of creating a vacuum between Germany and 
Russia in Central Europe. Failure to expand NATO is likely to 
prove irrevocable. Russian opposition would only grow as its 
economy gains strength. The nations of Central Europe would 
drift out of their association with Europe. So I would strongly 
urge the Senate to ratify NATO enlargement.
    Now, let me turn to another matter. While I strongly favor 
NATO expansion and recommend its approval, I am deeply worried 
about the Founding Act which seeks to reconcile Russia to NATO 
expansion by offering Russia a role in NATO councils. Part of 
my objection is philosophical. Alliances define a common 
threat; collective security deals with a legal contingency. 
Alliances delineate an area to be defended; collective security 
is open-ended and is redefined from case-to-case.
    The language of the Founding Act is that of collective 
security, not of alliance. I have gone through a lot of 
analysis of the language, which we do not have to do here.
    The words ``common defense'' apparently proved so offensive 
to their commitment to collective security that the drafters of 
the Founding Act could not bring themselves to invoke them, and 
used instead the euphemism, quote, ``commitments undertaken in 
the Washington Treaty,'' unquote, which created NATO in 1949.
    This view is assuredly not shared by the new members who 
are seeking to participate in NATO for reasons quite the 
opposite of what the Founding Act describes, not to erase 
dividing lines but to position themselves inside a guaranteed 
territory by shifting the existing NATO boundaries some 200 
miles to the east.
    My major concern is not philosophical. The most worrisome 
aspect of the Founding Act is the consultative machinery for 
which it provides. The act calls into being, side-by-side with 
existing NATO institutions, a new Permanent Joint Council 
composed of the same Ambassadors who form the existing NATO 
Council, plus a Russian full member. The Russian ambassador is 
located inside the same building as the other Council members, 
as are the military representatives. The Permanent Joint 
Council is supposed to meet at least once a month. Twice a year 
the Council is to meet at the foreign ministers' level. The 
first such ministerial meeting was held in the shadow of the 
United Nations last month. Regular meetings of the defense 
ministers are also envisaged, as well as regular summits.
    The act designates the Permanent Joint Council as the 
principal venue for crisis consultation between Russia and 
NATO. Each side agrees that, quote, ``it will promptly 
consult,'' unquote, within the Permanent Joint Council, quote, 
``in case one of the Council members perceives a threat to its 
territorial integrity, political independence and security,'' 
unquote. Thus, if Poland feels threatened by Russia, it may 
first have to appeal to the Permanent Joint Council on which 
Russia is represented.
    It will be argued that if the Permanent Council deadlocks, 
the regular NATO Council remains free to perform its historic 
functions. That is true in theory, but it will never work in 
practice. Since, except for the Russian representatives, the 
membership is identical, each country will assess the grave 
step of meeting without a Russian presence in terms of its 
overall relationship with Moscow. Thus, in practice, NATO 
Council sessions and Permanent Council sessions will tend to 
merge. The free and easy ``family atmosphere'' of existing 
institutions will vanish.
    As for the new members of NATO, they are joining in these 
restrictions with respect to the deployment of other NATO 
forces and nuclear weapons. The ultimate irony is that Russia 
will be participating in the Permanent Joint Council and 
achieving a voice in NATO 2 years before the new members, who 
have to wait for ratification of the enlargement by all the 
parliaments of NATO.
    The dilemma the supporters of NATO enlargement now face is 
that the Founding Act has already gone into effect upon 
signature. As an executive agreement, it does not have to be 
ratified by the Senate, while NATO enlargement, involving a 
treaty, does. Thus if the admission of new members were not 
ratified, we will have inherited the worst possible outcome: 
The demoralization of Central Europe and a NATO rendered 
dysfunctional by the Founding Act.
    Mr. Chairman, I know that you and other members of this 
committee share my concerns about the possibility that the 
Founding Act has given Russia too much of a role in NATO 
matters; and I am aware that you pressed the Secretary of State 
for clarification on a number of these issues when she appeared 
before the committee 2 weeks ago.
    I was pleased to note that, in her response to your 
questions, the Secretary reassured you and the American people 
that nothing which has been agreed to with the Russians will 
detract from the primacy of NATO. If I may make a suggestion, I 
believe this offers the Senate an opportunity in the course of 
the ratification procedure to address the philosophical 
ambiguities of the Founding Act.
    Specifically, Mr. Chairman, I recommend that, in its 
instrument of advice and consent, the Senate explicitly 
reassert the central role of the Atlantic Alliance for American 
foreign policy, and insist that nothing in any other document 
shall detract from the North Atlantic Council as the supreme 
body of the alliance. Such a resolution could draw directly on 
the forthright response which Secretary Albright gave to your 
questions. Additionally, the Senate resolution should declare 
that the United States expects Russia to desist from all 
pressures and threats in Europe on this issue. In the meantime, 
while ratification proceeds, a joint resolution of Congress 
should urge that the new NATO members be permitted to join the 
Permanent Joint Council while waiting for ratification. This 
would remove the anomaly that the institution created to 
reconcile Russia to NATO's expansion should come into being 
years before the expansion actually occurs.
    In this way I believe a truly bipartisan approach to the 
European security relationship can be achieved.
    Thank you very much, Mr. Chairman.
    [The prepared statement of Dr. Kissinger follows:]
                  Prepared Statement of Dr. Kissinger
    Mr. Chairman, Members of the Committee: It is an honor to appear 
before this committee on a matter of such importance to America's 
future. If this century has taught any lesson, it is that our security 
is inextricably linked with Europe's. NATO, the institution expressing 
this conviction, has successfully deterred war in Europe for 50 years. 
Now that Soviet power has receded from the center of the continent, 
NATO needs to adapt itself to the consequences of its success.
    The stakes involved are large, for the nations of the Atlantic area 
need each other, and NATO is the fundamental link between the two. 
Without America, Europe would turn into a peninsula at the tip of 
Eurasia, unable to find equilibrium, much less unity, and at risk of 
gradually subsiding into a role similar to that of ancient Greece in 
relation to Rome--the only outstanding question being whether America 
or Russia will play the role of Rome. Without Europe, America would 
become an island off the shores of Eurasia, condemned to a kind of pure 
balance-of-power politics that does not reflect its national genius. 
Without Europe, America's path would be lonely; without America, 
Europe's role would approach irrelevance. This is why America concluded 
twice in this century that the domination of Eurasia by a hegemonic 
power threatens its vital interests and has gone to war to prevent it.
    A major American role in Europe is a prerequisite for European 
coherence. Without it, the European Union would founder on the fear of 
German domination; France would see reinsurance in a Russian option; 
historic European coalitions would form, compounding their traditional 
tenuousness with irrelevance; Germany would be tempted into a 
nationalist role, Russia into revanchism. That role requires a 
definition of Europe that is historically valid--that is, which 
includes the nations of Central Europe.
    An American presence in Europe provides a measure of equilibrium. 
It gives France a safety net against German hegemony and Germany an 
emotional harbor as European unification slows down, as well as 
protection against outside dangers and excessive European nationalism. 
Even Russia has much to gain from an American presence, which is the 
best guarantee against the reemergence of historical European 
rivalries. Europe by itself cannot handle the two most dangerous 
Russian contingencies: resurgence of nationalism or implosion. A Russia 
facing a divided Europe would find the temptation to fill the vacuum 
irresistible. An America cut off from Europe would lose an anchor of 
its foreign policy.
    Critics of NATO enlargement argue that the admission of Poland, the 
Czech Republic and Hungary threatens prospects for the democratic 
evolution of Russia and therefore magnifies perils rather than allays 
them.
    I hold the opposite view. The former Russian Defense Minister Igor 
N. Rodionov explained Russian opposition to NATO enlargement on the 
ground that it deprives Russia of a buffer zone in Central Europe. Were 
NATO to fall in with this argument, it would perpetuate the injustice 
of the Soviet satellite orbit by condemning the only newly liberated 
nations of Central Europe to institutionalized impotence. And it would 
store up endless future troubles.
    Basing European and Atlantic security on a no man's land between 
Germany and Russia runs counter to historical experience, especially 
that of the interwar period. It would bring about two categories of 
frontiers in Europe: those that are potentially threatened but not 
guaranteed, and those that are guaranteed but not threatened. If 
America decides to defend the Oder but not the Vistula, 200 miles to 
the east, the credibility of the existing NATO guarantee would be 
gravely weakened. Nor would this exclusion of traditional Central 
European nations from the common defense achieve its purpose. 'Once 
Russia had succeeded in establishing a military buffer zone, it would 
logically follow with demands for a political corollary that would 
imply a veto over foreign policy.
    If the eastern border of Germany is defined as the limit of the 
common defense, Germany will be driven to doubt America's leadership 
role and to try to influence the security position of the buffer zone. 
Failure to enlarge NATO thus would risk either collision or collusion 
between Germany and Russia. Either way, American abdication would 
produce a political earthquake threatening vital American interests.
    Considerations such as these have transformed the great Czech 
president, Vaclav Havel, into a strong advocate of early NATO 
enlargement. An ardent human rights activist, he surely appreciates the 
argument for encouraging a democratic evolution in Russia. But he 
obviously believes that even the most optimistic outcome will take 
longer than is safely compatible with the establishment of a vacuum of 
power in Central Europe. I know no leader of Central Europe who does 
not share this view.
    NATO expansion therefore represents a balancing of two conflicting 
considerations: the fear of alienating Russia against the danger of 
creating a vacuum in Central Europe between Germany and Russia. Failure 
to expand NATO is likely to prove irrevocable. Russian opposition is 
bound to grow as its economy gains strength; the nations of Central 
Europe may drift out of their association with Europe. The end result 
would be the vacuum between Germany and Russia that has tempted so many 
previous conflicts. When NATO recoils from defining the only limits 
that make strategic sense, it is opting for progressive irrelevance.
    While I strongly favor NATO expansion, I am deeply worried about 
the Founding Act which seeks to reconcile Russia to NATO expansion by 
offering Russia a role in NATO councils. Alliances define a common 
threat; collective security deals with a legal contingency. Alliances 
delineate an area to be defended; collective security is open-ended and 
is redefined from case-to-case.
    The language of the Founding Act is that of collective security, 
not of alliance. The Act speaks of the parties' ``shared commitment to 
build a stable, peaceful and undivided Europe, whole and free'' and 
refers to the parties' ``allegiance to shared values, commitments and 
norms of behavior.'' But Russia sells nuclear power plants, submarines 
and other arms to Iran, ignoring specific American requests to desist. 
Russia supports, in opposition to American policy, the lifting of the 
embargo on Iraq. It refuses to delineate its border with Ukraine. Of 
what, then, do the shared commitments cited in the Founding Act 
consist?
    The words ``common defense'' apparently proved so offensive to 
their commitment to collective security that the drafters of the 
Founding Act could not bring themselves to invoke them and used instead 
(and only once) the euphemism commitments undertaken in the Washington 
Treaty'' (which created NATO in 1949). But they did not specify the 
nature of these commitments.
    The view assuredly is not shared by the new members, who are 
seeking to participate in NATO for reasons quite the opposite of what 
the Founding Act describes--not to erase dividing lines but to position 
themselves inside a guaranteed territory by shifting the existing NATO 
boundaries some 200 miles to the east.
    The most worrisome aspect of the Founding Act is the consultative 
machinery for which it provides. The Act calls into being, side-by-side 
with existing NATO institutions, a new Permanent Joint Council composed 
of the same ambassadors who form the existing NATO Council, plus a 
Russian full member. The Permanent Joint Council will meet at least 
once a month. Twice a year, the Council is to meet at the foreign 
ministers' level. The first such ministerial meeting was held in the 
shadow of the United Nations last month. Regular meetings of the 
defense ministers are also envisaged, as well as summits.
    The Act designates the Permanent Joint Council as the principle 
venue for crisis consultation between Russia and NATO. Each side agrees 
that ``it will promptly consult'' within the Permanent Joint Council 
``in case one of the Council members perceives a threat to its 
territorial integrity, political independence and security.'' Thus if 
Poland feels threatened by Russia, it may have to appeal first to the 
Permanent Joint Council. Similarly, according to the letter of the Act, 
Russia could have insisted that the Gulf War be brought to the 
Permanent Joint Council where--as the Founding Act repeatedly states--
decisions are made by consensus.
    It will be argued that if the Permanent Council deadlocks, the 
regular NATO Council remains free to perform its historic functions. 
That is true in theory but will not work in practice in all but the 
most extreme cases. Since, except for the Russian representatives, the 
membership is identical, each country will assess the grave step of 
meeting without a Russian presence in terms of its overall relationship 
with Moscow. Thus, in practice, NATO Council sessions and Permanent 
Council sessions will tend to merge. The free and easy ``family 
atmosphere'' of existing institutions will vanish.
    As for the new members of NATO, they are clearly joining in a 
second-class status subject to unprecedented restrictions with respect 
to the deployment of other NATO forces and nuclear weapons. The 
ultimate irony is that Russia will be participating in the Permanent 
Joint Council and achieving a voice in NATO two years before the new 
members who have to wait for ratification of the enlargement by all the 
parliaments of NATO.
    The dilemma the supporters of NATO enlargement now face is that the 
Founding Act has gone into effect upon signature. As an executive 
agreement, it will not have to be ratified by the US Senate, while NATO 
enlargement, involving a treaty, does. Thus if the admission of new 
members is not ratified, we will have inherited the worst possible 
outcome: the demoralization of Central Europe and a NATO rendered 
dysfunctional by the Founding Act.
    Mr. Chairman, I know that you and other members of this committee 
share my concerns about the possibility that the Founding Act has given 
Russia too much of a role in NATO matters. And I am aware that you 
pressed the Secretary of State for clarification on a number of these 
issues when she appeared before the committee two weeks ago.
    I was pleased to note that, in her response to your questions, the 
Secretary reassured you and the American people that nothing which has 
been agreed to with the Russians will detract from NATO's primacy. And 
if I may make a suggestion, I believe this offers the Senate an 
opportunity, in the course of the ratification procedure, to address 
the philosophical ambiguities of the Founding Act.
    Specifically, Mr. Chairman, I suggest that, in its instrument of 
advice and consent, the Senate should explicitly reassert the central 
role of the Atlantic Alliance for American foreign policy and insist 
that nothing in any other document shall detract from the North 
Atlantic Council as the supreme body of alliance. Such a resolution 
could draw directly on the forthright response which Secretary Albright 
gave to your questions. Additionally, the Senate resolution should 
declare that the United States expects Russia--after the qualitative 
changes that we have made--to desist from all pressures and threats in 
Europe on this issue. In the meantime, while ratification proceeds, a 
joint resolution of Congress should urge that the new NATO members be 
permitted to join the Permanent Joint Council while waiting for 
ratification. This would remove the anomaly that the institution 
created to reconcile Russia to NATO's expansion comes into being years 
before expansion occurs.
    If the administration does not want to be remembered as having in 
effect atrophied the most effective alliance of this century, it should 
welcome efforts to clarify the many ambiguities in the Founding Act. In 
this way, a truly bipartisan approach to American-European security 
relations can be restored.

    The Chairman. Dr. Kissinger, I thank you very much. I am so 
glad that you got into the matter that I exchanged 
correspondence with the Secretary about recently.
    I think we will go on 5 minutes for each Senator for the 
time being, because as soon as this breakfast is over we are 
going to be joined by many other Senators. Let us see how we 
can do on that.
    I am hesitant to do this, Dr. Kissinger, but you know about 
as much about China as anybody I know. I guess all of us have 
been thinking about the advice to give visitors, that includes 
me.
    Dr. Kissinger. That I give the advice--
    The Chairman. To the Chinese leaders who are visiting us. 
That has nothing to do with NATO, but I want you to spend a 
minute or so saying, telling, revealing what you think would be 
the best course for the United States to follow in trying to 
work out an amicable relationship with China.
    For my part, I have made several contacts over a period of 
time now trying to point out to the Chinese that the American 
people like the Chinese people and they want to do business 
with them and want to recognize them as the power they are, but 
the human rights thing is standing in the way. It certainly 
stands in the way as far as I am concerned. As I put it to one 
leader yesterday, you have no idea, Sir, how much cooperation 
and goodwill you would build if there could be not an 
expression of retreat but an expression that we are going to 
work on it sincerely and honorably. I do not know whether that 
did any good or not, but I thought the President of the United 
States did quite well yesterday in standing up for that.
    If you would give your opinion, what would you say to the 
President, or maybe you have said it since he has been here, 
the President of China, what would you say to him?
    Dr. Kissinger. Mr. Chairman, I am doing this really off the 
top of my head.
    The Chairman. I know that.
    Dr. Kissinger. I have not made any formal preparation for 
this, however it is obviously a topic about which I have 
thought. I did not have an opportunity on this trip, because I 
just came back from Europe yesterday late afternoon, to talk to 
the President of China, but I have had other occasions and I am 
sure I will have the opportunity.
    Of course we are all influenced by our experiences. I was 
the first American official to visit China. I was sent there by 
President Nixon. In those days there was a huge philosophical 
gap between China and the United States. President Nixon, with 
my enthusiastic concurrence, agreed or felt that peace, 
flexibility for American foreign policy, the ability to play a 
significant role in Asia, required that we have diplomatic 
exchanges with China, even though philosophically we could not 
have disagreed more than we did with the China of the Cultural 
Revolution.
    So we have on the face of it two somewhat contradictory 
problems. We have a national security problem, a national 
interest problem, which is that China has a population of 
1,250,000,000. There are 60 million overseas Chinese with a 
major influence on the economies of Southeast Asia. China plays 
a significant role in Korea, Cambodia, and elsewhere. So it is 
in our interest, if we can, to find a basis for cooperation to 
serve our own purposes and to see whether there are joint 
interests that can be developed.
    Confrontation with China is not the same as it was with the 
Soviet Union. China's is a different history, a different 
society. Its method of conducting confrontations is to make 
them extremely prolonged and exhausting. On the other hand, it 
is also true that, being a democracy, our government will not 
find support among the people if fundamental American values 
are consistently being violated. These are the dilemmas that we 
face.
    For somebody who has been in China in the Seventies, the 
present China looks more respectful of individuals than the 
China we saw then. Now, I recognize this is a relative 
statement, and I believe that in terms of day-to-day life the 
lot of the Chinese has greatly improved. In terms of their 
right to political opposition, it has not.
    Then, assuming as we must that there will be strong 
disagreements between us and China on human rights, there is 
the question of how we can influence it better. I believe we 
can influence it better as a Nation by quiet diplomacy than by 
visible pressures.
    Let me add, incidentally, that I have no problem with, in 
fact I respect, the demonstrators who express their views as 
private citizens. This is how our system operates. I, however, 
believe that, as a government, we should, if at all possible, 
avoid sanctions and attempt to find areas where we have 
genuinely common interests. Therefore, if China's leaders asked 
me, I would tell them that they should take very seriously 
expressions of concern such as the one you mentioned. If the 
President asked me to what extent he should do that publicly 
and with pressure, I would urge him to try to find another way 
to do it if at all possible.
    The Chairman. Thank you. Senator Wellstone.
    Senator Wellstone. Thank you, Mr. Chairman. Thank you for 
being here, Dr. Kissinger. I have just one comment about the 
last day or two, and I much appreciate your comments about 
people in the parks.
    Dr. Kissinger. I was not here, though.
    Senator Wellstone. On the question of the situation in 
China, you of course have a perspective that I do not have, but 
I know that one of the things that I find personally--and Mr. 
Chairman, this refers to some meetings we had yesterday--really 
quite devastating is the State Department's report on human 
rights in China. It is really dismal. In fact Assistant 
Secretary Shattuck, I believe met with Wei Jingsheng and 
because of that meeting Wei now finds himself back in prison. 
He just wrote a book called, ``The Courage to Stand Alone.''
    It is troubling that we don't see a lot of evidence of this 
quiet diplomacy working, at least by our own State Department 
reports on the state of human rights. I quite agree with you, 
there is of course a very legitimate question as to what we 
should do, what is most effective. But, boy, the most recent 
empirical evidence we have on what is going on in China is not, 
it certainly does not give one much reason for optimism, and I 
think that is why many of us are speaking up and are proud to 
identify ourselves with the human rights community.
    You can respond to that if you want to, but I want to ask 
you a question about NATO expansion. Do you want to respond 
first?
    Dr. Kissinger. Could I make a response to the Senator?
    Senator Wellstone. Of course.
    Dr. Kissinger. If I may make a response, Senator, I have 
never criticized the people who express their views on human 
rights, and I have, on several occasions which I have chosen 
not to publicize, intervened on behalf of some of the cases, 
and in at least two cases have succeeded. But my approach 
requires that I do not talk about it afterwards.
    What bothers me as I see this debate evolving is that we 
are dealing here with a huge country still in the process of 
evolving, and I believe it is really not in the American 
national interest to conduct its relations with it from a 
posture of confrontation. First, because I do not believe that 
any other Asian nation will support us. Second, because all the 
other Asian nations will then adopt a posture of semi-
neutrality between us, which means a more nationalist policy. 
So our capacity to shape events will diminish.
    When I became, first Security Advisor and then Secretary of 
State, we had 500,000 Americans in Vietnam, where we thought we 
would bring democracy and then found ourselves in a struggle we 
did not know how to end. So I am very influenced by the 
experience and do not believe in getting ourselves into a 
confrontation if it is avoidable, and second, that we make 
absolutely sure that when we do, the American public 
understands why we have done it.
    If China threatens the equilibrium in Asia, and if it 
becomes a military threat, I will be before this committee 
supporting opposition to it. But I am trying to avoid the 
situation, and I think the future of China is now still 
somewhat open. I cannot believe that it is possible to change 
the economy as they have without political consequences. What 
these consequences are exactly, I do not pretend to know.
    So this is my profound worry. Incidentally, I must add, it 
has nothing to do with economics. I would like to see trade, 
but that is minuscule in my consideration.
    Senator Wellstone. I appreciate that, Mr. Secretary.
    Dr. Kissinger. So this is what is on my mind as we go 
through these dramatic few days.
    Senator Wellstone. Let me ask one question. I very much 
appreciated--
    The Chairman. He will have to answer it on the next round.
    Senator Wellstone. OK. I will put the question out there. 
You have written that the new nations that are hoping to join 
NATO, and I quote: ``are seeking to participate in NATO . . . 
not to erase dividing lines but to position themselves inside a 
guaranteed territory by shifting existing NATO boundaries 300 
miles to the east. . . .'' I really appreciate your candor. 
This position, though, at least seems to me to be in 
contradiction with the administration's pronouncements that 
NATO expansion will erase dividing lines in Europe. In the 
words of the President, it is intended to, ``build and secure a 
new Europe undivided at last.''
    Maybe you can get to it later. I do not think it is, Mr. 
Chairman, an inconsequential question, because if there is 
anything we want to know about NATO expansion, it is whether it 
is going to unify or whether it will redivide Europe. I wonder 
whether you could comment at some point in time on what I 
identify at least as a contradiction here.
    Dr. Kissinger. Should I do that later?
    The Chairman. Yes, Sir. Senator Hagel.
    Senator Hagel. Dr. Kissinger, thank you for coming this 
morning. I have just a quick comment on China, and then I would 
like to get your thoughts on a couple of the elements that you 
talked about in your opening statement. I have always thought 
on the China debate that we have somehow misplaced some of the 
focus of the debate. It should not be about do we support human 
rights or do we not support human rights. Of course we all 
support human rights in China. The debate should be focused on 
how we best influence the behavior of the Chinese leaders to 
bring more human rights, and I only say that because as I have 
listened and witnessed much of this debate, it is like 
environmental issues and other issues, you are either for a 
clean environment or you are against it, and we need to get 
back to the real issue.
    Your points about the Founding Act, what do you believe the 
Russians think about the Founding Act, but more importantly, 
what do you believe their view is of the Founding Act?
    Dr. Kissinger. Let me just make a very quick comment about 
your China point. I am somewhat disturbed by the impression 
that is being created in the debate that the only issue we have 
vis-a-vis China is human rights, and that the only debate we 
have in this country is how we can improve human rights in 
China. I would urge that there be examination of whether we 
have any common interests in terms of our national security 
that would drive us to some degree of cooperation with China. 
This aspect of the relationship must be included, otherwise we 
will always seem as if we are somehow inadequate.
    Now about Russia. I do not agree with the administration's 
analysis of the Russian problem, and therefore I do not agree 
with the statement about erasing dividing lines in that sense. 
My analysis of Russia is as follows.
    A dominant view of some of the administration spokesmen 
seems to be that the obstacle to relations with Russia is the 
absence of pluralistic democracy, and that once democracy is 
established in Russia, all other problems will disappear. Then 
Russia will merge into some kind of big Eurasian structure.
    I think the problem of Russia is more complicated. First of 
all, the country is partly in Europe but also partly in the 
Middle East and partly in Asia, so that the pulls on Russia are 
much more complex than those faced by any other nation in 
Europe. Second, the history of Russia is quite different. It 
has not had a separate religion, as was the Catholic religion 
during the Medieval period, which established its own principle 
of justice. It did not have the Reformation, it did not have 
the Enlightenment, it did not have the Age of Discovery, it did 
not have capitalism. So the evolution toward democracy in 
Russia is more complex. Hopefully it will develop.
    Second, Russia has also been an imperialist country that, 
for 400 years of its history, acquired territories, expanding 
from the region around Moscow to the shores of the Pacific, 
into the Middle East, to the gates of India, and into the 
center of Europe. It did not get there by plebiscite. It got 
there by armies. To the Russian leaderships over the centuries, 
these old borders have become identified with the nature of the 
state.
    So I believe that one of the major challenges we face with 
Russia is whether it can accept the borders in which it now 
finds itself. On the one hand, St. Petersburg is closer to New 
York than it is to Vladivostok, and Vladivostok is closer to 
Seattle than it is to Moscow, so they should not feel 
claustrophobic. But they do. This idea of organizing again the 
old commonwealth of independent states is one of the driving 
forces of their diplomacy. If Russia stays within its borders 
and recognizes that Austria, Singapore, Japan and Israel all 
developed huge economies with no resources and in small 
territories, they, with a vast territory and vast resources, 
could do enormous things for their people. Then there is no 
security problem.
    So for all of these reasons I do not believe that in any 
foreseeable future it is possible for Russia to join NATO, and 
I think it would be a lot better if we said explicitly that 
this cannot happen. If I am very much in favor of negotiating 
with Russia, and the Chairman will remember, as I surely do, 
that in earlier incarnations he expressed some doubts about 
what he considered my excessive propensity for negotiating with 
the Soviet Union.
    But I believe that this is a question for political and 
diplomatic efforts. If we created a body within the European 
Security Conference to conduct dialog with Russia, I would 
favor that. What I do not favor is giving this impression that 
everything sort of mergers and everything is sort of evolving 
toward some kind of mini-U.N. From the Chinese border to the 
Canadian border up in Alaska. I have been very opposed to this 
approach and have said so repeatedly publicly.
    Senator Hagel. Thank you.
    The Chairman. Senator Biden.
    Senator Biden. It is good to see you, Dr. Kissinger, Mr. 
Secretary. I apologize for being late. I was where the Chairman 
was wise enough not to be. I was at the breakfast, and I 
apologize.
    My understanding, and please correct me if I am wrong, is 
that on the central issue before this committee, which is 
whether or not we should expand NATO, whether we should vote to 
amend the Washington Treaty, you think that we should.
    Dr. Kissinger. I strongly support it, and I urge you to do 
that.
    Senator Biden. The primary criticism is the way in which 
the relationship with Russia, as it relates to what was the 
Partnership for Peace and is now becoming the expansion of 
NATO, on those two fronts has changed.
    Dr. Kissinger. Correct.
    Senator Biden. I, quite frankly, got myself in a little bit 
of a bind because I quoted you in a debate. I referenced you in 
a debate I was having as a source of authority for a position I 
was taking, and was later informed that it was not your 
position. This was about 8 months ago. I recalled, and I had my 
staff go back and get it, a piece you had done in December 1994 
where you called for, and it confused me, you called for a 
treaty with Russia, a U.S. treaty with Russia. You said such a 
treaty would provide that no foreign troops be stationed on the 
territory of new NATO members on the model of the arrangements 
for East Germany (or better, no closer than fixed distances 
from the eastern border of Poland). In the next paragraph you 
say, at the same time such a treaty would provide for 
consultation between NATO and Russia on matters of common 
interest.
    I kind of thought that was what the President did, and that 
is what confused me. Now, I am not being a smart guy here or a 
wise guy. What is different between what you are recommending 
and what actually took place?
    Dr. Kissinger. First of all, that was the first article I 
wrote on this subject, and I do not believe that the President 
goes to bed at night worrying necessarily what I think of the 
subject.
    Senator Biden. I do. He does not, but I do.
    Dr. Kissinger. But he can be in no doubt that I modified my 
thinking on this. What I had in mind then was to accept some 
restrictions on the deployment of troops, and I still favor 
that on the model of East Germany. I did not think that it 
could be interpreted into this elaborate machinery which makes 
Russia, to my mind, a de facto member of NATO, no matter what 
we say about a voice and not a veto.
    Senator Biden. Again, as you know, as you were kidding me 
earlier today when I saw you in the hallway, you were saying 
you were hoping I would not be here because you and I have gone 
round and round. I want the rest of you to know the first 
meeting I ever attended as a young Senator was over in the 
Foreign Relations Committee room in the Senate, Mr. Chairman.
    I came to this meeting room at age 30 thinking I was 
supposed to be here because Dr. Kissinger was at that time 
presenting in closed session, quote, ``his world view.'' That 
is how we billed it. I was here ready and waiting, and a young 
staffer walked out and asked me, Senator, I had been here 2 
months, what are you doing. I said I am here for the hearing. 
He said no, it is over in the other building.
    So I went running over to the other building looking for S-
116 on the little door handles, and to make a long story short, 
I burst into the room, perspiring, I was nervous as heck. The 
door opened, and remember you used to have those filing 
cabinets right by the door, it came out and it smashed against 
the filing cabinets. I think I gave everybody coronary arrest, 
almost everybody. Then I walked in, sat down, making myself the 
second ranking member of the committee, looked over at Dr. 
Kissinger whom I had only known from watching on television, 
and Senator Mansfield said, ``do you have any questions?'' He 
was the acting chairman. I said yes, and Dr. Kissinger said, 
``I thought this was for Senators only.'' At which time I said, 
``well, Secretary Dulles, I am here to ask you whatever I 
can.''
    That is how our relationship started.
    Dr. Kissinger. Now you understand why my relations with the 
Senators were not always what they should have been.
    Senator Biden. Anyway, my time is up. I truly appreciate 
your clarification. I am not being facetious when I say my view 
of the arrangement that has been worked out is what I thought 
you were envisioning by a treaty providing consultation between 
NATO and Russia on matters of common interest. My reading of 
the agreement we made is not, and I could be dead wrong, but as 
I read the text, and talking to the principals, there is no 
including the non-NATO members of other countries. It was 
literally consultation, not intertwining the, as you put it, 
larger matrix of relationships. But you have answered my 
question.
    Dr. Kissinger. I have high regard for the people who 
negotiated this. I can live very happily with what Secretary 
Albright said here. I simply think that it is difficult to make 
it work that way as time goes on. You have these Ambassadors 
sitting in the building, they meet every day. Then the NATO 
members go off and say we are going to have our own meeting. 
Legally, of course, they can do it, but the human nature of 
these multi-lateral parties is against it.
    You asked me what the Russian strategy is. Russian strategy 
cannot be to build NATO. It is against their whole tradition. 
So they have every interest to water down NATO into some vague 
multi-lateral U.N. type talk shop. Therefore they will bring 
issues before the NATO Council that will achieve this purpose. 
This is my concern. I have no doubt at all that Secretary 
Albright means exactly what she is saying.
    Senator Biden. I thank you, Mr. Secretary.
    The Chairman. Senator Smith.
    Senator Smith. Mr. Secretary, first, thank you for coming 
to this hearing. For those of us who are new and trying to 
catch up with what you know and to learn the history that you 
both have and have made, I for one am grateful to you.
    When I listen to the President of the United States and 
others, well-intentioned, use words like we are not redrawing 
lines in Europe, Europe is undivided and free, and I see us 
expanding NATO, I frankly must confess I think we are playing 
word games. I think in fact what we are doing, and rightfully 
doing, is redrawing lines that say American values, western 
interests, principles that we value such as private property, 
the rule of law, human rights, that we do draw lines, and that 
as a community of western nations we reflect this not just 
economically and politically but even militarily in order to 
provide security arrangements. So frankly I find somewhat 
puzzling some of the language that we use to talk around this 
issue.
    I think what we are doing is moving lines, but I do think 
we have got to allow others, other people on the other side of 
those lines, we have to give them an eraser. They have to be 
able to join the western community by taking on our values, our 
culture, if they will, if they want to, and we need to be 
prepared to receive them. In my mind that certainly includes 
Hungary and Poland and the Czech Republic. I would have even 
allowed Slovenia and Romania into this first round.
    I guess the real push is going to come when it comes to the 
Baltics. Even we must be honest and say should it not also 
ultimately include Russia, if they would take on the kinds of 
institutions and abide by the rule of law that we share 
commonly with Western Europe. I wonder how you feel about 
further expansion, and ultimately Russia's inclusion if they 
would join Western Europe more than just rhetorically.
    Dr. Kissinger. Let me tell you what historic models I have 
in mind. I know there are a lot of people who think I burn 
votive candles to Metternich every night in my devotion to the 
19th century----
    Senator Biden. We thought you were.
    Dr. Kissinger. I knew it. May I give, however, an historic 
example. At the end of the Napoleonic wars France was in the 
position Russia is in today, that is, it was considered to be 
the aggressor in Europe. Everybody was deeply concerned about 
the fact that they might start on expansion again. So they 
created two separate institutions. One was the Quadruple 
Alliance. This was aimed at preventing a military attack from 
France. Second they created something called the Concert of 
Europe in which France could participate. The Concert of Europe 
discussed all the political issues, and in fact that became in 
time the dominant element. The Quadruple Alliance was never 
abolished, but it never needed to be activated.
    This is sort of the model that I have in mind for Russia. I 
think Russia should be consulted and participate in political 
discussions that affect its vital interests and the peace, and 
that as Russia evolves those institutions become more and more 
dominant. But I would keep NATO as a safety net, and keep it as 
unspoiled as possible as a community of democratic nations. If 
values were to be shared, then the political organs would 
become more dominant.
    But what worries me is that we have now created something 
that in the terms of the day-by-day, competes with the NATO 
Council and that historical analogy, kind of merges the 
Quadruple Alliance and the Concert of Europe. And that worries 
me deeply. I do not think that Russia should be permanently 
excluded. The Chairman knows very well that I was in favor of 
exploring with Russia even then whether there might be any 
common areas, and I certainly believe it even more today.
    Senator Smith. There is no more reason then to keep the 
Baltics out than to keep Poland out.
    Dr. Kissinger. The problem with the Baltics or, say, 
Ukraine, is that when you move former republics of the Soviet 
Union into NATO and an integrated military structure, then you 
have, especially with Ukraine, a major challenge to Russian 
self-consciousness. On the other hand, we have to find a way of 
conveying that a threat to the independence of the Baltics and 
Ukraine would be inimical to any friendly relationship with the 
United States, and that this is something we would look at with 
the greatest gravity.
    The Chairman. Senator Robb.
    Senator Robb. Thank you, Mr. Chairman. Dr. Kissinger, thank 
you for being with us this morning. You have indicated 
skepticism about the consultative process and the degree of 
influence that Russia might have on the NATO operations. Are 
there any steps that the United States ought to pursue, in your 
judgment, during this formative period that could be included 
in whatever charter arrangements are ultimately agreed to or 
changes that might be made that would restrict that role in 
ways that you believe are appropriate?
    Dr. Kissinger. Senator, I made clear before you came in the 
room that I strongly favor ratification in any event.
    Senator Robb. Unless there be any doubt, I do too.
    Dr. Kissinger. Nothing I have said should be interpreted as 
negative.
    Senator Robb. Nor was my question intended to imply that.
    Dr. Kissinger. I did not interpret it that way. What I have 
recommended to the Chairman and to the committee is that, in 
the instrument of ratification, the Senate find a way of 
expressing its view that the NATO Council is the dominant 
instrument for the operation of the alliance that the Permanent 
Council is a more political instrument, and that the 
fundamental decisions are taken in the first instance in the 
NATO Council. In order to keep the bipartisan character, I have 
also recommended that some of the language, or for all I know, 
all of the language that Secretary Albright used before this 
committee in explaining how she interprets the Founding Act, be 
incorporated in this so that we have a basis for a bipartisan 
consensus.
    I am convinced that future Secretaries of State would be 
grateful to be able to point to a Senate instruction to them, 
so that it does not look as if they are the spoil sports if 
they want to move more issues into the regular NATO Council. I 
would do my utmost to establish a procedure whereby no 
significant issue moves into the Permanent Council until there 
is a NATO Council decision with respect to it, and that this 
not be used as an alternative method. First there is a NATO 
Council decision, and then one meets with the Russians.
    Senator Robb. Well, with respect to current or future 
progress in terms of coming to decisions, I think it is fair to 
say that the rather lengthy and protracted process where we 
move from UNPROFOR into IFOR was not a model of efficiency. Are 
there suggestions you might have to address that particular 
question?
    Dr. Kissinger. One of the problems with respect to Bosnia 
was that the United States did not really have a policy; and 
history shows that a strong American lead is usually needed to 
crystallize a position. But I do not have any great structural 
suggestion.
    Senator Robb. There were a number of us, including members 
of this committee, who made certain recommendations earlier in 
that process that might have facilitated that.
    Dr. Kissinger. As to policy or as to procedure?
    Senator Robb. Really as to procedure. I take it back, as to 
policy in terms of what we ought to do, when we ought to do it.
    Dr. Kissinger. I agree. If that had been done, Senator, the 
likelihood is that there would have been a more unified NATO 
position.
    Senator Robb. It certainly proved to be beneficial once 
that was achieved. Mr. Chairman, I see my time is about up, and 
I am expected to be the acting Ranking Member over in the Armed 
Services Committee at this point. I thank you for the time, and 
I thank Dr. Kissinger for his appearance before this committee.
    The Chairman. Thank you, Senator Robb. Dr. Frist.
    Senator Frist. Thank you, Mr. Chairman, and thank you, Dr. 
Kissinger, for being with us. I am interested in the differing 
expectations that current members and prospective European 
members of the expanded NATO might have and what that might 
mean in terms of obligation and role in a postcold war Europe. 
These potential differences in expectations I would think would 
have real implications as we project ahead what the 
participants and potential participants would see as the future 
mission of NATO and how effective that future NATO can be.
    First of all, there is our own expectation, and it seems to 
me that the United States is struggling with what we should 
really think and expect of a future NATO. It is something that 
these discussions help all of us with, I think, to a great 
degree. If we look at the European current participants, their 
visions and expectations with our European partners seem to be 
different in many ways, but judging from their view of NATO's 
role in Bosnia and of numerous comments, there seems to be an 
indication that their expectations are different than our own.
    Then if we look at the prospective members, and you might 
help us with this in terms of what their expectations might be, 
Poland, the Czech Republic, and Hungary, clearly their 
expectations are very high, and understandably so, viewing NATO 
membership as a long overdue reentry back into the West.
    With the common bond or the glue that has held NATO 
together in terms of an external threat clearly changing, and 
with members and future members having these different visions, 
I guess I have two questions, do we have today an internal 
culture in NATO that is consistent with the expectations of the 
three potential new members to support an alliance strong 
enough to hold the expanded NATO together, again, the 
expectations today being very different than they might have 
been 10 years ago?
    Dr. Kissinger. Well, I think that is a very important 
question. I had the privilege of being in Poland at just about 
the time that its membership in NATO was approved. I thought it 
was one of those exhilarating moments somewhat comparable to 
being in Europe at the end of World War II, the liberation from 
German occupation, in that the Polish people that I met felt 
they were at last, after several hundred years, rejoining 
Europe as an integral member and as a charter member.
    A personal friend was Havel, the President of the Czech 
Republic. I did not see him at that time, but I saw him shortly 
afterwards, and he has a similar view. I might add, that when I 
first met Havel, he had some of the classic left wing notions 
of European socialism. He thought that NATO was sort of what 
the bellicose people do, and that the elevated people did 
something better. He has changed that view completely because 
he thinks it is now essential for the morale and cohesion of 
Europe.
    In this respect the Central Europeans have a different view 
from the West Europeans. They are more like the West Europeans 
were in the Fifties, and they also do not have the view that 
dividing lines are being erased. They still feel threatened. 
Now, in Western Europe and in America the problem is that NATO 
has not been given a new morale impetus, or psychological 
impetus-- or political impetus, whatever you want to call it--
for a long time, and that we are running on just operating the 
institutions.
    The Europeans are now absorbed in creating a common 
currency and in elaborating some kind of European identity. But 
what is that identity? What is it they are trying to do? There 
are too many voices in Europe that want to create this identity 
in some sort of opposition to the United States. If that 
becomes the dominant theme, then NATO will wither, no matter 
what institution we create. So I think it is very important 
that some new political initiative be taken to tie the Western 
democracies together.
    I find myself in the position that, on the issue of 
democracy I do not go along with all the exuberant notions of 
the protesters on China, but I would go much further on pushing 
the cohesion of the democracies in the West. This is a question 
of emphasis, and I am very worried that our relations in the 
North Atlantic are sort of withering. Nothing bad is happening, 
but a whole new generation is growing up that does not have the 
experience that my generation had of working together for noble 
objectives. We have become sort of mechanics in operating a 
system, and Bosnia is a symptom of this. So in this respect I 
much prefer the attitude of the East and Central Europeans, for 
whom NATO enlargement represents a moral act, and why not 
ratifying it would be a terrible blow to their whole image of 
what recent history has meant.
    Senator Frist. Thank you.
    The Chairman. Thank you, Senator. Mr. Secretary, I think 
you can imagine the correspondence we receive, maybe you get 
some of it too, that at best is an over simplification of what 
the problems are. Even some of the witnesses, and I respect 
them all, who have appeared here, some of them have appeared to 
suggest that this is an either/or proposition, that either we 
expand NATO and get drawn into future conflicts in Europe, as 
they put it, or we do not expand NATO and perhaps stay free of 
any involvement in Europe's recurring calamities.
    Now, my question to you almost answers itself, but I want 
to get it as a matter of record. Can you foresee a major 
European war occurring in which the United States would not be 
involved?
    Dr. Kissinger. No. There has not been one in which we have 
not been involved in this century.
    The Chairman. Our involvement in a European conflict is all 
but inevitable, if it happens, and, as you just indicated, it 
happened twice in this century. May I say what advantages does 
NATO expansion provide us in the best case to prevent wars and 
in the worst case to win them? I know that is sort of a 
convoluted question, but I would like to have your answer to 
that so that, to be honest about it, we can quote you.
    Dr. Kissinger. First, Mr. Chairman, with respect to some of 
the testimony you have received, I am frankly astonished that 
professionals of diplomacy could argue that a treaty we have 
signed and that is then not ratified--well, let me put it this 
way: If 3 years ago when this debate started, somebody had said 
let us not do this, I would understand that position. I would 
disagree with it but understand it. But I do not understand how 
it can be recommended to the Senate not to ratify an agreement 
which, if it is not ratified, would have such devastating 
impact on Eastern Europe, and which, in my view, would also 
have in the longer term a devastating impact even on the 
existing NATO countries.
    How can one say to the Germans that we are absolutely 
determined to defend the Oder, but that the Vistula, which is a 
few hours' drive away, we will not defend; that Poland, which 
has been as much part of the West, is excluded when Germany, 
which in a way was the cause of the war that created this mess, 
is included? Therefore failure to ratify would absolutely 
undermine the existing NATO.
    I have been astonished at some of the statements that I 
have seen made by people who used to be great Cold Warriors but 
who are suddenly acting as if history had been totally 
abolished.
    Second, the main argument for NATO expansion is, in my 
view, that these countries are historically members of the 
community of the West, that they feel themselves to be so, and 
that to say we will not defend you but we will defend those a 
few hundred miles further east does not make any sense. Third, 
it then will set up a competition between Germany and Russia in 
this area, because that vacuum is going to be filled anyway.
    Fourth, I believe that the best way to draw Russia into a 
cooperative relationship, which I strongly favor, is to remove 
its historic temptations and beliefs, because once you have 
declared Poland and this whole region a neutral zone, the 
inevitable next step for any Russian leader will be to try to 
influence the foreign policy of that region. Then we are right 
back to what caused the European wars in this century.
    So I believe that NATO expansion will stabilize Europe and 
improve our long-term relations with Russia, provided we give 
Russia an honorable opportunity to participate in dialog, and 
these would be my major reasons.
    The Chairman. Very good. Thank you. Senator Biden.
    Senator Biden. Mr. Secretary, I really appreciate the way 
only you can express very, very fundamental basic ideas. It 
amazed me, some of the people who have testified here, people I 
have great respect for, who seem not to understand the history, 
the very recent history. When in history, in the last 300 
years, has there been a vacuum in Central or Eastern Europe 
that has not been filled? And when has there been a 
circumstance where countries that were part of this grey zone 
or supposedly neutral have not sought their own separate 
arrangements for their own security because they are wise 
enough to understand that someone is going to attempt to fill 
the vacuum? That seems to me to beg the issue whether we should 
expand.
    The question in light of the way the Soviet Union has 
collapsed, is not whether we expand NATO or keep it the same, 
it is whether we have NATO or we expand it. The way you 
describe the attempt, the necessary foreign policy judgment 
would have to be made in Berlin and in Bonn and in Moscow, that 
they would have to compete to try to fill that Central and 
Eastern Europe vacuum. That seems to me the absolute last thing 
in the world we want--either the Germans filling the vacuum or 
the Russians. I am not eager for either of those outcomes.
    I am not by this question suggesting that you do not feel 
and believe we have a commitment to the Baltics, but I think 
there is a factual historical difference between Ukraine and 
the Baltics. For example, I think the immediate effect on the 
Russian psyche of admitting either the Baltics or Ukraine would 
be very similar. But in fact we never recognized that the 
Baltics, which were annexed by the Soviet Union, were 
legitimately part of the Soviet Union. We have never recognized 
that, and it seems to me that any further actions will take 
some time and may need some massaging. I am not smart enough to 
know exactly how to do it, but it seems to me as a matter of 
principle that it is very important to make a distinction 
between the Baltics, for example, and Ukraine.
    Dr. Kissinger. I agree with this. On the current schedule 
of NATO expansion, there is no way the issue of the Baltics can 
arise until well into the next term, if not later. If we simply 
look at the priorities that have been established, I doubt that 
there will be another similar hearing in this administration 
about new members. But that is my judgment. It is simply the 
way these things work. So we are talking about well into the 
next administration, or maybe even the one after that.
    I think however that some steps should be taken immediately 
to make clear that the Baltics are members of the Western 
community, and that the European community has almost an 
obligation to speed up the membership of these countries in the 
European Union. It is absurd to say that 10 million Baltics, 
because their economic evolution is not quite at the right 
level, is going to create an insuperable problem for a union 
that has some 300 million population.
    Senator Biden. I absolutely agree with this.
    Dr. Kissinger. But this is only the first thing that should 
be done. The second thing we should do is to study how military 
arrangements can be made that do not necessarily involve the 
advance of the integrated command, because the method of 
defending the Baltics does not have to be the same as the 
method of defending the Vistula, being geographically 
different. This I would recommend as a study-though I have not 
come to any view, I would not just sit until 2005 or whenever 
that issue becomes ripe on the present schedule. These are the 
interim steps we should be able to take almost immediately.
    Senator Biden. Again, my time is up, Mr. Secretary. Let me 
just make two very brief comments. One, nothing has 
disappointed me more or reinforced my view of the lack of 
political maturation that still exists in Europe, in Western 
Europe, than the failure of the EU to understand how it could 
play, without any damage to its economic integration, a 
historic role here to ameliorate a circumstance that could 
fester in a way that causes political problems. It is one of 
the great disappointments, the disconnect between their view of 
their naked economic interests and their long-term political 
interests. I think it is a very little chance they would be 
taking, although they have made some steps now with regard to 
Latvia, or maybe it is Estonia, I am not sure.
    The second point--
    Dr. Kissinger. But they do it as a purely economic issue. 
It is not an economic issue.
    Senator Biden. No, it is not. It is well beyond an economic 
issue. But the second point that I would make, if I may 
conclude, Mr. Chairman, is that by 5 years from now one of two 
things is going to happen. This progression within Russia 
toward democracy and a market economy will be considerably more 
evident or it will be in difficulty, in my view. It will not be 
settled, but we will have a clearer picture. That, I think, is 
going to impact significantly on what the next president of the 
United States feels he or she is able to do relative to the 
Baltics without upsetting the apple cart in meeting what I 
think is a recent historic obligation.
    Again, I thank you for the way in which you phrased the 
dilemma relative to expansion of NATO and this neutral zone and 
the vacuum.
    Dr. Kissinger. One slightly heretical point on the Russian 
situation. We have a tendency to present the issue entirely in 
terms of Russian domestic politics. I could see Russia making 
progress toward democracy and becoming extremely nationalistic, 
because that could become a way of rallying the people. We also 
have to keep an eye on their propensity toward a kind of 
imperialist nationalism, which, if you look at the debates in 
the Russian parliament, is certainly present.
    Senator Biden. Thank you, Mr. Chairman.
    The Chairman. Senator Hagel.
    Senator Hagel. Mr. Secretary, following up a little bit on 
what Senator Biden was talking about, your response to Senator 
Frist, you mentioned in your opening comments about reasserting 
the central role of NATO. You mentioned a theme, you talked 
about new political initiatives, the interconnects that Senator 
Biden was talking about that have been discussed here the last 
hour and a half. Should we take some initiative to redefine 
NATO after 50 years? It is being somewhat redefined. Should we 
take the initiative to really start focussing on its mission?
    The thing that you mentioned earlier in response to a 
comment I made on China it seems to me is very clear here, and 
that is the interconnects here. You mentioned Bosnia. All these 
are going to have major consequences and impacts on what we do 
with NATO expansion. I was wondering if you could develop that 
a little further.
    Dr. Kissinger. I believe that the next major, constructive 
phase of American foreign policy should be an emphasis on 
uniting the existing democracies as the base from which we 
operate, and I would apply that to the Western Hemisphere and 
to the North Atlantic. These are separate building blocks, but 
I would try over time to merge them.
    Right now there is no significant initiative in the North 
Atlantic area. We are operating on momentum. The Europeans are 
creating their own currency and are trying to evolve a new 
identity without any significant input from the United States 
on what might emerge in the long run. A few years ago I 
recommended a North Atlantic free trade area, but there may be 
other, better, ideas. And unless there is something by which we 
define that relationship, I think the evolution of the rest of 
the world is going to make what I consider the central 
relationship less and less relevant. If that continues, then we 
will be in the strange position of being confined sort of to an 
island off the coast of Europe and Asia.
    This will drive us into the kind of policy that, for 
example, my critics always say is unsustainable, namely a 
balance of power policy all over the world. If we do not have a 
community within which we operate, then we have to try to 
balance interests, rewards, and punishments.
    Now, in Asia, we have no choice in this matter, but in 
Europe and the Western Hemisphere we do have a choice. One 
reason, to get back to the question of German tradition, is 
that in Asia we have to balance the various nations, but in 
Europe and in the Western Hemisphere we can create a community. 
In Europe and in the Western Hemisphere war is highly unlikely. 
There, we can build structures based on common values, and we 
should give this more emphasis. In fact we have not given it 
any significant emphasis. We have put much more emphasis on 
relations and trade with Russia and other similar things.
    That would be my basic theme, even if I do not have a 
precise notion. If you put the best minds we have to work on 
it, as we did in the early Fifties, we will come up with 
something. I have no doubt.
    Senator Hagel. Thank you very much. Thank you, Mr. 
Chairman.
    The Chairman. Senator Grams.
    Senator Grams. Dr. Kissinger, welcome. I am sorry I am 
late. I do not know if I will retrace some steps that have been 
taken or questions that have been asked, but if I do you may be 
brief in answering those for me. I have a couple of questions. 
In June 1997, in an op-ed article in the Washington Post you 
said that you were gravely concerned that the Founding Act will 
dilute NATO into being a U.N.-styled system of collective 
security by grafting an elaborate and convoluted machinery for 
consultations with Russia at every level of the alliance. Now, 
what steps do you suggest that the Senate take in the 
resolution of ratification to ensure that this would not occur?
    Dr. Kissinger. I have made this recommendation. As I said, 
I strongly favor ratification, and nothing I have said should 
detract from that. I would, however, find it helpful, and I 
believe succeeding Secretaries of State and Presidents will 
find it helpful if the Senate expressed its view that the NATO 
Council remain the priority, that the central relationship we 
have in the North Atlantic area is within the Atlantic 
Alliance, and that relations with Russia should be friendly and 
cooperative but not part of the essence of NATO. I complimented 
Secretary Albright with respect to her forthright statement in 
response to a question by the Chairman, and some of the 
language she used might be incorporated so that it does not 
look like a partisan attack.
    Senator Grams. Is that an adequate response to the argument 
that while the Founding Act may give Russia no formal veto over 
NATO decisions, Russia will acquire basically a de facto veto 
through the Permanent Joint Council since some NATO countries 
could hesitate to decide a sensitive issue in NATO's policy 
making North Atlantic Council. Are we giving Russia too much 
voice, whether de facto or actual?
    Dr. Kissinger. I look at NATO, Senator, as our core group, 
and therefore I would not begin a new initiative by diluting 
it. There are many fora that can be created to deal with 
Russia, and I would favor those. But to use a military alliance 
as the principal forum confuses things. You know, I may be too 
old fashioned. I was not wild about the idea of a NATO Council 
meeting--of a Permanent Council meeting within the context of 
the U.N. in which the NATO Council meets with Russia in New 
York. If we had tried to have a NATO Council meeting in New 
York in the context of the United Nations, everyone would have 
screamed that this was extremely provocative and merging with a 
military organization. But here now you have a Permanent 
Council meeting in New York. That is not what NATO was 
originally designed to do.
    Second, you have this machinery in Brussels. You have the 
Secretary General who sits in on all these meetings. His staff 
serves both the NATO Council and the Permanent Council. Russia 
and the Secretary General are there all the time in the 
Permanent Council, and the United States rotates through it 
every 16th or 18th time. So these are two different 
institutions that are being merged by the same bureaucracy and 
in the same building.
    I do not doubt the good intentions of the people who are 
testifying here about a voice and not a veto. I am saying 
however that, operationally, I am very uneasy about this, and 
therefore the committee and the Senate could make a 
contribution by defining the role in a way so that future 
Presidents and Secretaries of State can point to it as 
instruction from the Congress, from the Senate. Even then I do 
not like it, for I would not have gone this way, but it would 
improve it.
    Senator Grams. There are some critics of enlargement that 
have stated concerns that enlargement will push Russia away 
from being cooperative with the West and toward more 
cooperation with China and with rogue states such as Iran, 
Iraq, and Libya. Do you think that this is a valid concern?
    Dr. Kissinger. Russia's relations with China will be 
determined by its own perception of its national interest and 
not by irritation, as may be the case with the West. I would 
think that there are certain geopolitical realities. They have 
a 4,000 mile frontier on one side of which is a billion people 
and on the other side of which are 30 million people. Normally, 
this is not an ideal situation for close political cooperation. 
After all, what brought the Chinese into a relationship with 
the United States when Nixon and Mao started it was not that 
both of them had suddenly become sentimental, but that there 
was a common national interest between the United States and 
China. So I think that whether Russia and China cooperate will 
be determined by their own fundamental interests. It is not a 
natural partnership, and I do not think it can possibly be 
affected by whether Poland joins NATO.
    One ought to remember another thing. Here is Russia with 
20,000 nuclear weapons. Who in Western Europe can even conceive 
of an attack on Russia? It is a myth. If one looks at history 
one has to say that Russian armies entered Europe more 
frequently than even European armies entered Russia. So if war 
becomes excluded in that region, a whole new consideration will 
arise. But I do not accept the proposition.
    I might point out one other thing from my own experience. 
When we made our first tentative overtures to China, all the 
former Ambassadors to the Soviet Union--and they were a very 
distinguished group including George Kennan and Chip Bolen--
requested an appointment with President Nixon and called on him 
to say that Russia would never forgive us, that our relations 
with Russia would never recover from these little moves we were 
making. It was a long time before President Nixon sent me there 
and the exact opposite happened. Our relations with the Soviet 
Union improved after our opening to China.
    If we conduct ourselves sensibly, which is to continue a 
serious dialog with Russia, but not within the context of them 
being tempted every day to see what they can do to weaken NATO, 
but on those issues that are of principal concern between us, I 
think our relations are more likely to improve than not. In any 
case, I do not believe that their relations with China will be 
driven by whether Prague is in NATO.
    Senator Grams. So we are not going to push Russia into a 
closer alliance with China just because of this? Such an 
alliance would have to be in their best interest?
    Dr. Kissinger. If you look at what Russia is actually doing 
rather than at the rhetoric, you realize that Russia is trying 
to needle us in many places, such as Iran and in many 
institutions in order to establish some claim to great power 
status. That is understandable. Some of this we can deal with 
by consulting with them, but we cannot change the structure of 
what we consider to be the essence of future relationships. I 
really feel that when you look at the world--at the upheavals 
that are likely to arise in the Islamic world, at the evolution 
in Asia and elsewhere--that the Western democracies have a 
basis for cooperation that should be preserved. I do not know 
what will happen 20 years from now with Russia. We could see 
this thing evolve, but that is more of a political than a 
military issue.
    Senator Grams. Thank you, Dr. Kissinger.
    The Chairman. Senator Biden.
    Senator Biden. Mr. Chairman, thank you. I have no further 
questions. I want to thank you again, Mr. Secretary, for being 
here. You, unlike anyone in the 25 years I have been here, have 
a way of putting the issues we are discussing in perspective in 
the broad sweep of historical change, and I for one appreciate 
it.
    It is presumptuous of me to predict anything, but I predict 
that you are going to be dead right. That is, I am absolutely 
convinced an expansion of NATO in the near-term and long-term 
will enhance our relationships with Russia, not diminish them. 
I am absolutely convinced of that. I am also convinced that as 
you look back over the last 50 years the very people who knew 
the most about Russia and the Soviet Union are a little bit 
clientized as they look at these things. I think their focus is 
so narrow in terms of what negative impact may come as a 
consequence of moves we make that I think sometimes, it is 
presumptuous of me to say this, they are somewhat blinded by 
the extent of their knowledge, if that makes any sense.
    The last point I will make is, and this is the only thing I 
disagree with what you said, and time will tell, I predict that 
we will have another hearing in this committee before this 
President's term is up on admission of Romania and Slovenia.
    Dr. Kissinger. I will be here testifying for it.
    Senator Biden. I know you will. But I was just referencing 
the point about how long this process is going to take. I agree 
with you that it probably will not be the Baltics within the 
time of this President, but I suspect, I hope at least we will 
be considering those other two countries sooner rather than 
later.
    At any rate, I want to thank you very much, and thank you, 
Mr. Chairman, for allowing me to make a concluding comment.
    The Chairman. Thank you. Mr. Secretary, we are all indebted 
to you for being available. We may not always agree, but the 
young folks on the Foreign Relations Committee staff, both 
Democrat and Republican, they know that they can ask you for 
your opinion and you always take the time to answer. We have 
two or three people like that, but we have a whole lot of 
people who say they do not have the time. I thank you for 
coming here this morning, and we are getting you out at 
approximately the time we had agreed to do. I bid you farewell, 
and good luck.
    Dr. Kissinger. Thank you for this opportunity.
    The Chairman. There being no further business to come 
before the committee, we stand in recess.
    [Whereupon, at 11:10 a.m., the hearing was adjourned, to 
reconvene at 2:08 p.m., October 30, 1997.]



                   NATO-RUSSIA RELATIONSHIP--PART II

                              ----------                              


                       THURSDAY, OCTOBER 30, 1997

                                      U. S. Senate,
                            Committee on Foreign Relations,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 2:08 p.m. in room 
SD-419, Dirksen Senate Office Building, Hon. Chuck Hagel, 
presiding.
    Present: Senators Lugar, Hagel, Thomas, Biden and 
Wellstone.
    Senator Hagel. Welcome. Mr. Secretary, nice to have you.
    Ambassador Pickering. Thank you very much, Senator Hagel. 
Nice to be with you.
    Senator Hagel. I note you were looking at the nameplate 
there. I can assure you it is not Kissinger. It is Pickering, 
spelled right.
    The Foreign Relations Committee this afternoon continues 
its examination of the critical issues surrounding the proposed 
expansion of NATO. The subject of our discussion will be the 
evolving NATO-Russia relationship. Appearing before the 
committee is a distinguished panel of our nation's leading 
experts on Russia.
    We will first hear from the Undersecretary of State for 
Political Affairs, the Honorable Thomas Pickering, who also 
served most recently as United States Ambassador to the Russian 
Federation.
    He will be followed by a second panel of non-governmental 
experts including Ambassador Jack Matlock, the George F. Kennan 
professor at the Institute for Advanced Study and America's 
last Ambassador to the Soviet Union; Lt. Gen. William Odom, 
director of National Security Studies at the Hudson Institute; 
and Mr. Dimitri Simes, president of the Nixon Center for Peace 
and Freedom.
    Gentlemen, on behalf of the committee, I welcome you and 
thank you for being with us and we look forward to your 
testimony this afternoon.
    Mr. Secretary, you may proceed. Good to have you.

STATEMENT OF AMBASSADOR THOMAS R. PICKERING, UNDERSECRETARY OF 
                  STATE FOR POLITICAL AFFAIRS

    Ambassador Pickering. Thank you, Senator Hagel and members 
of the committee. I am very pleased to have this opportunity to 
appear before you today. With respect to the nameplate, I would 
be delighted to appear here as Dr. Kissinger but I am sure 
there would be no confusion, at least in the physiognomy.
    These are truly historic hearings. They have begun the 
process of advice and consent on the enlargement of NATO. They 
have accelerated the national debate on this important 
initiative. Now the fate of NATO enlargement is in your hands 
and in those of the American public.
    We welcome this because as Secretary Albright said, we know 
that the security commitment that NATO enlargement entails will 
only be meaningful if it reflects the informed consent of the 
American people and their representatives.
    It is a special pleasure for me to come before you today to 
discuss NATO's emerging relationship with Russia. Having spent 
the past 38 years in the foreign service, I witnessed and 
participated in the remaking of the U.S./Soviet, and later, the 
U.S./Russian relationship from the confrontation of the cold 
war to the new opportunities of cooperation which we have 
today.
    As Ambassador to the Russian Federation from 1993 to 1996, 
I had the opportunity to meet the new leaders of this 
remarkable country and witness firsthand the salient changes 
that made such cooperation possible, and to participate in some 
of the planning which led to the founding act; the CFE second 
stage negotiations; to the ABM, TMD, and Start III issues.
    In her testimony before the Senate Foreign Relations 
Committee earlier this month, Secretary Albright explained the 
rationale for NATO enlargement and the reasons why we believe 
it is in our national interest. Today, I would like to tell you 
why we think a cooperative NATO-Russian relationship is also in 
that national interest.
    The challenge for the United States in relations between 
NATO and Russia can be framed in four simple declarative 
sentences.
    First, it is in the security interest of the United States, 
NATO, and the States of Central Europe to have constructive 
relations with Moscow, and to integrate a democratic, peaceful 
Russia into the world community.
    Second, while Russia's reforms have been impressive, 
Russia's future is not yet certain. In any case, our interests 
and those of Russia sometimes diverge. Third, the enlargement 
of NATO significantly advances U.S. security interests. Fourth, 
Russia's leadership voices its opposition to NATO enlargement.
    Today, I want to describe how we have framed our policy in 
a way that takes into account each of these realities.
    One of the greatest challenges of diplomacy is how a 
country structures its relations with former adversaries. After 
World War I, the United States and its allies failed that test, 
and the tragic results are well known. After World War II, the 
United States and its allies got it right, and the 
reintegration of Germany and the other Axis Powers into the 
community of democracies and the West stands as one of the 
great diplomatic accomplishments of this century.
    Today, there are few challenges more important than 
ensuring that we structure our relationship with the new Russia 
in a manner that serves our national interests and helps to 
promote United States/Russian cooperation. Russia today is 
still in the throes of a titanic political struggle over its 
future. We cannot be neutral bystanders in that struggle, for 
its outcome is not predetermined and American national 
interests are at stake.
    Our goal, like that of many Russians, must be to see Russia 
become a normal, modern state, democratic in its governance, 
abiding by the rule of law, market-oriented and prosperous, at 
peace with itself, with its neighbors, and with the rest of the 
world, and playing its full constructive role in the world 
community. Quite simply, we want to see the ascendancy of 
Russian reformers--those who look outward and forward rather 
than inward and backward.
    Ultimately, however, Russia's future rests squarely and 
completely in the hands of its people. A Russia that defines 
its national greatness in terms of the peace, well-being, and 
accomplishments of its people is likely to be part of the 
solution to Europe's and the world's problems.
    Conversely, a Russia that defines its greatness at the 
expense of its own people, or its neighbors, could be in the 
21st century just as it was in the 20th century--a serious and 
significant problem for us and others.
    Our objective must be to craft the political arrangements 
that help to encourage Russia to pursue the first path and not 
the second. This objective is fully consistent with our policy 
of adding new states to NATO. Indeed, the two complement each 
other.
    For example, I know that many Senators are concerned about 
the costs of NATO enlargement. One way to ensure that the costs 
remain low is to ensure that Russia remains on track, and 
continues on a cooperative course with the rest of Europe.
    Conversely, as Secretary Albright said to this committee 
earlier this month, and I quote, ``By engaging Russia and 
enlarging NATO, we give Russia every incentive to deepen its 
commitment to democracy and peaceful relations with neighbors 
while closing the avenue to more destructive alternatives.''
    Thus, a cooperative and functioning NATO-Russia 
relationship can become a pillar of stability in the new 
Europe. The importance of this objective is what led Presidents 
Ronald Reagan and George Bush to reach out to the then-Soviet 
Union, and later Russia, and to take the first steps in laying 
the foundation for a new NATO-Russia relationship.
    Already, at the Rome Summit in 1991, NATO declared that it 
no longer considered Russia a threat. It invited Russia to be a 
part of the North Atlantic Cooperation Council. In 1994, NATO 
created the Partnership for Peace and asked Russia to be a part 
of that program as well--an invitation that Russia ultimately 
accepted.
    We also began the so-called 16+1 conversations with Russia 
and other partner states, which refers to the discussions 
between the 16 members of NATO and other parties on a one-by-
one basis.
    The United States and NATO also consulted closely with 
Russia in formulating our strategy to stop the war in Bosnia 
and found a way for our troops to work together to implement 
the Dayton peace accords.
    Today, American and Russian soldiers are working side-by-
side in Bosnia, an arrangement that few of us would have 
believed possible a decade ago. It is a unique arrangement in 
which Russian soldiers serve side-by-side with NATO under 
American command.
    The most important step in relations between NATO and 
Russia, however, came on May 27 of this year when President 
Clinton and the other NATO leaders joined President Yeltsin in 
signing the NATO-Russia Founding Act.
    The Founding Act is a landmark document. It opens the door 
to a new and constructive relationship between these two cold 
war adversaries. It sets out the principles of the 
relationship; describes possible areas for consultation and 
cooperation; establishes a new forum, the Permanent Joint 
Council, for discussions between the alliance and Moscow; and 
it sets out a number of points regarding the political/military 
aspects of the relationship.
    In crafting the Founding Act, NATO structured its 
discussions with Russia with extreme care. We declared at the 
outset that there were some things we were willing to do, and 
that there were some that we were not.
    We said we were willing to create a document that would 
describe our new relationship. We said we were willing to 
create a new consultative forum. We said we would be willing to 
pursue adaptation of the Treaty on Conventional Armed Forces in 
Europe.
    But we also had five red lines. We said Russia would have 
no veto over NATO decisions including its own enlargement. We 
said there would be no delay in the enlargement process. We 
said we would not subordinate NATO and the North Atlantic 
Council, its decisionmaking body, to any other body or 
organization. We said we would not do anything that would 
consign new NATO members to second class status. We said that 
the act does not automatically exclude any qualified European 
state from future consideration for NATO membership.
    As we have explained to this committee on previous 
occasions, the ultimate text of the Founding Act stayed 
completely within these red lines.
    Barely 5 months have passed since the Founding Act was 
signed, but we have already seen some important steps to 
implement its provisions--most significantly, Russia is taking 
the Permanent Joint Council seriously, as is NATO.
    On July 18, the PJC met for the first time in Brussels at 
the level of permanent representatives. On September 26, 
Ambassador Albright and her counterparts held the first 
ministerial level meeting of the PJC in New York. The most 
recent PJC meeting was held among the permanent representatives 
on October 24.
    In addition, the PJC has adopted rules of procedure and a 
work plan for the remainder of 1997--documents that have been 
shared with this committee and the Senate NATO Observer Group.
    We have also made progress in implementing other parts of 
the Founding Act. On October 20, the Russian Minister of 
Defense named General Viktor Zavarzin as Russia's military 
representative to NATO. The general is expected to assume his 
duties before the end of the year, and he recently visited NATO 
with General Kvashnin, chief of the Russian General Staff.
    In addition, at the most recent Ambassadorial level meeting 
of the NATO-Russia PJC, NATO and Russia agreed on steps to 
implement the work program, including experts' talks on 
peacekeeping.
    As NATO and Russia deepened their record of consultation 
and cooperation in the PJC, in Bosnia, and in other ways, our 
own government continues to support Russia's reforms and to 
pursue important issues with Russia in other ways as well.
    We are continuing our efforts to achieve mutual and 
balanced reductions in both our countries' nuclear arsenals. 
Both countries have ratified the START I Treaty and are 
implementing its reductions in arms levels. We are looking 
forward to Russian ratification of START II, a treaty which we 
have already ratified. President Yeltsin and his advisors have 
begun making serious efforts to obtain the approval of the 
Russian Duma.
    And at the Helsinki Summit in March, President Yeltsin and 
President Clinton agreed that we will begin to work on a START 
III treaty as soon as START II has entered into force, so that 
we can make even deeper reductions in both countries' strategic 
stockpiles on an even and balanced basis. At Helsinki, we 
agreed that START III would be focused on reducing warheads to 
levels between 2,000-2,500 on each side.
    We also have continued efforts with Russia on conventional 
arms reductions in Europe. Along with 28 other states, we are 
pursuing a major adaptation of the Conventional Armed Forces in 
Europe treaty, and in July, all 30 states parties signed a 
decision on basic elements for treaty adaptation that can help 
us to achieve that goal.
    We also have deepened our cooperation with Russia and have 
worked to integrate Russia more fully into world economic 
institutions, into the Paris Club as a creditor country, and 
the World Trade Organization on terms normally applicable to 
newly acceding members.
    The regular discussions between Vice President Gore and 
Prime Minister Chernomyrdin have produced important agreements 
concerning cooperation on energy and the environment, as well 
as in seven other areas of significant cooperation, from 
agricultural and health to defense conversion.
    And through the Gore/Chernomyrdin process, and other 
bilateral discussions, we have raised our concerns with Russia 
about its relations with Iran, arms control, and other security 
issues.
    Those are the steps we have taken to build the new 
relationship between NATO and Russia. This relationship is 
based on shared principles and shared interests. It is a 
relationship that holds great promise for us and for all of 
Europe, as Russia continues in joining us in making the 
Permanent Joint Commission a constructive forum focused on 
problem solving.
    This new relationship is also, I want to remind members of 
the committee, a serious two-way street. Do not forget that 
while the Russians can propose raising issues in the PJC that 
they are concerned about, so can we, and we will.
    It is also not a process that can spin out of our control 
or out of NATO's control. Every item on the PJC agenda must be 
agreed to by consensus. That means we do not have to agree to 
discuss any issue that we think would be inappropriate or 
harmful to our interests or those of NATO.
    I know that there are two major concerns about the 
direction of our policy on NATO-Russia relations. One concern 
is that despite the Founding Act in the PJC, NATO enlargement 
will leave Russia isolated; strengthen Russian hard-liners who 
stress that isolation; undermine Russian reform; and doom 
prospects for security cooperation, especially in arms control. 
This would be a serious problem if it proved correct, for one 
of our goals is to integrate a democratic Russia into the new 
Europe.
    But a fair reading of recent events suggests that NATO 
enlargement is not having this impact on Russia and its 
policies. Over the past 18 months, precisely when NATO 
enlargement has been a salient part of our agenda, Russian 
reform and security cooperation have moved forward, not 
backward.
    To cite but a few examples, during this period, President 
Yeltsin was re-elected. He elevated reformers within his 
government. He appointed a new defense minister who supports 
START II and is actively working for its ratification.
    As I noted earlier, President Yeltsin agreed to negotiate a 
START III Treaty as soon as START II enters into force. He 
signed the Founding Act. We have made progress in the CFE 
negotiations. Russia has made positive steps in its relations 
with Ukraine.
    This track record does not support the hypothesis that 
Russian reform or reformers and security cooperation will 
inevitably suffer as a result of NATO enlargement. Russia has 
pursued these steps because they are in Russia's interest.
    We should also understand that the broad Russian public is 
not well-informed on NATO and does not consider NATO to be the 
key threat to their future. They are far more concerned about 
other issues, from wages and pensions to corruption and crime.
    That is why I am persuaded that we must continue to pursue 
both NATO enlargement and a steadily more constructive 
relationship with Russia, that they are not incompatible, and 
that they are in the long-term interests of both NATO and 
Russia in producing stability, prosperity, and cooperation in 
Europe.
    We are realists. We know that Russian opposition to NATO 
enlargement is real. But we must see it for what it is--a 
product of misperceptions about NATO's true purpose, a token or 
an artifact of outdated Soviet thinking about former satellites 
in Central Europe.
    Instead of changing our policy to accommodate outdated 
fears, we need to encourage the new Russia's more modern 
aspirations. This means we should be Russia's steadfast 
champion whenever it seeks to define its greatness by joining 
rule-based organizations, opening its markets, or by 
participating constructively in regional or world affairs. But 
when some Russian leaders suggest that a larger NATO is a 
threat, we must say that this is false and base our policies on 
what we know to be true.
    If the first group of critics worries that we have not done 
enough to promote cooperation with Russia, a second group of 
critics worries that we have done too much. I know that former 
Secretary of State Kissinger testified here before you this 
morning. Dr. Kissinger, along with others, has charged that the 
Founding Act and the PJC give Russia too much influence over 
NATO decisionmaking.
    I am a great admirer of Dr. Kissinger, and once had the 
privilege of serving as his special assistant. But on this one, 
as I have told him, I respectfully disagree with his judgment.
    I believe Secretary Albright has described cogently and 
carefully the limitations on any potential jeopardy regarding 
our consultations with Russia, and that this is the correct 
model for the future. She did this here before the committee, 
and I am happy to say that Dr. Kissinger apparently agrees that 
this is the correct model.
    We designed the Founding Act and the PJC to protect NATO's 
independent decisionmaking authority, and I believe we have 
succeeded. The PJC has no role in NATO's internal 
decisionmaking--none. It gives Russia a voice but not a veto.
    The North Atlantic Council remains NATO's sole and supreme 
decisionmaking body. The Founding Act imposed no restriction on 
NATO's military doctrine, strategy, or deployments. The 
unilateral statements of NATO's military policy are just that--
unilateral statements of policy that NATO had previously 
adopted outside the context of NATO-Russian discussions.
    The Founding Act in no way works to the detriment of NATO's 
new members. They will come into the alliance the way all the 
other allies did--as full and first-class members.
    It is also just not true that the U.S. and NATO created the 
Founding Act and the PJC as compensation to Russia or as 
concessions in exchange for Russian acquiescence to NATO 
enlargement. Rather, our goal has been for Russia to find ways 
to work together with Russia in spite of our disagreement on 
NATO enlargement.
    We insisted that every provision of the Founding Act had to 
meet this test--does it make sense on its own terms in regard 
to American interests? Our answer in each case has been yes.
    These are the two schools of criticism we hear most often 
regarding NATO-Russian relations. They come at this question 
from quite different perspectives, but there is one point on 
which they sometimes converge.
    Both camps often charge that we are ducking the issue of 
Russia, or being disingenuous about our motives. People in both 
camps often ask me a simple question--is not NATO enlargement 
ultimately about Russia? Is not it premised on a real or 
potential Russian threat? The question is important because it 
goes to the core of our fundamental intentions in pursuing the 
alliance's enlargement and this new relationship with Russia.
    Let me be clear. For the reasons I have listed, our policy 
is to engage Russia and to maximize the likelihood that that 
country will stay on the path of democratic development.
    But as the Secretary said before the Senate Appropriations 
Committee last week, none of us in the State Department has a 
perfect crystal ball. One contingency that the alliance must be 
able to respond to, even though we see it as unlikely and are 
working hard to make it even less likely, is the possibility 
that Russia could abandon democracy and return to old 
threatening patterns of behavior.
    That, however, is not the only reason or even the primary 
reason to enlarge the alliance. It is a mistake in our view to 
assume that this is the unspoken single premise guiding our 
policy.
    NATO does not need an enemy. It has enduring purposes--
deterring future threats, keeping the United States engaged in 
Europe, ensuring that Europe's security policies remain 
cooperative rather than competitive, and providing a collective 
defense capability for a range of future contingencies.
    That is precisely why we are pursuing both NATO's 
enlargement and a cooperative NATO-Russia relationship, and why 
both of them serve our interests. What we are asking you and 
your Senatorial colleagues to ratify is not a policy of NATO 
enlargement instead of a positive relationship with Russia, but 
NATO enlargement together with a positive relationship with 
Russia. We are committed to pursuing both, and we believe our 
policy is already showing positive and reassuring results.
    Thank you again, Senator Hagel, very much, and I stand 
ready to address your questions.
    [The prepared statement of Ambassador Pickering follows:]
               Prepared Statement of Ambassador Pickering
    Senator Hagel, members of the Committee: I am pleased to have this 
opportunity to appear before you today. These are truly historic 
hearings. They have begun the process of advice and consent on the 
enlargement of NATO. They have accelerated the national debate on this 
important initiative. Now, the fate of NATO enlargement is in your 
hands, and those of the American public. We welcome this because, as 
Secretary Albright said, we know that the security commitment that NATO 
enlargement entails will only be meaningful if it reflects the informed 
consent of the American people and their representatives.
    It is a special pleasure for me to come before you today to discuss 
NATO's emerging relationship with Russia. Having spent the past 38 
years in the Foreign Service, I witnessed and participated in the 
remaking of U.S.-Soviet and later U.S.-Russian relations from the 
confrontation of the Cold War to the new opportunities of cooperation 
we have today. As Ambassador to the Russian Federation from 1993-1996, 
1 had the opportunity to meet the new leaders of this remarkable 
country, and witness first hand the salient changes that made such 
cooperation possible, and participate in some of the planning which led 
to the Founding Act, the CFE negotiations and ABM and START III talks.
    In her testimony before the Senate Foreign Relations Committee 
earlier this month, Secretary Albright explained the rationale for NATO 
enlargement and the reasons why we believe it is in our national 
interest. Today I would like to tell you why we think a cooperative 
NATO-Russian relationship is also in that national interest.
    The challenge for the United States in relations between NATO and 
Russia can be framed in four declarative sentences. First, it is in the 
security interest of the U.S., NATO, and the states of Central Europe 
to have constructive relations with Moscow, and to integrate a 
democratic, peaceful Russia into the world community. Second, while 
Russia's reforms have been impressive, Russia's future is not yet 
certain, and in any case our interests and those of Russia sometimes 
diverge. Third, the enlargement of NATO significantly advances U.S. 
security interests. Fourth, Russia's leadership voices its opposition 
to NATO enlargement. Today, I want to describe how we have framed our 
policy in a way that takes account of each of these realities.
    One of the greatest challenges of diplomacy is how a country 
structures its relations with former adversaries. After World War I, 
the United States and its allies failed that test--and the tragic 
results are well known. After World War II, the United States and its 
allies got it right--and the re-integration of Germany and the other 
Axis powers into the community of democracies and the West stands as 
one of the great diplomatic accomplishments of this century. Today 
there are few challenges more important than ensuring we structure our 
relationship with the new Russia in a manner that serves U.S. national 
interests and helps to promote U.S.-Russian cooperation.
    Russia today is still in the throes of a titanic political struggle 
over its future. We cannot be neutral bystanders in that struggle, for 
its outcome is not pre-determined, and American national interests are 
at stake. Our goal, like that of many Russians, must be to see Russia 
become a normal, modern state--democratic in its governance, abiding by 
the rule of law; market oriented and prosperous; at peace with itself, 
with its neighbors, and with the rest of the world and playing its full 
constructive role in the world. Quite simply, we want to see the 
ascendancy of Russian reformers, those who look outward and forward 
rather than inward and backward. Ultimately, however, Russia's future 
rests squarely and completely in the hands of the Russian people.
    A Russia that defines its national greatness in terms of the peace, 
well being, and accomplishments of its people is likely to be part of 
the solution to Europe's and the world's problems. Conversely, a Russia 
that defines its greatness at the expense of its own people or its 
neighbors could be in the 21st century just as it was in the 20th 
century--a great problem for us and others. Our objective must be to 
craft the political arrangements that help encourage Russia to pursue 
the first path rather than the second.
    This objective is fully consistent with our policy of adding new 
states to NATO. Indeed, the two complement each other. For example, I 
know that many Senators are concerned about the costs of NATO 
enlargement. One way to ensure that the costs remain low is to ensure 
that Russia remains on track and continues on a cooperative course with 
the rest of Europe. Conversely, as Sec. Albright said to this committee 
earlier this month, ``By engaging Russia and enlarging NATO, we give 
Russia every incentive to deepen its commitment to democracy and 
peaceful relations with neighbors, while closing the avenue to more 
destructive alternatives.'' Thus, a cooperative and functioning NATO 
Russian relationship can become a pillar of stability in the new 
Europe.
    The importance of this objective is what led Presidents Ronald 
Reagan and George Bush to reach out to the then Soviet Union and later 
Russia and to take the first steps in laying the foundation for a new 
NATO-Russian relationship. Already at the Rome summit in 1991, NATO 
declared that it no longer considered Russia a threat. It invited 
Russia to be a part of the North Atlantic Cooperation Council. In 1994, 
NATO created the Partnership for Peace, and asked Russia to be a part 
of that program as well--an invitation that Russia ultimately accepted. 
We also began so-called ``16+1 conversations'' with Russia and other 
partner states which refers to the discussions between the 16 members 
of NATO, and other parties on a one-by-one basis.
    The United States and NATO also consulted closely with Russia in 
formulating our strategy to stop the war in Bosnia, and found a way for 
our troops to work together to implement the Dayton Peace accords. 
Today, American and Russian troops are working side by side in Bosnia--
an arrangement that few of us would have believed possible a decade 
ago. It is a unique arrangement in which Russian soldiers serve side by 
side with NATO under American command.
    The most important step in relations between NATO and Russia, 
however, came on May 27 of this year, when President Clinton and the 
other NATO leaders joined President Yeltsin in signing the NATO Russia 
Founding Act. The Founding Act is a landmark document. It opens the 
door to a new and constructive relationship between these two Cold War 
adversaries. It sets out the principles of the relationship, describes 
possible areas for consultation and cooperation, establishes a new 
forum, the Permanent Joint Council, for discussions between the 
Alliance and Moscow, and sets out a number of points regarding the 
political-military aspects of the relationship.
    In crafting the Founding Act, NATO structured its discussion with 
Russia with extreme care. We declared at the outset that there were 
some things we were willing to do, and some that we were not. We said 
we were willing to create a document that would describe our new 
relationship. We said we were willing to create a new consultative 
forum. We said we would be willing to pursue adaptation of the Treaty 
on Conventional Forces in Europe.
    But we also had five red lines. We said Russia would have no veto 
over NATO decisions, including its own enlargement. We said there would 
be no delay in the enlargement process. We said we would not 
subordinate NATO and the North Atlantic Council, its decisionmaking 
body, to any other body or organization. We said we would not do 
anything that would consign new NATO members to second-class status. We 
said that the Act does not automatically exclude any qualified European 
state from future consideration for NATO membership. As we have 
explained to this Committee on previous occasions, the ultimate text of 
the Founding Act stayed completely within these red lines.
    Barely five months have passed since the Founding Act was signed. 
But we have already seen some important steps to implement its 
provisions. Most significantly, Russia is taking the PJC seriously, as 
is NATO. On July 18, the PJC met for the first time in Brussels at the 
level of permanent representatives. On September 26, Ambassador 
Albright and her counterparts held the first Ministerial level meeting 
of the PJC in New York. The most recent PJC meeting was held among 
PermReps on October 24. In addition the PJC has adopted rules of 
procedure and a work plan for the remainder of 1997--documents that 
have been shared with the Committee and the Senate NATO Observer Group.
    We have also made progress in implementing other parts of the 
Founding Act. On October 20, the Russian Minister of Defense named 
General Viktor Zavarzin as Russia's Military Representative to NATO. 
The General is expected assume his duties before the end of the year 
and recently visited NATO with General Kvashnin, chief of the Russian 
General Staff. In addition, at the most recent ambassadorial level 
meeting of the NATO Russia PJC, NATO and Russia agreed on steps to 
implement the work program including holding experts talks on 
peacekeeping.
    As NATO and Russia deepen their record of consultation and 
cooperation in the PJC, in Bosnia, and in other ways, our own 
government continues to support Russia's reforms and to pursue 
important issues with Russia in other ways as well. We are continuing 
our efforts to achieve mutual and balanced reductions in both our 
countries' nuclear arsenals. Both countries have ratified the START I 
Treaty and are implementing its reductions in arms levels. We are 
looking forward to Russian ratification of START II--a Treaty we have 
already ratified--and President Yeltsin and his advisers have begun 
making serious efforts to obtain the approval of the Russian Duma. And 
at the Helsinki Summit in March, President Yeltsin and President 
Clinton agreed that we will begin work on a START III Treaty as soon as 
START II has entered into force, so that we can make even deeper 
reductions in both countries' strategic stockpiles. At Helsinki we 
agreed that START III would be focused on reducing warheads to levels 
between 2000 and 2500 on each side.
    We also have continued efforts with Russia on conventional arms 
reductions in Europe. Along with 28 other states, we are pursuing a 
major adaptation of the Conventional Force in Europe Treaty, and in 
July, all 30 states parties signed a Decision on Basic Elements for 
Treaty Adaptation that can help us achieve that goal.
    We also have deepened our cooperation with Russia and have worked 
to integrate Russia more fully into world economic institutions--into 
the Paris Club as a creditor country and the World Trade Organization 
on terms normally applicable to newly acceding members. The regular 
discussions between Vice President Gore and Prime Minister Chemomyrdin 
have produced important agreements concerning cooperation on energy and 
the environment as well as in seven other areas of significant 
cooperation from agriculture and health to defense conversion. And 
through the Gore-Chemomyrdin process and other bilateral discussions, 
we have raised our concerns with Russia about its relations with Iran, 
arms control and other security issues.
    Those are the steps we have taken to build the new relationship 
between NATO and Russia. This relationship is based on shared 
principles and shared interests. It is a relationship that holds great 
promise for us and all of Europe, as Russia continues in joining us in 
making the PJC a constructive forum focused on problem-solving. This 
new relationship is also a two-way street. Don't forget: while the 
Russians can propose raising issues in the PJC that they are concerned 
about, so can we. And we will. It is also not a process that can spin 
out of our control, or out of NATO's control. Every item on the PJC 
agenda must be agreed to by consensus. That means we do not have to 
agree to discuss of any issue that we think would be inappropriate or 
harmful to our interests or NATO's.
    I know that there are two major concerns about the direction of our 
policy on NATO-Russian relations. One concern is that, despite the 
Founding Act and the PJC, NATO enlargement will leave Russia isolated, 
strengthen Russian hardliners who stress that isolation, undermine 
Russian reform, and doom prospects for security cooperation, especially 
arms control. This would be a serious problem, if it proved correct, 
for one of our goals is to integrate a democratic Russia into the new 
Europe.
    But a fair reading of recent events suggests that NATO enlargement 
is not having this impact on Russia and its policies. Over the past 18 
months, precisely when NATO enlargement has been a salient part of our 
agenda, Russian reform and security cooperation have moved forward, not 
backward. To cite a few examples, during this period, President Yeltsin 
was re-elected. He elevated reformers within his government. He 
appointed a new Defense Minister who supports START II and is actively 
working for its ratification. As I noted earlier, President Yeltsin 
agreed to negotiate a START III treaty as soon as START II enters into 
force. He signed the Founding Act. We have made progress on CFE. And 
Russia has made positive steps in its relations with Ukraine. This 
track record does not support the hypothesis that Russian reform or 
reformers and security cooperation will inevitably suffer as a result 
of NATO enlargement.
    Russia has pursued these steps because they are in its own 
interest. We should also understand that the broad Russian public is 
not well informed on NATO and does not consider NATO to be the key 
threat to their future. They are far more concerned about other issues, 
from wages and pensions to corruption and crime. That is why I am 
persuaded that we must continue to pursue both NATO enlargement and a 
steadily more constructive relationship with Russia, that they are not 
incompatible and that they are in the long-term interests of both NATO 
and Russia in producing stability, prosperity and, cooperation in 
Europe.
    We are realists. We know that Russian opposition to NATO 
enlargement is real. But we must see it for what it is--a product of 
misperceptions about NATO's true purpose and a token of outdated Soviet 
thinking about former satellites in Central Europe. Instead of changing 
our policy to accommodate these outdated fears, we need to encourage 
the new Russia's more modem aspirations. This means we should be 
Russia's steadfast champion whenever it seeks to define its greatness 
by joining rule-based organizations, opening its markets or by 
participating constructively in regional or world affairs. But when 
some Russian leaders suggest that a larger NATO is a threat, we must 
say that this is false and base our policies on what we know to be 
true.
    If the first group of critics worry that we have not done enough to 
promote cooperation with Russia, a second group of critics worries that 
we have done too much. I know that former Secretary of State Kissinger 
testified before you this morning. Dr. Kissinger, along with others, 
has charged that the Founding Act and the PJC give Russia too much 
influence over NATO decisionmaking.
    I am a great admirer of Dr. Kissinger, and once had the privilege 
of serving as his Special Assistant. But on this one, as I have told 
him, I respectfully disagree with his judgment. I believe Secretary 
Albright has described cogently and carefully the limitations on any 
potential jeopardy regarding our consultations with Russia and that 
this is the correct model for the future.
    We designed the Founding Act and the PJC to protect NATO's 
independent decisionmaking authority, and we succeeded. The PJC has no 
role in NATO's internal decision making--none. It gives Russia a voice, 
but not a veto. The North Atlantic Council remains NATO's sole and 
supreme decision making body. The Founding Act imposed no restrictions 
on NATO's military doctrine, strategy, or deployments. The unilateral 
statements of NATO's military policy are just that--unilateral 
statements of policy that NATO had previously adopted outside the 
context of NATO-Russian discussions. The Founding Act in no way works 
to the detriment of NATO's new members. They will come into the 
Alliance the way all the other allies did--as full and first class 
members.
    It also is just not true that the US and NATO created the Founding 
Act and PJC as compensation to Russia, or as concessions in exchange 
for their acquiescence to NATO enlargement. Rather, our goal has been 
to find ways to work together with Russia in spite of our disagreement 
on NATO enlargement. We insisted that every provision of the Founding 
Act had to meet this test: does it make sense on its own in terms of 
American interests? Our answer is yes.
    These are the two schools of criticism we hear most often regarding 
NATO Russian relations. They come at this question from quite different 
perspectives. But there is one point on which they sometimes converge. 
Both camps often charge that we are ducking the issue of Russia or 
being disingenuous about our motives. People in both camps often ask me 
a simple question: ``Isn't NATO enlargement ultimately about Russia? 
Isn't it premised on a real or potential Russian threat?'' The question 
is important, because it goes to the core of our fundamental intentions 
in pursuing the Alliance's enlargement and this new relationship with 
Russia.
    Let me be clear. For the reasons I have listed, our policy is to 
engage Russia and to maximize the likelihood that this country will 
stay on the path of democratic development. But, as the Secretary said 
before the Senate Appropriations Committee last week, none of us in the 
State Department has a crystal ball. And one contingency that the 
Alliance must be able to respond to--even though we see it as unlikely 
and are working hard to make it even less likely--is the possibility 
that Russia could abandon democracy and return to old, threatening 
patterns of behavior.
    That, however, is not the only reason, or even the primary reason, 
to enlarge the Alliance, and it is a mistake to assume that this is the 
unspoken single premise guiding our policy. NATO does not need an 
enemy. It has enduring purposes: deterring future threats; keeping the 
U.S. engaged in Europe; ensuring that Europe's security policies remain 
cooperative rather than competitive; and providing a collective defense 
capability for a range of future contingencies.
    That's precisely why we are pursuing both NATO's enlargement and a 
cooperative NATO-Russia relationship, and why both of them serve our 
interests. What we are asking you and your Senate colleagues to ratify 
is not a policy of NATO enlargement instead of a positive relationship 
with Russia, but NATO enlargement together with a positive relationship 
with Russia. We are committed to pursuing both, and we believe our 
policy is already showing positive and reassuring results.
    Thank you.

    Senator Hagel. Mr. Secretary, thank you very much. I am 
joined here by my colleagues Senator Wellstone from Minnesota, 
Senator Lugar from Indiana, Senator Thomas from Wyoming. What 
we will do is--and the distinguished ranking minority member, 
Senator Biden.
    Senator, we have just taken the eloquent testimony of 
Secretary Pickering, and if you would like to make a comment, 
we will get to questions.
    Senator Biden. No, no. I am sure I could not improve on 
anything the former Secretary said.
    Senator Hagel. Thank you. Mr. Secretary, what do you 
believe the expectations, goals, are of the Russians, their 
leaders, in signing the Founding Act? What do they wish to get 
out of this? What do have in their minds as short-term, long-
term goals?
    Ambassador Pickering. Senator, ever since my arrival in 
Russia in the middle of 1993, I have been impressed by the fact 
that a key pillar of President Yeltsin's policy, alongside 
democratic and economic reform, has been to play a serious role 
in the world community as a democratic State with an open and 
developing and prosperous set of market arrangements.
    And while President Yeltsin has objected to NATO 
enlargement, the Founding Act provided him and his colleagues 
in the reform group in Russia a serious opportunity to play a 
role alongside NATO in the future of European security to deal 
with problems through consultation that might arise in the 
context of European security, hopefully before they became 
serious problems, and to cooperate as he had with us in the 
Contact Group, where there is no question in dealing with 
Bosnia we had differences.
    But there is no further question that we were able to work 
out and resolve those differences as we went through the 
process of Dayton, and in the implementation of the Dayton 
accords.
    This, in my view, is a record we need continually to look 
at, and it is a picture of Russia that I think is important to 
understand despite the fact that there are many who believe 
that Russia is bent on recreating a Soviet-style imperialist 
State.
    I think the facts of President Yeltsin's leadership belie 
that. I think a number of the points that I have made in my 
opening statement about their pursuit with us jointly of arms 
control arrangements and their interest in playing a 
constructive role in European security is culminated, if you 
would like, in getting into the Founding Act with NATO and 
seeking to provide a way to assure further cooperation in 
European security, which is what the NATO Founding Act is 
designed to provide.
    Senator Hagel. I want to read back to you just for a minute 
a sentence or two from your testimony and ask for a little 
further explanation. Page seven you say, The PJC has no role in 
NATO's internal decisionmaking--none. It gives Russia a voice, 
but not a veto.
    Could you explain, Mr. Secretary, for the committee, what 
that means, it gives them a voice but no veto? What kind of 
voice?
    Ambassador Pickering. I would like first, Senator Hagel, to 
make sure that you understand that the PJC is a consultative 
mechanism, and that consultation in diplomatic parlance means 
just that, talking together.
    It does not mean a situation in which you are obliged to 
negotiate. It does not mean you are in a situation where you 
are obliged to make a decision. It is an exploration of finding 
ways to harmonize policy on the basis of your interest and 
intent. So, it provides that kind of opportunity.
    It is extremely important, I believe, that we all 
understand that even the subject matter to be raised in the PJC 
is subject to consensus. In cases where the Russians might 
suggest subject matter on which there is no NATO position, it 
is clearly provided that NATO is not required to undertake any 
such discussion and certainly can, if it wishes and chooses to 
make such a discussion, first agree among itself, its members, 
as to what its position is.
    It is important, however, because it is a two-way street. 
There are benefits, I believe, from talking to the Russians 
about a whole range of questions, from peacemaking through the 
issue of broad security questions inside the European 
continent. In this day and age, I think a level of transparency 
consistent with our security interests is very important.
    Second, a two-way street is a two-way street. We have equal 
rights to ask the Russians to discuss issues with us, and we 
have equal rights to expect a comparable level of attention to 
the issues as we are prepared to give them. I believe this is 
important in carrying on a dialog and I believe it is 
significant that the Russians have agreed to this.
    The Founding Act contains a number of important principles. 
One of those is, of course, that internal affairs are internal 
affairs. Others are that no particular discussion item is 
required to be brought forth if either party does not wish to 
discuss it.
    So it is an opportunity to conduct, if you like, diplomacy 
and relations between the alliance and Russia on a constructive 
basis but on a willing buyer/willing seller/willing partner 
basis, and that is precisely what it is designed to achieve.
    From the Russian perspective, to go back to your first 
question, it gives them an opportunity to have a voice in the 
process of developing European security. That voice is 
important because just as the Contact Group led to cooperative 
Russian participation in the forces implementing Dayton, so a 
voice with NATO in future questions could open the door to an 
equally productive and cooperative relationship with respect to 
other problems in Europe.
    Russia is a considerable power. It has significant 
interests. It can speak with an important voice. To have Russia 
inside the tent, to borrow a phrase from Lyndon Johnson, rather 
than outside, I think, is extremely important.
    The price we pay for that is only our willingness to 
discuss, but I believe there is important benefits to both 
Russia and the United States for being willing to pay that 
price, which is to lend an ear and a voice to the process.
    Senator Hagel. Thank you. Senator Biden?
    Senator Biden. It is good to see you, Tom. It has been a 
long time that you have been coming up before this committee. I 
am getting a little worried my staff reminded me, as if I could 
forget, that you are now the senior guy at the State 
Department. My God, we are getting old. We have been here a 
long time.
    Ambassador Pickering. Senator, I do not know whether I came 
up here before you did or not.
    Senator Biden. I think you probably did. I did not come 
until 1973, so it was January 1973, but----
    Ambassador Pickering. I can remember some bad days before 
that.
    Senator Biden. Yep. I--it is interesting that--I think, by 
the way, what we put together today is one of the most--
beginning with Dr. Kissinger this morning and with the panel 
that will follow you including your predecessor, Ambassador 
Matlock and others--distinguished panels we have had to comment 
on this. What strikes me is the divergence of opinion.
    And it reflects what goes on up here in that the Founding 
Act is viewed by some as having given too much and by others as 
not having given nearly enough. Some think it not only 
mollifies Russia but emboldens Russia to have a greater say in 
what happens in NATO, and others think that it really isolates 
Russia.
    And we are going to hear that divergence today, I expect, 
as we will in the future of this debate about the security 
concerns Russia has relative to the expansion of NATO.
    I have only made one trip to Moscow in the last 12 months, 
and met with every leader of every major faction. And nobody 
talked about the direct security concerns. They talked about 
their anger, their sense of rejection, this meaning that we 
really never want them to be part of the West, the isolation of 
Russia, and so on.
    But it was actually a Russian that reminded me that Norway 
has long been a member of NATO, the only country with a common 
border of the ones that are involved, including the three new 
ones that are about to come in. There has never been any great 
concern because Norway and NATO made fundamental decisions 
about nuclear weapons and the stationing of troops there. The 
same decisions that have unilaterally been made by NATO with 
regard to the three new countries who are a hell of a lot 
further from the Russian border.
    But I would like to pursue a point made by Secretary 
Kissinger this morning. I, quite frankly, have misunderstood 
his position twice. I think I understand it now, and I am not 
being facetious when I say that. He had early on in 1993 or 
1994 written about the need to have, I thought, just such a 
consultative group or arrangement. Then, I realized he was 
opposed, I thought, unalterably opposed to the notion.
    Really, what he said today as I understand it and maybe 
everybody understood it all along, but I did not--was, look at 
the way these institutions function--it was kind of the 
argument that the old anti-arms controllers used. If you start 
to negotiate, you are going to be compelled to bring back an 
agreement. Kind of like the way Senators talk about special 
prosecutors these days, no matter how honest he or she is, you 
appoint them, their reputation rests on an indictment, and if 
they do not get one, they will find one.
    And as I listened to him, he talked about, as I understood 
it, the concern that notwithstanding the fact that you and the 
President and Secretary Albright and others are of the view 
this is a voice, not a veto, the practical effect of being in 
the same building, the same proximity, the same circumstances, 
is that women and men are not going to get up from this 
consultative group in room B after having talked about 
something that the Russians raised--that we do not have to 
listen to if we do not want to, we do not have to respond to if 
we do not want to--and then walk down to room A where the NAC 
is meeting and say, Now, I am not going to consider what was 
just said in there.
    His concern is there is going to be this--this is kind of 
my phrase--porous wall between those two rooms or those two 
floors or those two separate wings of the building.
    How do you respond to that concern because in one sense, he 
reflects how human nature basically functions in that even 
though officially they will not have this direct an impact, the 
kind of impact many worry about, practically, they will have an 
impact?
    Again, I may have butchered his view, but I think that is 
the essence of what his concern was--that the effect will be a 
Russian veto, although the institution does not require it, 
does not call for it, and actually explicitly says they will 
not have a veto, that will be the net effect because of the 
proximity--physical proximity.
    Ambassador Pickering. Thank you. Senator, thank you also 
for your kind words.
    It is an interesting point because I, too, had 
misunderstood his position although I knew that this was part 
of his position. I thought his position had more weight in 
other directions, and it may now be reduced to its simplest 
proportions.
    I, in no way, would ever second guess Dr. Kissinger on the 
frailties of human nature. But I would say that having seen him 
operate in the position of Secretary of State and having seen 
Secretary Albright, I in no way can share his doctrine which is 
a kind of fundamental presumption on the frailty of human 
nature or the inability of Secretaries of State and their 
servants to understand American national interests and pursue 
them.
    I think we have lots of checks and balances, a group of 
them are in this room. There are others out there in the press, 
and there is the necessary transparency in the foreign policy 
process. But I do not think we necessarily need you biting our 
ankles to be sure that we understand what American national 
interests are and continue to pursue them.
    And besides, if it was such a problem, why has not our 
bilateral relationship with Russia totally contaminated our 
NATO policy and I do not believe it has? I think, in a sense, 
that we have the ability as a country to be big enough to 
listen to all points of view; indeed, we ought to welcome it. 
We ought to consider that a helpful check on the innate 
correctness of our position.
    But at the same time, I think, we should have an unerring 
compass and that is the President's responsibility and the 
Secretary's responsibility and our responsibility as advisors 
to make certain that we do have paramount before us American 
national interests. I can tell you in our building 100 times a 
day in all corners these are problems and issues that are 
constantly re-examined against the bedrock of what are our 
national interests.
    So I do not believe they go out the window or are forgotten 
or are elided by discussion. I do not believe Secretary 
Kissinger's secretaryship was characterized by that particular 
problem.
    And so, while his discernment in characterizing human 
failures in other individuals may be large, it is not 
necessarily in my view a contamination of the total Government 
by that particular issue; rather, the contrary. I do not think 
we would be able to stay on our jobs, or in office, if we 
pursued that kind of weakness on this set of issues.
    It is, however, important that we hear other views, as I 
said. It is important we take those into account. It is 
important that we continue to review our national interests 
against the backdrop of this.
    Senator Biden. But he argues that--in fairness to him, he 
strongly argues that it is necessary as well. It is ironic. He 
has become the darling of many conservatives now, and for 
years, was pilloried, because he wanted dialog.
    But, and I mean this sincerely when I say he made a very 
important point, that there should not be a military 
institutional framework within which to discuss these issues. 
It should be a separate entity like the Concord of Europe early 
on.
    I mean, he makes a distinction that both should occur. But 
they should not be within the context of a military 
organization, even though one is separate and apart but can 
comment on it. It should be a different institutional 
arrangement, that is all.
    Ambassador Pickering. But there are--if I could just make 
one other comment on that--obviously differing views of NATO. 
It is essentially a collective defense organization, but it has 
many other facets. We have known for years that NATO members 
have found, indeed, that security is broader than, even if 
fundamentally founded upon, the central military interests, and 
that we talk widely about everything from the environment to 
political relationships in foreign States in the organization. 
So it is not so narrowly constructed.
    But second, I still think that the sense of pressure, 
contamination, influence by osmosis, is not there. I think that 
we have enough clearheadedness to avoid that.
    Senator Biden. Thank you very much. Thank you, Mr. 
Chairman.
    Senator Hagel. Thank you. Senator Lugar?
    Senator Lugar. Thank you very much, Mr. Chairman. Secretary 
Pickering, in his testimony this morning, former Secretary of 
State Kissinger commented upon what he felt was the threat of 
second-class status for the new and potential entrants to NATO.
    Specifically, he said the dilemma supporters of NATO 
enlargement now face is that the Founding Act has gone into 
effect upon signature. As an executive agreement, it will not 
have to be ratified by the Senate, while NATO enlargement, 
involving a treaty, does have to be ratified.
    Thus, if admission of the new members is not ratified, we 
would have the worst of the two worlds; namely, the Founding 
Act--demoralization, as Secretary Kissinger saw it, of Central 
Europe--``and a NATO rendered dysfunctional by the Founding 
Act.''
    Two paragraphs later, he offers a solution.
    Secretary Kissinger has offered what I suppose is the first 
amendment or reservation, to the resolution of ratification. I 
would like your comments on the effect of reservations and 
amendments, that Secretary Kissinger and others might propose 
to the resolution of ratification.
    Specifically, the Secretary suggested the Senate should 
explicitly reassert the central role of the Atlantic Alliance 
for American Foreign Policy insist that nothing in any other 
document shall detract from the North Atlantic Council as the 
supreme body of the alliance. Such a resolution could draw 
directly on the forthright response of Secretary Albright:
    ``Additionally, the Senate resolution should declare the 
United States expects Russia, after the qualitative changes we 
have made, to desist from all pressures and threats in Europe 
on this issue.
    ``In the meantime, while ratification proceeds, a joint 
resolution of Congress should urge that the new NATO members be 
permitted to join the Permanent Joint Council while waiting for 
ratification. This would remove the anomaly that the 
institution created to reconcile Russia to NATO's expansion 
comes into being years before the expansion occurs.''
    What is your opinion of Secretary Kissinger's 
recommendation?
    Ambassador Pickering. Thank you, Senator Lugar. It is a 
challenging and interesting question, and I would like to first 
to address the premises, although I am at a disadvantage 
because I was not here and did not hear the testimony or read 
the statement of Secretary Kissinger. As a result, if I get it 
wrong, I can say only that I heard what you had to say.
    But my sense is that it is important to understand that 
advice and consent to changes in the NATO treaty is 
fundamental. It is fundamental in my view for many reasons, but 
most fundamentally because of article 5. The fact is that we 
all collectively agree to treat an attack against one as an 
attack against all. Therefore, it must be through the agreement 
of all of the NATO member parliaments or through the process of 
ratification in each NATO member state that we can add new 
members to the alliance. I think that is extremely significant 
because it involves a very serious security commitment.
    On the other hand, the Founding Act is an executive 
agreement that does not involve such security commitments and 
indeed, if we had taken it up the other way around, we would 
have implied quite to the contrary that we were doing something 
more portentous with respect to security obligations of the 
United States that merited advice and consent to ratification.
    So I think the initial distinctions here are very important 
to keep in mind, and I think they go further to answering the 
question that we are over committed to NATO in the Founding Act 
and I think it is important to keep that in mind.
    Second, with respect to reservations, while you have been 
kind enough to welcome executive branch advice if not consent, 
it is clearly something within your province.
    But let me, on the basis of your invitation, offer you a 
couple of thoughts--one, that Secretary Albright's statement in 
response to Chairman Helms' question was carefully thought out 
to try very, very clearly to define for you precisely how we 
saw and interpreted the Founding Act with relevance to that 
particular question of Is Russia playing too large a role in 
this process and is Russia now able to intrude into NATO 
decisionmaking? And our answer remains a resounding no.
    And I am sure the Secretary would be happy to have you take 
into account, in whatever way you thought best, her very clear, 
very thoughtful, and I think very open reassurance on that 
particular subject.
    The issue of Russian behavior is always of concern to us, 
and I do not believe under any circumstances the executive 
branch would reject the notion that should Russia seek to use 
unconscionable pressure or outrageous threats or anything else 
that we would not object to it immediately, certainly, 
directly, and forthrightly.
    It is a principle of our diplomacy. It is a principle, 
perhaps, of our national existence. I do not believe it 
requires a treaty reservation to take something as fundamental 
as that and make sure that we understand where our interests 
lie on that particular problem.
    Again, that is something you would have to answer for 
yourself. But I do not believe that any administration would 
feel that it should be presumed to be deficient, if I could put 
it that way, in that particular area.
    With respect to new members, potential new members 
participating in the PJC, the PJC is a NATO-Russia agreement. 
It is limited to NATO members. NATO members are members when 
all 16 parliaments and the parliament of the exceeding country 
have ratified the protocol admitting that country. You cannot 
be half a member; it is like pregnancy. You either are or you 
are not.
    In this particular set of issues, I do not believe that 
countries which are not yet members could sit on PJC and 
exercise the same rights, the same role, as the other member 
states without creating what I would say is elements of 
discord, discontinuity, and difficulty.
    That having been said, we would hope that the PJC remains a 
transparent body, one that we can in its overall lines of 
activity, inform others about. It is not meant to be a secret 
conclave. Its meetings are closed as a lot of diplomatic 
meetings are, but we would hope that in fact there is enough 
openness so that new members and potential new members down the 
road--because we do not a closed door policy on membership--
would know and understand exactly what is happening in the PJC 
and in a sense be clearly informed about that process as it 
goes ahead.
    And of course, they are always free to say what they think 
about things. It is a free and open world, and countries do 
accept those responsibilities.
    Senator Hagel. Thank you. Senator Wellstone?
    Senator Wellstone. Thank you, Mr. Chairman. I have to be 
brief because I have another panel to attend to, and there are 
witnesses there that I know we want to hear from.
    I guess my--I guess I want to put this in a somewhat 
different framework and ask you a question that I have asked 
earlier. I mean, I do not any evidence of any military threat 
to the countries of Eastern Europe, Central Europe. In some 
ways, I think this is sort of a bit of a relic of a cold war as 
to why we are really expanding NATO. I know my colleagues 
agree; it makes me skeptical.
    You talked about putting Russia inside the tent. If Russia 
meets the same criteria that we are going to apply to new 
members--because after all, it is Czechoslovakia, Poland, 
Hungary, but then we could be talking about the Baltic states, 
talking about the Ukraine. Then my question is sort of what 
this--what effect this has on Russia.
    If Russia meets up the criteria, would they, Russia, be 
eligible for membership?
    Ambassador Pickering. Thank you, Senator Wellstone, for 
that question. It is not the first time that that question has 
been raised, I know. I would tell you this, that the United 
States believes that it is essential to maintain an open door 
to membership.
    In respect to that, Russia has continually asserted its 
view that it does not wish to be a member. Nevertheless, our 
view has been that all states which meet the criteria are 
eligible for membership. There are two sets of criteria, 
obviously--one is the capability and willingness of States to 
meet the responsibilities of NATO membership, and indeed the 
trust and faith of the members of the alliance the applying 
states have the capabilities and the intentions to meet the 
objectives of the alliance.
    And so, in fact, it is a two-way street, and so Russian or 
Lithuanian or, indeed, anybody else's membership would have to 
meet those criteria. But I see nothing at this stage that would 
ipso facto rule out what your question implies except at the 
moment what we understand to be the Russian opinion on this 
question.
    Senator Wellstone. We have this kind of internal debate 
here. I am actually going to try to go to the larger question, 
and I do not--I know that Senator Biden and I talked to it. 
Again, my understanding for the record is that the Ambassador 
to--that Russia's Ambassador to the United States, Yuli 
Vorontsov? Vorontsov? Have I got the pronunciation right?
    Ambassador Pickering. Vorontsov.
    Senator Wellstone. Vorontsov. My father was from Russia--
look how poorly I am doing. That according to him, that when 
the idea of expanding NATO was originally floated, he asked 
whether or not this invitation was also to Russia, and was told 
no and that he has received the same answer from others in the 
United States Government--maybe so, maybe not.
    The point is--and you are shaking your head no so we do not 
need to debate it. I guess my question is we have got--and this 
is what I keep coming back to, because I do not want to keep 
going over the same ground--Ambassador Matlock is going to 
testify, and I just want to quote.
    He starts out his testimony and he says--I will just read 
one part of it. If it should be approved, talking about the 
expansion of NATO, by the U.S. Senate, it may well go down in 
history as the most profound strategic blunder made since the 
end of the cold war.
    Far from improving the security of the United States, he 
goes on, says he thinks it would lead to a chain of events 
which could pose a serious security threat, including something 
that Senator Lugar has been very concerned about, which is what 
happens with all of this nuclear weaponry and it gets into the 
hands of rogue states and is taken out of the country.
    I mean, given that concern, why--what, again, is the case 
for this? I mean, we do not have a military threat. This is 
primarily a military alliance. Why are we doing this? Given 
this potential--what Ambassador Matlock is talking about, what 
George Kennan has talked about, why--if could you just in a 
very succinct way tell me why are we doing this?
    Ambassador Pickering. Yes, I could, and let me try to do 
this in very clear and simple terms. NATO enlargement, as I 
indicated in my speech, has a series of concerns.
    One is the one that I think stems from your first question. 
While we recognize that Russia is on the democratic track and 
on the reform track, and we want to do everything to keep it on 
that track.
    Senator Wellstone. Right.
    Ambassador Pickering. There is no certainty that in the 
long-term, that is an inevitable outcome. So, states in the 
region who felt concern about the uncertainties of the long-
term future have for their own reasons sought to join and 
enlarge NATO.
    Second, we see a whole series of seriously disruptive--and 
that is a massive piece of understatement if you have been 
through Bosnia--problems in Europe or emerging in Europe which 
not only NATO enlargement but I would submit the NATO-Russia 
cooperative arrangements in the Founding Act are well-designed 
to attempt to deal with.
    A third point is that we in this country have been drawn 
into two horrendous wars in this century, in large measure, as 
a result of opting out, if you like, of serious problems all 
across Europe. Unfortunately, the new area of focus of NATO 
was, in many cases, a kind of cockpit for difficulty in the 
historical past.
    And as a result, we believe, NATO can provide an 
arrangement for security in that area which can help us to 
avoid it.
    Fourth point--our involvement in Europe, we believe, has 
had a very useful effect in dealing with old, long-standing 
animosities and antagonisms in the center of Europe. So our 
role in being helpful in those kinds of problems is, in my 
view, not irrelevant.
    Fifth point is a negative one. What would happen if we 
accepted the Russian view that there is no need to expand NATO? 
Would we be accepting the Stalin dividing line, or somebody 
else's--Churchill's dividing line--on Europe, that on the one 
side you could be members of a collective defense arrangement; 
on the other side, you were forbidden that kind of membership 
by a pure accident of geography and not by the application of 
rational thought?
    The next question. Is this a fundamental security threat to 
Russia with all of the problems and difficulties that that 
might portend for internal and external Russian concerns? And 
the answer, in my view, is yes. If you accept Stalin's 
characterization of NATO, you have got to believe that.
    I do not know anybody in this room, frankly--I have not 
talked to them all--who is persuaded that that view is right. I 
know a lot of people who tell me they are persuaded that view 
is right, but they have not persuaded me. I have seen a lot of 
people among the Russian reformers who are not persuaded that 
view is right.
    But they do not know how to persuade the rest of the 
Russians that that view is not right, except by a process of 
moving ahead and building a relationship with NATO, West and 
the rest of the world, which is the way I believe the new 
Russian leadership sees the role for the future of its country.
    Senator Wellstone. Thank you.
    Senator Hagel. Mr. Secretary, I have got only one 
additional question, and then my colleagues may have additional 
questions.
    In light of the activity of the past year, more 
specifically, the NATO enlargement issue and what we have been 
talking about here the last hour, do you detect--see in any way 
any efforts to reach or implement arms control agreements with 
the Russians going any easier or better as a result of these 
negotiations the last few months?
    Ambassador Pickering. I would say that the safest thing I 
can say is that it is not getting harder, and there are some 
signs that it is getting easier.
    The reason I say this is that I have focused my attention 
principally on START II. I can recall that when former 
Secretary of Defense Bill Perry spoke about this in the Russian 
Duma, there were a long series--the deep litany of problems 
having to do with Start II, and that a large number of them 
have been resolved, even if you like--if you accept the view 
that NATO enlargement is so terribly negative.
    Even under the shadow of the enlargement discussion in 
Europe and in Russia, steps have been made forward--steps have 
been taken forward in dealing, for example, with the Russian 
problem in the ratification of START II having to do with the 
fact that the configuration of START II and the nature of 
Russian security forces requires that they dismantle a lot of 
multiple warhead missiles, and then, in order to come to parity 
to the United States, construct a lot of new single warhead 
missiles.
    And so, we came forward with the concept, Secretary Perry 
and others, that we go to a START III and that START III would 
parallel the implementation of START II. START III would aim to 
have both countries reduce warheads overall so that there would 
not be a build-down to buildup on the Russian side which they 
said they could not afford.
    We have resolved, in my view, a very thorny and difficult 
problem in distinguishing between anti-ballistic missile 
defense and theater missile defense, talking with the Russians 
under a set of circumstances which permits all of the theater 
missile defense programs that we had in view and in plan to go 
ahead while at the same time, I believe, carefully assuring the 
Russians that the lines of control under the ABM Treaty have 
not been breached--a very important part because we had huge 
disagreements about this. This was another premise for people 
in Russia to reject START II.
    A third premise from the point of view of Russia, although 
it has nothing to do, in my view, in any direct sense with 
START II, was NATO enlargement. Now we have the Founding Act. 
Not all Russians are reconciled, but we have a Russian 
government which, after all, has to go and defend START II and 
says that they are prepared to cooperate with NATO even as they 
object to its enlargement.
    The difficulty, I think, is that in the Russian Duma on 
Start II, you have a parliamentary body dominated by communists 
who clearly do not believe that START II, for political 
reasons, is something that they want to ratify and gratify 
President Yeltsin's reform government. As a result, they search 
for any set of arguments.
    Having, even in the period of NATO enlargement, winnowed 
out and cut down the whole series of those arguments, we have 
given President Yeltsin additional ammunition and backing in 
the process of trying to move his Duma forward, and we have 
recently seen in his efforts with the Duma the beginning, at 
least I think, of the assertion of a number of the very 
considerable advantages he has in dealing with his Parliament 
which the American president does not have, including an 
opportunity to dismiss over a period of time, and an 
opportunity independently to legislate, on areas where the 
legislative has not gone or does not choose to go.
    Senator Hagel. Thank you. Senator Biden?
    Senator Biden. We call that executive fiat here.
    It kind of happens sometimes. I have one very brief comment 
and one question off of it.
    You know, one of the arguments used against expansion of 
NATO is that it was obviously a military organization designed 
to meet a specific military threat. It was the Soviet Union, 
although we never mention the Soviet Union--in any place I can 
recall. There is no place it is mentioned in the Washington 
treaty.
    And therefore, since we do not have the Soviet threat--it 
is an argument made by my distinguished colleague from 
Wisconsin--since we do not have that threat, why are we 
enlarging?
    Well, it seems to me if that argument makes sense, a 
logical argument is why NATO? I mean, why do we have NATO? So I 
think those who suggest that we should not enlarge and make 
that argument have to examine whether or not the argument they 
are making justifies the continuation of NATO in the first 
instance because NATO no longer has the same precise purpose. 
It may have that purpose in the future, it may be anticipatory.
    But there seems to have been a transition and a 
recognition, although never stated for the last 40 years, that 
it was also about stability. It was also about England and 
France,--I mean, France and Germany. It was also about 
something other than, in addition to--not other than, in 
addition to--whether or not the Fulda Gap was going to be 
breached by 45 divisions of Russian soldiers.
    But in keeping with this notion of what NATO is, has 
become, what its purpose was, what it has evolved to, and what 
it will evolve into, in my discussions with people who are 
above my pay grade in Russia, NATO expansion is usually 
discussed in the context of wounded pride and isolation.
    Now, this may be a strange question, and I realize the 
answer is totally subjective. But you are there, day-to-day. 
You are trying to figure out everything from whether or not you 
have enough electricity coming into the compound--with no 
interruption because of a faulty electrical system, whatever, 
straight through to whether START II is going to be ratified, 
or START III.
    You have been there. In all the things that end up on your 
desk, get to your level, that affect bilateral relationships 
with the United States, where does enlargement of NATO rank? 
How often is that a central concern expressed to you, whether 
that is the purpose of your interfacing with your counterparts 
or whether it is brought up as an adjunct to other issues? What 
role does it play in your day-to-day running of the business of 
our country's relations with Russia?
    Ambassador Pickering. Let me first tell you that I have not 
been in Russia since I left the post almost a year ago. So, I 
cannot give you--except from my close relationship in my new 
job in the State Department with the charge and now with 
Ambassador Collins--my successor, a sense of this issue.
    Senator Biden. But you were there leading up to all of 
the----
    Ambassador Pickering. But I was there leading up to it and 
I wanted to try to point out to you that a significant amount 
of my time was spent dealing with the questions, as I indicated 
in my statement, of how we could build together a NATO-Russia, 
a US/Russia relationship in light of the enlargement to deal 
with either significant or putative problems in the 
relationship so that in a sense we could build a framework that 
we have brought to you, what I think is the win-win--the 
Founding Act, the CFE negotiations, and the NATO enlargement--
if not in a package for ratification, at least in a package for 
presentation.
    But I would tell you that my feeling was in my time there, 
it went from about a 3-percent of the public interest inside 
the Moscow Beltway to slightly over a 20 percent interest 
nationally, but that it is extremely clear that in the 
hierarchy of Russian issues of angst, if I could call it that 
way, it was well down the list--that there were a whole lot of 
other things, again as I said in my statement, having to do 
with existential, economic, and social issues that bothered 
Russians a great deal more than this.
    And that at the same time, that the major groupings who 
were concerned about this happened to be the Russian 
equivalents of our think tanks, the Russian equivalents of our 
editorial writers, the Russian equivalents of our legislators, 
and some of the Russian equivalents of our executive branch 
people.
    Senator Biden. In my much more limited encounters than 
yours or Jack's--and I know he was not there at the time in the 
capacity, and others will testify--NATO expansion would be 
raised, but then it was like, well, let us get onto something 
that we can really deal with here.
    Ambassador Pickering. I think quite so, and there were, in 
fact, several times when I was there that there really had to 
be a small group of Russian so-called thinkers and 
intellectuals--opinion influencers--who would sort of gather up 
themselves and produce a new paper and then spread it around in 
the paper and say: Let us reinvigorate our lagging concern.
    At the same time, a number of Russians, some of whose names 
have been mentioned in this hearing, had come to me time after 
time and said, Cannot we work out a set of arrangements that 
helps deal with this particular problem?
    And many of the ideas in the Founding Act came out of those 
kinds of conversations. They were constructive, they were 
useful. They were people concerned about isolation and how do 
you deal with it. You get into consultations.
    Senator Biden. I am over my time. Can I go for another 2 
seconds?
    Senator Hagel. Well, I am going to do better than that. How 
about a minute?
    Senator Biden. OK.
    Ambassador Pickering. I apologize. I made you go over the 
time in my answer.
    Senator Biden. My impression is that even when enlargement 
was the focus of the discussion, it was almost always used, and 
has continued to be, to make a larger point that does not 
relate to physical security concerns, but relates to ``Do you 
love me? What is this relationship going to be? Where am I on 
this--where are we in this deal?''
    I mean, I am not being very articulate here, but, you had 
Yeltsin, for example, when telling Walesa, Look, you are an 
independent country. You are a sovereign. You want to be part 
of NATO? It is OK.
    He gets back--he got the living hell kicked out of him 
rhetorically back home, and then, things change.
    But I just never have gotten the sense that it was viewed 
by most Russian intellectuals or think tankers, legislators, or 
other--in the security context as much as in a context of are 
we equals? What is this relationship going to be? What does 
this say about where it is going?
    Ambassador Pickering. Mr. Senator----
    Senator Hagel. Mr. Secretary, you have 1 minute.
    Ambassador Pickering. [continuing]. there are two answers, 
two pieces to the answer. One is that it was even deeper than, 
`` Do you love me?'' It was a fundamental of who is most 
important--Western Europe or us?
    Second set of questions was--in Russia, politics is 
domestic, preeminently, and it is economic. Therefore, Yeltsin 
was prepared not to take on his nationalists and right-wing 
opposition, if I could phrase it that way, over a foreign 
policy issue of this size, when he had a lot of other important 
fish to fry in bringing reforms about.
    Senator Biden. Thanks, Mr. Chairman. Thanks to you, Mr. 
Secretary.
    Senator Hagel. Mr. Secretary, as always, we are grateful. 
Thank you.
    Ambassador Pickering. Thank you, Senator Hagel so much.
    Senator Hagel. Good seeing you, Tom. If our distinguished 
second panel would come forward.
    [Pause]
    Senator Hagel. Gentlemen, welcome. Ambassador Matlock, 
would you like to begin? Thank you.

STATEMENT OF AMBASSADOR JACK F. MATLOCK, JR., GEORGE F. KENNAN 
PROFESSOR, INSTITUTE FOR ADVANCED STUDY, PRINCETON, NEW JERSEY.

    Ambassador Matlock. Thank you very much. At the outset, let 
me say that I agree totally with what Secretary Pickering has 
said about the Founding Act, and about the advantages of the 
relationship that the administration has negotiated with Russia 
and with NATO.
    I think that everything he said about that not only agrees 
with my judgment, but I think that negotiating that agreement 
is a real achievement of this administration.
    Having said that, I must also point out those elements in 
his testimony and in the administration's position with which I 
disagree.
    I am probably the only person on the panel you have called 
today who disagrees that the enlargement of NATO significantly 
advances U.S. security interests, one of statements that 
Secretary Pickering made earlier in his testimony.
    I think that to bring in new members at this time under 
these conditions is a misguided policy and if it should be 
approved by the Senate, that it could go down in history as a 
profound strategic blunder.
    Now, far from improving the security of the United States, 
its allies, and the nations that wish to enter the alliance, it 
could well encourage a chain of events that could produce the 
most serious security threat to this nation since the Soviet 
Union collapsed.
    I know these are strong words, but I am convinced they are 
justified, and I appreciate the opportunity to explain why I 
use them.
    In Russia today, there are somewhere between 40 and 50,000 
nuclear warheads, maybe even more--22,000 of them tactical 
weapons relatively easy to transport. Furthermore, there are 
enormous stocks of highly enriched uranium of weapons grade, 
and plutonium, at research institutes, naval facilities, and 
warehouses scattered throughout that vast country.
    In addition, Russia has something like 50,000 tons of 
chemical warfare agents, and an amount which one can only guess 
of biological warfare agents, agents the possession of which 
they only admitted officially after Russia became independent 
and Yeltsin was President.
    Equally important, Russia has a veritable army of 
scientists and engineers who are adept at turning these 
materials into weapons and devising ingenious delivery systems.
    There is no serious danger now, or in the foreseeable 
future, that the Russian Government intends to use any of these 
weapons against us, our allies, or for that matter, against any 
other country. It would be totally irrational for them to do 
so, and though Russian Governments may sometimes see things 
differently from the way we do, they are not irrational.
    The danger these weapons pose is not that they may be 
intentionally used by a Russian Government, but that they may 
fall into irresponsible hands or rogue states.
    It is very much in Russia's interest that such weapons and 
the materials and know how to make them not leak out of secure 
control to other quarters. But the sad fact is that the Russian 
authorities may no longer have an ability to ensure their 
safety. When the people guarding them have not been paid for 6 
months and weapons scientists literally have trouble feeding 
their families and heating their apartments in sub-zero 
weather, it is unreasonable to expect that all are going to 
resist the temptation of selling dangerous materials to local 
criminals or of going to work for some unsavory regime.
    Let us count it a miracle that there has yet been no 
documented diversion of a nuclear weapon, though we may never 
know for sure that one has occurred until one turns up in some 
unexpected place.
    Now, in general, I do not use the term ``vital interests'' 
lightly. Countries can have many interests. It is rare, 
particularly in a country as strong as the United States, to 
say that a given threat or a given interest is absolutely 
vital.
    But it seems to me by any definition secure, responsible 
control of weapons of mass destruction has to be one of them, 
and maybe the top one. If any of these weapons get into the 
hands of a rogue regime, the United States will be right at the 
top of the list of the terrorists they sponsor. They could do 
it in a way to render our deterrent force useless.
    If we did not where the weapon came from, how could we 
retaliate? And very likely we would not know until we had lost 
a city or two anyway. Nor will a missile defense protect us 
from weapons delivered by means terrorists are most likely to 
choose: a ship, a small plane, a minivan, even perhaps a large 
knapsack two men could lift.
    Chemical and biological weapons are potentially equally 
dangerous, as the attacks on the Tokyo subway a few months ago 
showed. They are even easier to deliver than nuclear devices, 
and would not require a suicide bomber do it.
    Now, what has this to do with the question before us? 
Simply this. Adding members to NATO will do nothing to protect 
us from the real threat I have described. But it does convey to 
the Russian nation, and particularly their military, that we 
still consider Russia at least a potential enemy, unsuited for 
the same security guarantees and the same degree of cooperation 
that countries in Central and Eastern Europe are being offered.
    Even if the Russian Government is forced to acquiesce to 
the enlargement of NATO, which, in effect, it has, there is no 
question that our decision to take on new members now, when no 
country in Eastern Europe faces a security threat from the 
outside, will greatly complicate our efforts to see to it that 
the vast stocks of nuclear weapons now in Russia are never used 
against us or our allies.
    We are constantly being assured that nuclear and other 
weapons of mass destruction in Russia are under full and 
responsible control. This may be correct when it is a question 
of intercontinental ballistic missiles, ICBM's, and other large 
missiles in the Rocket Forces. But smaller weapons, and much 
weapon-grade nuclear material, is much less secure.
    General Lebed has recently said that 84 portable weapons 
are missing from Russian arsenals. His allegation has been 
denied by Russian authorities, but still it is impossible to be 
complacent about this question. Even if it is a matter of 
sloppy recordkeeping rather than actual theft of a nuclear 
weapon--and, frankly, that is the hypothesis I would put 
forward first--it, nevertheless, seems most likely that neither 
we nor the Russians know how many weapons they have and where 
they are at all times.
    Given the prevalence of organized crime and the high prices 
some regimes or terrorist groups would pay for nuclear weapons 
and materials, the possibility of diversion is clearly the most 
immediate and tangible threat to American security today. The 
progress we have made in assisting Russia to improve the 
security of its weapon stocks is substantial, but still 
inadequate.
    I would recommend, if you have not seen it yet, Mr. 
Chairman, a book just recently out, called ``One Point Safe.'' 
I have no financial or other authorial interest in this book. 
You really ought to read it or at least have your staff 
summarize it for you. It may contain a few exaggerations. The 
prose is sometimes a bit hyped. But I think it describes a real 
situation, and a situation which we must take into account when 
we think about U.S. security.
    Now, the fact is it is going to become increasingly 
difficult to obtain Russian cooperation in securing this 
material if our actions are interpreted as attempts to exploit 
Russia's current weakness, as they are by most officials in 
those Russian institutions responsible for weapons security. 
Let me say here that I agree with Secretary Pickering in his 
judgment on one thing: This is largely an elite issue, and most 
Russians do not spend a lot of time talking about it. That is 
true. But such issues as NATO enlargement counts very heavily 
in military minds and others in the security complex--the very 
complex with the very people we now have to depend upon to keep 
these weapons under control.
    I would point that out. I would also say in that regard--
and I was there when we negotiated German unification and so 
on--the basic steps that brought an end to the cold war did not 
elicit that much interest from the broader public. The degree 
of interest in the public is not necessarily a measure of the 
importance of an issue or what its future impact is going to 
be.
    Now, adding new members to NATO--and what is announced will 
be nearly the first stage in a continued process of 
enlargement--will inevitably undermine our ability to influence 
Russian attitudes on the nuclear question. This has nothing to 
do with whether Russia has designs on Eastern Europe or not. I 
think they do not have designs on Eastern Europe. Their 
problems are precisely the psychological problems that we heard 
discussed between Secretary Pickering and Senator Biden just 
now.
    The fact that these problems are abstract issues does not 
mean that they do not play a great role, particularly in the 
psychology of people whom we are going to have to depend on, to 
some degree, for our own security.
    Now, I am convinced that this policy has in fact caused a 
delay in the ratification of START II. I know that the 
Communists do not want to give Yeltsin a victory. But I believe 
his case would have been much stronger if we had not started 
the announced policy of bringing new members into NATO without 
regard to Russia's position and without regard to whether there 
is a threat to the candidate countries or not.
    And also, this move has produced pressures for the Russian 
Army to rely more, rather than less, on nuclear weapons in the 
future. After all, they are feeling very weak after their 
defeat in Chechnya, and the Army is running into increasingly 
difficulties. They are going to have to restructure, to 
restructure radically. Of course, as they do so, a lot of 
people are going to lose their jobs--people, including those 
who work in these nuclear and other weapons establishments.
    It is hard to overestimate the security Russian weapons 
hold for the safety and well-being of the American people. 
Although the administration has paid some lip service to its 
importance, its efforts to deal with the problem have been 
hobbled by bureaucratic infighting, some of which you can read 
about in this book and elsewhere, lack of senior-level 
attention, and, most of all, the failure of the President and 
his senior associates to give the matter the priority and the 
day-to-day attention it deserves.
    I can tell you, as one who worked for 3 years on the staff 
at the NSC during the Reagan administration, that nothing gets 
done in the American Government, except things the bureaucracy 
does every day, unless it gets a push from the top. That push 
has to be continual, day in and day out. This issue, is not 
getting that push.
    What little we are doing--and it is more than a little, but 
it is still not enough--came from an initiative from this end 
of Capitol Hill. Notably in the Nunn-Lugar appropriations. This 
has been, I think, highly successful. It is probably the best 
value of all of our defense appropriations.
    The Nunn-Lugar program has been implemented reasonably well 
by the administration. But instead of a strategy that would 
enhance our ability to work on this issue in an effective 
partnership with those Russian agencies responsible for weapons 
security, we see instead enormous efforts to promote an ill-
conceived plan that does not meet the real security dangers we 
face, and, in fact, makes it substantially more difficult to 
deal with it.
    The plan to increase the membership of NATO, in my opinion, 
fails to account for the real international situation following 
the end of the cold war and proceeds in accord with the logic 
that made sense only during the cold war. The thing that many 
people seem to forget is that Russia is not the Soviet Union.
    It was my privilege to be present in those last few years 
of the Soviet Empire. The Russian political leaders who are 
still in power in Russia today were the final force that broke 
up the Soviet Empire. That is something that people who say, 
Russia is always imperialistic and is likely to be in the 
future, forget, or maybe they never noticed.
    But the fact is, if Yeltsin and his associates had not 
pulled Russia out of the Soviet Union at the end of 1991, there 
would be a Soviet Union of some sort, with at least seven or so 
republics. The Central Asians and Belarus did not want to leave 
the Soviet Union. Russia, in the final analysis, broke up that 
Empire, and they did it in their own interest.
    When we were winding up the cold war, the influence of the 
Russian leaders was pushing Gorbachev to go even further than 
he went. When there was the war in the Gulf, Yeltsin told me at 
that time--he was head of the Parliament in Russia--he said, 
``We not only should cut off all arms supplies to Iraq during 
this crisis, we should cut them off to all the radical states 
in the Near East, and we should send our troops to fight with 
you.
    Well, this was not politically possible. But I would 
emphasize that we did end the cold war with the cooperation 
with the Russian leadership. Those who say, ``We won the cold 
war,'' of course are right. But we won the cold war over the 
Soviet Union. We won it in part because we convinced the 
Russians it was in their interest as well to end it.
    So to treat Russia now, as if it is a defeated enemy and a 
potential threat in the future would be making the same mistake 
we made after World War I, when we blamed Germany exclusively 
for the First World War and did not heal the rift between 
Germany and the Western powers, which left Europe vulnerable to 
a new war.
    The division of Europe ended before there was any thought 
of taking new members in NATO and, the fact that this was the 
case was recognized by this administration, at least a few 
years ago. Here is a statement made from the White House podium 
in January 1994:
    ``The United States believes that the objective of 
promoting security and stability in Europe could be undermined 
if NATO were to be expanded too rapidly. Such a course as that 
would risk dividing Europe by creating new blocs and 
unintentionally replicating a bit further to the east a line of 
demarcation that NATO has fought for such a long time to 
erase.''
    Who made that statement? Former Secretary of State Warren 
Christopher.
    Now, obviously, he must have changed his mind, or was 
ordered to change his mind, somewhere along the line. He made 
that statement before we announced the Partnership for Peace. 
The Partnership for Peace has now been in operation only about 
3 years, which is a very short time to organize a multinational 
effort, and not really enough to show what it can achieve. Yet, 
for 2 years now, we have been on a course that, in effect, 
ignores that and ignores the wisdom in Christopher's statement 
in 1994.
    The fact is that no one is threatening to redivide Europe. 
It is therefore absurd to claim, as some have, that it is 
necessary to take new members into NATO to avoid a future 
division of Europe. This not only misrepresents history, since 
the division of Europe ended under previous administrations; it 
ended because the Warsaw Pact collapsed, because the Soviet 
Union collapsed. NATO never divided Europe. Europe is not 
divided today.
    It is also, I think, devoid of logic to make the statement 
that to rectify the division of Europe in the past we have to 
move NATO eastward. If NATO is to be the principal instrument 
for unifying the continent, then logically the only way it can 
do so is by expanding to include all European countries. But 
that does not appear to be the aim of the administration. Even 
if it is, the way to reach it is not by admitting new members 
piecemeal.
    Now, Mr. Chairman, all of the purported goals, in my 
opinion, of NATO enlargement are laudable. Of course the 
countries of Central and Eastern Europe are culturally part of 
Europe and should be guaranteed a place in European 
institutions. Of course we have a stake in the development of 
democracy and stable economies there. But membership in NATO is 
not the only way to achieve these ends. It is not even the best 
way, in the absence of a clear and identifiable security 
threat.
    I am one who has always been a champion of NATO, and I 
continue to be. I agree with Secretary Pickering and others who 
point out that the aim of NATO was much more than simply 
deterring the Soviet Union. All of those reasons which he cited 
for us to stay in NATO are there. That is one of the reasons I 
do not like to see a premature move to expand the alliance, 
which I believe will weaken the organization ultimately.
    Even if NATO is able to absorb the three candidate members 
successfully, there are going to be other applicants who we 
have already been told that they are also in line for 
membership. I think there are about 12 applicants in the line 
now. If Russia has not applied, it is only because it fears 
being turned down, not that it has no interest in membership.
    It seems to me that this starts a process which will 
require NATO for the next decade or so, to focus not on the 
real security threats that we face, but on the questions of who 
should be the next member, and under what conditions. In other 
words, NATO will be condemned to contemplate its navel, its 
expanding waistline, and will have little time to attend to the 
real security threats, particularly those that I have 
described.
    It seems to me, therefore, that although the goals that 
have been described are laudable, this is not the right time or 
the right method to pursue them, and to proceed as the 
administration has proposed would be a strategic error.
    Thank you.
    [The prepared statement of Ambassador Matlock follows:]
                Prepared Statement of Ambassador Matlock
    In contrast to the other persons invited to testify today, I 
consider the Administration's recommendation to take new members into 
NATO at this time misguided. If it should be approved by the United 
States Senate, it may well go down in history as the most profound 
strategic blunder made since the end of the Cold War. Far from 
improving the security of the United States, its Allies, and the 
nations that wish to enter the Alliance, it could well encourage a 
chain of events that could produce the most serious security threat to 
this nation since the Soviet Union collapsed. Those are strong words, 
but I am convinced that they are justified, and I appreciate the 
opportunity to explain why I use them.
    In Russia today there are somewhere between 40,000 and 50,000 
nuclear warheads, 22,000 of them tactical weapons, relatively easy to 
transport. Furthermore, there are enormous stocks of HEU and plutonium 
at research institutes, naval facilities, and warehouses throughout 
that vast country. In addition, Russia has something like 50,000 tons 
of chemical warfare agents and an amount which one can only guess of 
biological warfare agents. Equally important, it has a veritable army 
of scientists and engineers who are adept at turning these materials 
into weapons and devising ingenious delivery systems.
    There is no serious danger now, or in the foreseeable future, that 
the Russian government intends to use any of these weapons against us, 
our Allies, or for that matter against any other country. It would be 
totally irrational to do so, and though Russian governments may 
sometimes see things differently from the way we do, they are not 
irrational. The danger these weapons pose is not that they may be 
intentionally used by a Russian government, but that they may fall into 
irresponsible hands or rogue states. It is very much in Russia's 
interest that such weapons and the materials and know-how to make them 
not leak out to other quarters, but the sad fact is that the Russian 
authorities may no longer have an ability to insure their safety. When 
the people guarding them have not been paid in six months and weapons 
scientists literally have trouble feeding their families and heating 
their apartments in sub-zero weather, it is totally unreasonable to 
expect that all are going to resist the temptation of selling dangerous 
materials to local criminals, or of going to work for some unsavory 
regime. Let us count it a miracle that there has as yet been no 
documented diversion of a nuclear weapon (though we may never know for 
sure until one turns up in some unexpected place).
    I do not use the term ``vital interest'' lightly. But by any 
definition, secure, responsible control of weapons of mass destruction 
has to be one of them. If any get in the hands of a rogue regime, the 
United States will be right at the top of the list of the terrorists 
they sponsor. And they could do it in a way that our deterrent force 
would be useless. If we didn't know where it came from, how could we 
retaliate? And, very likely, we would not know, until we had lost a 
city or two. Nor will a missile defense protect us from weapons 
delivered by means terrorists are most likely to choose: a ship, a 
small plane, a minivan, even perhaps a large knapsack two men could 
lift. Chemical and biological weapons are potentially equally 
dangerous, as the attacks on the Tokyo subway a few months ago showed. 
They are even easier to deliver than nuclear devices, and would not 
require a suicide bomber.
    What does this have to do with the question before us? Simply this: 
adding members to NATO will do nothing to protect us from the real 
threat I have described. But it does convey to the Russian nation, and 
particularly their military, that we still consider Russia a potential 
enemy, unsuited for the same security guarantees and the same degree of 
cooperation that countries in central and eastern Europe are being 
offered. Even if the Russian government is forced to acquiesce to the 
enlargement of NATO, there is no question that our decision to take in 
new members now, when no country in Eastern Europe faces a security 
threat from the outside, will greatly complicate our efforts to see to 
it that the vast stocks of nuclear weapons now in Russia are never used 
against us or our Allies.
    We are constantly being assured that nuclear and other weapons of 
mass destruction in Russia are under full and responsible control. This 
may be correct when it is a question of ICBMs and other large missiles 
in the rocket forces. But smaller Weapons and much weapon-grade nuclear 
material is much less secure. General Lebed has recently said that 84 
tactical weapons were missing from Russian arsenals. His allegation has 
been denied by Russian authorities, but still it is impossible to be 
complacent about the question. Even if it is a matter of sloppy record 
keeping rather than actual theft of nuclear weapons, it seems most 
likely that neither the Russians nor we know how many weapons they have 
and where they are at all times. Given the prevalence of organized 
crime and the high prices some regimes or terrorist groups would pay 
for nuclear weapons or materials, the possibility of diversion is 
clearly the most immediate and tangible threat to American security 
today. The progress we have made in assisting Russia to improve 
security of its weapon stocks is substantial, but still inadequate.
    It is going to become increasingly difficult to obtain Russian 
cooperation in securing this material if our actions are interpreted as 
attempts to exploit Russia's current weakness, as they are by most 
officials in those Russian institutions responsible for weapons 
security. Adding new members to NATO, in what is announced will be 
merely the first stage in a continued process of enlargement, will 
inevitably undermine our ability to influence Russian attitudes on 
nuclear questions. This policy has already caused a delay of at least 
two years in the Duma!s ratification of the START II treaty, and has 
produced pressures for the Russian Army to rely more rather than less 
on nuclear weapons in the future.
    It is hard to overestimate the importance of this issue to the 
safety and well being of the American people. Although the 
Administration has paid some lip service to its importance, its efforts 
have been hobbled by bureaucratic infighting, lack of senior level 
attention, and most of all a failure of the President and his senior 
associates to give the matter the priority and the day-to-day attention 
it deserves. In fact, I see no evidence of an overall strategy to deal 
with the problem, What little we are doing came from an initiative from 
this end of Capitol hill. Instead of a strategy which would enhance our 
ability to work in an effective partnership with those Russian agencies 
responsible for weapons security, we see enormous efforts to promote an 
ill conceived plan that does not meet the real security dangers we 
face, and in fact makes it substantially more difficult to deal with 
them.
    The plan to increase the membership of NATO fails to take account 
of the real international situation following the end of the Cold War, 
and proceeds in accord with a logic that made sense only during the 
Cold War. The division of Europe ended before there was any thought of 
taking new members into NATO. No one is threatening to re-divide 
Europe. It is therefore absurd to claim, as some have, that it is 
necessary to take new members into NATO to avoid a future division of 
Europe; if NATO is to be the principal instrument for unifying the 
continent, then logically the only way it can do so is by expanding to 
include all European countries. But that does not appear to be the aim 
of the Administration, and even if it is, the way to reach it is not by 
admitting new members piecemeal.
    All of the purported goals of NATO enlargement are laudable. Of 
course the countries of Central and Eastern Europe are culturally part 
of Europe and should be guaranteed a place in European institutions. Of 
course we have a stake in the development of democracy and stable 
economies there. But membership in NATO is not the only way to achieve 
these ends. It is not even the best way in the absence of a clear and 
identifiable security threat.
    The effect on Russia, however, is perhaps not the most important 
reason for saying that the Administration's proposal is misguided. I am 
a strong supporter of NATO, which I believe is essential for the future 
stability of the European continent. And I am convinced that the 
process which the Administration proposes to start is going to weaken 
the alliance ultimately. For a decade or more we will be debating who 
should or should not be a member, and these debates are bound to be 
divisive within the Alliance. Meanwhile, these debates will distract us 
from dealing with the real threats that exist.
    If ever there was a case of misplaced priorities, this is it.

    Senator Hagel. Mr. Ambassador, thank you very much. General 
Odom.

STATEMENT OF WILLIAM E. ODOM, LT. GEN., USA, RETIRED, DIRECTOR 
 OF NATIONAL SECURITY STUDIES, HUDSON INSTITUTE, WASHINGTON, DC

    General Odom.  Mr. Chairman, it is not only an honor, but 
an exceptional responsibility to testify before the committee 
on enlargement. The gravity of the issue inspires a sense of 
humility. I think too much is at stake to make the decision 
based on clever arguments and representation.
    And I must say, after Ambassador Matlock's presentation, I 
have a huge sense of cognitive dissonance. I do not know how 
NATO, if he asserts it never divided Europe, how will it divide 
it by expanding? But let me get on to a more important issue.
    You have already heard, I think, virtually all of the 
arguments that can be made for and against. You are hearing a 
lot of arguments added that do not have anything to do with it 
one way or the other.
    Now, I do not suffer the illusion that I can bring much new 
remarkable evidence to this debate. Instead, I would rather 
offer a way to stand above the plethora of arguments and 
details and evidence in order to get our bearing, and to 
simplify things and see what the evidence and arguments which 
are truly important and which can be set aside in making the 
decision.
    Now, how does one do that? I believe it comes down to 
focusing on three questions--basic questions, questions that 
draw out what is at stake, the most significant forces 
affecting what is at stake, and the priorities we must maintain 
to defend what is at stake.
    The first basic question is whether or not the United 
States should remain committed militarily and politically to 
Europe. This may not strike you as a relevant question, but I 
think it will soon become so in my further remarks.
    The major lesson in the first half of this century is that 
when we have had bad relations or no military ties to Germany 
and Japan--we have tried--and when we have tried to avoid 
dealing with emerging German and Japanese power, we have had 
war in Europe and Northeast Asia. The lesson of the second half 
of the century is that when we have had strong military ties to 
Germany and Japan, we not only have had peace, we have enjoyed 
unprecedented prosperity, and our liberal democratic values 
have spread in the world. We too often lose sight of this 
simple yet critically important understanding.
    Now, for example, I think people tend to forget it when 
they complain that our wealthy allies in Europe do not carry 
their share of the military burden. One can debate how fairly 
the burden has been distributed, but one cannot deny that we 
have grown wealthier than our freeloading friends, even while 
carrying the larger share. Our defense allocations in Europe 
should be seen not primarily as a burden. Actually they have 
been a very profitable investment, because they have made 
possible freer trade, more trade and lower transaction costs in 
trading activities. Without them, both we and our European 
allies would be poorer.
    Now, this is not to suggest that costs are irrelevant. 
There has been greater burdensharing precisely because U.S. 
Senators have pressed it with our allies. Rather it is to 
explain why the cost issue is not fundamental for deciding the 
NATO enlargement issue. It should not figure in one's final 
decision, because remaining committed to European security has 
proven a money-making, not a money-losing, proposition.
    Now, the case for keeping U.S. forces in NATO in Europe is 
overwhelming when one considers the political and military 
consequences that would ensue if U.S. forces were withdrawn. 
Now, this is an important conclusion. Again, you may react by 
asserting that we are not debating whether or not to remain in 
Europe, but whether or not to enlarge NATO. My colleague here 
to the right obviously does not see the connection.
    That strikes me as a seriously mistaken impression. It 
takes me to my second basic question: Can NATO survive if it 
remains static, refusing to enlarge in a dynamic and changing 
Europe?
    I have heard no opponents of enlarging NATO address this 
question. I have heard--they merely assume that NATO can more 
or less remain as it is, making only internal adjustments. Now, 
this is highly unrealistic. The reasons why take us to a 
question of our strategic priorities in Europe. Which country 
is more important and consequential for the United States in 
Europe, Russia or Germany?
    Economically, politically and militarily, Germany clearly 
deserves first priority.
    Too many American policymakers take Germany for granted. 
They assume that the European political/military integration 
process is irreversible, even close to full success, something 
that removes the century-old German question from the European 
agenda. Now, if you share that mistaken impression, then I 
would ask you to consider several facts.
    First, Britain and France opposed German reunification, and 
are still not happy about it, a point the Germans will not 
forget soon.
    Second, Britain and France fell into a serious quarrel with 
Germany over Croatia, Bosnia and Serbia during 1992-1995, 
making a mockery of a common European defense policy. The 
British Foreign Secretary, in 1994, was reported to have said 
that it is better to have Russia on the Adriatic coast than 
Germany. This quarrel is now repressed only because the United 
States belatedly took a leadership role and put NATO forces in 
Bosnia. If U.S. troops are withdrawn any time soon, it will 
resurface with a vengeance.
    Would that be in our strategic interest? Hardly.
    Third, in Germany, virtually all political leaders of all 
parties but the Greens, and even some of the Greens, support 
NATO enlargement. Why? Several SPD leaders who were never very 
pro-NATO, have offered the most articulate and compelling 
answer. They cite the inter-war period, when Moscow, Berlin, 
London, Paris, and Rome, which George Kennan ought to remember, 
but seems to have forgotten, competed irresponsibly for 
influence in Eastern Europe, a competition that set up the 
conditions allowing World War II to break out. They remember 
that even a weak Soviet Union was able to use diplomacy to play 
off major powers in Europe, one against another, inducing 
strategic instability.
    These German spokesmen argue that if NATO is not enlarged, 
Germany will be forced to follow a unilateral Ostpolitik, a 
foreign policy that will make Germany vulnerable to deals by 
Moscow at the expense of the small states in Central and 
Eastern Europe. That, in turn, will exacerbate Germany's 
relations with its Western allies. A common European foreign 
and defense policy will fade even as an aspiration. The 
consequences for European security and economic prosperity will 
be adverse.
    Can it be in the United States strategic interest for 
Germany, France, Britain, Italy, Russia, and perhaps others to 
fall into a major struggle for influence in the countries of 
Central Europe? The Germans argue that the most effective way 
to prevent this is to enlarge NATO.
    Now, fourth, I recently spoke with a group of journalists 
from the three new candidate members. In our discussion, they 
forthrightly admitted that although their publics want them to 
join NATO because of the Russian threat, the more thoughtful 
people want to join because of U.S. forces in Germany, which 
will protect them from Germany.
    Does the United States really want Poland to believe and 
act as thought it is threatened both by Moscow and Berlin?
    Fifth, a well-placed Russian national security official 
told me about a year ago that he and his colleagues foresee 
their main challenge as strategic competition with Germany over 
hegemony in Central and Eastern Europe. They oppose NATO 
enlargement precisely because this would neutralize this 
competition.
    Can it be in the U.S. interest to allow this competition to 
distract Russia from dealing with its problems of economic and 
political reform, and controlling nuclear weapons?
    These five points indicate something of the postcold war 
dynamic in a changing Europe. They reveal emerging forces that 
a static NATO cannot control. If it cannot control them, what 
will be the consequences?
    Just imagine the impact on Germany if the United States 
decides against enlargement. Not only will its western 
neighbors, but the United States as well will be at odds with 
Germany over its policy toward Russia and Central Europe. No 
matter how good our relations with Russia are, the United 
States will find itself embroiled in all kinds of intra-
European bickering and competition, but without NATO embracing 
a sufficient number of the troublesome countries to prevent a 
downward spiral. Reluctant to enlarge NATO, the United States 
will find itself on the path of withdrawal. It can only stay in 
Europe as long as its ties to Germany are strong and 
cooperative, a condition that now requires NATO enlargement.
    The third question is this: What will be the consequences 
for Russian political development if NATO enlarges?
    I put this question number three, because in the context of 
U.S. strategic interest, it is the lowest priority. Russia is 
indeed an important country. But in deciding on NATO 
enlargement, one is dealing with the U.S. stake in two mutually 
related goals: first, a secure and economically prosperous 
Europe; and, second, ensuring that a reunified Germany does not 
catalyze a new balance of power game among our European allies. 
I see now way that Russia can be more important for the U.S. 
strategic interest than these two goals.
    This has been the U.S. strategic priority since the 
formation of NATO: Europe and Germany first; Russia second. Let 
us suppose that all the direst warnings about Russia's 
reactions to NATO enlargement were to come true. Would that 
provide sufficient cause for the United States to reverse these 
priorities? Obviously not. I simply see no way that Russia, 
even if it becomes a thriving liberal democracy, can be more 
important or more critical to the U.S. than Europe and Germany.
    Those who oppose the NATO enlargement because of Russia's 
possible reaction are really asking us to reorder our most 
fundamental strategic priorities without even debating the 
question, not even bringing it up, without even consciously 
considering what it would mean.
    If I were in your position and had to vote on NATO 
enlargement, I would want the opponents to explain to me why 
they believe that this well-established and stabilizing order 
of strategic priorities should be reversed. I would want to 
know how they believe the dynamics of Europe, from the Atlantic 
to the Urals, in the decades ahead will not drive us out of 
Europe, leaving Europe politically and militarily not 
integrated--far from completion of its integration, but perhaps 
giving way to disintegration.
    Clearly the NATO enlargement issue should be decided not on 
the basis of Russia's reaction. Even if we knew that the worst 
will happen in Russia, that is simply not sufficient reason to 
fail to enlarge.
    Happily, the most dire warnings about Russia's reaction are 
not persuasive. In fact, NATO enlargement is far more likely to 
contribute objectively to the prospects of liberal democracy in 
Russia. I know that several experts on Russian and Soviet 
affairs believe otherwise, but I believe they are fundamentally 
mistaken. I will be glad to elaborate this dissenting view in 
the question period, but let me offer one point now.
    The key issue that will determine whether or not Russia has 
a fair chance at democratic development is empire. Both in the 
Imperial Russian period and during the Soviet period, the 
imperatives of empire made a liberal development path 
impossible. If Russia returns to empire, it has not prospects 
for becoming democratic. NATO enlargement will diminish the 
likelihood of Russia taking that path. Failure to enlarge NATO 
will encourage it.
    Other Western policies will also be required to lower the 
chances that it will return to empire. But NATO enlargement 
will make it more difficult. It will encourage those liberals 
in Russia who favor NATO enlargement precisely for this 
objective reason, but who have been intimidated into silence by 
neo-imperialist voices, trumpeting so loudly against NATO 
enlargement in Moscow today--voices which do not reflect public 
opinion polls or genuine Russian strategic interests.
    Now, to sum up, I believe that when all these arguments, 
pro or con, are sorted out, and when we look at the basic 
questions on which our foreign policy ought the turn, we will 
reach the following inexorable conclusions:
    First, the U.S. commitment to Europe has long enjoyed a 
consensus in the United States. A negative vote on enlargement 
would be to reject this consensus and go against it without 
even considering the consequences.
    Second, it is most doubtful that NATO can remain in a 
static in a rapidly changing Europe. Many of the arcane and 
complicated developments in Central Europe contributing to 
change receive too little attention or understanding in our own 
public debates on NATO enlargement.
    Third, even if all the dire warnings about Russia, if they 
come true--and I think not very probable--this should not be a 
decisive factor.
    Now, in light of these conclusions, the prudent decision, I 
think, is obvious and not even a close call. This is not to 
say, however, that enlarging NATO will not bring problems, and 
some of them quite trying. The arguments about the impact of 
dilution on the NATO military structure are serious. The 
reactions of the countries not admitted are serious. The 
Russian reaction could be troublesome. There will be some 
financial costs. To avoid these problems by not enlarging the 
Alliance, however, is to risk creating far larger problems.
    Finally, it seems to me that you members of the Senate face 
a choice in this question of no less historical importance than 
when the Senate refused to ratify the Versailles Treaty and 
when it did ratify the North Atlantic Treaty. The outcomes of 
both of those decisions are a sound guide for facing the choice 
today. Going forward with new commitments was not risk free in 
1949, but it transformed the world in a positive way. Standing 
pat, refusing to go forward in 1920, was intended to avoid 
risk, but it also transformed the world, making this the 
bloodiest century in history.
    Thank you.
    [The prepared statement of General Odom follows:]
                   Prepared Statement of General Odom
    Mr. Chairman, it is not only an honor but an exceptional 
responsibility to testify before this committee on NATO enlargement. 
The gravity of the issue inspires a sense of humility. Too much is at 
stake to make the decision based on clever arguments and 
representation.
    You have already heard virtually all of the arguments that can be 
made, for and against, on this question. I do not suffer the illusion 
that I can provide much new or remarkably enlightening evidence. 
Instead I want to offer a way stand above the plethora of arguments, 
details, and evidence in order get our bearings, to simplify things, 
and to see what evidence and arguments are truly important and what can 
be safely set aside in deciding the question.
    How does one do this? I believe it comes down to focusing on only 
three basic questions, questions that draw out what is at stake, the 
most significant forces affecting what is at stake, and the priorities 
we must maintain to defend what is at stake.
    The first basic question is whether or not the United States should 
remain committed militarily and politically to Europe. This may not 
strike you as a relevant question, but I believe that will soon become 
clear that it is.
    The major lesson of the first half of this century is that when we 
have had no military ties to Germany and Japan, when we have tried to 
avoid dealing with emerging German and Japanese power, we have had war 
in Europe and Northeast Asia. The lesson of the second half of the 
century is that when we have had strong military ties to Germany and 
Japan, we not only have had peace; we have enjoyed unprecedented 
economic prosperity, and our liberal democratic values have spread in 
the world. We too often lose sight of this simple yet critically 
important understanding.
    For example, people seem to forget it when they complain that our 
wealthy allies in Europe do not carry their share of the military 
burden. One can debate how fairly the burden has been distributed, but 
one cannot deny that we have grown wealthier than our free-loading 
friends even while carrying the larger share. Our defense allocations 
in Europe should not be seen primarily as a burden. Actually they have 
been extremely profitable investments because they have made possible 
freer trade, more trade, and lower transactions costs in trading 
activities. Without them, both we and our European allies would be a 
lot poorer today.
    This is not to suggest that costs are irrelevant. There has been 
greater burden sharing precisely because US Senators have pressed it 
with our allies. Rather it is to explain why the cost issue is not 
fundamental for deciding the NATO enlargement issue. It should not 
figure in one's final decision because remaining committed to European 
security has proven a money-making, not a money-losing proposition.
    The case for keeping US forces in Europe is overwhelming when one 
considers the political and military consequences that would soon ensue 
were US forces withdrawn. This is an important conclusion, although 
again you may react by asserting that we are not debating whether or 
not to remain in Europe but whether or not to enlarge NATO.
    That strikes me as a seriously mistaken impression, and it takes me 
to the second basic question: Can NATO survive if it remains static, 
refusing to enlarge, in a dynamic and changing Europe? I have heard no 
opponents of enlarging NATO address this question. They merely assume 
that NATO can remain more or less as it is, making only internal 
adjustments. This is highly unrealistic. And the reasons why take us to 
the question of our strategic priorities in Europe. Which country is 
more important and consequential for both the United States and Europe? 
Russia or Germany? Economically, politically, and militarily, Germany 
clearly deserves first priority.
    Too many American policy-makers take Germany for granted. They 
assume that European political and military integration is 
irreversible, even close to full success, something that removes the 
century old German question from Europe's agenda. If you share that 
mistaken impression, then I ask you to consider several facts.
    First, Britain and France opposed German reunification and are 
still not happy about it, a point the Germans will not soon forget.
    Second, Britain and France fell into a serious quarrel with Germany 
over Croatia, Bosnia, and Serbia during 1992-95, making a mockery of a 
common European defense and foreign policy. The British foreign 
secretary in 1994 was reported to have said that it is better to have 
Russia on the Adriatic coast than Germany. This quarrel is now 
repressed only because the United States belatedly took the leadership 
role and put NATO forces in Bosnia, and if US troops are withdrawn 
anytime soon, it will resurface with a vengeance. Would that be in our 
strategic interest? Hardly!
    Third, in Germany, virtually all political leaders of all parties 
but the Greens, and even some of the Greens, support NATO enlargement. 
Why? Several SPD leaders, some who were never very pro-NATO, have 
offered the most articulate answer. They cite the interwar period when 
Moscow, Berlin, London, Paris, and Rome competed irresponsibly for 
influence in Eastern Europe, a competition that set up the conditions 
allowing World War II to break out. They remember that even a weak 
Soviet Union was able to use diplomacy to play off the major powers in 
Europe against one another, inducing strategic instability. These 
German spokesmen argue that if NATO is not enlarged, then Germany will 
be forced to follow a unilateral Ostpolitik, a foreign policy that will 
make Germany vulnerable to deals offered by Moscow at the expense of 
the small states in Eastern and Central Europe. That in turn will 
exacerbate Germany's relations with its Western European allies. A 
common European foreign and defense policy will fade, even as an 
aspiration. And the consequences for European security and economic 
prosperity will be adverse. Can it be in the US strategic interest for 
Germany, France, Britain, Italy and Russia to fall into a major 
struggle for influence in countries of Central Europe? The Germans 
argue that the most effective way to-prevent it is to enlarge NATO.
    Fourth, I recently spoke with a group of journalists from the three 
new candidate NATO members. In our discussion, they forthrightly 
admitted that although their publics want them to join NATO because of 
the Russian threat, the more thoughtful people want to join because US 
forces in Germany will protect them from Germany. Does the United 
States really want Poland to believe and act as though it is threatened 
both by Moscow and Berlin?
    Fifth, a well placed Russian national security official told me 
that he and his colleagues foresee their main challenge as strategic 
competition with Germany for hegemony over Central and Eastern Europe. 
They oppose NATO enlargement precisely because that would neutralize 
this competition. Can it be in the US interest to allow this 
competition to distract Russia from dealing with its problems of 
economic and political reform?
    These five points indicate something of the post-Cold War dynamic 
in a changing Europe. They reveal emerging forces that a static NATO 
cannot control, and if it cannot control them, what will be the 
consequences? Just imagine the impact on Germany if the United States 
decides against NATO enlargement. Not only its western neighbors, but 
the United States as well will be at odds with Germany over its policy 
toward Russia and Central Europe. No matter how good our relations with 
Russia are, the United States will find itself embroiled in all kinds 
of intra-European bickering and competition but without NATO embracing 
a sufficient number of the troublesome countries to prevent a downward 
spiral. Reluctant to enlarge NATO, the United States will find itself 
on the path of withdrawal. It can only stay in Europe as long as its 
ties to Germany are strong and cooperative, a condition that now 
requires NATO enlargement.
    The third basic question is this: what will be the consequences for 
Russian political development if NATO enlarges? I put this question as 
number three because in the context of US strategic interests, it is 
lowest in priority. Russia is indeed an important country, but in 
deciding on NATO enlargement, one is dealing with the US stake in two 
mutually related goals: first, a secure and economically prosperous 
Europe, and second, insuring that a reunified Germany does not catalyze 
a new balance of power game among our European allies. I see no way 
that Russia can be more important for US strategic interests than these 
two goals.
    This has been the US priority since the formation of NATO--Europe 
and Germany first, Russia second. Let us suppose that all of the direst 
warnings about Russia's reactions to NATO enlargement were to come 
true. Would that provide sufficient cause for the United States to 
revise these priorities? Obviously not. I simply see no way that 
Russia, even if it becomes a thriving liberal democracy, can be more 
critical to the United States than Europe and Germany.
    Those who oppose NATO enlargement because of Russia's possible 
reaction are really asking us to reorder our most fundamental strategic 
priorities without even debating this question, without even 
consciously considering what it would mean. If I were in your position 
and had to vote on NATO enlargement, I would want the opponents to 
explain to me why they believe this well established and stabilizing 
order of strategic priorities should be reversed. I would want to know 
how they believe the dynamics of Europe from the Atlantic to the Urals 
in the decades ahead will not drive us out of Europe, leaving European 
political and military integration not only incomplete but giving way 
to disintegration.
    Clearly the NATO enlargement issue should not be decided based on 
Russia's reaction. Even if we knew that the worst will happen in 
Russia, that is not a sufficient reason to fail to enlarge NATO.
    Happily, most of the dire warnings about Russia's reaction are not 
persuasive. In fact, NATO enlargement is for more likely to contribute 
objectively to the prospects for liberal democracy in Russia. I know 
that several experts on Soviet and Russian affairs believe otherwise, 
but I believe they are fundamentally mistaken. I will be glad to 
elaborate this dissenting view in the question period, but let me offer 
one reason for it at this point.
    The key issue that will determine whether or not Russia has a fair 
chance at democratic development is empire. Both in the Imperial 
Russian period and during the Soviet period, the imperatives of empire 
made a liberal development path impossible. If Russia returns to 
empire, it has no prospects for becoming democratic. NATO enlargement 
will diminish the likelihood of Russia taking the imperial path once 
again, and failure to enlarge NATO will encourage it to do so. Other 
western policies will also be required to lower the chances that it 
will return to empire, but NATO enlargement will make it more 
difficult. And it will encourage those liberals in Russia who favor 
NATO enlargement precisely for this objective reason but who have been 
intimidated into silence by the neo-imperialist voices trumpeting so 
loudly against NATO enlargement in Moscow today, voices which do not 
reflect public opinion polls or genuine Russian strategic interests.
    To sum up, I believe that when all the arguments, pro and con, are 
sorted out, and when we look at the basic questions on which our 
decision ought to turn, we will reach the following inexorable 
conclusions:
    First, the US commitment to Europe has long enjoyed a consensus in 
the United States, a consensus among both policy elites and the public 
for very good military, economic, and political reasons. A negative 
vote on enlargement would be to reject this consensus and go against it 
without even considering the consequences.
    Second, it is most doubtful that NATO can remain static in a 
rapidly changing Europe. Many of the arcane and complicated 
developments in Central Europe contributing to change receive little 
attention or understanding in our public debates on NATO enlargement.
    Third, even if all the warnings about Russia's reaction come true--
not very probable--this should not be a decisive factor in deciding 
whether or not to expand NATO.
    In light of these conclusions, the prudent decision on enlargement 
is obvious, not even a close call. This is not to say, however, that 
enlarging NATO will not bring problems, some of them quite trying. The 
arguments about the impact of dilution on the NATO military structure 
are serious. The reaction of those countries not admitted is serious. 
The Russia reaction could be troublesome. There will be some modest 
financial costs. To try to avoid those problems by not enlarging the 
alliance, however, is to risk creating far larger problems.
    Finally, it seems to me that you face a choice in this question of 
no less historical importance than when the Senate refused to ratify 
the Versailles Treaty and when it did ratify the North Atlantic Treaty. 
And the outcomes of both of those decisions are a sound guide for 
facing the choice today. Going forward with new commitments was not 
risk free in 1949, but it transformed the world in the most positive 
way. Standing pat, refusing to go forward in 1920-21, was intended to 
avoid risks, but it also transformed the world, making this century the 
bloodiest in history.

    Senator Hagel. General Odom, thank you. Mr. Simes.

  STATEMENT OF DIMITRI K. SIMES, PRESIDENT, NIXON CENTER FOR 
               PEACE AND FREEDOM, WASHINGTON, DC

    Mr. Simes. Thank you very much, Mr. Chairman. I am also 
very privileged to testify before the committee. I know that it 
is a great responsibility. I know that at this late hour, my 
particular responsibility is to try to be very brief, which I 
will, especially as so much of ground has already been covered 
and you already have my statement, in which I tried to be, to 
the best of my ability, sophisticated and nuanced.
    Senator Hagel. Your statement, Mr. Simes, will be included 
in the record.
    Mr. Simes. Thank you very much, Mr. Chairman.
    Let me say first that if we were debating today the 
question of whether Russia supports NATO enlargement, we would 
probably find a consensus among all students of Russia that the 
answer is negative. I have yet to find a single Russian who 
believes that NATO enlargement, which they assume would exclude 
Russia, is a good idea.
    But I presume that this is not what we are debating. I 
believe we are debating whether NATO enlargement may adversely 
affect important American interests vis-a-vis Russia. If that 
is the question, it is very difficult for me to find evidence 
which would suggest that we are going to lose anything of 
importance in the U.S. relationship with Russia if we proceed 
with NATO enlargement, particularly with the very cautious and 
moderate first stage of NATO enlargement, which, mind you, 
would not bring the Alliance to the Russian border, with the 
one exception of the Kaliningrad enclave.
    Even in Russia, to the best of my knowledge, no one 
seriously claims that Poland will become a staging ground for 
the invasion of Kaliningrad. If one looks at public opinion 
polls, they suggest that in today's Russia this is, for all 
practical purposes, a non-issue, particularly after Helsinki 
and Madrid.
    One can find Russian officials who duly register their 
opposition to NATO enlargement, which in Russia has become the 
functional equivalent of belief in God and apple pie. But this 
is not an emotional issue.
    Like Senator Wellstone's father, my father was also born in 
Russia. Unlike in the case of Senator Wellstone, however, my 
father-in-law still lives in Russia, as do as many of my other 
relatives and friends, some of whom actually negotiated with 
Ambassador Matlock and Ambassador Pickering these very issues 
of NATO enlargement.
    I have yet to remember a single conversation I have had 
with anyone in the Russian foreign policy establishment or in 
the Yeltsin government after office hours in which NATO 
enlargement has been a serious emotional issue. They do not 
like it. They do not approve of it. They worry about the second 
stage, especially Ukraine and the Baltic nations. But as far as 
the three Visegrad nations are concerned, it is simply not a 
serious political matter for anyone in Russia.
    When I hear that NATO enlargement could move Russian public 
opinion in a nationalist/extremist direction, I really want to 
know what kind of naivete it requires to believe this about a 
country in which, as Ambassador Matlock observed, the Russian 
leadership was the principal architect of the destruction of 
its own empire. Unlike General de Gaulle's withdrawal from 
Algeria or the British pullout from India, Russia's leaders 
made no arrangements whatsoever to protect its own citizens, 
the 26 million ethnic Russians living in other Soviet 
republics.
    They also engaged in terrible atrocities in Chechnya 
against, among others, many Russian civilians. They are not 
paying wages and pensions to their own people at the time when 
the people can easily observe the huge mansions of the new, 
elite and the private jets of Russia's new tycoons. None of 
this moves the Russian politics in a nationalist or reactionary 
direction. But somehow an obstruction like NATO enlargement is 
supposed to have a mystical destructive impact on Russian 
politics. It is very difficult for me to believe.
    As far as arms control agreements are concerned, let me 
simply say that President Yeltsin has not lifted a finger to 
have START II ratified by the Russian Duma. We have been told 
this by many Russian political commentators. We have been told 
this by many members of the Russian Duma. It has simply never 
been a priority for the Russian Government.
    I am not going to engage in speculation about what Yeltsin 
would do if he had a friendly Duma and if ratification could be 
delivered to him on a silver platter. But the fact remains that 
even before NATO enlargement became a major issue, Yeltsin was 
not interested in ratification of the START II treaty--at least 
he was not interested in fighting with Communists and 
nationalists in the Duma over this arms control agreement.
    The Nixon Center hosted Mr. Zyuganov. We had a very 
interesting presentation by him and another very interesting 
presentation by General Lebed. Both of them made very clear 
that while they have serious concerns about the START II 
agreement, these concerns connected much more to the ABM 
treaty, with all the differences between theater and 
intermediate-range nuclear defenses, than with anything that 
may happen in the first stage of NATO enlargement.
    General Lebed is a nationalist politician and a very 
ambitious man. I do not think that he would be so outspoken in 
arguing that NATO enlargement is not a problem, that the first 
stage of NATO enlargement is not a problem, if he were 
concerned that such statements would alienate his nationalist 
constituency.
    What really should be discussed is whether we need NATO 
enlargement as a protection against a new Imperial Russia. I 
agree with Ambassador Matlock that Russia is not a threat 
today. I am not going to dwell on that. It is almost self-
evident.
    However, I disagree with Ambassador Matlock that simply 
because the Yeltsin leadership was instrumental in destroying 
the old Soviet Union, we should say that it is anti-Imperial. 
It was very much to Yeltsin's advantage to destroy the Soviet 
Union and to take the country from under President Gorbachev. 
Looking at the composition of the Russian leadership today, it 
is clear that they are certainly not Jeffersonian democrats. 
They are not people who came from the ranks of dissidents or 
any kind of opposition. As Russia becomes minimally stronger 
today as the economy begins to stabilize, we see a growing 
Russian assertiveness.
    I think that Bismarck was quite right when he observed that 
Russia is never as strong or as weak as it appears to be. I 
think chances are quite good that at the beginning of the 21st 
century Russia is going to be a serious power once again--not a 
superpower--but a serious power. I can well understand that 
nations in Central Europe may be somewhat nervous about it.
    Now, I would not suggest for a second that Russia is a 
prisoners of its history. Germany and Japan prove otherwise--at 
least hopefully prove otherwise in the long run. I would not 
suggest that the current Russian leadership is interested in 
aggression. In fact, they are interested primarily in the 
enrichment of themselves and the Russian elite as a whole. But 
taking into account Russia's past and its potential power, it 
is simple prudence to proceed with a new security architecture 
in Central Europe, if it can be done without seriously damaging 
your relationship with Russia and without alienating Russian 
public opinion.
    I believe it can be done without alienating Russian public 
opinion. And the time is precisely now, when Russia is 
preoccupied with domestic issues when we have a fairly benign 
relationship with Yeltsin, and when Russia is still modestly 
dependent upon foreign aid, particularly from the World Bank 
and the International Monetary Fund. The present time is a 
window of opportunity to expand NATO without entering into a 
confrontation with Moscow.
    Where I see a problem with Russia and NATO enlargement is 
exactly where Secretary Kissinger sees it. I am not going to 
talk about that a great deal. I am sure that he presented his 
perspective; mine is very close to his. I am not going to talk 
about NATO bodies and what kind of voice Russia will have 
within them. This is not a purely technical question. I think 
that the administration is entitled to argue that there is 
enough ambiguity in the Final Act for us to believe that Russia 
is getting a voice but not a veto.
    But everything depends on who interprets the Final Act. Mr. 
Yasrtrzhembsky, Yeltsin's press secretary, said, 2 days after 
the Final Act was signed that it was not the end of the battle 
over NATO enlargement,end, but rather the beginning of the 
battle of the interpretation of the Final Act, and that Russia 
would try to interpret it in the broadest possible way.
    Looking at the Clinton administration record vis-a-vis 
Russia, I have to admit that I am concerned that the Clinton 
administration is not always prepared to be sufficiently 
realistic about Russian behavior and intentions. I think that 
the administration has not leveled with the American people 
about President Yeltsin's undemocratic practices, including the 
gross violations of human rights in Chechnya, which were real 
atrocities perfectly comparable to what happened in Bosnia.
    I think the Clinton administration has not leveled with the 
American people and the Congress about the extent of 
corruption, which reaches into the highest echelons of the 
Russian Government. Some of the people labelled reformers by 
the administration are called thieves in Moscow.
    I think that the administration has been somewhat too 
lenient about Russian arms control violations, about violations 
of a variety of other agreements and, even more important, 
about defending American interests, particularly in the case of 
Russian nuclear missile and energy deals with Iran. Under these 
circumstances, I am not confident that the administration's 
interpretation of the Final Act will be based on sufficiently 
realistic assumptions about Russia rather than our best hopes 
and sometimes naive expectations.
    That is why it seems to me we have to appreciate one very 
simple fact. NATO, of course, has to be adjusted in a number of 
ways. The call to reform it is proper. NATO adaptation should 
be debated in this building and across the Atlantic, and a 
great deal of innovative thinking and serious discussion is in 
order. But I am concerned that sometimes people in the 
administration, and especially those who opposed the expansion 
and have now joined the administration, are trying to use NATO 
expansion to change the very nature of the Alliance, and to 
turn it into a collective security body. That, in my view, 
would be a major mistake.
    Let me conclude with a very simple proposition. A strong 
and effective NATO will be not an obstacle, but an asset in 
dealing with Moscow in the 21st century. It will not create new 
dividing lines in Europe as long as we cooperate with Russia on 
many other levels, from trade to security. It is precisely 
because we want to have a united Europe that we need to create 
certainty in Russia's about what is permissible and what is off 
limits. That security climate would be much better for a united 
Europe than the misguided accommodation of Russia today, which 
can lead only to trouble, misunderstanding and confrontation 
tomorrow.
    Thank you.
    [The prepared statement of Mr. Simes follows:]
                    Prepared Statement of Mr. Simes
    Thank you, Mr. Chairman and members of the Committee, for the 
opportunity to explain my views on the impact of NATO enlargement on 
Russia, its foreign policy, and its relations with the United States. 
Let me state first, however, that the Nixon Center for Peace and 
Freedom does not take institutional positions on policy issues and, 
accordingly, that my remarks today represent strictly my own opinions.
    To put the impact of NATO's enlargement on Russia in its proper 
context, it is important to remember the original reasons behind the 
expansion of the Alliance. Those reasons did not include strengthening 
U.S. ties with Russia; rather, they were built around promoting 
stability and security in Central Europe, consolidating the gains of 
democracy in the region, and responding to the historical aspirations 
of its peoples to be included in the Western community of nations. It 
is these goals that have been presented as the principal rationale for 
NATO's expansion by the U.S., its NATO partners, and prospective 
members in the Alliance. Accordingly, in evaluating the impact of NATO 
enlargement on Russia, the key question is not ``Will NATO enlargement 
have a positive effect on Russia?'' but ``Will NATO enlargement 
adversely affect key U.S. interests with respect to Russia?'' By such a 
standard, NATO expansion--especially in its first stage--is not a 
problem.
    Even before the agreements reached between Presidents Clinton and 
Yeltsin in Helsinki in March of this year--and despite the efforts of 
some Russian opinion-makers--the Russian public was not at all 
exercised about the prospect of NATO expansion. A variety of polls 
indicated that under 10% of Russia's citizens see NATO enlargement as a 
serious threat. After the Helsinki Summit, and particularly after the 
July 8-9 Madrid Summit, the NATO issue has for all practical purposes 
dropped off the radar screens of the vast majority of Russia's 
citizens.
    Nevertheless, opponents of NATO enlargement continue to predict 
darkly that expanding the Alliance will undermine the Yeltsin 
government and turn Russian domestic politics in a reactionary, 
nationalist direction. It requires an inordinate degree of naivet6 to 
take this argument--which is also the principal argument against NATO 
expansion made by some elements of the Russian government and foreign 
policy establishment--at face value. If the Yeltsin regime could 
survive nationalist ire after playing a leading role in the destruction 
of the USSR and essentially abandoning 26 million ethnic Russians 
living in the other Newly Independent States; if it could survive 
public outrage over its conduct of a genocidal war in Chechnya in which 
at least 40,000 civilians (including many ethnic Russians) were killed; 
if it could withstand the humiliation of defeat in that same war by the 
Chechen rebels; if it could be forgiven for using tanks against its own 
democratically-elected (albeit very imperfect) parliament in October 
1993 (after Yeltsin issued a decree to dissolve it that he himself 
admitted at the time was ``extra-constitutional''); if it could survive 
the massive redistribution of Soviet/Russian state property to corrupt 
officials and well-connected tycoons who make America's 19th century 
robber barons look like innocents; if it could sustain itself while 
withholding wage and pension payments to millions of citizens for 
months while the same officials and tycoons built huge mansions and 
bought private jets, it is difficult to imagine how an abstraction like 
the incorporation of three Central European states with no shared 
border with Russia (with the exception of Poland's border with the 
Kaliningrad enclave) into NATO could have a serious impact on Russian 
politics. If such an impact were to any serious degree imaginable, it 
is highly unlikely that an unabashedly nationalist presidential 
candidate such as General Aleksandr Lebed would say point-blank that 
NATO enlargement ``poses no threat at this stage.''
    Those in Russia who oppose NATO enlargement can be divided into two 
broad categories. The first category includes xenophobic Communists and 
hardline nationalists who have made opposition to the West, and the 
U.S. in particular, their battle cry. This group does not need NATO 
enlargement--or any other Western policy--to become motivated and 
mobilized. What little basis is necessary to trigger complaints and 
accusations from them is demonstrated by an open letter to President 
Clinton from the heads of several Duma committees (with the notable 
absence of the Yabloko faction) on October 16 charging that NATO's 
``Sea Breeze-97'' maneuvers with Ukrainian forces in Crimea violated 
the 1990 Convention on the Rights of the Child and the 1949 Geneva 
Convention on the Protection of Civilian Persons because they took 
place in the vicinity of a children's hospital.
    The second category of Russian critics of NATO enlargement consists 
principally of government officials and pro-government establishment 
figures who want to establish their patriotic credentials on the cheap 
to protect themselves in Russia's increasingly nationalist political 
climate. Significantly, after Helsinki and particularly Madrid, these 
voices have been considerably muted--at least as far as the first stage 
of expansion is concerned. Some even argue that if Russia manages to 
develop meaningful cooperation with NATO through the NATO Russia 
Permanent Joint Council, it is not inconceivable, as an influential 
Izvestia columnist recently wrote, that in two years the Russian press 
agency ITAR-TASS will report on President Yeltsin's congratulations to 
the Presidents of Poland, Hungary, and the Czech Republic on their 
entry into the Alliance.
    For the United States to fail to proceed with NATO enlargement 
would be a stunning event, even in Russia, and a tremendous victory for 
the hardliners.
    Some American critics of NATO expansion also argue that enlarging 
the Alliance may complicate the Russian State Duma's ratification of 
the START II treaty and other arms control agreements. However, this 
argument ignores the fact that to this day--before and after Western 
discussions of NATO enlargement--the Yeltsin government has done next 
to nothing to get START II ratified. NATO enlargement cannot be an 
alibi for President Yeltsin's failure to make START II ratification a 
priority, especially as the Duma opposition connects ratification much 
more closely to the maintenance of the ABM treaty than to NATO 
expansion. Paradoxically, the process of NATO enlargement could even 
improve Russian cooperation on arms control if the Clinton 
Administration indicates that the scope and timing of the next round of 
expansion may be influenced by Russia's arms control performance. At 
present, there is simply not a single negative development in Russian 
foreign policy which can be attributed to NATO expansion.
    The relationships with China and Iran--which are often cited as 
``responses'' to NATO enlargement--also have other, prior, and more 
substantial causes.
    Thus, I believe that the impact of NATO enlargement on Russia 
should not be a major concern in evaluating the future of the Alliance. 
Conversely, however, the potential Russian challenge should be a 
legitimate consideration in deciding when and how to expand the 
Alliance. Russia today is not in a position to threaten its European 
neighbors. Its armed forces are too weak and its dependence on foreign 
aid and investment is too great to encourage provocative conduct. Also, 
Russia is led by a relatively benign government which seems generally 
committed to developing a reputation as a good international citizen. 
It is not a government which seems prepared to take chances in the name 
of anything other than the immediate economic interests of the new 
post-Communist elite.
    But the Russian economy is beginning to show signs of 
stabilization. Russia's leaders seem to believe, perhaps prematurely, 
that their country is now less dependent on credits from the World Bank 
and International Monetary Fund. Also, for the first time, there is 
serious talk of military reform. And there are indications of a new, 
more assertive foreign policy in Moscow aimed at undermining U.S. 
global leadership and shaping a new, ``multipolar'' international 
system. Finally, Boris Yeltsin will not be the President of Russia 
forever and, since the Russian constitution was uniquely tailored to 
his personal political needs, there is a good chance of significant 
changes in Russia when Yeltsin leaves office. Simple prudence suggests 
that an appropriate security architecture should be created to define 
the limits to any revanchist aspirations should they ever again impel 
Russian policy. It is precisely now, when Russia is relatively weak and 
preoccupied with its own evolution--and when, due to its benign 
relationship with the West, NATO enlargement is less likely to be 
perceived through the prism of hostility--that is the right time to 
proceed .
    As Germany and Japan have demonstrated in the second half of the 
20th century, no nation is a prisoner of its history. It would be both 
unfair and counterproductive to accuse the presently peaceful Russia of 
aggressive designs preemptively. But history should not be ignored 
either. It is outright recklessness not to take Russia's past--and 
power--into account when considering the future of Europe. This is all 
the more true as we have already seen how extremely brutal today's 
relatively benign Moscow can be, even with its own citizens, when 
Russia's leaders believe they can get away with such behavior.
    The inclusion of Poland, Hungary, and the Czech Republic in NATO 
will not create new lines of division in Europe as long as Russia 
remains on the path of democratic development and does not threaten its 
neighbors. The new ties between Russia and the West--in the economic, 
political, security, and even social spheres--are broad and deep enough 
to preclude such an eventuality. What NATO enlargement does is create 
certainty in Moscow that policies of aggression and intimidation in 
Central Europe will have profoundly negative consequences.
    That understanding will be advantageous even to the nations not 
invited, at least in the near future, to join the Alliance just as the 
presence of NATO members on the borders of Austria, Sweden, and Finland 
provided an essential security umbrella during the Cold War. Ukraine 
and the Baltic States will benefit in a similar manner from the 
inclusion of Poland, Hungary, and the Czech Republic in the Alliance. 
Although Ukraine is not at this point seeking membership in the 
Alliance as Lithuania, Latvia, and Estonia are, all four states are 
united in the belief that NATO enlargement--even if limited to its 
current parameters--is advantageous to their security. As a matter of 
fact, as expansion of the Alliance has become increasingly likely, 
Russian treatment of Ukraine and the Baltic States has become more 
moderate and more flexible. Russian policymakers clearly appreciate 
that rocking the boat too much could accelerate NATO's expansion to 
Russia's frontier--something they are eager to avoid.
    It is not the implications of NATO expansion within Russia but 
rather Russia's new role in NATO which could create profound problems. 
From the outset, when Central European nations first announced their 
intentions to join NATO, Moscow has taken the position that enlargement 
would be acceptable to Russia only if the Alliance changed its name and 
transformed itself into a universal collective security system. The 
Clinton Administration rejected the first symbolic demand but has made 
major concessions to accommodate the second, substantive one.
    There is enough ambiguity in the so-called Founding Act between 
NATO and Russia to allow the administration to claim that Russia has 
been given a voice but not a veto. But the Permanent Joint Council 
established by the Founding Act has at least the technical possibility 
to deal with a broad range of political and security matters central to 
the ability of the Alliance to maintain its character as a cohesive 
military organization. The Russian government is certain to interpret 
its prerogatives under the Founding Act as broadly as possible. As 
Yeltsin spokesman Sergei Yastrzhembsky put it, ``the signing of the 
agreement is not the end but the beginning of its life: it begins the 
struggle over its interpretation.''
    Thus, a great deal depends on who interprets the agreement and how 
it is interpreted on the NATO side--particularly in Washington. In this 
respect, the Clinton Administration's record does not inspire 
particular confidence. The President and his advisors have consistently 
demonstrated a predisposition to go the extra mile to accommodate the 
Yeltsin government. This excessively generous attitude has ranged from 
a reluctance to criticize Russian atrocities in Chechnya to a refusal 
to acknowledge the undemocratic practices and pervasive corruption 
evident at the highest levels in Moscow, and from the promotion of 
Russian membership in the G-7 and the Paris and London Clubs--none of 
which are justified on economic merits--to lobbying on Russia's behalf 
with the IMF and World Bank. The administration is also hesitant to 
introduce any penalties for undesirable Russian behavior when important 
U.S. interests--and even U.S. laws--are disregarded, as in the case of 
Russian nuclear, energy, and weapons deals with Iran. Further, senior 
administration officials make clear that they visualize not just an 
expanded NATO but a fundamentally altered NATO, redesigned in a manner 
which appears to be largely along the collective security lines 
advocated by Russia.
    After the collapse of the Soviet Union, NATO is in need of 
adaptation if it is to cope with a radically different international 
environment. This reform will require innovative thinking and serious 
debate on both sides of the Atlantic. But it would be a great mistake 
to use the expansion of the Alliance as cover to change its nature 
fundamentally simply in order to avoid alienating Russia. A strong and 
effective NATO is not an obstacle, but an asset in dealing with Moscow 
in the 21st century.

Dimitri K Simes is President of the Nixon Center for Peace and Freedom, 
a non-partisan public policy institution with offices in Washington, DC 
and Southern California.

    Senator Hagel. Mr. Simes, thank you very much.
    To all three of you, thank you.
    Ambassador Matlock, have you missed your train, or will you 
be taking another train?
    Ambassador Matlock. I have another 10 minutes, yes.
    Senator Hagel. May I start with you. I know you have to get 
a train, and I am grateful that you would spend some time with 
us.
    I noted you being a little itchy, listening to your friends 
and colleagues. Would you care to respond? This is not open 
ended, by the way. But if you would take a couple of minutes to 
respond, I would be interested in a couple of your responses to 
what you heard.
    Ambassador Matlock. Just two points. Although, obviously, 
to discuss them thoroughly would take a long time.
    First of all, I really cannot understand General Odom's 
feeling that NATO is static if it does not take in new members. 
It seems to me NATO has been substantially changing its focus 
and its orientation. We made some rather significant changes in 
connection with German unification. We since have had the 
Partnership for Peace, which is just beginning to be 
implemented. All the states in the area are members of that. 
Some are going to be more active than others. We still have not 
really tested the limits of that. Now we have the Founding Act 
with Russia.
    I think these are all very, very important changes in NATO. 
I do not understand how is can be considered ``static.''.
    I would say I simply do not accept that we have to take new 
members in now, under these conditions, in order to preserve 
NATO. I do have the strong feeling that it is not just a matter 
of these three countries. We have said that others are coming. 
I do not see how we can avoid a divisive debate for many years 
to come about who they are going to be. I do not think that is 
the primary security issue we face.
    Regarding Mr. Simes' comments, I would simply clarify my 
own position. My position is not that we should accommodate 
Russia. Far from it. It does seem to me that whatever residual 
imperialistic tendencies, which, indeed, can be a problem, can 
best be contained by methods other than adding members to NATO. 
I can think of no lever more effective, no political lever, 
than the threat that if Russian behavior does not meet certain 
standards, NATO will be enlarged, and enlarged very rapidly, 
and even further, and considerably further, than the current 
proposal envisages.
    As a diplomat, I would love to have such leverage to try to 
keep them in line. Therefore, I think that my position is not 
properly described as one calling for concessions to Russia.
    My final point would be that if indeed NATO is to be the 
primary instrument for preventing conflict among its members, 
then why not enlarge it to cover those areas where there is 
actual violence? The current proposal is to bring countries 
into NATO that do not need it to keep them from becoming 
threats to the press. If that is the objective, then, for 
goodness sake, let us look at the Balkans. Let us look at 
Transcaucasia.
    My point is that we need to use other means to deal with 
violence-prone areas in Europe. They will be much more 
effective. I do not see that Germany is a potential problem. I 
am just not seeing evidence that supports General Odom's 
assertion. One can draw all sorts of scenarios, and yet, he 
says that his scenario has not been refuted. Well, if I had a 
week or so to write it out, I could refute it, and probably 
write a book almost as long as the one I wrote before. But, 
obviously, we do not have time for that now.
    Thank you.
    Senator Hagel. Mr. Ambassador, do you foresee at any time 
in the future a need or a reason for NATO enlargement?
    Ambassador Matlock. Possibly, yes. I testified here 2 years 
ago that I could see two conditions under which NATO 
enlargement would not only be desirable but necessary. One 
would be an arrangement which would include Russia, and either 
have some Russia/NATO arrangement where this would be part, but 
would make Russia a partner in responsibility for helping 
maintain the security of Europe.
    The other would be a situation whereby Russia potentially 
or actually begins to threaten other countries in Europe. In 
either instance, I would be in favor of enlargement. But it 
does seem to me that we have many instruments today to meet the 
legitimate concerns of the East Europeans.
    I am one who feels that their membership in the European 
Union is much more important to their future and to the 
development of democracy and to the development of their 
economies than is membership in a military organization, when 
their security is not under threat from military sources.
    Thank you.
    Senator Hagel. Thank you.
    Senator Biden.
    Senator Biden. I am going to direct my questions to you at 
the moment, since you have to leave. I am a little confused--
and I mean that seriously--about the correlation between the 
expansion of NATO and Nunn-Lugar. Rather than my characterizing 
it, can you explain that to me again?
    Ambassador Matlock. I did not connect the two. What I said 
was that I consider the most serious potential security threat 
to the American people the possibility that weapons of mass 
destruction from Russian arsenals will seep out to 
irresponsible rogue regimes or terrorist groups.
    Senator Biden. I agree with that concern.
    Ambassador Matlock. And that I do not see a strategy 
emerging from the administration to deal with this. I said that 
one of the most effective things we are doing did not originate 
there. It originated here on the Hill, which shows that the 
influence. So I was praising this program and praising the 
initiative from the Senate to do so.
    Senator Biden. I understood that. I just thought you were 
suggesting a connection and you have clarified it. I thought 
you were making a connection that the one thing that made a lot 
of sense was Nunn-Lugar. Nunn-Lugar worked as far as it was 
allowed to go. This administration has not had a larger or 
broader or more encompassing initiative to either keep 
scientists and/or materiel from----
    Ambassador Matlock. I think you are absolutely--yes, that 
was the point I was making. I think if I look and try to assess 
what are the real near-term security threats to the American 
people, threats that could result in substantial casualties, 
this is the one that I would put at the top of the list.
    Senator Biden. All right.
    Ambassador Matlock. And I think it is the responsibility 
to--and I am convinced that bringing new members into NATO is 
irrelevant to it, and potentially can undermine the effort. I 
would like to know how the administration--I would think the 
Senate would like to know--what plans it has to deal with this 
and how it relates to its plans for NATO enlargement.
    Senator Biden. I would also like to know their plan to deal 
with a number of issues that relate to Russia and other places. 
But I do not know why we cannot sort of walk and chew gum at 
the same time. That is, press them on that, and if this other 
matter is unrelated--and I think it is, although you say 
potentially it could undermine efforts to deal with weapons of 
mass destruction--I am lost on how it potentially undermines 
those efforts--press the administration and still do our job. 
Constitutionally Senators are constituted to do one thing and 
only do one thing in foreign policy--and that is, we have to 
react.
    We cannot make foreign policy. We can initiate things like 
Nunn-Lugar, which I played a small part in. But, ultimately, we 
basically react in the area of foreign policy. If we had our 
way, I could make the argument that continuing the Partnership 
for Peace, which turned out to be much more robust and much 
more successful than I think anyone thought it would be at the 
outset, may arguably have been a better way to go, and that to 
continue that process and beef it up before you move to 
expansion, if you move to expansion, would have been better.
    But we are where we are. From my perspective--I speak only 
for myself, but I do not think I am totally alone in this--I 
did not see a threat when I was in Warsaw or Budapest or in 
Slovenia or anyone else seeing an immediate threat from Russia. 
But I see the threat lying in a gray zone existing where there 
is instability, where individual nations seek their own 
individual alliances, like they have in past historical moments 
like this, and where competing interests on the continent 
conclude that they will, not by the use of force but by the use 
of economic, political and diplomatic leverage, attempt to 
affect the foreign policy of those nations that are in play.
    And Poland is in play. Ukraine is in play. These countries 
are in play. So my view is that by making them part of NATO we 
enhance stability, although arguably there could be a better 
and more successful way of doing what I seek, and that is to we 
enhance stability. It seems to me if I am a Russian democrat, 
the last thing I want happening is the various countries that 
were either part of the Union and/or were satellites out there 
deciding what their relationships with their neighbors are 
going to be.
    I would argue, for example, that the only reason Romania 
has worked out, for the first time in my lifetime, some 
reasonable arrangement with their Hungarian brothers is because 
of the prospect of NATO admission. I would argue the reason why 
Germany and Poland moved on border disputes as rapidly as they 
did, in part, was related to this issue.
    So I find it to be something that is calming troubled 
waters. I do not think the Russian bear is going to, all of a 
sudden, resurrect itself and come roaring across Europe again. 
Quite frankly, I do not think so. Where I disagree with Mr. 
Simes is that I think it is not only crippled, I think it is an 
amputee right now.
    Now, maybe bears can grow back limbs; I do not know. That 
may happen. I am not suggesting anything is permanent in this 
business. But for the next 10 to 20 years, it seems to me 
incredibly difficult to figure out a circumstance where anyone 
in Russia would contemplate the use of land forces or engaging 
in an all-out war in Europe. I mean, I just think that is not 
likely.
    But whether that is true or not, it seems to me there is a 
fairly compelling argument, Jack, that something is going to 
happen. Something is going to happen, over the next 5 years, 
with Poland and with the Czech Republic and in countries not 
invited, Romania and others, as to how they are going to 
determine what their security arrangements are going to be.
    We, in a sense, talk about them like they are orphans. You 
know, either we or the Russians are going to decide their 
future. When, in fact, I quite frankly think they are sitting 
there thinking, OK, if we do not get this deal, what do we do?
    Ambassador Matlock. Well, Senator, I do know the area well. 
I speak Czech. I read Polish. I know the literature, the 
history. I was Ambassador to Czechoslovakia, not only the 
Soviet Union.
    Senator Biden. I know that. That is why I am asking.
    Ambassador Matlock. I would simply say that I do not buy 
the argument that we hear from some--and I know this is not 
yours--that this is a geopolitical vacuum. It is not a vacuum. 
These are countries that are now basically very healthy 
politically. They know where their orientation is. It is to the 
West. They are not going to start making alliances elsewhere. 
That would be idiotic, and it would be against their whole 
culture.
    Senator Biden. Well, I am not suggesting they will make 
them elsewhere. They may make them amongst themselves.
    Ambassador Matlock. But the thing is, I think this is 
actually a very stable part of Europe now. If there is 
instability and if the argument is that NATO has to bring 
members in and order to give them incentives to make it stable, 
then look at the Balkans.
    Now, I am not making that argument.
    Senator Biden. That is why I think Slovenia should be part 
of NATO.
    Ambassador Matlock. Well, and we need to go even further. 
Slovenia is stable. Do you want Bosnia in? This would give them 
a real incentive to get together.
    Senator Biden. No, Jack.
    Ambassador Matlock. No, I mean, really. If you follow that 
logic, if you follow that logic----
    General Odom.  The answer is NATO out-of-area action.
    Senator Hagel. What we will do here is we will let 
everybody in this.
    Ambassador Matlock. Thank you very much. I do have a train 
I have to catch.
    Senator Hagel. General Odom, do you want to jump in? Mr. 
Simes?
    Senator Biden. You better catch your train. I am accustomed 
to having to catch the train.
    Senator Hagel. Ambassador Matlock, thank you very, very 
much.
    Senator Biden. Thank you.
    Ambassador Matlock. Thank you both.
    Senator Hagel. Why don't we just pursue what we have been 
throwing around here. I know you both have some thoughts 
regarding some of the statements Ambassador Matlock made. So 
you just jump in where you want, General Odom. Please, Mr. 
Simes, feel free to engage here.
    General Odom.  Let me followup on this point, because I 
think Senator Biden, in responding to Ambassador Matlock, is 
putting his finger right on the point I tried to highlight and 
say is being lost entirely in the situation. The Ambassador 
said he did not understand why NATO is static. He understands 
it is changing. I say that it makes internal adjustments, 
surely, but my statement was that NATO does not have its arms 
around all of the dynamic forces and change in Europe in a way 
that will allow it to control, either with out-of-area 
operations in Bosnia or otherwise.
    And Senator Biden has just gone down and reiterated the 
kinds of dynamics in Central Europe that are outside of NATO 
and that will, as the Germans warn us, become the basis for 
deals between Moscow and Berlin at the expense of the East 
Europeans, which, in turn, will invite the British and the 
French to cut deals inside, or it can work the other way. We do 
not know. But we do know that we had several variants of that 
in the inter-war period.
    We also know that 7 years out, 5 years out from the 
Versailles Treaty, if we had been in this room, having the 
debate again, we would have had an ambassador telling us about 
how stable the democracies in Poland and Czechoslovakia and 
Romania and Hungary were. They were then.
    By the mid-1930's, they were all gone but the Czechs. We 
are much too early to reach those kind of conclusions. That is 
the point I want to make.
    The other point I want to relate to you and reemphasize is, 
having said that, we do not draw the further connection that if 
you really buy in the arguments against expansion, you are 
raising a very real prospect that you are voting to leave 
Europe. Now, I do not hear people saying that, and I do not see 
people thinking about that. I think you make that probability. 
Nothing is certain. But I think you make that probability very 
significantly higher.
    And if you want to convince yourself, go talk to the 
Germans. I think they are pretty critical.
    Senator Biden. We have similar isolationist friends up here 
today that we have talked to. We may have to go to Germany.
    General Odom.  But those are the essential components. That 
is the point I want to leave you.
    Senator Hagel. Thank you.
    Mr. Simes?
    Mr. Simes. I would like to respond to Senator Biden, if I 
may.
    Senator, I completely agree with you that if we lived in an 
ideal world, we would not need NATO enlargement in Central 
Europe. But I would like to remind you of the dynamics of the 
process. The idea did not originate in Washington. It did not 
originate in the White House. It originated in Central Europe.
    I would even go one step further. If Boris Yeltsin did not 
go to Warsaw and, as we are now told, have a little bit too 
much to drink with President Walesa, and then say things that 
encouraged the Poles, which Walesa exploited very carefully to 
claim that Russia now did not mind NATO expansion, we perhaps 
would not be having the discussion. But we are dealing with a 
real situation, not a hypothetical one.
    I did not mean, Senator, for a second to imply that 10 or 
15 years from now I expect Russian armies moving----
    Senator Biden. No, I was not suggesting you said that.
    Mr. Simes. I understand. But let me continue. What worries 
me is that Central European nations, whose history with Russia 
is very different than America's history with Russia, look at 
the situation with a much greater degree of concern. They will 
want to go even one step further. So we should also discuss 
Ukraine and the Baltic nations.
    Opponents of enlargement very often say, well, if you 
really want to protect those who are truly vulnerable, why 
don't you expand instantly into Ukraine and the Baltic nations? 
Of course, Ukraine has not asked us. They have not applied for 
membership. As far as the Baltic nations are concerned, 
however, something very interesting has happened recently.
    Once NATO's expansion into Central Europe became almost 
inevitable from the Russian standpoint, and once Russia became 
concerned what could happen with the Baltic applications, 
Moscow's treatment of the Baltic states improved immeasurably. 
As has Russian flexibility vis-a-vis Ukraine. During the Cold 
War the Austrians, Finns, and Swedes were neutral, but they 
benefited from the power equilibrium in Europe and the 
certainty, in the Russian mind, that certain things Moscow 
tried to say would be off limits.
    It is these kind of subtle concerns, rather than the 
apocalyptic scenarios, that, in my view, favor NATO 
enlargement.
    Senator Biden. Let me ask you a question. I would argue 
that the same dynamic is going to take place within Russia. And 
there is an expression that I always use with my younger staff 
when they come on, and they say, why don't you tell Senator so 
and so why he should vote for this? And I say, I never tell 
another man or woman her politics. They know their politics 
better than I do. They know what works in their State better 
than I can presume to tell them what their best political 
judgment is.
    And it is kind of presumptuous, in carrying that a little 
further, to tell another country what its interests are. But it 
seems to me--and I mean this sincerely--it seems to me that the 
dynamics put in play here not only are the ones that, in my 
view, have required the Romanian Government to accommodate the 
Hungarian minority, but have required the Russian Government to 
accommodate more readily the Baltic concerns. I think you are 
going to see that same dynamic occur within Russia.
    It is a very basic decision. You two have forgotten more 
about this than I am going to learn. But let me just state it 
for you and ask you to comment.
    Part of the struggle within Russia, historically, in the 
last 70, 80, 90 years--70 years--has not been merely communism 
or capitalism. It has been West versus rejection in the West. 
It seems to me that the dynamic that gets put in play here, is 
for Russia and successive Russian Governments, if I had to bet, 
to look West for anchors rather than looking to Central Europe 
or to the East. Because Central Europe is no longer an option 
as we make this judgment--Central Europe alone.
    And so I would think--and I would like you to comment on 
this, the human mind has an incredible ability to rationalize--
I made the judgment this expansion is a good idea, and I want 
to make sure I am not kidding myself about this. But it seems 
to me that one of the potentials is that it is as likely that 
this will ameliorate the conduct, the negative conduct, of 
Russian Governments in the future as it is that it will 
exacerbate the negative aspects of their conduct.
    Is that because you have, I would say, a more--some would 
say--more realistic, others would say more pessimistic view of 
what may happen in Russia? Would you comment on that?
    Mr. Simes. Senator, first of all, my view is not 
pessimistic. Let me put it differently. It is more open minded. 
What I see in Russia today is a mixed bag. There are a variety 
of trends. Some, on the top, very disturbing. Others are quite 
encouraging, such as the emergence of a middle class and 
something that begins to look like civil society. I am not 
pessimistic about the Russian future. I am agnostic.
    The most fundamental choices, of course, will have to be 
made by Russia. But to the extent that empire has traditionally 
been a straight jacket on Russian democracy, a better Russian 
relationship with the Balts and a more normal Russian 
relationship with Ukraine would be a contribution to Russian 
democracy, to the establishment of checks and balances, and, in 
the long run, to a more benign Russian foreign policy.
    Senator Biden. Well, that is a more succinct and rational 
way of saying what I was attempting to say.
    General Odom.  I would add that most of the arguments you 
are making I have made in writing for some time. I think most 
of my colleagues in the Soviet area really got it wrong. The 
impact on Russia internally of NATO expansion has been 
positive. You had a very distinguished scholar, like Sergei 
Blogavolin, make this argument openly and strongly in Russia 
back in 1993. In fact, an article that I wrote was translated 
for NATO expansion.
    It was translated and published in a Russian newspaper, and 
Blogavolin was asked to respond to it. He said, I do not 
disagree. He made the argument for the Russian side.
    So I also remember having a discussion in March 1996 with a 
former very high-level official in the Foreign Ministry, who 
said the minute the elections are over this summer, the next 
day you should enlarge NATO. If you were to, again, to 
understand his rationale for that, it would follow exactly the 
line that you are making, Senator.
    Senator Biden. I agree. By the way, to get Western Europe 
to react to a threat that is a perceived threat or an agreed-
upon threat from Moscow, that calls for enlargement, as the 
Ambassador suggested, seems to me to run counter to every 
instinct that would likely come to the fore. As the Ambassador 
says there are two circumstances in which he would suggest 
expansion, one of which is the emergence of a genuine threat.
    It would seem to me that every apologist argument in the 
world would begin to be made once that occurred. I mean, the 
likelihood of it expanding in that circumstance seems to me to 
be highly unlikely, if past is prologue. Second, in terms of 
being viewed as whether or not it is a pejorative act, whether 
it is a threatening act, it would be put in that context of 
emergency or threat. Because it would be. It would be a 
counter.
    Senator Hagel. We are going to do one more minute. I do not 
want to in any way inhibit the good Senator Biden's voting 
record. I want to keep a perfect record for him. We had a vote 
called about 5 minutes ago. So if we can get 1 minute more. 
Thank you.
    Mr. Simes. Let me make a second comment. Senator, as you 
explained very well, we have to be practical about our choices. 
You cannot rewrite history. You can advise, consent and perhaps 
amend agreements signed by the President. You have to ask how 
the Russians, particularly Russian hardliners, would interpret 
it if this NATO enlargement were rejected by the U.S. Senate.
    I do not know whether NATO enlargement will help Russian 
politics. But I know that the rejection of enlargement would 
have a devastating impact on the credibility of Russian 
reformers.
    Senator Hagel. General Odom?
    General Odom.  I will take 30 seconds.
    Senator Biden raised one of my concerns when he said he has 
convinced himself of this and he wants to be sure. I have had 
the same reaction. It seems to me the case, even though great 
imponderables face us here, the case is enormously compelling 
to expand. Therefore, I have been going through what I call an 
honesty in advertisement exercise, in trying to foresee the 
problems that are going to emerge. There are some. I list a few 
here. I think one that this body may face is that merely the P-
for-P force requirements are overextending the troop levels we 
have in Europe today, plus Bosnia.
    Another one is whether or not we understand the connection 
of succeeding in Bosnia with NATO enlargement. We cannot fail, 
and separate that issue.
    Senator Biden. Absolutely.
    General Odom.  There are tough issues here.
    Senator Biden. The chairman and I have been talking about 
that one for a few months.
    Senator Hagel. Yes.
    General Odom.  Thank you.
    Senator Hagel. Gentlemen, you have been very, very helpful. 
Thank you.
    Senator Biden. Thank you.
    Mr. Simes. Thank you very much.
    [Whereupon, at 4:35 p.m., the hearing was adjourned, to 
reconvene at 10:04 a.m., November 5, 1997.]



                    PUBLIC VIEWS ON NATO ENLARGEMENT

                              ----------                              


                      WEDNESDAY, NOVEMBER 5, 1997

                                       U.S. Senate,
                            Committee on Foreign Relations,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 10:04 a.m. in 
room SD-419, Dirksen Senate Office Building, Hon. Gordon Smith 
presiding.
    Present: Senators Smith, Kerry and Robb.
    Senator Smith. Ladies and gentlemen, we welcome you to the 
Senate Foreign Relations Committee hearing.
    Today's hearing will provide an opportunity for the Foreign 
Relations Committee to hear from a broad spectrum of ethnic, 
civic interest, and religious groups with views on NATO 
enlargement. We will hear from a total of 15 witnesses, both 
for and against NATO enlargement.
    In the letter of invitation to each of these witnesses, the 
committee asked that oral statements be limited to 5 minutes. I 
plead with our witnesses in advance to please adhere to that 
limit in order to insure that all views can be heard today.
    Longer written statements, of course, will be submitted in 
their entirety as part of the permanent record of the NATO 
expansion debate. So we would welcome any additional comments 
you would like to enter for the record.
    I expect the witnesses to express their views with 
precision and ask Senators, if they find it necessary to ask 
for additional explanations, to limit their questions to one 
per witness.
    Before we start, I ask unanimous consent to include in the 
record the testimony of Assistant Secretary of State Marc 
Grossman, Assistant Secretary of Defense Frank Cramer, that of 
Dr. Stephen Cambone, Dr. Steve Larrabee, and Dr. John Micgiel. 
This testimony was prepared for an October 22 hearing on the 
qualifications of candidates for NATO membership. That hearing 
was canceled at the last minute due to an unrelated objection 
in the Senate.
    Finally, I ask unanimous consent that a letter from the 
Ambassadors of Poland, Hungary, and the Czech Republic as well 
as testimony of several organizations not able to appear today 
be included in the printed record of this hearing.
    It is so ordered.
    [The information referred to appears in the appendix.]
    Senator Smith. Senator Biden will be joining us shortly. He 
is at the White House at another meeting. But I know he wants 
to be here, especially to greet and I think ask questions of 
Mr. Jan Nowak.
    I now recognize Mr. Nowak, the representative of the 
Central and Eastern European Coalition as the first witness, to 
be followed by the remaining witnesses, which I will announce 
after Mr. Nowak.
    Mr. Nowak, we welcome you and thank you so much for being 
here to share your experience and your views with us.

  STATEMENT OF JAN NOWAK, REPRESENTATIVE, CENTRAL AND EASTERN 
            EUROPEAN COALITION, ANNANDALE, VIRGINIA

    Mr. Nowak. Thank you very much, Mr. Chairman. I am here as 
a spokesman of the Central and Eastern European Coalition, 
which unites 22 million U.S. citizens from 14 ethnic 
communities.
    At the first stage of NATO enlargement, the Senate will be 
asked to ratify the admission of only three new NATO members. 
Why, then, do all our ethnic communities unanimously support 
this decision?
    We do not believe that the isolation or humiliation of 
Russia would serve the interests of the United States or the 
countries of our heritage. We would like to see a new European 
security architecture based on close cooperation between the 
enlarged NATO and Russia. This is why our organizations do not 
oppose the Founding Act as long as it offers partnership with, 
and not the participation of, Moscow in the NATO 
decisionmaking.
    There is no animosity between the Russian people and their 
neighbors. 2 million Russians cross the Polish border every 
year to trade with Poles. According to a public opinion poll 
conducted by the Moscow Center of Sociological Research last 
April, 68 percent of Russians expressed friendly feelings 
toward Poles. Intense Russian propaganda against NATO does not 
seem to have any impact. Attempts to organize protest meetings 
against NATO enlargement in front of the Polish and American 
embassies in Moscow last July were a spectacular failure.
    The Russian people do not see NATO as an enemy or a threat. 
They are mainly interested in the improvement of their 
desperately bad living conditions.
    Unfortunately, the Russian political ruling class has not 
reconciled itself to the loss of its empire. The economic and 
political system has been changed, but the mentality of the 
people who are pursuing global designs for the Soviet super 
power all their lives cannot be changed overnight. Eduard 
Shevardnadze warned the American people that the Russian empire 
disintegrated but the imperialistic way of thinking still 
remains. Andrei Kozyrev also warned against the old guard which 
has a vested interest in presenting NATO as a threat and an 
enemy. ``Yielding to them,'' wrote Kozyrev in Newsweek, ``would 
play into the hands of the enemies of democracy.''
    Both statesmen have inside knowledge of the Russian ruling 
elite. They certainly speak with authority. Moscow is opposed 
not to the enlargement of NATO but to the very existence of 
NATO because it rightly sees a defensive military alliance as a 
threat to its long-term ambitions to regain in the future a 
controlling influence over the former nation of the Soviet 
orbit.
    As in the time of the Soviet Union, we have to expect that 
the continued enlargement of NATO will meet with threats and 
fierce opposition from Moscow. Once, however, the process is 
complete, any imperialistic dreams will become unrealistic and 
Russia may accept the present boundaries of its influence as 
final. Such a reconciliation with reality would prompt Moscow 
to concentrate its full attention and resources on internal 
recovery. A change of the present mind set would open a new 
chapter of friendly relations between Russia and her neighbors, 
who would no longer see Moscow as a threat. This new sense of 
security would be an historic turning point.
    This is exactly what happened between Germany and Poland. 
Final recognition by Germany of its postwar borders brought an 
end to the centuries-old German drive to the East. German 
nationalists finally lost hope of regaining the territories 
they had lost in two world wars. With the loss of hope came the 
loss of nationalists' influence. Traditional enemies, Germany 
and Poland, are today friends and are ready to become allies.
    In a similar way, the enlargement of NATO may bring to an 
end Russia's relentless drive to expand its huge territories. 
For over 5 centuries, this urge to expand has been a scourge 
for the Russian people. Russia remains the largest country in 
the world, but Russians remain the poorest people of the world.
    Let me emphasize that we want to see the continued 
enlargement of NATO, which would leave no gray zone and no 
unprotected nations between Germany and Russia, because we want 
peace and friendship with Russia--a Russia finally reconciled 
to the loss of its empire. Only then will the United States be 
able to reap its full and lasting dividend of peace. Only then 
will the United States be free to turn her attention to other 
potential sources of conflict.
    Allow me to end with a few personal observations as an 
eyewitness of much of the dramatic history of this century. I 
was born on the eve of World War I in Warsaw under the rule of 
Czarist Russia. Five years later, Poland reemerged on the map 
of Europe thanks to its own indomitable will and thanks to 
President Woodrow Wilson. As a child, I was saved from 
starvation, in a country totally devastated by war, by the 
Herbert Hoover Relief Committee for Poland. There was a 
monument of gratitude to America in the heart of Warsaw which 
was erased by the Nazis. There was the George Washington Rondo 
and monuments to President Wilson in Polish cities. Every 
American who was in Poland will tell you that Poland, as well 
as other countries in that region, are the most pro-American 
nations in the world.
    The admission of Poland, Hungary, and the Czech Republic 
into NATO and later the admission of other nations in this 
region with their traditional ties to America will considerably 
strengthen American leadership and presence in Europe. The 
rejection of these nations by NATO would do much to destroy 
this strong pro-Western and pro-American orientation.
    The United States' withdrawal from Europe after World War I 
and the appeasement of Hitler by France and Britain led to 
World War II. Hitler would never have attacked Poland and have 
set the world on fire had he known that he would face the 
awesome power of the United States.
    When I look at the thousands of white crosses on the hills 
of Arlington Cemetery, I am painfully aware that these young 
Americans could have lived full, happy lives. World War II 
could have been prevented; 60 million people killed, executed, 
and tortured to death in concentration camps and 6 million 
Jews, extinguished like insects in gas chambers, could have 
been saved.
    In World War II, I crossed enemy lines five times, both 
ways, as an emissary between the Warsaw underground and the 
allies in London. I was there between Tehran and Yalta. I met 
Winston Churchill, Anthony Eden, and other British leaders. I 
watched with despair how the appeasement of Stalin led to the 
enslavement of Poland and others. The allies made it so easy 
for Stalin to subjugate eight nations with a total population 
of 100 million people that he was led to believe he could go on 
expanding his empire without risk beyond the dividing lines 
established at Yalta and Potsdam. This is how the cold war 
began.
    Today, I have a horrible feeling of deja vu when I hear 
opponents of NATO asking why the United States should risk 
American lives in defense of distant countries such as Poland, 
Hungary or the Czech Republic. Neville Chamberlain asked the 
same question on the eve of the Munich Agreement. Hitler 
perceived these words as a signal that dismemberment of 
Czechoslovakia and the onslaught on Poland would not be 
resisted by the Western democracies. Should we today encourage 
the hopes of Russian nationalists that the countries of Central 
and Eastern Europe may one day, once again, become a Russian 
sphere of influence?
    Throughout the period of the cold war, the United States 
stood ready to defend its allies. Because of our determination, 
not one single American soldier lost his life in defense of 
such distant countries as Greece or Turkey. Should we not learn 
from this historical experience?
    The United States will not be safe either economically or 
militarily without a safe Europe. Europe will not be safe 
unless the smallest European nation feels safe.
    The United States won World War I and then lost the peace. 
The United States won World War II and lost the peace for the 
second time. The United States won the cold war, and I beg of 
you, let's not lose the peace for the third time.
    Thank you.
    [The prepared statement of Mr. Nowak follows:]
                    Prepared Statement of Mr. Nowak
    I'm here as a spokesman of the Central and Eastern European 
Coalition, which unites 22 million U.S. citizens from 14 ethnic 
communities.
    At the first stage of NATO enlargement, the Senate will be asked to 
ratify the admission of only three new NATO members. Why then, do all 
our ethnic communities unanimously support this decision?
    We do not believe that the isolation or humiliation of Russia would 
serve the interests of the United States or the countries of our 
heritage. We would like to see a new European security architecture 
based on close cooperation between the enlarged NATO and Russia. This 
is why our organizations do not oppose the Founding Act as long as it 
offers partnership with, and not the participation of Moscow, in NATO 
decision-making.
    There is no animosity between the Russian people and their 
neighbors. Two million Russians cross the Polish border every year to 
trade with Poles. According to a public opinion poll conducted by the 
Moscow Center of Sociological Research last April, 56 percent of 
Russians believe that Polish-Russian relations are friendly; 30 percent 
consider them normal; and 68 percent \2/3\ expressed friendly feelings 
toward Poles. Intense Russian propaganda against NATO does not seem to 
have any impact. Attempts to organize protest meetings against NATO 
enlargement in front of the Polish and American embassies in Moscow 
last July were a spectacular failure. The Russian people do not see 
NATO as an enemy or a threat. They are mainly interested in the 
improvement of their desperately bad living conditions.
    Unfortunately, the Russian political ruling class has not 
reconciled itself to the loss of its empire. The economic and political 
system has been changed, but the mentality of the people who were 
pursuing global designs for the Soviet super power all their lives 
cannot be changed overnight. Eduard Shevardnadze warned the American 
public that the Russian empire disintegrated but the imperialistic way 
of thinking still remains (ABC's Nightline with Ted Koppel; 9/28/93). 
Andrei Kozyrev also warned against the old guard, which has a vested 
interest in presenting NATO as a threat and an enemy. Yielding to them, 
wrote Kosyrev in Newsweek, ``would play into the hands of the enemies 
of democracy.'' (Newsweek, 10/2/97)
    Both statesmen have inside knowledge of the Russian ruling elite 
(one was a foreign minister of the Soviet Union, the other of the 
Russian Federation). They certainly speak with authority. Moscow is 
opposed not to the enlargement of NATO but to the very existence of 
NATO, because it rightly sees a defensive military alliance as a threat 
to its long-term ambitions to regain in the future, a controlling 
influence over the former nations of the Soviet orbit.
    As in the time of the Soviet Union, we have to expect that the 
continued enlargement of NATO will meet with threats and fierce 
opposition from Moscow. Once, however, the process is complete, any 
imperialistic dreams will become unrealistic and Russia may accept the 
present boundaries of its influence as final. Such a reconciliation 
with reality would prompt Moscow to concentrate its full attention and 
resources on internal recovery. A change of the present mind set would 
open a new chapter of friendly relations between Russia and her 
neighbors, who would no longer see Moscow as a threat. This new sense 
of security would be an historic turning point.
    This is exactly what happened between Germany and Poland. Final 
recognition by Germany of its post-war borders brought an end to the 
centuries-old German ``drive to the East''. German nationalists finally 
lost hope of regaining the territories they had lost in two world wars. 
With the loss of hope came the loss of the nationalists' influence. 
Traditional enemies, Germany and Poland, are today friends and are 
ready to become allies.
    In a similar way, the enlargement of NATO may bring to an end 
Russia's relentless drive to expand its huge territories. For over five 
centuries, this urge to expand has been a scourge for the Russian 
people. Russia remains the largest country in the world, but Russians 
remain the poorest people in the world.
    Let me emphasize, we want to see the continued enlargement of 
NATO--which would eventually leave no gray zone and no unprotected 
nations between Germany and Russia--because we want peace and 
friendship with Russia, a Russia finally reconciled to the loss of its 
empire. Only then will the United States be able to reap its full and 
lasting dividend of peace. And only then will the United States be free 
to turn her attention to other potential sources of conflict.
    Allow me to end with a few personal observations as an eyewitness 
of much of the dramatic history of this century. I was born on the eve 
of World War I in Warsaw under the rule of Czarist Russia. Five years 
later, Poland reemerged on the map of Europe thanks to its own 
indomitable will, and thanks to President Woodrow Wilson. As a child I 
was saved from starvation--in a country totally devastated by war--by 
the Herbert Hoover Relief Committee for Poland. There was a monument of 
gratitude to America in the heart of Warsaw which was erased by the 
Nazis. There was the George Washington Rondo and monuments to President 
Wilson: Wilson Squares, Wilson Parks, and Wilson Streets in Polish 
cities. Any American who was in Poland will tell you that Poland, as 
well as other countries in that region, are the most pro-American 
nations in the world. The admission of Poland, Hungary, and the Czech 
Republic into NATO, and later, the admission of other nations in this 
region, with their traditional ties to America, will considerably 
strengthen American leadership and presence in Europe. The rejection of 
these nations by NATO would do much to destroy this strong pro-western 
and pro-American orientation.
    The United States withdrawal from Europe after World War I and the 
appeasement of Hitler by France and Britain led to World War II. Hitler 
would never have attacked Poland and have set the world on fire, had he 
known that he would face the awesome power of the United States. When I 
look at the thousands of white crosses on the hills of Arlington 
Cemetery, I am painfully aware that these young Americans could have 
lived full, happy lives--World War II could have been prevented; 60 
million people killed, executed and tortured to death in concentration 
camps and 6 million Jews, extinguished like insects in gas chambers, 
could have been saved.
    In World War II, I crossed enemy lines 5 times both ways as an 
emissary between the Warsaw underground and the allies in London. I was 
there between Tehran and Yalta. I met Winston Churchill, Anthony Eden 
and other British leaders. I watched with despair how the appeasement 
of Stalin led to the enslavement of Poland and others. The allies made 
it so easy for Stalin to subjugate eight nations--with a total 
population of 100 million people--that he was led to believe he could 
go on expanding his empire without risk beyond the dividing lines 
established in Yalta and Potsdam. This is how the Cold War began.
    Today, I have a horrible feeling of deja vu when I hear opponents 
of NATO asking why the United States should risk American lives in 
defense of distant countries such as Poland, Hungary, or the Czech 
Republic. Neville Chamberlain asked the same question on the eve of the 
Munich Agreement. Hitler perceived these words as a signal that the 
dismemberment of Czechoslovakia and the onslaught on Poland would not 
be resisted by the Western democracies. Should we today encourage the 
hopes of Russian nationalists that the countries of Central and Eastern 
Europe may once again become a Russian sphere of influence? Throughout 
the period of the Cold War, the United States stood ready to defend its 
allies. Because of our determination, not one single American soldier 
lost his life in defense of such distant countries as Greece or Turkey. 
Should we not learn from this historical experience?
    The United States will not be safe either economically or 
militarily without a safe Europe. And Europe will not be safe unless 
the smallest European nation feels safe.
    The United States won World War I and then lost the peace. The 
United States won World War II and lost the peace for the second time. 
The United States won the Cold War and I beg of you: let us not lose 
the peace for the third time.
    Thank you.

    Senator Smith. Mr. Nowak, thank you for coming and sharing 
with us your views and the history that you helped to make. 
Your counsel is wise and we will heed it.
    I wonder if you have any misgivings about the NATO--Russia 
agreement and if there are things that the Senate should do to 
make sure that the administration's words, which are that 
Russia has a voice but not a veto, are, in fact, so, that, in 
fact, Russia does not have an operative or a de facto veto. Are 
there some changes that you think we need to shore up or 
assure?
    Mr. Nowak. Well, I take the assurances and the 
interpretation of the administration on their face value. I 
mean, we are told that it is not a treaty, not a commitment, 
but it is a unilateral declaration of intentions. There is no 
commitment that, for instance, NATO troops should never enter 
Poland. It simply says there is no need for it right now. We 
agree with that.
    So I believe that there is no reason to be concerned as 
long as Russia does not have a right to a veto and a right to 
participate in the decisionmaking. But the partnership with 
Russia is necessary, is important. NATO enlargement would not 
make much sense if it would not be linked with the partnership 
and cooperation with Russia.
    Senator Smith. We hope the same thing. We hope that 
people's intentions are met and we hope that this vacuum that 
exists will soon be filled by the presence of NATO. We will win 
the peace this time.
    Thank you, sir.
    Mr. Nowak. Thank you very much.
    Senator Smith. We will now call up Edward Moskal. He is the 
President of the Polish American Congress. Mr. Moskal, welcome.

   STATEMENT OF EDWARD J. MOSKAL, PRESIDENT, POLISH AMERICAN 
                    CONGRESS, WASHINGTON, DC

    Mr. Moskal.  Thank you, Senator Smith and members of the 
committee. Because we are of Polish heritage, we are, of 
course, concerned that the freedom and independence of Poland 
is maintained. We are, however, Americans first, some by birth 
and others by choice. Therefore, our primary interest is in the 
well-being of these United States.
    Almost 6 decades ago, the Polish American Congress warned 
that the peace of this country, indeed that of the entire 
world, was inextricably tied to the security and welfare of 
Central Europe, in general, and of Poland, in particular. The 
result of inattention to that prediction is well known and 
there is no need to repeat that historical account today.
    If the past is but prologue, however, we chance renewed 
disaster when we do not heed its lessons.
    More than ever, as events have placed the United States as 
the world's major economic and military power, discord among 
other nations is bound to draw this country into the eye of the 
hurricane, perhaps as peacemaker, but just as likely as a 
participant.
    The newly emancipated nations arising from a half-century 
of virtual occupation are strategically fragile today and, 
without international assurance for their security, will remain 
basically weak tomorrow. A world still rejoicing in the 
collapse of communism and the end of the cold war is not 
anxious to consider the possibility of future conflict, even 
though the sober contemplation of experts will demonstrate just 
how precarious peace really is.
    Such self-inflicted blindness is a potential danger to our 
own continued freedom from conflict.
    It has long been a policy of our nation that military 
preparedness is our best defense against the possibility of 
war. Great sums have been expended in the pursuit of that 
concept, a concept in which a vast majority of the American 
people continue to believe. Oddly, although there appears to be 
a general agreement on the expansion of NATO, there are also 
voices of concern about the price of such expansion. 
Admittedly, there are differences of opinion regarding the 
actual cost to the U.S. and its allies that may be attendant to 
the addition of Poland, Hungary, and the Czech Republic. We 
suspect, however, that even the highest estimates would be far 
less than the costs resulting from intervention in a conflict 
involving these nations, an intervention that no one reasonably 
denies as a possibility. More realistically, considering the 
proven effectiveness of the alliance, the investment will be an 
excellent bargain.
    If we examine the highest estimates of $60 billion as a 
total cost of admitting the three proposed countries to NATO, a 
sum I hasten to add with which we do not agree, expended over 6 
years it equals the amount spent annually to assist friendly 
nations in the Middle East, an expenditure which is only rarely 
questioned in these halls.
    It is remarkably, however, a similar overall cost involving 
clear allies in Europe, a continent into whose problems and 
conflicts we have been drawn with too great a frequency.
    There is a tendency in some quarters to develop an urgent 
sense of economy. Moreover, the cost to the United States will 
be only a fraction of the total, our allies being expected to 
accept their share and the new members having indicated a 
willingness to assume their fair portion of costs associated 
with their assimilation into the alliance.
    Estimates of NATO enlargement have varied widely. We 
suggest that the confusion is largely due to the failure to 
make a distinction between what Poland in particular would be 
required to spend for modernization and military reorganization 
as opposed to those costs which may arise directly from its 
membership.
    The Polish Ministry of National Defense, for which it was 
vitally necessary to assess NATO membership costs, determined 
that modernization, integration and the adoption of new 
methodology will require an expenditure of $1.26 billion. 
Adding payments for the NATO civil and military budgets, as 
well as costs of joint missions, total costs are estimated at 
$1.5 billion, which, if spread over 15 years, until the year 
2010, amounts to 4 percent of Poland's 1995 military budget.
    These figures may, indeed, seem minuscule when compared to 
other estimates. The Poles, however, recognize that the cost of 
modernizing their armed forces or of reorganization are not 
validly calculated as NATO--related expenses. On the contrary, 
those are expenses that must be made under any circumstances. 
In fact, an even larger investment in modernization would 
surely be insufficient to defend the nation without the 
security inherently provided through NATO.
    It is not surprising, then, that the Defense Ministry of 
Poland has stated with clarity that it is ready to pay the 
largest part of costs arising from its NATO admission.
    In the brief time that Poland has enjoyed independence, it 
has already taken the necessary steps for the improvement of 
its internal defense industry. That development, however, is 
hampered by the inability to fully adopt international 
standards until its membership status is solidified.
    Similarly, the Polish communication infrastructure, 
purposefully inadequate under the recent occupation, is being 
modernized and expanded with surprising alacrity. A program 
known as the National Communications System, funded by private 
domestic and foreign corporations, will assure total 
communications interoperability with NATO nations within only a 
few years.
    Regarding transportation, Poland already has a highly 
developed rail system and is expending over $15 billion in 
highway construction and has a long-term plan for development 
of 12 interconnected airports. This plan provides for air 
traffic control and safety, including state-of-the-art radar 
systems, all of which are demonstrable assets which Poland 
brings to NATO, the benefits of which are not properly added to 
the actual cost of admission to the alliance.
    Two conclusions must be made. First, Poland is well aware 
of the direct costs arising from admission to NATO. It has 
considered them, implemented plans to deal with them, and 
accepts its responsibility in regard to these costs.
    Second, modernization of the Polish military forces is 
required in any event. Poland is already moving seriously in 
that direction.
    I have not mentioned the political implications of NATO 
expansion only because we recognize the need to address sincere 
questions relative to monetary consideration. Nevertheless, I 
would be remiss if I did not conclude by acknowledging their 
importance.
    The contribution of NATO to the peace and stability of 
Europe, and, thereby, the world, is unquestioned. What a 
wonderful boon to mankind it will be when the actuality of the 
spirit found in the NATO alliance is expanded to Central 
Europe.
    The antithesis is readily witnessed in the sad situation of 
Bosnia, where it has already cost us over $5 billion in an 
ongoing attempt to restore the peace. It proves, once again, 
that expenditures to maintain the peace are a bargain, whether 
counted in dollars or in lives.
    It would be another of history's great errors and omissions 
if unfounded fears were to deter us from insuring a wider zone 
of cooperation, peace, and stability.
    Thank you.
    [The prepared statement of Mr. Moskal follows:]
                    Prepared Statement of Mr. Moskal
    Mr. Chairman and members of the committee, because we are of Polish 
heritage, we are, of course, concerned that the freedom and 
independence of Poland is maintained. We are, however, Americans first, 
some by birth and others by choice. Therefore, our primary interest is 
in the well-being of the United States.
    Almost six decades ago the Polish American Congress warned that the 
peace of this country, indeed that of the entire world, was 
inextricably tied to the security and welfare of Central Europe in 
general and Poland in particular. The result of inattention to that 
prediction is well known and there is no need to repeat that historical 
account today. If the past is but prologue, however, we chance renewed 
disaster when we do not heed its lessons.
    More than ever, as events have placed the United States as the 
world's major economic and military power, discord among other nations 
is bound to draw this country into the eye of the hurricane, perhaps as 
peacemaker, but just as likely as a participant. The newly emancipated 
nations, arising from a half century of virtual occupation, are 
strategically fragile today and, without international assurance for 
their security, will remain basically weak tomorrow. A world still 
rejoicing in the collapse of communism and the end of the Cold War, is 
not anxious to consider the possibility of future conflict, even though 
the sober contemplation of experts will demonstrate just how precarious 
peace really is. Such self inflicted blindness is a potential danger to 
our own continued freedom from conflict.
    It has long been a policy of our nation that military preparedness 
is our best defense against the possibility of war. Great sums have 
been expended in the pursuit of that concept, a concept in which a vast 
majority of the American people continue to believe. Oddly, although 
there appears to be general agreement upon the expansion of NATO, there 
are also voices of concern about the price of such expansion. 
Admittedly, there are differences of opinion regarding the actual cost 
to the U.S. and its allies that may be attendant to the addition of 
Poland, Hungary and the Czech Republic. We suspect, however, that even 
the highest estimates would be far less than the costs resulting from 
intervention in a conflict involving these nations, an intervention 
that no one can reasonably deny as a possibility. More realistically, 
considering the proven effectiveness of the Alliance, the investment 
will be an excellent bargain.
    If we examine the highest estimates of $60 billion as a total cost 
of admitting the three proposed countries to NATO, a sum I hasten to 
add with which we do not agree, expended over six years, it equals the 
amount spent annually to assist friendly nations in the Middle East, an 
expenditure which is only rarely questioned in these halls. Remarkably, 
however, a similar overall cost involving clear allies in Europe, a 
continent into whose problems and conflicts we have been drawn with too 
great a frequency, there is a tendency in some quarters to develop an 
urgent sense of economy. Moreover, the cost to the United States will 
be only a fraction of the total, our allies being expected to accept 
their share and the new members having indicated a willingness to 
assume their fair portion of costs associated with their assimilation 
into the alliance.
    Estimates of NATO enlargement have varied widely. We suggest that 
the confusion is largely due to the failure to make a distinction 
between what Poland, in particular, will be required to spend for 
modernization and military reorganization, as opposed to those costs 
which may arise directly from its membership.
    The Polish Ministry of National Defense, for which it was vitally 
necessary to assess NATO membership costs, determined that 
modernization, integration and the adoption of new methodology will 
require an expenditure of $1.26 billion. Adding payments for the NATO 
civil and military budgets, as well as costs of joint missions, total 
costs are estimated at $1.5 billion, which, if spread over 15 years 
until the year 2010, amounts to 4% of Poland's 1995 military budget.
    These figures may, indeed, seem minuscule when compared to other 
estimates. The Poles, however, recognize that the costs of modernizing 
its armed forces or of reorganization are not validly calculated as 
NATO-related expenses. On the contrary, those are expenses that must be 
made under any circumstances. In fact, an even larger investment in 
modernization would surely be insufficient to defend the nation without 
the security inherently provided through NATO. It is not surprising, 
then, that the Defense Ministry of Poland has stated with clarity that 
it is ready to pay the largest part of costs arising from its NATO 
admission.
    In the brief time that Poland has enjoyed independence, it has 
already taken necessary steps for the improvement of its internal 
defense industry. That development, however, is hampered by the 
inability to fully adopt international standards until its membership 
status is solidified.
    Similarly, the Polish communication infrastructure, purposefully 
inadequate under the recent occupation, is being modernized and 
expanded with surprising alacrity. A program known as the National 
Communications System, funded by private domestic and foreign 
corporations, will assure total communications interoperability with 
NATO nations within only a few years.
    Regarding transportation, Poland already has a highly developed 
rail system, is expending over $15 billion in highway construction, and 
has a long-term plan for development of twelve interconnected airports. 
This plan provides for air traffic control and safety, including state-
of-the-art radar systems, all of which are demonstrable assets which 
Poland brings to NATO, benefits which are not properly added to the 
actual costs of admission to the alliance.
    Two conclusions must be made. First, Poland is well aware of the 
direct costs arising from admission to NATO. It has considered them, 
implemented plans to deal with them and accepts its responsibility in 
regard to these costs. Second, modernization of the Polish military 
forces is required in any event, Poland is already moving seriously in 
that direction.
    I have not mentioned the political implications of NATO expansion 
only because we recognize the need to address sincere questions 
relative to monetary consideration. Nevertheless, I would be remiss if 
I did not conclude by acknowledging their importance. The contribution 
of NATO to the peace and stability of Europe, and thereby the world, is 
unquestioned. What a wonderful boon to mankind it will be when the 
actuality of the spirit found in the NATO alliance is expanded to 
Central Europe. The antithesis is readily witnessed in the sad 
situation of Bosnia, where it has already cost us over $5 billion in an 
ongoing attempt to restore the peace. It proves, once again, that 
expenditures to maintain the peace are a bargain, whether counted in 
dollars or in lives. It would be another of history's great errors and 
omissions, if unfounded fears were to deter us from ensuring a wider 
zone of cooperation, peace and stability.

    Senator Smith. Thank you very much, Mr. Moskal. We 
appreciate your testimony.
    We are pleased to be joined by Senator Robb and Senator 
Kerry.
    I wonder if either of you has a question.
    Senator Robb. No, not at this time, Mr. Chairman.
    Senator Kerry. Thank you, but no.
    Senator Smith. Then we thank you.
    Mr. Moskal.  Thank you.
    Senator Smith. We will now call up Mr. Frank Koszorus. Mr. 
Koszorus is a board member of the Hungarian American Coalition. 
We welcome you, sir. Please proceed.

   STATEMENT OF FRANK KOSZORUS, JR., BOARD MEMBER, HUNGARIAN 
               AMERICAN COALITION, WASHINGTON, DC

    Mr. Koszorus. Thank you, Mr. Chairman.
    Mr. Chairman and members of the committee, it is a great 
honor to appear before you to address the vital issue of United 
States security.
    The Hungarian American Coalition enthusiastically supports 
the enlargement of NATO to include Hungary, Poland, and the 
Czech Republic. We believe this historic step will serve the 
geopolitical interests of the United States.
    As a military alliance for the Euro--Atlantic Community, 
NATO has succeeded in keeping the peace in Europe by deterring 
outside aggression. The United States has provided NATO with 
strong leadership because it has recognized that threats to 
European security constitute threats to U.S. security as well.
    In fact, the two hot wars and the cold war in Europe 
resulted from aggression emanating from Europe and it cost 
America dearly, both in terms of lives lost and treasure 
expended.
    Today, there is a security vacuum in Central and Eastern 
Europe. That vacuum will be filled. The only question is who 
will fill it.
    NATO enlargement will shore up the new democracies, insure 
stability of the region, and help facilitate market economies 
and prosperity--ingredients of a peaceful and secure Europe.
    NATO enlargement does not threaten Russia. NATO has always 
been a non-threatening defensive alliance. Moreover, the West, 
including the United States, has continued to demonstrate its 
good faith toward Russia through generous assistance programs 
and by entering into the Founding Act, which we must insure 
will give Russia a voice, but certainly not a veto, over NATO 
matters.
    In fact, stability on Russia's Western border translates 
into greater security for Russia, as well.
    The costs of expanding NATO are modest, considering the 
defense budget, and, further, as an insurance policy against 
future instability, tensions, and conflict, the price tag is 
indeed inexpensive and a wonderful bargain.
    Mr. Chairman, I had the great pleasure of recently visiting 
Hungary, Poland, and the Czech Republic as part of a joint 
Department of Defense/Department of State fact finding mission. 
It was striking to observe the desire of the military 
leadership of the three countries to be part of and to 
contribute to NATO and to the security of the region.
    This desire was evident, for example, in Hungary, where the 
young, reform minded officers who recently had been promoted to 
senior ranks enthusiastically spoke about steps they had taken 
to restructure the military better to conform to NATO 
standards.
    We were particularly impressed as they and their junior 
officers briefed us in English.
    The majority of Hungarians welcome NATO membership because 
they want to be part of a successful and defensive alliance. 
Mr. Chairman, they recall how their quest for freedom and 
independence was brutally crushed by Soviet tanks in 1956 
because Hungary was on the wrong side of Stalin's dividing 
line.
    Now having testified about NATO's preeminent role in 
promoting peace, I would be remiss if I failed to mention an 
often ignored and misunderstood, but significant, element of 
security in the region.
    NATO enlargement is a building block, indeed the 
cornerstone of stability in Europe and, there by extension, in 
the United States. An enlarged NATO alone, however, is not a 
panacea for ethnic peace. While an enlarged NATO that sticks to 
its core function will promote interstate stability in Central 
Europe, the alliance cannot alone resolve tensions caused by 
discriminatory policies and practices of majorities toward 
ethnic minorities, the historical source of conflict and 
stability in the region.
    The United States, therefore, can cement long-term 
stability by not only enlarging NATO but also by promoting the 
ability of minorities to enjoy the fruits of democracy.
    A sure way of defusing ethnic tensions in Central and 
Eastern Europe, protecting the territorial integrity of the 
States, and promoting democracy and good neighborly relations 
is to grant ethnic minorities group rights, such as the ones 
exercised by Western Europeans. Such policies, as opposed to 
basic treaties between the countries of the region, would serve 
U.S. strategic interests in Central Europe and dispel our fears 
of perpetual conflict. They would also insure the continued 
strength and vitality of an expanded NATO.
    Mr. Chairman, as we approach the 21st Century, we simply 
cannot afford to squander an historic opportunity to safeguard 
long-lasting stability and democracy. We can win the peace this 
time. If only to avoid being drawn back into exacerbated 
controversies, the United States should not ignore the 
challenges posed by Central and Eastern Europe.
    This means that NATO enlargement should be ratified quickly 
and overwhelmingly and the democratically expressed aspirations 
of ethnic minorities to enjoy the fruits of Western style 
minority rights should be actively and vigorously promoted.
    These steps would constitute inexpensive, yet vital, 
insurance policies for the United States. Our failure to 
exercise leadership, on the other hand, will insure a post 
communist evolution far less congenial to our interests.
    Thank you, Mr. Chairman.
    [The prepared statement of Mr. Koszorus follows:]
                   Prepared Statement of Mr. Koszorus
    Mr. Chairman and members of the Committee, it is a great honor and 
pleasure to appear before you to address the vital issue of the 
security of the United States which is closely linked to European 
security. Mr. Chairman, the Hungarian American Coalition 
(``Coalition'') enthusiastically supports the enlargement of NATO to 
include Hungary, Poland and the Czech Republic. We believe that this 
historic step will serve the geopolitical interests of the United 
States. In order to be successful, the enlargement process must take 
into consideration the unique history of the region and espouse West 
European norms relating to the ethnic communities of Central and 
Eastern Europe.
    The Coalition is a consortium of organizations and individuals 
which disseminates educational and cultural materials about Hungarians, 
U.S. relations with Hungary and the Hungarian minorities living in the 
Carpathian Basin.
    The Coalition strongly believes that the long-term national 
security and budgetary interests of the United States require an 
unequivocal commitment to the transition of Central and Eastern 
European countries to fully democratic and free market status. That 
commitment requires the United States to be actively engaged in the 
region.
    The Coalition further believes that peace and stability throughout 
Europe serve the national security interests of the United States. In 
this century, the United States was called upon to fight two hot wars 
and a 45-year Cold War--conflicts which emanated from the heart of 
Europe--in the furtherance of those vital geopolitical interests. These 
wars, which resulted from uncertainty and instability in the region, 
cost America dearly in lives lost and treasure expended.
    In addition to the institutionalization of democracy and market 
economies in Central and Eastern Europe, the prevention of any large 
power dominating any part of Europe are the best means of guaranteeing 
that there will be no further European conflicts which will entangle 
the United States. We believe that with the collapse of communism and 
the Soviet Union, the objectives of peace, stability, and democracy in 
Europe are achievable if we exercise leadership.
    Among the most visible and effective forms of our engagement is our 
continuing involvement in the security issues of the region. We believe 
that the general stability and security of the region can be 
accomplished through the enlargement of NATO to include Hungary and 
other countries which desire to join the Affiance and meet the criteria 
for membership.
    Mr. Chairman, I had the great pleasure of visiting Hungary, Poland 
and the Czech Republic two weeks ago as part of a joint Department of 
Defense/Department of State fact finding mission. It was striking to 
observe the desire of the people, including the military leadership, of 
the three countries to be part of and contribute to NATO and the 
security of the region. This desire was evident, for example, in 
Hungary where young, reform-minded officers recently had been promoted 
to senior ranks and enthusiastically spoke about steps they had taken 
to restructure the military better to conform to NATO standards. We 
were particularly impressed as they and their junior officers briefed 
us in English.
    The majority of Hungarians welcome NATO membership because they 
want to be part of a successful and defensive alliance. They recall how 
their quest for freedom and independence was brutally crushed by Soviet 
tanks in 1956 because Hungary was on the wrong side of Stalin's 
dividing line.
    Today, we must not permit Central and Eastern Europe to languish in 
a security vacuum. Russian interests are not threatened by the 
expansion of a defensive alliance. Moreover, stability and economic 
growth on the borders of Russia can only benefit Moscow. Russia should 
not be isolated and mechanisms, such as the Founding Act between NATO 
and Russia, should dispel any lingering concerns Moscow may entertain 
about an enlarged NATO. Russia, however, should under no circumstances 
be permitted to exercise a ``veto'' in NATO matters.
    Russia is in a fluid state with voices of nascent expansionism 
being heard in some quarters. Failure by NATO to accept the invited 
countries will redraw the lines imposed by Stalin and signal Russian 
imperialists that they, in fact, enjoy a ``sphere of influence'' in 
Central and Eastern Europe. The consequences of rejecting Hungary, 
Poland and the Czech Republic would be contrary to U.S. geopolitical 
interests in a secure, integrated, and democratic Europe.
    NATO enlargement is a building block--indeed the cornerstone--of 
stability in Europe. An enlarged NATO alone, however, is not a panacea 
for ethnic peace. As a military alliance, NATO's role has been to 
defend its members from outside aggression. An enlarged NATO that 
sticks to its core function will promote a large degree of interstate 
stability in Central Europe. The Alliance alone will not resolve 
tensions caused by discriminatory policies and practices of majorities 
toward ethnic minorities--a historical source of conflict and 
instability in the region. The United States, therefore, can cement 
long-term stability by not only enlarging NATO, but also by promoting 
the ability of minorities to enjoy the fruits of democracy.
    NATO enlargement should not be seen as a means of sweeping minority 
rights under the rug; the enlargement process must not apply a 
different standard to new members as has been applied to current 
members. It should be recalled that the scope of collective--i.e., 
ethnic or group--rights of the Catalans and Basques of Spain, the Welsh 
and Scots of Great Britain, the South Tyroleans of Italy, the Walloons 
of Belgium or the Swedes of Finland are significantly greater than 
those sought but denied to ethnic communities, especially Hungarians, 
in Central and Eastern Europe.
    The Soviet Union cynically suppressed minorities while loudly 
proclaiming that socialism had solved the nationalities question. A 
NATO expansion process which ignores the legitimate and democratically 
asserted aspirations of minorities will leave them frustrated and 
dissatisfied. They once again will feel abandoned as they did in 1920 
when borders were drastically redrawn and millions of minorities 
created without their having a say in the determination of which states 
they would live in. If NATO enlargement is to serve U.S. interests, it 
must not become a vehicle of instability by ignoring the rights of 
minorities in Central and Eastern Europe.
    In order to promote lasting stability in Central Europe, the United 
States must do two things in addition to enlarging NATO. First, it must 
recognize that improved interstate and interethnic relations are a 
function of democracy and enlightened minority policies.
    Second, the United States must use its influence to convince the 
states in the region that if they want to join Western institutions, 
including NATO, they must conform to Western minority rights practices. 
Central European minorities must be granted the same rights as the 
rights exercised by Western European minorities. Dismissing the 
aspirations of Central Europeans to enjoy such rights virtually 
guarantees that our worst fears may become self-fulfilling prophecies.
    The surest way to defuse ethnic tensions in Central and Eastern 
Europe, protect the territorial integrity of states and promote 
democracy and good neighborly relations is to grant ethnic minorities 
group rights such as the ones exercised by Western Europeans. Such 
policies--as opposed to basic treaties between the countries of the 
region--would serve United States strategic interests in Central Europe 
and dispel our fears of perpetual conflict. They would also ensure the 
continued strength and vitality of an expanded NATO.
    As we approach the 21st century, we simply cannot afford to 
squander a historic opportunity to safeguard long-lasting stability and 
democracy. We can win the peace this time. The adverse consequences of 
our withdrawal from Europe at critical times in the past are well 
known. Had the United States reacted firmly to the turmoil threatening 
peace in Europe prior to the First and Second World Wars, many American 
lives and resources would have been spared. Similarly, the Cold War 
would have been far less expensive and dangerous had the United States 
not pulled back from the heart of Europe and had we resisted domestic 
pressure to ``bring the boys home'' before the European political order 
had been settled.
    If only to avoid being drawn back into exacerbated controversies, 
the United States should not ignore the challenges posed by Central and 
Eastern Europe. This means that NATO enlargement should be ratified 
quickly and overwhelmingly, and the democratically expressed 
aspirations of ethnic minorities to enjoy the fruits of Western style 
minority rights should be actively and vigorously promoted. These steps 
would constitute inexpensive, yet vital insurance policies for the 
United States. Our failure to exercise leadership, on the other hand, 
will ensure a new world order far less congenial to our interests.

    Senator Smith. Thank you, Mr. Koszorus. We really 
appreciate your testimony.
    Are there questions?
    Senator Kerry. I would just ask one quick question, if I 
may, or a couple.
    The first tranche is fairly accepted now and I think will 
most likely move rapidly through the Senate. But clearly the 
first tranche changes what NATO was and its fundamental 
rationale at one time was, though you say it was defensive, it 
clearly shifts in this post soviet era. So the question is with 
respect to the other nations, you have differing degrees of 
problems that arise with their possible entry. I think the 
great issue is not necessarily the initial tranche and the 
difficulties faced by that--I feel as though those have almost 
sort of taken care of themselves--but what follows.
    Do you have any opinion about whether or not the sanguinity 
expressed by many people about Russia's acceptance of this 
first tranche would change significantly as it grows larger and 
particularly as you get to the point of thinking about Baltic 
States?
    Mr. Koszorus. Senator Kerry, NATO enlargement has been a 
self-selecting process. It has enlarged over the years without 
threatening Russia itself.
    I think NATO enlargement must be, should be, has to be open 
to all countries of this region which meet the membership 
criteria and want to contribute to the alliance itself.
    I do not believe that an enlargement of this defensive 
alliance itself will pose a threat. Quite to the contrary, I 
think once stability of the region, once prosperity of the 
region is insured, I think that will only benefit Moscow and I 
think Moscow will see the advantages of a strong, stable 
region.
    So I do not see that as any long-term problem.
    Senator Kerry. But if they don't, if they said we don't, if 
they were to continue to express a particularly strong 
attitude, and if the perception were that it was having an 
impact on your implementation of arms control agreements, if 
your perception was it was playing a serious hand in terms of 
internal Russian politics, is it conceivable that your attitude 
might then be different about the Baltics?
    Mr. Koszorus. Well, I think we have to work with Russia, 
certainly through mechanisms such as the Founding Act. I think 
that those types of confidence building measures will diffuse 
those types of problems.
    What is the alternative? Do we assign these States to the 
Russian sphere of influence once again? Do we open that door 
again? I don't think that would be a wise policy from our 
perspective. I think that with mechanisms--the Founding Act, 
continued cooperation, continued interaction, continued 
assistance--I think we can bring Russia along to acceptance.
    Senator Kerry. But that does not presume that that is the 
only alternative. I mean, you might extend Partnership for 
Peace. You might have any number of other things. It may be 
that the Western European entity becomes more viable. I mean, 
there are other possibilities, are there not?
    Mr. Koszorus. Certainly there are other possibilities and, 
of course, we are going into an area of speculation at this 
point. I think, considering the history of Europe, considering 
the history of U.S. relations with Europe, NATO has been the 
engine of stability, has been the engine of security in the 
region. I think if a sovereign State, an independent State, 
which has won its independence from the Soviet Union wishes to 
be part of NATO, it should certainly be given every opportunity 
to do so.
    Senator Kerry. Thank you.
    Thank you, Mr. Chairman.
    Senator Smith. Thank you very much, Mr. Koszorus. You know, 
Senator Kerry asked a very important question that this 
committee, I am sure, will grapple with over the next 4 years. 
I wonder if Mr. Nowak, who has lived through this, who has seen 
us win a war and lose a peace, would care to answer Senator 
Kerry's question. If you would, answer it for me based on what 
you have experienced in your life.
    Then I would like to say we will stand in a brief recess. 
The three of us need to go and cast a vote in just a few 
minutes.
    Mr. Nowak, would you care to speak to that?
    Mr. Nowak. I strongly believe that to limit the NATO 
enlargement to only 3 States would mean the division of Europe 
into two spheres of influence. The Russian perception will be 
that these States are in something like the situation of 
Finland at the time of the cold war.
    The Russians--rather, the Soviets--did oppose every stage 
of NATO enlargement, including the foundation of NATO itself. 
There were threats, bordering on ultimata. Even when Spain was 
going to join, there was an opposition.
    Once they faced an accomplished fact, however, they 
accepted it. I believe they accepted it, practically speaking, 
by signing the Founding Act, the enlargement of NATO as far as 
the Czech Republic, Hungary, and Poland are concerned. I am 
convinced that they will accept also continued enlargement.
    There will be protests. There will be an opposition. But 
they will finally accept it--on one condition, that they will 
not be isolated. Enlargement has sense only if it is linked 
with growing cooperation with Russia itself.
    I just said that we believe in the new security 
architecture that would be based on close cooperation between 
an enlarged NATO and Russia. I am confident that, once it is 
over, Russia will accept it and it will have a considerable 
impact on the Russian mentality, particularly of its ruling 
class. It will get reconciled, finally, with the loss of its 
empire because they will see no realistic possibility 
otherwise.
    Senator Smith. Thank you very much.
    Senator Kerry. Mr. Chairman, if I could just make one 
comment.
    Senator Smith. Of course.
    Senator Kerry. I spent a very interesting weekend with 
former Secretary Perry, Secretary Christopher, Ashton Carter, 
General Joulwan, General Scowcroft, and a host of people--maybe 
15 or 20 people--out at Stanford. We spent an entire Friday and 
Saturday talking about this.
    I was struck by the breadth of experience that was there 
talking about it and the breadth of disparity of opinion with 
respect to where we go as we go down the road. You know, NATO 
is one thing today. It is something that we can define. It is 
something that is tangible. It's something where we can clearly 
understand its mission.
    But every expansion poses as yet undefined and unanswered 
questions with respect to that future mission. It is an 
organization that, as we know, works on consensus. That 
consensus may be harder and harder to draw as the mission 
definition changes.
    So I think it is a little more complicated than perhaps 
some people have yet come to grips with. I am not suggesting 
that only those people have a sense of its complexity. But I do 
think, as we go down the road here, there are some very 
significant questions. I mean, Russia is a major cooperator 
with us in Bosnia. I think you have to be thoughtful about what 
really will matter to the whole series of relationships that we 
have with Russia and that we need to have with respect to a lot 
of other issues as we go down this road.
    So I, for one, am unwilling to suggest that a decision as 
to what NATO will be or who will be members will be up to only 
those countries that decide they want to join. I think we have 
to be very careful about that, Mr. Chairman.
    Mr. Nowak. Senator, I believe that NATO will be much 
stronger after these three countries and others are included 
because they are traditionally pro-American and pro-Western. 
Therefore, the balance of power within NATO will shift to the 
advantage of the United States, its presence in Europe and its 
leadership.
    I believe that as I know these countries.
    Senator Kerry. Let me say that I absolutely agree with you. 
I have no question but that NATO will be stronger for the 
admission of the countries that we are currently considering 
admitting and that I am convinced, obviously, will be admitted. 
We will ratify it. I have no doubt about that.
    But I think there are, as yet, a series of unanswered 
questions about what comes next. That is all I am suggesting, 
that we should not be in automatic gear here. We need to be 
very thoughtful about it.
    Senator Smith. Thank you, Senator.
    Thank you very much, Mr. Nowak.
    We will stand in brief recess. We will be right back and 
will carry on, hearing from Mr. Bob Doubek.
    [Recess]
    Senator Smith. The committee will come to order. We 
apologize for the recess, but we were sent here to vote and we 
did it as quickly as we can.
    We are going to have to ask, in order to accommodate 
everyone who wishes to be heard, when you give your testimony, 
please do so as quickly as we can. Obviously we would 
appreciate that.
    Now we will call forward Mr. Bob Doubek, President of 
American Friends of the Czech Republic. Mr. Doubek, welcome.

 STATEMENT OF ROBERT W. DOUBEK, PRESIDENT, AMERICAN FRIENDS OF 
               THE CZECH REPUBLIC, WASHINGTON, DC

    Mr. Doubek. Thank you very much, Mr. Chairman. I am 
President of American Friends of the Czech Republic and I thank 
you for the opportunity to testify. By way of identifying 
myself, I served in Vietnam as an Air Force officer and I was a 
leader of the effort to build the Vietnam Veterans Memorial on 
the Mall. In 1986, the Senate voted to award me a Congressional 
Gold Medal.
    I speak today in behalf of Americans who support the Czech 
people. This includes 140 major corporations, who have invested 
over $1 billion, thousands of Americans who work and live in 
the Czech Republic, thousands of Americans of Czech birth, 
millions of Americans of Czech descent, and millions of 
Americans who are otherwise friends of the Czech people. We 
support NATO enlargement and the membership of Poland, the 
Czech Republic, and Hungary.
    The Czechs will be great allies. This is because they have 
a deep and abiding friendship for the United States, because 
our countries share many historical ties, and because we share 
many key values, especially civil and religious liberty.
    The strategic location of the Czech Republic, it political 
stability, and its human and industrial resources will 
strengthen NATO. The Czech State has been part of the West for 
over 1,000 years. It was part of the Holy Roman Empire. The 
Protestant Reformation had its roots there with the teachings 
of John Hus. After 3 centuries of national subjugation, the 
Czech people fought with the allies in World War I and achieved 
their independence. The Czechs, then, with the Slovaks formed 
what became the only democracy that functioned in Central 
Europe through the Munich Agreement. Czechoslovak soldiers and 
airmen fought on the allied side in World War II, suffering 
10,000 combat deaths.
    In 1948, after less than 3 years of revived freedom, the 
Soviet backed communists took over the country and turned it 
into a police State. The Czechs in 1968 tried to reassert their 
independence but were crushed by the Warsaw Pact. In the last 8 
years, however, they have reclaimed their heritage as a free 
and democratic nation. They wish now to rejoin the Western 
family of nations.
    Ties between our countries are centuries old. The first 
Czech immigrant came in 1633 and surveyed the Chesapeake Bay 
region. The Moravian Brethren who settled in North Carolina and 
Pennsylvania beginning in the 1740's were of Czech descent. So 
was a signer of our Declaration of Independence.
    A code of Czech laws written in 1579 contributed to our 
Bill of Rights. Many Czechs served in the Union Army in the 
Civil War, and the wife of Thomas Masaryk, the first President 
of Czechoslovakia, was an American from Brooklyn, a Mayflower 
descendant.
    Their Declaration of Independence was patterned after our 
own.
    Czechs and their descendants have made major contributions 
to America in many fields. We can talk about John Havlicek in 
sports, Kim Novak and Sissy Spacek in film, but especially 
astronauts Eugene Cerna, James Lovell and John Blaha in space.
    McDonald's, which is the worldwide symbol of American 
business enterprise, was founded by an American of Czech 
descent, Ray Kroc.
    Czechs supported America in the Gulf War. Their 
contribution to the peacekeeping forces in Bosnia exceeds our 
own in proportion to their population. They made a firm 
commitment to increase their defense spending to meet NATO 
norms and the Czech people now support NATO membership by two 
to one.
    America left much blood and treasure in Europe in World 
Wars I and II. NATO prevented World War III and won the cold 
war. The extension of NATO to Central Europe will enhance its 
ability to defend freedom and democracy against new threats.
    Democracies do not invade one another, and NATO membership 
will give these countries the security to flourish as 
democracies. With the addition of these capable and committed 
allies, NATO will be politically, militarily, and morally 
strengthened.
    The costs of not expanding NATO would be far greater than 
enlargement, as shown by Bosnia. The ultimate cost of not 
enlarging NATO is incalculable because the alliance would 
probably not support such inertia.
    Prague is closer to Dublin than to Moscow. It is closer to 
Copenhagen than it is to Sarajevo. The Czechs have contributed 
to Western culture, science, art, and industry. They want to 
contribute now to Western security.
    The status quo is not an option. The choice is between an 
enlarged NATO, preserving it, or delivering a death sentence.
    Czech President Vaclav Havel said it well: ``If the West 
does not stabilize the East, the East will destabilize the 
West.''
    Thank you.
    [The prepared statement of Mr. Doubek follows:]
                    Prepared Statement of Mr. Doubek

                            I. Introduction

    Mr. Chairman, Members of the Committee. My name is Robert W. 
Doubek. I am the president of American Friends of the Czech Republic 
(AFoCR), a national educational and advocacy organization based in 
Washington, DC. I thank you for the opportunity to testify today.
    By way of identification, I served as an Air Force officer in 
Vietnam in 1969. I was a principal leader in the effort to build the 
Vietnam Veterans Memorial, for which the Senate in 1986 voted to award 
me a Congressional Gold Medal.
    The mission of AFoCR is to assist the Czech people in rejoining the 
Western family of free and democratic nations. We speak for the many 
and varied American constituencies supporting the Czech Republic. These 
include almost 140 major U.S. corporations with business and investment 
interests, the thousands of Americans presently residing and pursuing 
careers in the Czech Republic, thousands of Americans of Czech birth, 
millions of Americans of Czech descent, and the millions of Americans 
who have visited the Czech Republic or otherwise are its friends.
    We wholeheartedly support the enlargement of the North Atlantic 
Treaty Organization and the admission of Poland, the Czech Republic and 
Hungary. Because others today will speak to Poland and Hungary, I limit 
my remarks to the Czech Republic.
    We support the admission of the Czech Republic because the Czechs 
will be among the best allies that the United States has ever had. This 
is because of their deep and abiding friendship and admiration for 
America, the many and substantial historical links between the Czech 
and American peoples, and the broad range of values shared by Czechs 
and Americans. Throughout their history, the Czech people have valued 
learning and civil and religious liberty. Since the American 
Revolution, they have looked to America as a beacon of hope embodying 
these values.
    Furtherrnore, the strategic location of the Czech Republic in the 
heart of Europe, its stability, its industrial and human resources, and 
its military capabilities will strengthen the NATO alliance.

                 II. The Czech Republic and Its History

    The present day Czech Republic occupies the historical regions of 
Bohemia, Moravia, and part of Silesia. Bohemia emerged as a European 
state more than a thousand years ago. One of its earliest princes was 
Wenceslas, who died in 929, but whose memory lives on in our Christmas 
carol. The Czechs were Christianized by the Roman church and were an 
integral part of the Holy Roman Empire. In the 14th century the Czech 
state flowered as a center of commerce, learning and government under 
King Charles IV, who became Holy Roman Emperor and founded Charles 
University in Prague in 1348.
    The Protestant Reformation had roots in Bohemia with the teachings 
of John Hus, who reformed the liturgy, introduced the vernacular in 
worship and preached the primacy of the Gospel. These innovations were 
embraced a century later by Martin Luther, who acknowledged the role of 
Hus. By the year 1600, the majority of the Czech population of Bohemia 
and Moravia was Protestant.
    In the year 1620, however, the Czechs suffered a calamitous 
military defeat at the Battle of the White Mountain and lost their 
national independence for almost three centuries. During this time, 
religious, civil and educational liberties were suppressed, and the 
Czech language lived on only among the peasants and working people.
    A national reawakening occurred in the 19th century and brought 
with it the idea of national independence. During World War I Czech 
prisoners of war and deserters formed the Czech Legions to fight with 
the Allies for the independence of their country. With freedom in 1918 
the Czechs, together with the Slovaks, formed what was the only 
functioning democracy in Central Europe as of the Munich Agreement in 
October 1938. During World War II many Czech soldiers and airmen 
escaped and fought bravely in the Allied side. Czech pilots were 
instrumental in winning the Battle of Britain, Czech bomber squadrons 
bombed Germany, and Czech infantry units distinguished themselves at 
Tobruk, in North Africa. Czechoslovak combat deaths exceeded 10,000.
    In early 1948, after less than three years of revived freedom, the 
Soviet-backed communists took over the country and turned it into a 
police state. When the Czechs in 1968 again tried to assert their 
independence, the Soviet Union and its satellites invaded and crushed 
the freedom movement.
    For many years it seemed that all hope was lost, but in 1989 the 
Czech and Slovak peoples overthrew communist domination and set out to 
create a new future. Czechoslovakia peacefully divided itself as of 
January 1, 1993, and the Czechs have reclaimed their heritage as a free 
and democratic country, and they want to rejoin the Western family of 
free and democratic nations. Only by being part of NATO can they be 
assured of peace and freedom, as well as the opportunity to help defend 
and further them.
    It is important to note that the Czechs never have attacked any 
other country, and Bismarck, the first Chancellor of a united Germany 
stated that whoever controls Bohemia controls Europe.

        III. The American Constituencies for the Czech Republic

    The American constituencies for the Czech Republic are many and 
varied. Currently almost 140 major U.S. corporations have business 
interests and investments in the Czech Republic. These include Boeing, 
Bristol-Myers Squibb, Continental Airlines, Ford Motor, ICF Kaiser, 
Kodak, Philip Morris, Proctor & Gamble, and United Technologies, all of 
whom have supported AFoCR. Total U.S. direct investment in the Czech 
Republic through 1996 exceeded $1.0 Billion.
    Currently almost 20,000 Americans, especially younger people, are 
residing and working in the Czech Republic. Some have worked on public 
service, such as teaching English and democracy, while others have 
started entrepreneurial ventures to take advantage of the many business 
opportunities. A prime example is the weekly English language Prague 
Post newspaper, which is owned by a young American woman.
    Since 1989 hundreds of thousands, if not millions, of Americans 
have visited the Czech Republic and have been enchanted by its natural 
beauty, its artistic and architectural treasures, its cultural life, 
and the friendliness and industry of its people. Czech President Vaclav 
Havel, the playwright dissident who led the Velvet Revolution, is one 
of the world's most admired statesmen. Last month in Washington he 
received the J. William Fulbright Award for Statesmanship from the 
association of former Fulbright scholars.
    One example of the range of American support for the Czech Republic 
is the initiatives of the University of New Orleans, which has an 
exchange program with Charles University allowing both Czech and 
Louisiana students to study abroad. A further example is the 
Jacksonville, Florida, Chamber of Commerce which has conducted trade 
missions for Florida business leaders to the Czech Republic and hosted 
Czech business people for training in American management practices.
    A fourth major constituency for the Czech Republic is the body of 
almost two million Americans of Czech descent, who reside throughout 
the United States, but primarily in the states of Illinois, Texas, 
Minnesota, Iowa, Missouri, Wisconsin, Michigan, Ohio, Nebraska, and now 
Florida, Arizona and California. Although the first Czech immigrant 
came in 1633, significant Czech immigration began after 1848 and 
swelled between the years 1880 and 1914. Czech immigrants in this 
period were primarily farmers and skilled tradesmen, and the Czechs had 
the highest rate of literacy of all ethnic groups coming through Ellis 
Island.
    A fifth major constituency is comprised of Americans of Czech 
birth, who fled the Nazi occupation of 1939, the communist coup of 
1948, and the Soviet invasion of 1968. Refugees to the U.S. from Hitler 
numbered about 20,000, and Czech immigrants between the years 1946 and 
1975 numbered over 27,000. This is an extremely highly educated group 
of people, among which are many professors and scientists who occupy 
positions in major U.S. universities and government research 
facilities. They are concentrated in Massachusetts, New York, Maryland, 
Virginia, and California.

             IV. American/Czech Influences and Connections

    The first known Czech immigrant was Augustin Herman, a surveyor who 
came to New Amsterdam in 1633. He created the first map of the 
Chesapeake Bay region and received 13,000 acres in Maryland. Today the 
Bohenua River flows through his former lands into the northern tip of 
the Bay. A signer of the Declaration of Independence, William Paca of 
Maryland, was of Czech descent.
    Another significant infusion of Czech values came with the arrival 
of the Moravian Brethren into Pennsylvania and North Carolina beginning 
around 1740. The Moravian Brethren were disciples of John Hus who had 
fled to Germany to practice their Protestant beliefs. Although they 
spoke German when they immigrated to America, their liturgy and music 
reflected their Czech origins. Czech values influenced America's 
founding fathers. At Colonial Williamsburg, Virginia, in the exhibit of 
documents that contributed to our Bill or Rights is the Czech Code of 
1579.
    Many Czechs served in the Union Army in the Civil War, and by 1870 
there were over 40,000 living in the United States. One of the earliest 
organized efforts of Czechs in America was the founding of fraternal 
benefit societies to care for one another, their spouses and children. 
The story of the struggle of these immigrants was poignantly told in 
the novel ``My Antonia'' by Nebraska author Willa Cather.
    In 1892, Czech composer Antonin Dvorak was invited to head the 
National Conservatory in New York. His New World Symphony, 
incorporating the influences of Black spiritual music as well as 
nature, has been a major contribution to American culture. His legacy 
directly influenced the development of the American classical work of 
George Gershwin and Aaron Copland.
    With the outbreak of World War I Czechs in the United States played 
a major role in the Czech independence movement, which was led by 
Professor Thomas Masaryk, whose wife Charlotte Garrigue, was an 
American from Brooklyn, New York. Some 3,000 Americans joined the 
Czechoslovak Legions to fight in France, and 40,000 Americans of Czech 
and Slovak origin served in the American forces.
    During the war a network of 80 Czech immigrants spied on the German 
and Austrian businesses and embassies where they worked. They exposed 
the infamous Zimmermann telegram, which played a major role in the U.S. 
decision to enter the war.
    The newly designed Czechoslovak flag was flown for the first time 
at the Plaza Hotel in New York, and on October 18, 1918, the 
Czechoslovak Declaration of Independence, which was patterned after our 
own, was proclaimed in Washington, DC.
    Another indication of the ethics and values of the Czech people is 
that their descendants have made very good Americans, who have made 
major contributions in business, the trades, professions, arts and 
sports. Some well known names in various fields of endeavor are:

        Politics: Mayor Anton J. Cerniak, Senator Roman Hruska, and 
        Congressman Charles Vanik
        Space: Astronauts Eugene Ceman, James Lovell and John Blaha
        Science: Dr. Ales Hrdlicka--Curator of the Smithsonian 
        Institution
        Military: Lt. Col. David Hrdlicka and hundreds of other names 
        on the Vietnam Veterans Memorial
        Business: Bulova Watch Co. and Ray Kroc, founder of McDonald's 
        Corporation
        Arts: Rafael Kubelik, Rudolf Firkusny and Jarmila Novotna
        Movies: Sissy Spacek, Kim Novak, and Milos Fonnan
        Sports: George Halas, George Blanda, John Havlicek, Jay 
        Novacek, as well as Czech born hockey and tennis players

                        V. The Czechs as Allies

    The Czechs have participated in numerous military exercises under 
the Partnership for Peace, and have earned the praise of U.S. officers. 
The Czech Republic sent a unit to the Gulf War that was instrumental in 
identifying chemical agents. The Czech Republic currently has a 
Mechanized Battalion serving with the NATO peace keeping forces in 
Bosnia and Czech troops levels exceed that of the U.S. in proportion to 
their population.
    The Czech Government has made a firm commitment to increase its 
spending on defense so as to reach NATO levels by the year 2000. The 
Government has confirmed this commitment in its 1998 budget, even in 
the face of pro rata reduction in most other areas due to the damage 
from the catastrophic floods last July.
    While the percentage levels of support for joining NATO among the 
Czech population have not been as high as in Poland and Hungary, the 
lower percentages can be explained by the fact that the Czechs, unlike 
the Poles and Hungarians, do not have a tradition of military glory as 
a nation state. Yet, an October survey by the U.S. Information Agency 
showed that the Czech people were 2 to 1 in favor of NATO membership.

                 VI. The Importance of NATO Enlargement

    Recognizing the importance of NATO enlargement to the United States 
is as easy as I, II, III: World War I, World War II and World War III. 
Americans in large numbers answered the call in World War I and left 
much of their blood and treasure on the fields of Europe. Following 
that war, however, the spirit of isolationism prevailed and Americans 
left Europe and, like most Europeans, disarmed.
    Only twenty years later, Americans in large numbers had to answer 
the call in World War II and return to Europe, shedding much more blood 
and treasure on the same fields. Following that war, however, the 
tragic lesson of World War I prevailed and Americans maintained their 
presence in Europe. With our European allies and even their former 
adversaries, Americans helped create and sustain the most powerful and 
effective Alliance the world has ever known. That Alliance, and the 
solidarity of its membership, not only prevented World War III, but 
secured victory in the Cold War without major bloodshed in Europe.
    NATO is adapting, as it must, to new threats by attempting to 
project its stability eastward, working with its new partners and 
allies to consolidate, strengthen, extend and secure the peace. The 
extension of NATO membership to democracies in Central and Eastern 
Europe will enhance NATO's ability to adapt and continue to defend the 
freedom and democratic political systems of its members against these 
new threats.
    First, one of the most reliable guarantees against aggression is 
the spread of democracy; democracies do not invade one another and do 
not engage in aggressive wars. The extension of membership will also 
help provide the security in which these young democracies can set 
deep, sturdy roots and flourish so as to contribute fully to Alliance 
goals well beyond their own borders.
    With the addition of capable and committed allies in Central and 
Eastern Europe, NATO will be politically, militarily and morally 
strengthened and all the better prepared to address its security 
concerns and prevent conflict in that region and elsewhere, as well as 
respond to it if necessary.
    If NATO were not to extend its membership, if it were to ignore the 
need for integrating these new democracies with the West and for 
creating a Europe free, undivided and secure, or if it were to leave 
this task to some other organization, the costs would be far greater 
than those for enlargement. For example, the United States currently 
spends far more on its involvement in the former Yugoslavia than it 
will need to pay toward NATO enlargement, and it would be spending far 
less there if a concerted NATO effort had been marshaled early to deter 
the conflict. Moreover, if the new democracies were forced to provide 
for their own defense independent of any collective security 
arrangement, their expenses would be far greater than those required 
for NATO membership and would be far less cost-effective. To quote 
German foreign minister Klaus Kinkel: ``We do not want a re-
nationalization of defense policy; we want multilateral integration 
instead.''
    The ultimate cost of not extending membership to the new 
democracies is probably incalculable, because NATO would not survive 
such inertia--the status quo would be untenable--and the current 
configuration of NATO would atrophy and disintegrate. European nations 
would lose their primary bond to collective security, and slide 
backward toward the dangers of pre-Alliance diplomatic and military 
perspectives. Central and Eastern Europe would remain a security vacuum 
in which freedom and democracy would have far less chance to prosper, 
and the United States might well find itself returning to Europe once 
again to shed more blood on the same fields.

                            VII. Conclusion

    The Czechs will be among the best allies that the United States has 
ever had because of their deep and abiding friendship and the broad 
range of values which we share. The strategic location of the Czech 
Republic, its stability, its industrial and human resources, and its 
military capabilities will strengthen the NATO alliance.
    Prague is closer to Dublin than it is to Moscow. Prague is closer 
to Copenhagen than it is to Sarajevo. The Czech people throughout their 
history have contributed to Western culture, science, industry, art and 
prosperity. They now want to contribute to Western security.
    The status quo is not a real option. The United States Senate will 
not be choosing between enlarging NATO and preserving it in its current 
state. The choice is between preserving NATO in an enlarged form or 
delivering its death sentence.
    For almost fifty years, NATO has maintained peace and freedom for 
America and Western Europe. It can do the same for the Czechs and other 
former communist-dominated countries if they are admitted. If they are 
not, we can expect real problems and costs. Czech President Vaclav 
Havel said it well: ``[I]f the West does not stabilize the East, the 
East will destabilize the West.''
    I thank you again for the opportunity to testify.

    Senator Smith. Thank you very much, Mr. Doubek.
    We will now call Mr. Mati Koiva, who is a member of the 
Board of the Joint Baltic American National Committee, 
Incorporated. We welcome you, sir.

  STATEMENT OF MATI KOIVA, MEMBER, BOARD OF DIRECTORS, JOINT 
     BALTIC AMERICAN NATIONAL COMMITTEE, INCORPORATED, AND 
   PRESIDENT, ESTONIAN AMERICAN NATIONAL COUNCIL, ROCKVILLE, 
                            MARYLAND

    Mr. Koiva. Thank you, Mr. Chairman, members of the 
committee. We have submitted written testimony and also I will 
now present a summary of that.
    I welcome this opportunity to appear before you to discuss 
the importance of a successful ratification vote for NATO 
enlargement and the necessity, commitment, and timetable for 
further enlargement.
    The Joint Baltic American National Committee represents 
over 1 million Americans of Estonian, Latvian, and Lithuanian 
descent. JBANC strongly believes that the long-term national 
security and economic interests of the United States demand an 
unwavering commitment to an enlarged NATO to the countries of 
Central and Eastern Europe, including Estonia, Latvia, and 
Lithuania.
    With U.S. leadership, a stable and democratic Europe has 
been restored after two costly world wars and a 45 year cold 
war. We can sustain this stability by overwhelmingly ratifying 
an amendment to the Washington Treaty allowing Poland, Hungary, 
and the Czech Republic to become full NATO members, which will 
begin the enlargement process.
    JBANC holds the position that the European Security Act of 
1997 is a part of the NATO enlargement process. This act, which 
received overwhelming support from the House and subsequent 
adoption by the Senate, states that Estonia, Latvia, and 
Lithuania should be invited to become full NATO members at the 
earliest possible date and makes them eligible for transition 
assistance.
    The Security Act, now part of the State Department 
Authorization Act, is held up in conference. JBANC urges the 
House and Senate to resolve the situation to assure the 
enactment of the European Security Act in the year of its 
designation, that is, 1997.
    Similarly, JBANC also fully endorses the Foreign Operations 
Appropriations Act of 1997 and urges its final passage.
    Our specific recommendations for the ratification process 
and continued enlargement are as follows. First, the U.S. must 
unequivocally express its commitment to NATO enlargement to 
assure ratification in the parliaments of other members.
    JBANC urges the Senate to ratify the NATO treaty in a way 
that clearly supports continued enlargement without any 
restrictions on a time line for a second wave. Any delay in the 
process provides an opportunity for unsettling European 
stability and encourages anti-NATO nationalists in a volatile 
Russia.
    Second, JBANC urges the administration to issue a timetable 
and strong commitment for further enlargement. In 1999, when 
Hungary, Poland, and the Czech Republic become full NATO 
members, countries designated by Congress as being eligible for 
NATO transition assistance, including Estonia, Latvia, and 
Lithuania, should be invited for accession talks.
    Third, JBANC fully endorses the position that overall 
stability and security in Europe can be best accomplished 
through an expedited enlargement of NATO to all nations that 
desire to join and who qualify.
    It is critical that the Baltic countries of Estonia, 
Latvia, and Lithuania, who are now structuring their defense 
forces to NATO standards and participating in NATO's Bosnia 
operations become full NATO members by 2001.
    The U.S. never recognized the Soviet occupation of the 
Baltics. They should not be treated any differently from other 
NATO candidates, as Russia wants us to believe. JBANC remains 
concerned about reports that contradict the President's 
assurances that Russia does not have an implicit veto over NATO 
enlargement.
    Russian officials have repeatedly voiced opposition to 
Baltic membership in NATO. Less than 2 weeks ago, Russian 
President Boris Yeltsin issued a statement saying that the 
Russian side has already stated that we do guarantee the 
security of the Baltic countries. He suggested that these 
guarantees be a unilateral obligation of Russia through mutual 
security and friendship agreements between Russia and the 
Baltic countries.
    These offers of security guarantees and friendship treaties 
are reminiscent of a 1939-1940 occupation of the Baltic 
countries and similar events in the region that started World 
War II.
    We ask the Baltic and U.S. Governments not to be lulled 
into a false sense of security but to move ahead vigorously 
with NATO expansion. The final passage of the European Security 
Act by Congress would demonstrate U.S. resolve of this action.
    We conclude with a plea to the committee, that since the 
U.S. is committed to shaping a peaceful and undivided Europe, 
the Baltic countries must be included in its security 
architecture.
    We strongly support Secretary Albright's statement that all 
States large and small must have the right to choose their own 
alliance in a new Europe. It is in the U.S. national security 
and economic interest to enlarge NATO to Central and Eastern 
Europe, including Estonia, Latvia, and Lithuania.
    Thank you.
    [The prepared statement of Mr. Koiva follows:]
                    Prepared Statement of Mr. Koiva
    Mr. Chairman and members of the committee: I welcome this 
opportunity to appear before you to discuss the importance of a 
successful ratification vote for NATO enlargement and the necessity of 
a commitment and timetable for further enlargement.
    The Joint Baltic American National Committee, Inc. (JBANC) 
represents over one million Americans of Estonian, Latvian and 
Lithuanian descent. JBANC strongly believes that the longterm national 
security and economic interests of the U.S. demand an unwavering 
commitment to enlarging NATO to the countries of Central and Eastern 
Europe, including Estonia, Latvia and Lithuania.
    In this century, the United States was called upon to fight two 
costly World Wars and a 45-year Cold War in Europe. NATO allies with U. 
S. leadership were essential in restoring peace, freedom and democracy 
to the current stable Europe,.
    In order to further foster a peaceful, undivided and democratic 
Europe, the Alliance extended invitations in Madrid to Poland, Hungary 
and the Czech Republic for accession talks. In keeping with the pledge 
of an open door policy for further enlargement, the NATO Madrid 
Declaration supports the Baltic countries as aspiring members.
    JBANC urges the Senate to overwhelmingly ratify an amendment to the 
Washington NATO Treaty allowing Poland, Hungary and the Czech Republic 
to become full NATO members, which will begin the enlargement process.
    Since NATO enlargement is viewed as an on-going process, JBANC 
holds the position that the European Security Act of 1997 is a part of 
the process. JBANC is pleased to be a leading supporter of this Act 
which received overwhelming support from the House. The Act designates 
the Baltic countries as being eligible to receive funding to help them 
qualify for NATO in the future. The Act also states that Estonia, 
Latvia and Lithuania should be invited to become full NATO members at 
the earliest possible date. This language was also strongly adopted by 
the Senate.
    The European Security Act, now a part of the State Department 
Authorization Act (H.R. 1757) is held up in conference committee due to 
unrelated family planning amendments. JBANC urges the House and Senate 
leadership to resolve these issues and to enact the European Security 
Act in the year of its designation, i.e. 1997.
    JBANC also fully endorses the Foreign Operations Appropriations Act 
of 1997 which received overwhelming support in Congress. This includes 
funding to assist the Baltic defense forces to prepare for NATO. JBANC 
urges its final enactment.
    That brings us to our specific recommendations for the ratification 
process and continued enlargement:
    First, the U.S. must unequivocally express its commitment to NATO 
enlargement if the ratification process in the parliaments of the other 
fifteen NATO allies is to be achieved. JBANC strongly supports an 
overwhelming ratification vote in the Senate for Poland, Hungary and 
the Czech Republic which will reflect the confidence among American 
voters that NATO enlargement is in the U.S. best interests. This in 
turn enhances the open door policy enabling a second wave of 
enlargement, including the Baltic countries.
    JBANC urges the Senate to ratify the NATO treaty in a way that 
clearly supports continued enlargement without any restrictions on a 
timeline for the second wave.
    Second, JBANC believes that not only must there be a successful 
vote for NATO ratification in the Senate but the Administration must 
issue a timetable and strong commitment for further enlargement. In 
1999 when Hungary, Poland and the Czech Republic become full NATO 
members, all the countries that have been designated by Congress as 
being eligible for NATO transition assistance, including Estonia, 
Latvia and Lithuania should be invited for accession talks.
    Any delay in the process of continued enlargement provides an 
opportunity for those whose aim is to destabilize Europe, thus 
decreasing the Allies' security. Hesitation in completing the 
enlargement process encourages anti-Western forces in Russia. In the 
long term, a delay in the process would adversely affect the security 
and economic interests of the United States.
    As has been noted by many commentators, the Baltic countries are 
the most exposed and at risk of all the NATO aspirants in Central and 
Eastern Europe, by virtue of their geography and history of being 
forcibly annexed by the USSR. The U.S. never recognized the Soviet 
occupation of the Baltic countries. Therefore they should not be 
treated any differently from other countries in Central and Eastern 
Europe for NATO membership. If democratic reform in Russia falters and 
if NATO enlargement is incomplete, the Baltics could be relegated to a 
gray zone of instability. A gray zone in the Baltic region encourages a 
volatile Russia to renew expansionism.
    Third, JBANC fully endorses the position that overall stability and 
security on the European continent can be best accomplished through the 
enlargement of the NATO alliance to all nations of the region that 
desire to join and meet the membership criteria. At this critical 
juncture, it is necessary that the Baltic countries of Estonia, Latvia 
and Lithuania become full NATO members by 2001.
    JBANC remains deeply concerned about reports that contradict the 
President's assurances that Russia does not have an implicit veto over 
NATO enlargement. Russian officials have repeatedly voiced opposition 
to Baltic membership in NATO and have extended Russian security 
guarantees in return--as demonstrated by Russian Prime Minister 
Chemomyrdin in Vilnius, Lithuania.
    More recently in Moscow, President Boris Yeltsin issued a formal 
statement regarding Russian relations with the Baltics, ``The Russian 
side has already stated that we do guarantee the security of the Baltic 
countries. As a follow-up to this initiative we suggest that such 
guarantees should be given in the form of a unilateral commitment of 
the Russian Federation backed, perhaps, in terms of the international 
law, by an agreement on good-neighborliness and mutual security 
provision between Russia and individual Baltic countries or between 
Russia and all three Baltic countries.'' (Article attached).
    These offers of security guarantees and good-neighborly treaties 
are reminiscent of the 1939-1940 occupation of the Baltic countries and 
similar events in the region which started World War II. We urge the 
Baltic governments and the U.S. not to be lulled into a false sense of 
security but to move ahead vigorously with the inclusion of the Baltics 
and others into NATO.
    The Administration's lack of a public denouncement of Yeltsin's 
statement emphasizes the urgency for the European Security Act to be 
passed in this session of Congress. This Act designates the Baltic 
countries as being eligible to receive funding to help them qualify for 
NATO in the future and states that they should be invited to become 
full NATO members at the earliest possible date. The final passage of 
the European Security Act will demonstrate U.S. support for the Baltics 
security, sovereignty and territorial integrity.
    JBANC holds the position that enlarging NATO to emerging 
democracies in Central and Eastern Europe, including Estonia, Latvia 
and Lithuania promotes not only the institutionalization of democracy 
and market economies but also good-neighborly relations and settlements 
of minority issues.
    Legislation and Congressional statements of support for Baltic 
membership in NATO clearly indicate that the Baltics would make 
outstanding contributions to furthering the goals of NATO and that they 
should be invited to become full NATO members at the earliest possible 
date.
    In this session of Congress, Senators Richard Durbin (D-IL) and 
Slade Gorton (R-WA) co-chair the Baltic Freedom Caucus, consisting of 
Senators Carol Moseley-Braun (D-IL), Joseph Lieberman (D-CT), and 
Charles Grassley (R-IA). All have demonstrated strong support for the 
Baltic peoples' security concerns. Senators Durbin, Gorton and Mitch 
McConnell (R-KY) have been instrumental in sponsoring legislation which 
fully endorses Baltic security issues.
    In the House, International Relations Committee Chairman Ben Gilman 
(R-NY), Gerald Solomon (R-NY) and Henry Hyde (R-IL) have taken the lead 
on legislation which strongly supports the security concerns of the 
Baltic countries. JBANC would like to thank all Members of Congress who 
have demonstrated outstanding support for the security interests of the 
Baltics.
    JBANC believes the Baltic countries are meeting the criteria for 
NATO membership. The Baltics are succeeding in implementing democratic 
and economic reforms. They have made tremendous progress toward 
establishing civilian control of their militaries, good-neighborly 
relations, making commitments to protect the rights of all their 
citizens and adhering to the rule of law.
    The Baltic countries are building their defense forces by NATO 
standards. They are working to achieve interoperability between their 
defense forces and NATO. They are cooperating in a regional airspace 
initiative, improving their communication and information systems and 
command and control. The Baltics have shown their willingness to be 
producers, not just consumers, of security by joining NATO's 
Partnership for Peace program with increased support for activities and 
by providing troops for NATO-led operations in Bosnia.
    We want to conclude with a plea to the Committee that since the 
U.S. is committed to shaping a peaceful and undivided Europe, the 
Baltic countries must be included in the security architecture. 
Stability in the entire Baltic Sea region promotes stability in all of 
Europe.
    We strongly support Secretary Madeleine Albright's statement that 
all states, large and small, must have the right to choose their own 
alliances and associations in the new Europe. It is in the U.S. 
national security and economic interests to enlarge NATO to the 
emerging democracies of Central and Eastern Europe, including Estonia, 
Latvia and Lithuania.
    Thank you.

    Senator Smith. Thank you, Mr. Koiva. Obviously, you don't 
think that the Baltics' former status as part of the Soviet 
Union really changes their status any more than Poland, 
Hungary, or the Czech Republic?
    Mr. Koiva. No. We believe it should not.
    Senator Smith. Thank you very much for your testimony.
    Mr. Koiva. Thank you.
    Senator Smith. We will now call up Hon. Paula Stern, 
representing the U.S. Committee to Expand NATO. We welcome you.

STATEMENT OF HON. PAULA STERN, PRESIDENT, THE STERN GROUP, NEW 
 YORK, NEW YORK, ON BEHALF OF THE U.S. COMMITTEE TO EXPAND NATO

    Ms. Stern. Thank you very much. We brought several items to 
show and tell with us. Gloria Jones is assisting in putting 
them up.
    Thank you very much for inviting me to testify here. I am 
delighted to be here to speak about guaranteeing European and 
American security for the 21st Century for that is what I 
believe will be achieved by expanding NATO to include the 
Central European democracies of Poland, Hungary, and the Czech 
Republic.
    In sharing with you my convictions that NATO enlargement is 
absolutely justified, I draw your attention to these two 
posters that I have brought with me. They were produced by the 
U.S. Committee to expand NATO, which is a bipartisan group of 
which I am a member. Both distill some fundamental truths that 
should be kept in mind as you and your colleagues in the Senate 
decide how to vote on this issue.
    The one which is the Price of Peace is a good example. 
There is a cost. There is a price. But I think you have to 
consider that the cost of not ratifying NATO expansion would be 
staggering. This demonstrates that you could calculate that the 
price would be, the cost to the taxpayer would be about as much 
as it would to buy a kid a candy bar. Following Halloween, I 
certainly think we could afford to get rid of a lot of that 
candy.
    Wes Clark, the current SACEUR, said that an ounce of 
prevention is worth a pound of cure. I would add to that that 
since the cost of expansion is less than a candy bar, it 
certainly would also be less fattening.
    I would not go on and talk about other, broader economic 
consequences.
    When the North Atlantic Treaty was ratified in 1949, the 
alliance was dedicated to containing the threat posed by the 
Soviet Union and to providing America's allies in Europe with a 
crucial security umbrella that they would need to rebuild their 
economies and strengthen their democratic institutions in the 
aftermath of World War II.
    Today, with the geopolitical landscape of both Europe and 
the world dramatically changed, NATO's mission must also be 
adjusted, even as it remains the security alliance it has 
always been. In effect, by opening itself to Poland, Hungary, 
and the Czech Republic, NATO is extending assurances of 
stability that will allow those nascent democracies and free 
markets in these newly sovereign States to flourish.
    As one who is particularly concerned about the economic 
ramifications of NATO expansion, I am convinced an enlargement 
under consideration is all to the good. Consider, for instance, 
the economic impact of NATO--inspired stability among its 
existing member States. Statistics show that in 1996, two-way 
trade across the Atlantic reached $544 billion and two-way 
investment was a staggering $776 billion, making that trade 
relationship between the U.S. and European allies the most 
significant in the world today.
    Clearly, what must be said about this trade relationship 
and its vitality is that it simply would not have materialized 
without NATO. So, at the same time, in considering enlargement 
of the alliance we need to recognize these other aspects of 
NATO's mission, that it was set up to safeguard the freedom, 
common heritage, and civilization of its member nations' 
peoples; that it was founded on the principles of democracy, 
individual freedom and the rule of law; and that its success is 
a testament to the fact that it has become more than just a 
security arrangement.
    With the fall of the Berlin Wall and the collapse of the 
former Soviet Union, it is now time for NATO to become 
something new again--an organization that reflects the changes 
in the landscape that surrounds it. What better way to reflect 
such changes than to extend the peace, stability, and 
prosperity NATO member nations have enjoyed to the three young 
democracies most deserving and desirous of joining?
    In fact, it must be said that even the prospect of joining 
NATO is having a tremendous impact on the development of these 
new market economies. GDP growth in Poland, Hungary, and the 
Czech Republic ranges between 4 and 5 percent, far faster than 
the rest of Europe. Moreover, infrastructures are improving and 
the determination to create viable and successful open, free 
market economies is changing the way business is conducted.
    Such vitality, of course, is providing many opportunities 
for U.S. businesses in these untapped and very promising 
markets. Trade and direct investment between these countries 
and the U.S. is growing and it will continue to do so. But the 
formula is clear: Transatlantic trade is vital to the success 
of NATO economies and NATO expansion will increase the 
opportunities for such trade.
    Still, success is dependent on building confidence in 
tomorrow's future. We can talk about improving bilateral ties, 
or economic relations, or encouraging the European Union to 
take the lead, and so forth. But the bottom line for these 
countries, and really for any country, is that without 
security, without stability, economic progress is next to 
impossible.
    Beyond Bosnia there remain real potential flash points of 
ethnic friction in Central and Eastern Europe, and the mere 
presence of NATO in the region can help keep these frictions 
from igniting. Ultimately, through the expansion of economic 
wellbeing, NATO's presence can, in fact, dissipate these 
frictions.
    We should not get in the way of such possibilities and we 
should bear in mind in our own deliberations that if we do not 
advance the twin ideas of enlargement of NATO and adjustment in 
its mission, we would put that institution at risk of not 
surviving.
    Ultimately, of course, in the absence of NATO, the cost of 
keeping the peace will fall on the shoulders of the United 
States alone, an eventually that I don't think any of us 
relishes.
    Also I am convinced that NATO's expansion in Poland, 
Hungary, and the Czech Republic will do for these countries in 
the East what it did for the West after World War II. Rather 
than just a cost, there NATO enlargement must be seen as an 
investment in the future, in new markets, and in new 
opportunities for the U.S. economy.
    I am not alone in that line of thinking. You must 
appreciate, for instance, the results of a recent study by the 
Pugh Research of American Political Opinion. It showed that, 
while a solid 63 percent of the American people support an 
expanded NATO, an overwhelming 91 percent of America's business 
leaders support future NATO enlargement.
    Dana Meade, chairman and CEO of Tenneco, an early investor 
in Central Europe, recently said that these figures should not 
come as any surprise because--and I am quoting--``security and 
prosperity of America is inextricably tied to the security and 
prosperity of Europe.''
    Increased trade, however good for America, is not the only 
reason why I am a staunch supporter of NATO expansion nor why 
the Senate should be as well. The lessons from history are 
clear: Peace in Europe should not be taken for granted. Rather, 
they must be nurtured, and NATO enlargement is part of that 
process of insuring that continued peace in Europe and the 
prosperity it brings to the United States.
    It is clear that the prospect of NATO membership has 
encouraged positive developments in the economies of these 
countries, in their human rights records, and in their 
relationships with their neighbors. NATO enlargement will lock 
in that stability in Central Europe that we now enjoy.
    I know that there are some issues surrounding the costs, as 
I said, but I believe that that price is marginal, especially 
if you look back at the vast costs of war.
    Turning our back on these democracies by not expanding NATO 
would be a severe blow to the viability of all of their 
political, social, and economic reforms.
    Now, briefly, I would just like to share with you the 
Transatlantic Business dialog's potential to facilitate NATO's 
expansion. I currently serve as an adviser to this TABD, the 
Transatlantic Business dialog, which is a group of business and 
government people. As a matter of fact, I will be leaving in a 
few hours for Rome to attend the government--business TABD 
conference. That is a unique example of entrepreneurial 
diplomacy by American and European businesses.
    They sought to ferret out concrete barriers to trade and 
were instrumental in this year's Information Technology 
Agreement and in the U.S.--E.U. Mutual Recognition Agreement.
    In closing, 50 years ago, the Marshall Plan resurrected 
Europe from the Second World War. That era is long gone. 
Invigorating the economies of Europe, especially those nations 
about to enter NATO, requires a business and commercial, not 
just a government sponsored economic outreach. The more quickly 
these new NATO members are integrated into the NATO economies, 
including that of the United States, the sooner they will be 
meeting fully their contribution to European security and to 
U.S. security.
    Just as NATO expansion brings security, the TABD's 
equivalent expansion in the dialog that will be going on this 
week means that NATO economies will be brought in as well to 
enhance trade and prosperity while serving as a natural agent 
for helping the new NATO countries modernize their own 
economies.
    NATO's expansion and even the prospect of membership is 
clearly moving Hungary, Poland, and the Czech Republic in the 
right direction. But, more importantly, NATO expansion is good 
for the United States.
    Thank you.
    [See appendix for supplemental material submitted by Ms. 
Stern.]
    Senator Smith. Thank you very much, Ms. Stern. We 
appreciate it.
    I now call forward Mr. Daniel Plesch, Director, British 
American Security Information Council. We welcome you, sir.

   STATEMENT OF DANIEL T. PLESCH, DIRECTOR, BRITISH AMERICAN 
          SECURITY INFORMATION COUNCIL, WASHINGTON, DC

    Mr. Plesch. Good morning and thank you, Mr. Chairman, 
members of the committee. It is an honor to testify before you 
today on the Council's behalf.
    Consideration of the desirability of expanding NATO should 
begin with the security needs of Europe. There is no 
conventional military threat to NATO or to Eastern Europe. 
Nevertheless, thousands of nuclear weapons could, despite 
President Clinton's assurances, destroy this country in an 
hour. The risk today is of accident and human error.
    We must reduce and eliminate Weapons of Mass Destruction 
and further reduce the likelihood of any conflict to the East 
and South of NATO through the aggressive pursuit of arms 
control and nonproliferation measures.
    Unfortunately, NATO enlargement is at best irrelevant to 
these policy priorities and appears to be slowing them down.
    Even before the invention of nuclear arms, the leaders and 
peoples who fought two world wars realized that a system of 
military alliances alone always produces war and that these 
have become increasingly destructive. We had, first, the League 
of nations and now the United Nations. The first failed and the 
second is faltering.
    This is happening for the same reason as in the 1920's. The 
great powers are returning to the belief that they can rely on 
their own military power alone.
    We would do well to recall the words of the Atlantic 
Charter, of Franklin Roosevelt and Winston Churchill, who, in 
the dark days of August 1941, declared that they believed that 
all of the nations of the world, for realistic as well as 
spiritual reasons, must come to the abandonment of the use of 
force.
    They further outlined the need for reductions in armaments 
leading to the creation of a system of general security.
    It is becoming commonplace today to deride disarmament and 
arms control as ineffective and unverifiable. This is the worst 
form of defeatism for, if it is impossible to create effective 
disarmament measures, then in the long run nuclear war will be 
inevitable.
    Fortunately, there is a great tradition of disarmament to 
be pursued. Ronald Reagan and Mikhail Gorbachev's INF and START 
treaties name but two.
    Today, for the first time in history, there are no 
significant cross border conflicts in Europe. According to 
NATO's own assessments, the Russian Army barely exists and will 
take a generation to rebuild We need to build upon that 
opportunity with nonmilitary measures.
    I would like now to come to a central issue in the nature 
of the alliance itself, Mr. Chairman. There is, unfortunately, 
a dangerous illusion at the heart of the pro-enlargement 
argument. NATO is said to offer a security guarantee. But if 
one looks at what President Clinton said in a letter to members 
of the Senate, he explained the Article 5 commitment in this 
way. Article 5 states that members will consider an attack 
against one to be an attack against all. It does not define 
what actions would constitute an ``attack'' or prejudge what 
alliance decisions might be made in such circumstances.
    Member States, acting in accordance with established 
constitutional processes, are required to exercise individual 
and collective judgment over this question. That is a case by 
case interpretation of Article 5.
    Contrast that with the remarks of Secretary Albright in 
Prague, where she said above all, NATO membership means you 
will always be able to rely on us.
    This weakness and contradiction has long been understood by 
officials in Europe. During the cold war, no one raised the 
matter in public except the French. In any case, it was assumed 
that any war would rapidly become nuclear, in which case the 
small print of documents would not become relevant.
    Extending these commitments today is a very different 
matter. It is reckless of the administration to talk of 
guarantees in Eastern Europe but of loopholes when talking to 
the Congress.
    The Hungarian people are soon to be asked to vote on 
whether they want a security guarantee from NATO. No one has 
shown them the small print. Bosnia is a critical case. The U.S. 
was and is reluctant to commit troops. We are led to believe 
that this reluctance would not exist were Bosnia or any other 
country to be in NATO. Yet, the answer given by President 
Clinton to Senator Hutchison and other members indicates in the 
clearest possible way that the NATO treaty does, indeed, 
contain an escape clause, permitting another Munich or 
Sarajevo.
    We should recognize that there is not much difficulty 
between the commitments already given in the Partnership for 
Peace and the NATO treaty itself.
    Mr. Chairman, all the arguments that one nation can put 
forward for inclusion in NATO can be put forward by its 
neighbor. We are faced with a chain of commitments leading 
through Russia to the borders of China. If NATO enlargement 
continues, we are just embarking on expanding NATO across 
Eurasia. If the process of enlargement is halted, we will again 
draw a new dividing line in Europe; that is to say, do we leave 
out Russia, do we leave out Poland?
    The better, more modern approach will be going back to the 
wise words of Franklin Roosevelt and Winston Churchill to 
develop our political interest in all encompassing nonmilitary 
institutions.
    For example, the Organization for Security and Cooperation 
in Europe has to do with just $55 million for its entire 
operating budget.
    Mr. Chairman, I do not wish to take the time of this 
committee, but if I may, I would close with one final point 
with respect to nuclear weapons, which I think illustrates many 
of the key problems at the heart of this enterprise.
    The United States rightly spent much time and energy 
insuring that Belarus and Ukraine became non-nuclear countries. 
Now, with the prospect of security guarantees to Poland, we are 
going to bring the Poles and other East Europeans into the NATO 
nuclear planning process. South Africa and many other 
countries, other than Belarus and Ukraine, see this as a 
problem within the Nonproliferation Treaty. This contradiction 
is, I believe, just one of many, more detailed points that I 
trust, I am sure, the committee is looking at.
    Thank you for your attention.
    [The prepared statement of Mr. Plesch follows:]
                    Prepared Statement of Mr. Plesch
    Mr. Chairman, members of the Committee, it is an honor to testify 
before you today on the Council's behalf and to submit written 
testimony for the record.
    Consideration of the desirability of expanding NATO should begin 
with the security needs of Europe today. There is no conventional 
military threat to NATO or to Eastern Europe. Nevertheless, thousands 
of nuclear weapons could, despite President Clinton's assurances, 
destroy this country in an hour. The risk today is of accident and 
human error.
    We must reduce and eliminate Weapons of Mass Destruction and 
further reduce the likelihood of any conflict to the East and South, 
through the aggressive pursuit of arms control and non-proliferation 
measures. NATO enlargement is at best irrelevant to these policy 
requirements it appears to be slowing them down.
    There has indeed been a revolution in military, indeed human, 
affairs brought about by the invention of nuclear weapons. For the 
first time humanity has the power of self-destruction. This 
necessitates a change in strategy which has yet to take hold amongst 
the great powers. This is not unusual, revolutions in thought do not 
happen quickly. In this case though the challenge to the human mind may 
be too great. The mass use of violence in war may remain attractive 
until it is too late. The future can only lie in global cooperation 
accompanying the global market.
    Even before the invention of nuclear arms the leaders and peoples 
who fought two world wars realized that a system of military alliances 
always produces war and that these are increasingly destructive. As a 
result we had first the League of Nations and now the United Nations. 
The first failed and the second is faltering. This is happening now for 
the same reason as in the 1920s; the great powers are returning to the 
belief that they can rely upon their own military power alone.
    We would do well to recall the words of the Atlantic Charter of 
Franklin Roosevelt and Winston Churchill, who, in the desperate days of 
August 1941 declared that, ``they believe that all of the nations of 
the world, for realistic as well as spiritual reasons must come to the 
abandonment of the use of force.'' They further outlined the need for 
reductions in armaments leading to the creation of a system of general 
security. It is becoming commonplace to deride disarmament and arms 
control as ineffective and unverifiable. This is the worst form of 
defeatism. For if it is impossible to create effective disarmament 
measures then nuclear war will be inevitable.
    Fortunately, there is a great tradition of disarmament to be 
pursued: Ronald Reagan's and Mikhail Gorbachev's INF and START 
Treaties.
    Not long ago the confrontation with the totalitarian communist 
regimes of Eastern Europe made progress extremely difficult. Today for 
the first time in history there are no significant cross border 
conflicts in Europe.
    According to NATO's own assessments, the Russian Army barely exists 
and would take a generation to rebuild. NATO has conventional military 
supremacy against any combination of adversaries to the East and South. 
There is no significant modern defense industrial base we and our 
allies do not control. In this uniquely favorable setting, we can do no 
less than those who worked in far more difficult times.
    Mr Chairman, there is a dangerous illusion at the heart of the pro-
enlargement argument. NATO is said to offer a security guarantee. It 
does not. President Clinton made this clear in a letter to members of 
the Senate. President Clinton explained the commitment in Article 5 of 
the NATO Treaty this way: ``Article 5 states that members will consider 
an attack against one to be an attack against all.'' It does not define 
what actions would constitute ``an attack'' or prejudge what alliance 
decisions might be made in such circumstances. ``Member states acting 
in accordance with established constitutional processes, are required 
to exercise individual and collective judgment over this question.''
    Contrast this case by case interpretation with Secretary Albright 
in Prague last July 17th. ``Above all, it [NATO membership] means you 
will always be able to rely on us and we will always be able to rely on 
you ... If there is a threat to the peace and security of this country, 
we will be bound by a solemn commitment to defeat it together. For this 
reason, we can be confident such a threat is far less likely to 
arise.''
    The weakness of Article 5 of the North Atlantic Treaty has been 
long understood by officials in Europe. It is often contrasted with the 
clearer language of the West European Union which states; ``If any of 
the High Contracting Parties should be the object of an armed attack in 
Europe .... the other High Contracting Parties will afford the Party so 
attacked all the military and other aid and assistance in their 
power.'' Article 5 WEU Treaty.
    The confrontation with the Soviet Union ensured that no one, except 
the French, raised this matter in public. In any case, it was assumed 
that any war would rapidly become nuclear in which case documents would 
not be relevant.
    Extending these commitments today is a very different matter. It is 
reckless of the Administration to talk of guarantees in Eastern Europe 
but of loopholes when talking to the Congress. The Hungarian people are 
soon to be asked to vote on whether they want a security guarantee from 
NATO. No one has shown them the small print.
    Bosnia is a critical case. The US was and is reluctant to commit 
troops. We are lead to believe that this reluctance would not exist 
were Bosnia or any other country to be in NATO. Yet the answer given by 
President Clinton to Senator Hutchison indicates in the clearest 
possible way that the NATO Treaty does indeed contain an escape clause 
permitting another Munich or Sarajevo. We should recognize that there 
is not much difference between the commitments already given in PfP and 
the NATO Treaty itsell

   Mr Chairman, all the arguments that one nation can put 
        forward for inclusion in NATO can also be put forward by its 
        neighbor, which produces a chain of commitments leading through 
        Russia to the borders of China. The Administration is explicit 
        that the door is open to all states in the Partnership for 
        Peace.
   If NATO enlargement continues, we are just embarking on 
        expanding NATO across Eurasia. The Administration is creating a 
        massive new unfunded mandate. Former Secretaries Warren 
        Christopher and William Perry believe that all nations within 
        the Partnerships for Peace should be built up to the same 
        military level as NATO members.
   If the process of enlargement is halted, we will again draw 
        a new dividing line in Europe. That is to say do we leave out 
        Russia or do we leave out Poland?
   The better and more modern approach would be to develop our 
        political interest in a non-military institution. The 
        Organization for Security and Cooperation in Europe has to 
        operate on a budget of just $55 million for its work in 
        mediation, arms control and elections. The creation of a 
        greater pool of skilled personnel for these tasks is an 
        international priority. The OSCE has some advantages for the US 
        because it has the potential to involve it in European economic 
        policy--a long standing and unfulfilled US goal. Certainly the 
        OSCE is out of fashion, but this is because the US has shown 
        little interest in it.

    Mr. Chairman; There are additional negative consequences of the 
enlargement policy.

   We have betrayed our promise to Russia and are needlessly 
        recreating conflict. The diplomatic record has been made clear 
        by those who negotiated the end of the Cold War. The Russians 
        were given commitments by the United States during the 
        negotiations on Germany that NATO would not expand. NATO with 
        Mrs. Thatcher's leadership, issued the ``Declaration of 
        Turnberry'', in which we offered Russia a ``Europe whole and 
        free.'' There is no intention now of treating Russia as an 
        equal partner, even though its has embraced both democracy and 
        the free market economy. For hundreds of years Russia has been 
        one of the powers of Europe. Despite suffering under absolute 
        monarchy and communism its people played a positive role in 
        European history and helped save Europe from the tyrannies of 
        Napoleon and Hitler. To exclude them now from decision making 
        is a clear return on our part to sphere of influence politics. 
        Russia certainly pursues policies we do not like but so too do 
        other states with whom the United States has good relations 
        such as Japan and France. This is no reason to refuse to treat 
        either these countries or Russia as genuine partners.
   NATO enlargement is likely to increase tensions and 
        misunderstanding between those who join and those who are left 
        out. The increased credit worthiness that membership of the 
        Alliance brings will be more than offset by the drain on 
        capital resources of increased military expenditures and the 
        negative impact on excluded neighbors. The US is already 
        diverting funds for economic assistance into military programs 
        the hundreds of millions of dollars which United States 
        taxpayers are already devoting to improving the armaments of 
        Eastern Europe would be far better spent in building the civil 
        sector or in reducing the tax burden in the United States.
   Military relations are now so dominant that threat and risk 
        reduction strategies have been neglected. The Alliance has no 
        proposals for further reducing armaments in Europe although 
        vast quantities remain. The Conventional Forces in Europe 
        Treaty was an enormous achievement of the Reagan and Bush 
        Administrations. We need to see a follow-on and more emphasis 
        on preventing weapons proliferation. Much of the flow of 
        illegal small arms onto world markets comes from Eastern 
        Europe. NATO agreed at the Lisbon OSCE meeting to consider 
        reductions in new types of weapons, which should include small 
        arms and new technologies. It has failed to follow through. The 
        alliance and the Partnerships for Peace should have an active 
        program to destroy surplus weapons and shut down the factories 
        supplying rogue nations and groups.
   NATO enlargement is likely to increase tensions and 
        misunderstanding between those who join and those who are left 
        out. The increased credit worthiness that membership of the 
        Alliance brings will be more than offset by the drain on 
        capital resources of increased military expenditures and the 
        negative impact on excluded neighbors. The US is already 
        diverting funds for economic assistance into military programs 
        the hundreds of millions of dollars which United States 
        taxpayers are already devoting to improving the armaments of 
        Eastern Europe would be far better spent in building the civil 
        sector or in reducing the tax burden in the United States.
   Military relations are now so dominant that threat and risk 
        reduction strategies have been neglected. The Alliance has no 
        proposals for further reducing armaments in Europe although 
        vast quantities remain. The Conventional Forces in Europe 
        Treaty was an enormous achievement of the Reagan and Bush 
        Administrations. We need to see a follow-on and more emphasis 
        on preventing weapons proliferation. Much of the flow of 
        illegal small arms onto world markets comes from Eastern 
        Europe. NATO agreed at the Lisbon OSCE meeting to consider 
        reductions in new types of weapons, which should include small 
        arms and new technologies. It has failed to follow through. The 
        alliance and the Partnerships for Peace should have an active 
        program to destroy surplus weapons and shut down the factories 
        supplying rogue nations and groups.
   The enlargement of NATO's Nuclear Planning Group is nuclear 
        proliferation. South Africa and other states have pointed out 
        that the expansion of NATO will bring more countries to rely 
        upon nuclear weapons, is in contradiction of the objective of 
        the nuclear Non-Proliferation Treaty. The United States rightly 
        went to enormous effort to de-nuclearize Belarus and Ukraine. 
        But now Belarus and Ukraine are to border a state whose 
        officials will take part in NATO nuclear planning. This 
        contradiction illustrates how misguided the enlargement policy 
        is.

    It common to say the train has left the station, we must go on. But 
this is exactly what was said at the outset of the First World War.

    Senator Smith. Thank you very much, Mr. Plesch. We 
appreciate your testimony. We are happy to have it considered.
    We will now call up Mr. David Acheson. Mr. Acheson looks 
like a former Secretary of State whose book I recently read, 
``Present at the Creation.'' It is an excellent book if you 
want to understand why American foreign policy is where it is 
and why we are here.

STATEMENT OF DAVID C. ACHESON, PRESIDENT, THE ATLANTIC COUNCIL 
              OF THE UNITED STATES, WASHINGTON, DC

    Mr. Acheson. I recommend it, Mr. Chairman.
    Senator Smith. I figured you would.
    Please proceed.
    Mr. Acheson. I am here to state my views on NATO 
enlargement, specifically the accession of the Czech Republic, 
Hungary, and Poland, which I strongly support.
    I think we can all see that newly evolved missions of NATO 
have already assumed great importance in addition to the 
mission of collective defense. I refer to peacekeeping and 
peace enforcement and promoting stability in Central Europe, a 
region which has, for centuries, been fought over and dominated 
by various great powers.
    Central Europe has now chosen to break free of that history 
through NATO membership, seeking stability by inclusion in the 
company of Western democracies. NATO has several times in the 
past sought to provide stability by adding member countries 
that had once been threats to the peace but sought to lock in 
their democratic reforms by association with NATO. I refer to 
the enlargements of NATO by the additions of Germany, of Greece 
and Turkey, and of Spain.
    When one reflects on how NATO membership has kept the lid 
on the animosity between Greece and Turkey and how the desire 
to qualify for NATO membership has done a lot to resolve the 
quarrels between Hungary and Romania and between Slovakia and 
Hungary, I think we can find proof of the proposition that NATO 
can promote stability by inclusion and extension.
    So far as peacekeeping and peace enforcement are concerned, 
it makes all kinds of sense to broaden the base upon which NATO 
can draw for protecting the peace, not only as a matter of 
enlarging resources for that purpose but also in order to 
enhance the interoperability of multinational peacekeeping 
forces.
    Mr. Chairman, it has been a fundamental American policy for 
50 years to encourage European integration, chiefly in the 
economic sphere, as a means of enhancing stability and 
prosperity in that continent. Mutual dependence has been 
thought to tighten the bonds of peace, and I believe we can see 
that this has happened to a very great extent both in the 
European Union and in NATO.
    It stands to reason, therefore, that the inclusion of 
properly qualified new countries in NATO will extend the 
network of mutual dependence and tighten the bonds of peace 
even further. If this is a reasonable hope, then the benefits 
of admitting the nations invited at the Madrid Summit would 
appear to greatly outweigh the risks, which seem very modest, 
always subject to a searching negotiation of the terms of 
accession so that the new members will be contributors and not 
merely users of security.
    Mr. Chairman, I do not see NATO enlargement as a 
provocation to Russia. The NATO--Russia Permanent Joint Council 
has been set up. The Russian representatives are participating 
in it. Mr. Primakov has agreed to it, and I think they are 
going to learn a lot about the peacekeeping characteristics and 
the peaceful characteristics of NATO through participation in 
that organ.
    More important, the Russian brigade in Bosnia under the 
NATO Supreme Commander is going to learn even more than the 
diplomats about the real NATO through daily experience from 
private soldier to general.
    I believe it to be an exaggeration when people say that 
NATO enlargement will energize the demagogues in the Duma. I 
think one can already see the issue fading in Russia as the 
public opinion polls indicate. I do not, however, go so far as 
to say that open ended enlargement of NATO might at some future 
time energize the demagogues in the Duma. Much is to be learned 
as the years go by as to whether that problem is disappearing 
or whether it might return.
    In short, Mr. Chairman, I think NATO enlargement well 
serves the purposes of peace and stability of Europe and is 
entirely consistent with the historic American policy of 
encouraging greater cohesion in Europe.
    Thank you for giving me the opportunity to testify.
    [The prepared statement of Mr. Acheson follows:]
                   Prepared Statement of Mr. Acheson
    Mr. Chairman, members of the Committee: My name is David C. 
Acheson. I am president of the Atlantic Council of the United States, a 
non-profit, bipartisan policy center in Washington. Since the Council 
does not take formal institutional positions on legislation, I am here 
to state my personal views on NATO enlargement, specifically the 
accession of the Czech Republic, Hungary, and Poland, which I strongly 
support.
    I think we all can see that newly evolved missions of NATO have 
assumed great importance. In addition to collective defense those 
missions are peacekeeping, peace enforcement and promoting stability in 
Central Europe, a region which has for centuries been fought over and 
dominated by various great powers. Central Europe has chosen to break 
free of that history through NATO membership, seeking stability by 
inclusion in the company of western democracies. NATO has several times 
in the past sought to enhance stability by the inclusion of countries 
that had once been threats to the peace, but which sought to lock in 
their democratic reforms by association with NATO. I refer to the 
previous enlargements of NATO by the addition of Germany, Greece, 
Turkey, and Spain. When one reflects on how NATO membership has kept a 
lid on the animosity between Greece and Turkey, and how the desire to 
qualify for NATO membership has done much to resolve the quarrels 
between Hungary and Romania and between Slovakia and Hungary, I think 
we can find proof of the proposition that NATO can promote stability by 
inclusion.
    So far as peace keeping and peace enforcement are concerned it 
makes all kinds of sense to broaden the base upon which NATO can draw 
for protecting the peace, not just as a matter of enlarging resources 
for that purpose, but also in order to enhance the interoperability of 
multinational peacekeeping forces.
    Mr. Chairman, It has been American policy for fifty years to 
encourage European integration, chiefly in the economic sphere, as a 
means of enhancing stability and prosperity in that continent. Mutual 
dependence has been thought to tighten the bonds of peace and I believe 
we can see that this has paid dividends both in the European Union and 
in NATO. It stands to reason that the inclusion of property qualified 
new countries in NATO will further extend the network of mutual 
dependence and tighten the bonds of peace. If this is a reasonable 
hope, then the benefits of admitting the nations invited at the Madrid 
summit, would appear to outweigh the risks which seem very modest, 
always subject to a searching negotiation to make sure that the new 
members will be contributors, an not merely users, of security.
    Mr. Chairman, I do not see NATO enlargement as a provocation to 
Russia. The NATO-Russia Permanent Joint Council has been set up an the 
Russian representatives are participating in it. They are certain to 
learn a lot about the peaceful character of NATO. More important, the 
Russian brigade in Bosnia under the NATO Supreme Commander is learning 
at least as much as the diplomats about the real-life NATO through 
daily experience, from private soldier to general. I believe it to be 
an exaggeration when people say that NATO enlargement will energize the 
demagogues in the Duma. I believe one can already see the issue fading 
in Russia, as the public opinion polls indicate, though we should watch 
this carefully as further enlargement is approached.
    In short, Mr. Chairman, I think the Madrid tranche of NATO 
enlargement well serves the purposes of peace and stability in Europe 
and is entirely consistent with the historic American policy of 
encouraging greater cohesion in Europe.
    Thank you for giving me the opportunity to express my views.

    Senator Smith. Thank you very much, Mr. Acheson, for your 
testimony and we thank your family, too, for its contribution 
to a better world.
    Mr. Acheson. I appreciate that very much. We do our best.
    Senator Smith. Thank you.
    We will now call up Mr. Adrian Karatnycky. I would simply 
remind everyone that we have to recess at noon and we have 
seven more witnesses. So we encourage you to make your comments 
but to make them as briefly as you can.

 STATEMENT OF ADRIAN KARATNYCKY, PRESIDENT, FREEDOM HOUSE, NEW 
                         YORK, NEW YORK

    Mr. Karatnycky. Mr. Chairman, I am delighted for this 
opportunity. I have three basic points to make. Although I feel 
that I am part of the second tranche of speakers before this 
committee, I think that our enthusiasm for NATO enlargement is 
no less than that of the second tranche of aspirants.
    Senator Smith. As with the second tranche of nations, you 
are also welcome.
    Mr. Karatnycky. Thank you. I appreciate that.
    I would like to make three basic points--the point of 
democracy, the point of the internal culture of the NATO 
alliance with enlargement, and also the effects on the security 
climate, including on Russia, of the prospects of NATO 
enlargement.
    The first is to say that Freedom House, which as an 
institution is a nonprofit, nonpartisan institution which 
surveys the state of political rights and civil liberties 
around the world, recently produced a report entitled ``Nations 
in Transit: 1997'' in which we look at all the countries of 
East and Central Europe and Central Eurasia and examine the 
vibrancy of their civil institutions, political liberties, 
freedom of the press, and the like.
    It is the unrelated conclusion, but one that fully 
corroborates the decision of NATO, that the three countries--
the Czech Republic, Hungary, and Poland--rate the highest among 
the 25 countries that we surveyed in terms of these basic 
freedoms. These are stable democracies, they are stabilizing, 
they will make able and reliable partners for the alliance.
    The second reason is the cultural reason. As Jan Nowak had 
indicated, the accession of the three--Poland, Hungary, and the 
Czech Republic--makes sense because these countries have 
recently struggled. Millions of people in these countries 
recently struggled for their freedom. These are the countries 
that have given us the Polish Solidarity Movement, the Czech 
Republic Civic Forum, the Democratic Opposition Movements of 
Hungary--people who put their lives on the line to win their 
freedom from communist tyranny.
    Moreover, NATO's leadership will be dramatically enhanced 
by the voices and values of such leaders as Hungary's President 
Arpad Goncz, who was a freedom fighter in 1956 and was 
imprisoned for this activity, Solidarity Prime Minister Jerzy 
Buzek, who risked his personal freedom by leading an 
underground in that country to struggle for the rights that the 
NATO alliance upholds, and, of course, Vaclav Havel.
    The third reason that NATO enlargement makes sense is in 
the security dimension. As Mr. Acheson has indicated, the very 
prospect of NATO enlargement has created a new reordering of 
cooperation among the countries of East and Central Europe. 
There are the agreements between Poland and Ukraine, Ukraine 
and Romania, Romania and Hungary, Slovakia and Hungary. All of 
these trends, as the Romanian Foreign Ministry's Dumitru Ceausu 
noted, were intended to demonstrate that Romania has no 
problems with its neighbors and similarly other representatives 
of the foreign ministries indicate. So NATO enlargement is 
leading to greater stability in terms of interstate cooperation 
as, importantly, NATO enlargement is having a dramatic effect 
on Russian conduct and, contrary to that, the opponents of NATO 
enlargement had argued.
    Tough love, I would argue, with Russia is working. Russia 
is realistically responding to the reality of the strategic 
balance of power in the region.
    It was 6 years since the collapse of the Soviet Union, but 
it was only on May 30, just a month before NATO's Madrid 
Summit, that Ukraine and Russia agreed to a treaty of 
friendship that confirmed borders and resolved the potentially 
incendiary issue of the division of the Black Sea fleet. Russia 
has indicated that it is entering into stronger relationships 
and is eager to sign cooperation agreements with the Baltic 
States.
    Moreover, despite the claims of U.S. opponents of NATO 
enlargement that the enlargement would undermine pro-Western 
reformers in Russia, the fact is that the advocates of free 
market ideas and democratic change within Russia are gaining 
strength in the upper reaches of the Russian Government as the 
process of NATO enlargement moves along.
    In conclusion, I would say that all of the evidence of the 
last year and all of the trends in Central and Eastern Europe 
show that democracy and security are being strengthened by 
NATO's plan to expand.
    The arguments that the critics of NATO enlargement have 
advanced are being daily shattered by the on the ground reality 
of the new security and political order of Central and Eastern 
Europe. All that enlargement's critics have going for them is 
disproved hypotheses and discredited theory.
    A NATO enlargement is encouraging democratic practices in 
the region, peaceful interstate relations and market reforms.
    It is insuring that the Atlantic Community's ideals of 
liberty are on the ascendancy in the region. If this pattern 
persists and is given further momentum, then it will be 
possible to agree with the statement of German General Klaus 
Naumann, who chairs NATO's Military Committee and who recently 
told a Polish news weekly that, ``We have the chance of 
attaining in Europe the same stability that we had in the 
period of the Congress of Vienna.''
    I thank you for the opportunity to testify.
    [The prepared statement of Mr. Karatnycky follows:]
                  Prepared Statement of Mr. Karatnycky
    Mr. Chairman, it is a great honor to testify before the Senate 
Foreign Relations Committee on an issue of vital importance to the 
security of the American people and of the Euro-Atlantic community--a 
community united by the values of democracy, freedom, and economic 
liberty. Freedom House, as you and your colleagues well know is a non-
profit non-partisan organization that tracks the state of political 
rights, civil liberties and economic freedom around the world.
    In May, 1997 we produced a major report that analyzes the states of 
political rights, development of civil society, emergence of free 
markets, independent media, rule of law. Our findings--published in a 
book--constitute an inventory of democracy, entitled Nations in Transit 
1997 freedom, and economic liberty in Central and Eastern Europe and 
the New Independent states of the ex-USSR.
    Mr. Chairman, as one of the coordinators of that study, I can say 
without reservation that Freedom House's findings fully corroborate the 
decisions made by NATO's leaders in their decision to begin accession 
talks with Poland, Hungary, and the Czech Republic. These three Central 
and East. European states stand at the top of the heap as the freest 
and most open countries in the former Soviet space. I have appended 
Freedom House's ratings of the countries in the region to my written 
testimony (Appendix 1). These ratings were evaluated by a group of 
eminent political scientists and area experts from Princeton 
University, Columbia University, and Johns Hopkins. Additionally, I 
would like to turn over to you and your Committee a copy of our 400-
page study.
    These three NATO aspirant countries have the East Central European 
region's most vibrant civic institutions, governments and citizens 
subject to the rule of law, and democratic political processes. In 
addition, there is a vibrantly free media in Poland and the Czech 
Republic. Hungary, where privatization of national television and radio 
still lags behind, has made less progress in terms of its free and 
independent media.
    It also is clear that eight years after the fall of Communism, 
public attitudes in the three NATO aspirant countries are solidly in 
favor of democracy, pro-Western in orientation, and pro-American. NATO 
enlargement will strengthen and deepen these propitious developments. 
Moreover, by joining NATO, the armed forces of these countries will 
deepen their respect for democratic civilian control of the military.
    Joining NATO, of course, cannot insulate any country completely 
from internal instability. But it can act as an important factor in 
stabilizing the already considerable achievements of the new and 
emerging democracies.
    There is a second reason, why the accession of Poland, Hungary, and 
the Czech Republic into NATO makes sense. The participation of these 
countries will enrich and strengthen the Atlantic alliance. Millions of 
citizens in these countries have taken part in the struggle for 
freedom. These countries have been profoundly changed by the legacy of 
Poland's Solidarity, the Czech Republic's Civic Forum, and Hungary's 
democratic opposition movements.
    NATO enlargement eastward will ensure that this spirit of deep 
commitment to democracy will become a part of the shared legacy of the 
Atlantic Alliance. I would aver that this spiritual and moral dimension 
is as important as the technical capabilities of these countries 
militaries to participate in the Alliance's force structures. As 
significantly, no one should dispute that NATO's leadership will be 
enhanced by the voices and values of such leaders as Hungary's 
President Arpad Goncz, who fought for freedom from tyranny in 1956 and 
participated in the democratic opposition after his release from prison 
in the 1960s; Poland's new Prime Minister Jerzy Buzek, who risked his 
personal freedom when he headed the Solidarity trade union underground 
in the coal-mining region of Silesia in the 1980s; and the Czech 
Republic's leading fighter for freedom, President Vaclav Havel.
    The third reason why NATO enlargement makes sense is the security 
dimension in Central and Eastern Europe. Even before Congress acts, 
NATO enlargement already is having a salutary effect on security in the 
region and on relations between states in the region--including Russia.
    Well before the July 8, 1997 NATO meeting in Madrid, the very 
prospect of NATO's move eastward already has led to some dramatic 
improvements in the security of Central and Eastern Europe. Indeed, 
since the NATO allies and especially the U.S. signaled their intent to 
expand the Atlantic alliance, there has been a flurry of diplomatic 
activity in Eastern Europe.
    Much of this diplomacy has been driven by the desire of Central 
European countries to join NATO and other Western institutions. 
Additionally, a number of treaties and agreements between Russia and 
her neighbors also suggest that the shifting power balance in the 
region is affecting Russia's behavior in ways that suggest that Moscow 
is beginning to grudgingly accept its more limited role in the region.
    As part of the process of improving the chances for entry into the 
Atlantic alliance and the European Union, the emerging democracies of 
Central and Eastern Europe have been moving at a rapid, indeed, 
dramatic pace to resolve outstanding security and border issues and to 
resolve questions related to the potentially incendiary problems of 
minorities residing within their borders.
    Mr. Chairman and Members of the Committee, NATO's formal decision 
to enlarge its membership is already proving to be a landmark 
development in European history. The very expectation that NATO would 
move eastward has contributed to dramatic improvements in the security 
of Central and Eastern Europe.
    For the past year, there has been a flurry of diplomatic activity 
among the countries of East-Central Europe, driven by their desire to 
join the Alliance and other Western institutions. This diplomacy has 
resulted in treaties that have resolved longstanding border issues and 
ethnic disputes that were the source of instability and tension, and 
that could have led to armed conflict.
    In the hope of strengthening their case for entry into the Atlantic 
Alliance, Hungary and Slovakia have signed and ratified a comprehensive 
treaty. The treaty establishes mechanisms for dealing with the half-
million strong Hungarian minority in Slovakia, and it allows for 
limited local self-government in southern Slovakia, the area where most 
of the ethnic Hungarian minority lives. Hungary also has settled its 
border issues with Romania through a far-reaching Treaty of Friendship 
and Cooperation signed in 1996 and ratified by both parliaments by May 
of 1997.
    Meanwhile, under President Emil Constantinescu, Romania has worked 
with Ukraine to resolve some potentially destabilizing border and 
minority issues. Despite opposition from the ex-Communists who ruled 
Romania until this year, the two countries initialed a basic treaty May 
3 confirming the inviolability of existing borders and renouncing the 
threat or use of force. The document also provides for measures to 
protect the culture and preserve the rights of Ukrainian minorities in 
Romania and Romanian minorities in Ukraine. As the Romanian Foreign 
Ministry's Dumitru Ceausu noted, the settlement with Ukraine was 
achieved quickly ``to demonstrate that Romania has no problems with its 
neighbors''-a precondition for NATO membership.
    Poland, meanwhile, has signed a document on Ukrainian-Polish 
reconciliation that addresses the mutual recriminations stemming from 
the 1930s and 1940s. In May, the legislatures of Poland and Lithuania 
deepened cooperation by creating an Inter Parliamentary Assembly 
designed to strengthen cultural relations and protect minority rights.
    Poland, Hungary, and the Czech Republic are playing a also critical 
role in promoting security in the countries to their East that are not 
in the first wave of NATO enlargement. The three new prospective 
members of NATO understand that although the Alliance is the 
cornerstone of regional security, it cannot solve all the region's 
problems. Poland, in particular, has taken the lead in promoting 
regional cooperation through a process known as the meetings of ``the 
Five Presidents.'' The Five Presidents are those of Poland, Ukraine, 
Lithuania, Latvia, and Estonia; they will meet regularly to discuss 
economic cooperation, cultural exchange, and regional security.
    New cooperation represents a dramatic change for the better in the 
political climate. And while the deepening democratic and free-market 
transformations is a major factor, there is no doubt that it was helped 
greatly by the understanding that NATO, anchored by the U.S., is the 
predominant economic and military presence in the region, a force that 
can intercede when ethnic tension or border disputes threaten peace.
    Nor has this positive trend been limited to Central Europe. While 
Russia remains cool toward NATO expansion, its conduct toward its 
neighbors is improving. This suggests that as NATO enlargement move 
forward, Moscow is awakening to the reality that Russia's diminished 
economic and military power means it will perforce play a more limited 
role in the region.
    In recent months, Russia has sought to improve relations with 
states it has threatened and bullied in the past. Nearly six years have 
passed since the collapse of the USSR, but it was only on May 30, a 
month before NATO's Madrid summit, that Ukraine and Russia agreed to a 
treaty of friendship that confirmed their borders and resolved the 
potentially incendiary issue of the division of the Black Sea. Similar 
progress has occurred in Russia's relations with other neighbors. In 
late May, Russian Foreign Minister Yevgeny Primakov sent a letter to 
his Latvian counterpart, Valdis Berkavs, expressing hope that a border 
agreement between the two countries could be signed in the fall. And on 
July 3, Russia signed a Treaty on Friendship, Cooperation, and Security 
with Azerbaijan that provides protections for the territorial integrity 
of both countries.
    NATO's enlargement has not led to the radicalization of moderate 
forces within the Russian establishment-vide the recent 2 to 1, vote in 
the Federation Council (Russia's upper legislative house) which 
rejected the lifting of embargoes against Iraq and Libya. Nor has NATO 
enlargement caused Russian leaders to abandon their plans to radically 
scale back the size of their armed forces.
    Despite claims by U.S. opponents of NATO enlargement that it would 
undermine proWestern reformers, in fact, advocates of free-market ideas 
and democratic change are gaining in strength within the upper reaches 
of the Russian government, as demonstrated by the growing power of the 
reformist First Deputy Prime Ministers Boris Nemtsov and Anatoly 
Chubias. Many key hardliners, meanwhile, are being eased out of office.
    Clearly, setbacks cannot be ruled out. No one can guarantee that 
Russia's democracy will not falter or that some reckless demagogue may 
not seize power in some East European country now on the path toward 
democracy and the free market. But most signs point to a continuation 
of the progress already witnessed in the region. Particularly, if 
NATO's new members continue pursuing widely supported policies of 
taking the economic, political, and security steps needed to link 
Eastern Europe to the West.
    In conclusion, all the evidence of the last year and all the trends 
in Central and Eastern Europe show that democracy and security are 
being strengthened by NATO's plan to expand. With the arguments of NATO 
enlargement's critics being daily shattered by the on-the-ground 
reality of the new security and political order of Central and Eastern 
Europe, all that enlargement's critics have going for them is disproved 
hypotheses and discredited theory.
    NATO enlargement is encouraging democratic practice, peaceful 
inter-state relations, and market reforms. It is ensuring that the 
Atlantic community's ideals of liberty are on the ascendant. If this 
pattern persists and is given further momentum, then it will be 
possible to agree with the statement of German General Klaus Naumann, 
chairman of NATO's Military Council, who recently told Poland's Wprost 
news weekly that ``We have the chance of attaining in Europe the same 
stability that we had in the period of the Congress of Vienna.''
    Mr. Chairman, as a non-profit, non partisan organization that 
unites liberals, moderates, and conservatives, Democrats and 
Republicans, and representatives of business, labor and the academic 
community, Freedom House does not take positions on specific 
legislation. Nevertheless, Mr. Chairman, I hope that this testimony 
will contribute in a small way to a better understanding by the 
American people and their elected representatives that the 
preponderance of the facts demonstrates the wisdom of an enlarged NATO 
in safeguarding Europe's security and deepening its democratic culture.
    I thank you and the Committee for the opportunity to share these 
views.



    Senator Smith. Thank you very much, Mr. Karatnycky. I 
appreciate your testimony.
    I now call Admiral Jack Shanahan, Director of the Center 
for Defense Information. We welcome you, Admiral.

   STATEMENT OF ADMIRAL JACK SHANAHAN, USN (RET.), DIRECTOR, 
         CENTER FOR DEFENSE INFORMATION, WASHINGTON, DC

    Admiral Shanahan. Thank you, Senator.
    Mr. Chairman, I am grateful to you and the other 
distinguished members of this committee for granting me the 
opportunity to speak on NATO expansion.
    In 1969, Mr. Chairman, I was in country in Vietnam, engaged 
in a real war where Americans were fighting for their very 
lives. In 1970, I was assigned to the U.S. Mission to NATO in 
Brussels.
    Mr. Chairman, it is difficult to imagine the culture shock, 
some of which remains with me to this very day, of moving from 
Vietnam to the never-never land of NATO, and mingling with some 
3,000 mindless bureaucrats and diplomats whose main mission in 
life was to avoid taking any position disruptive of a serene 
lifestyle. 500 people could have done the job better.
    The prevailing attitude of most members of the alliance was 
that they were safely tucked under the U.S. nuclear umbrella 
and that the Warsaw Pact was not a major concern. As a result, 
our allies did not consistently meet their NATO commitments in 
terms of defense spending. Their prepositioned war reserves of 
food, ammunition, fuel, et cetera, were well below NATO's 
standards. Interoperability was a joke. They were not ready 
then and they are not ready now. As we integrate East European 
militaries into the alliance, this condition will worsen, 
placing greater demands on the U.S. military to shoulder the 
burden.
    Even as we speak, our allies are making significant 
reductions in their military spending and in their force 
structures.
    With that background, Mr. Chairman--and I am sure you sense 
some bias on my part--I am here to express my very real concern 
on the issue of NATO expansion. That concern has to do with the 
need to maintain our bilateral relations with Russia, which are 
more important to the long-term security and economic interests 
of the United States and the American people and which far 
outweigh the fuzzy goals of NATO expansion.
    We could well be driving Russian foreign policy in a 
direction decidedly not to our liking. There are many issues 
out there on which Russian cooperation is essential. I have in 
mind nuclear weapons stockpile reductions, nuclear 
nonproliferation, environmental pollution, conventional arms 
control and sales, access to new oil resources, strategic 
relationships in the Middle East and the Far East and the 
success or failure of a series of treaties either signed or on 
the table.
    Thus, I oppose NATO expansion on the grounds that we are 
sacrificing our long-term relations with Russia on the altar of 
an ill-conceived plan to haphazardly expand an outmoded 
military alliance, ill conceived for domestic political 
purposes, ill conceived as a legacy for one man, and ill 
conceived since we are not clear on why, how, when, and where 
to expand.
    It is haphazard because we don't know how many countries 
will eventually join. There is no clear definition of NATO's 
new mission and there is no clear idea of the real costs.
    I hope, therefore, that the Senate, in its infinite wisdom, 
will delay the process of allowing time for an informed debate 
on both sides of the Atlantic. As George Kennan observed, 
expanding NATO would be the most fateful error of American 
policy in the entire post cold war era.
    If this be true--and I believe it is--sir, we need to be 
cautious and proceed with deliberate speed.
    Thank you, Mr. Chairman, and I yield the balance of my 
time.
    [The prepared statement of Admiral Shanahan follows:]
                 Prepared Statement of Admiral Shanahan
    Mr. Chairman, Senator Biden, I am grateful to you and the other 
distinguished members of this Committee for granting me the opportunity 
to speak on NATO expansion.
    In 1969, Mr. Chairman, I was in country in Vietnam, engaged in a 
real war where Americans were fighting for their very lives. In 1970, I 
was assigned to the U.S. Mission to NATO in Brussels. Mr. Chairman, it 
is difficult to imagine the shock, some of which remains with me to 
this very day, of moving from Vietnam to the never-never land of NATO, 
and mingling with some 3,000 mindless bureaucrats and diplomats whose 
main mission in life was to avoid taking any position disruptive of a 
serene lifestyle. Five hundred people could have done their jobs 
better.
    The prevailing attitude of most members of the alliance was that 
they were safely tucked under the U.S. nuclear umbrella, and that the 
Warsaw Pact was not a major concern. As a result, our allies did not 
consistently meet their NATO commitments in terms of defense spending. 
Their pre-positioned war reserves of food, ammunition, fuel, etc. were 
well below NATO standards. Interoperability was a joke. They were not 
ready then, they are not ready now, and as we integrate East European 
militaries into the alliance this condition will worsen, placing 
greater demands on the U.S. military to shoulder the burden. Even as we 
speak, our allies are making significant reductions in military 
spending and in their force structures.
    With that background, Mr. Chairman, and I am sure you sense bias on 
my part; I am here to express my very real concern on the issue of NATO 
expansion. That concern has to do with the need to maintain our 
bilateral relations with Russia, which are more important to the long 
term security and economic interests of the U.S. and the American 
people and which far outweigh the fuzzy goals of NATO expansion.
    We could well be driving Russian foreign policy in a direction 
decidedly not to our liking. There are many issues out there on which 
Russian cooperation is essential. I have in mind nuclear weapons 
stockpile reductions, nuclear non-proliferation, environmental 
pollution, conventional arms control and sales, access to new oil 
resources, strategic relationships in the Middle East and the Far East, 
and the success or failure of a series of treaties, either signed or on 
the table.
    Thus, I oppose NATO expansion on the grounds that we are 
sacrificing our long term relations with Russia on the altar of an ill-
conceived plan to haphazardly expand an outmoded military alliance--
ill-conceived for domestic political purposes, ill-conceived as a 
legacy for one man, and ill-conceived since we are not clear on why, 
how, when, and where to expand.
    It is haphazard because we don't know how many countries will 
eventually join, there is no clear definition of NATO's new mission, 
and no clear idea of the costs.
    I hope the Senate in its infinite wisdom will delay the process to 
allow time for an informed debate on both sides of the Atlantic. As 
George Kennan observed, ``Expanding NATO would be the most fateful 
error of American policy in the entire post-cold war era.'' If that be 
true, and I believe it is, then, Sir, we need to be cautious and 
proceed with deliberate speed.
    Mr. Chairman, let me thank you once again for this opportunity. I 
will be pleased to answer any questions you or any other members of the 
committee might have.

    Senator Smith. Thank you, Admiral. We appreciate your 
views, your perspective, and for contributing to this very 
important debate.
    Thank you, sir.
    We will now call Charles Ciccolella to the witness table.
    Mr. Ciccolella is the Assistant Director of the American 
Legion. We welcome you.

    STATEMENT OF CHARLES S. CICCOLELLA, ASSISTANT DIRECTOR, 
  NATIONAL SECURITY AND FOREIGN RELATIONS DIVISION, AMERICAN 
                     LEGION, WASHINGTON, DC

    Mr. Ciccolella. Thank you, Mr. Chairman. Thank you for the 
opportunity to present the American Legion's testimony in 
support of NATO expansion.
    The American Legion has long recognized that the security 
of the United States is tied to and depends on a stable Europe. 
Ours, after all, is an organization founded by veterans of 
World War I and dedicated to insuring that America should 
always be militarily prepared. No one knows better than 
veterans that America's security is tied to the security of 
Europe.
    Thousands of Americans fought and died in World War I and 
World War II. Hundreds of thousands of others served during the 
cold war and also endured many risks. If this century has 
provided Americans and American veterans one lesson, it is that 
continued engagement in Europe is a vital national security 
interest of the United States.
    Mr. Chairman, in the years since the demise of the Soviet 
Union and the end of the cold war, the American Legion has come 
to believe that we now have an unprecedented opportunity to 
help shape a more stable Europe through the integration of the 
Central and Eastern European nations with West European nations 
and by the reduction of old ethnic disputes and military 
rivalries.
    That is why the American Legion wholeheartedly endorsed the 
U.S. sponsored initiative, Partnership for Peace. That 
initiative has provided Central and Eastern European nations an 
opportunity for political and military cooperation. It has 
encouraged them to transition to democratic, free market 
societies.
    Now it is time for America to take the next step. The 
American Legion has taken that lead.
    As early as 1995, delegates to our National Conventions 
have repeatedly adopted and approved resolutions which 
encourage these nations to continue participating in the 
Partnership for Peace initiative and to consider applying for 
NATO membership on a case by case basis.
    Enlarging NATO is consistent with the American Legion's 
principles of U.S. foreign policy, in particular the concept 
that we advocate called ``democratic activism.'' In this case, 
democratic activism means that the American Legion supports the 
democratic right of these nations to join in the NATO alliance 
if they meet the qualifications. This goes to the heart of 
Senator Kerry's question. It is too soon to tell or to discuss 
and prejudice the outcome of the debate on the Baltic nations.
    The American Legion supports the right of those nations to 
apply for membership in NATO if they meet the qualifications.
    NATO today must respond to new challenges and threats. The 
American Legion is convinced that the best way to address these 
new threats is to expand on the gains which were made at the 
expense of so many American service men and service women who 
served during two World Wars and the cold war.
    NATO enlargement is, in our view, the best way to help 
prevent the possibly of another war in Europe.
    This year at the Madrid Summit in July, three States were 
formally invited to join NATO. It is probably no accident that 
these three--Poland, Hungary, and the Czech Republic--
physically lie in an area which has often been called the 
``geopolitical no-man's land'' of Europe.
    The American Legion believes that when these three 
countries join NATO, the so-called ``no man's land'' will 
become a more stable region.
    We are also well aware of the criticisms which have been 
lodged against this initiative, that the costs involved in 
enlarging NATO will be significantly higher, or that the United 
States may become involved in entangling alliances which are 
not in our interests, or that the relationship between Russia 
and the United States could be jeopardized, possibly propelling 
Russia to a resurgent nationalism.
    The American Legion knows that expanding the alliance 
represents a major commitment by the United States and the 
other members of NATO. It will not be easy and it will not be 
cheap. It will take many years for the new NATO members to 
become fully integrated into the alliance or for their 
militaries to be able to operate effectively as an integral 
part of NATO forces.
    Expanding the alliance does, in fact, entail new security 
commitments and we believe that these must be the same 
commitments, backed up by military force, if necessary, which 
apply to all other members. We recognize, too, that Russia's 
interests must be considered, but we believe Russia should have 
no veto and certainly no decisionmaking authority with regard 
to NATO's actions.
    Mr. Chairman, the 3 million members of the American Legion 
believe that the accession of these 3 States to the NATO 
alliance represents a major step forward for the security of 
Europe as well as the security of America. Enlarging NATO will 
enhance the alliance by making it stronger.
    Contrary to what some witnesses have proposed, we are 
already seeing a more constructive relationship developing 
between the alliance and its former adversary. It is also 
reaffirming America's pivotal leadership role in the collective 
security apparatus of Europe.
    Most important of all, the American Legion believes that 
enlarging NATO will help prevent American soldiers having to 
fight another war in Europe.
    Mr. Chairman, this is a foreign policy initiative that 
makes sense.
    That concludes my testimony.
    [The prepared statement of Mr. Ciccolella follows:]
                  Prepared Statement of Mr. Ciccolella
    Mr. Chairman and members of the committee, The American Legion 
appreciates the opportunity to present testimony in support of NATO 
enlargement. The American Legion has long recognized the security of 
the United States depends upon a stable and secure Europe. In 1919, 
battle tired World War I veterans founded The American Legion to ensure 
the proper care of returning veterans and to ensure that America would 
never again be militarily unprepared.
    Unfortunately, the Legion's call for military preparedness 
following World War I, through the concepts of Selective Service and 
Universal Military Training, were largely unheeded. Sadly, America's 
unwillingness to ensure a stable Europe after World War I resulted in 
American service members, once again, fighting and dying in foreign 
lands. The impulses which guide this organization's values regarding 
the security of Europe, are the first hand experiences of Legionnaires 
who helped liberate Europe and served to protect NATO members during 
and after World War II.
    If this century has provided American veterans one lesson, it is 
that engagement in Europe, whether through the Marshall Plan or by 
forward-deployed military forces is a vital national security issue for 
the United States. Since the end of the Cold War, The American Legion 
believes the United States is faced with an unprecedented opportunity 
to help shape a more stable Europe through the integration of former 
Soviet Bloc nations with western Europe and the reduction of ethnic 
disputes and military rivalries.
    In 1994, The American Legion wholeheartedly endorsed the U.S.-
sponsored PARTNERSHIP FOR PEACE (PFP) Initiative. The American Legion 
believes the PFP initiative has provided a sound framework for both 
political and military cooperation, as well as crisis management in 
humanitarian assistance and peacekeeping efforts. In April 1996, the 
Ambassador from the Republic of Slovakia, Dr. Branislav Lichardus, and 
Colonel George Buskirk, from the Indiana Army National Guard, spoke to 
The American Legion on their relationship as a result of the 
Partnership for Peace initiative. It was clear to Legionnaires that 
such Partnership For Peace relationships have forged strong links among 
U.S. and NATO forces and their new democratic partners from Eastern and 
Central Europe. The Partnership for Peace Initiative has also helped 
provide many former Soviet Bloc countries political, economic and 
military encouragement in their efforts to become more democratic, free 
market nations.
    As early as 1995, The American Legion commissioned an Ad Hoc Group 
to study the issue of NATO enlargement. The study group first reported 
favorably on the continuing effectiveness of the NATO Alliance and 
reaffirmed that U.S. membership in NATO continues to serve the vital 
interest of the United States. In addition, the study concluded that 
expanding the NATO Alliance was consistent with The American Legion's 
principles of U.S. Foreign Policy, particularly the concept of 
``Democratic Activism.'' This concept supports the democratic right of 
Central and Eastern European nations to apply for membership into the 
NATO Alliance.
    As a result of the study group's efforts, delegates to The American 
Legion's National Convention repeatedly approved and adopted 
resolutions encouraging the Central and Eastern European nations 
continuing participation in the Partnership For Peace Initiative and 
their applications for NATO membership. However, The American Legion 
believes applications should only be favorably considered on an 
individual basis. Each candidate should also accept and conform with 
the principles, policies and procedures adopted by all standing members 
of the NATO Alliance.
    Last year, three Central European nations were identified as 
leading candidates for membership into NATO. At the Madrid NATO Summit 
in July of 1997, these candidates were formally invited to join the 
Alliance. It is probably no accident that these three--Poland, Hungary, 
and the Czech Republic, physically lie in an area identified as the 
``geopolitical no-man's land of Europe.'' The American Legion believes 
that when these three countries--Poland, Hungary, and the Czech 
Republic--are accepted for membership by the United States and the 
other 15 Members of NATO, this so-called ``no man's land'' will be 
replaced by a more stable region and result in closer political, 
economic and military ties with the West.
    The American Legion fully supports expanding the NATO Alliance with 
the addition of Poland, Hungary and the Czech Republic. The American 
Legion believes history has demonstrated the need to pursue the 
inclusion of these countries. Securing the stability of Central Europe 
by expanding NATO to these three candidates is in the best interest of 
the United States. The American Legion believes the best way to address 
the new threats of the Post Cold War environment is to expand on the 
gains achieved during the Cold War. NATO enlargement appears to be the 
best alternative to ensure stability in Europe.
    Critics of NATO enlargement assert the costs involved in enlarging 
the Alliance will be significantly higher than current administration 
estimates. While various budget estimates differ, these estimates share 
underlying assumptions that the United States should be required to 
fund its share (some 40%) of the interoperablility or direct 
enlargement costs. These interoperability costs, which total about 10 
billion dollars over a 10-year period (approximately 200 million 
dollars a year for the United States), are roughly one-third of the 
total NATO enlargement estimates. It is The American Legion's 
understanding that the two other major categories of costs, 
modernization and power projection, will be funded by the current and 
new NATO members. For example, the military modernization expense for 
the new members will be born by those nations themselves, while the 
costs for enhancing each NATO nation's power projection capabilities 
are to be born collectively by the current members of the Alliance.
    In summary, it is our understanding that three NATO dollars will be 
spent for each U.S. dollar committed to fund NATO Enlargement. The 
American Legion believes this is an equitable distribution. Both the 
Secretary of Defense and the Secretary of State have estimated the 
direct enlargement costs may actually be less than originally 
estimated. According to both the Departments of State and Defense, 
further investigation reveals that Poland, Hungary and the Czech 
Republic have better developed infrastructures to support their 
military integration into NATO than original estimates.
    Thus, the relatively small U.S. contribution to fund NATO expansion 
appears to be a fair price for the expected return of stability and 
security in Europe. The American Legion National Commander, Anthony 
Jordan, recently returned from a mission to NATO Headquarters in 
Brussels, as well as Poland, Hungary and the Czech Republic. During an 
interview, Commander Jordan was questioned about the costs of expanding 
NATO. Commander Jordan noted that ``this is not a cost issue, this is a 
peace issue.'' Simply put, protecting American lives from future 
hostilities in Europe is well worth the monetary costs.
    Expanding the alliance will also entail new security commitments 
and possible risks. The American Legion is fully aware of the dangers 
of America becoming involved in new entangling alliances. This is an 
important concern because the same security guarantees which protect 
current NATO members must be extended to new members. This means that 
Poland, Hungary and the Czech Republic must be defended in the same way 
as all others nations in the Alliance. What critics ignore is the force 
structure contributions of these new members. After all, each new 
member will be contributing its own military forces and will be 
shouldering responsibility for its share of the collective defense of 
Europe.
    The American Legion is convinced that Poland, Hungary and the Czech 
Republic will take their security commitments seriously. During 
National Commander Jordan's recent NATO tour, he also witnessed several 
military live-fire exercises and visited with Polish, Hungarian and 
Czech forces. Commander Jordan concluded these three nations are fully 
prepared now to contribute immediately to NATO. Commander Jordan also 
noted that each of these nation's military personnel truly want to join 
NATO to actively contribute to the collective security of Europe.
    Some critics have argued that enlarging NATO could seriously 
jeopardize U.S.-Russian relations and perhaps lead Russia towards a 
resurgent in nationalism. In addition, some believe NATO enlargement 
would encourage Russia to abrogate its responsibilities with regards to 
various treaties and arms control agreements. While no one can rule out 
such possibilities, The American Legion believes NATO's relationship 
with Russia must evolve from one oriented at confronting and containing 
the former Soviet Union to one focused on a stabilized Central and 
Eastern Europe. Mr. Chairman, the Cold War is over and working with the 
former Soviet Union to resolve our differences is essential to the 
success of the NATO enlargement initiative.
    The question our Legionnaires have raised, however, is whether the 
United States is better off in any of these scenarios with an expanded 
NATO or with the current NATO. The membership of The American Legion 
has concluded that the United States is better off as a member of an 
expanded alliance. Like the United States and current NATO members, the 
people of Poland, Hungary and the Czech Republic want security and 
stability in Europe. As National Commander Jordan stated, ``it will be 
good for the United States to have more allies in NATO (because) it 
gives us another shield, so to speak, from possible threats to our 
national security interests.''
    The American Legion believes the accession of these new candidates 
to the NATO Alliance will promote the national security interests of 
the United States. Enhancing the NATO collective security alliance will 
mean a more stable, secure and democratic Europe. United States' 
support for NATO enlargement also reaffirms our pivotal leadership role 
in Europe. Most important of all, The American Legion believes that 
when NATO is enlarged, there will be much less chance that American 
soldiers will be called upon to fight another war in Europe.
    Mr. Chairman, The American Legion applauds your leadership and the 
leadership of the Senate Foreign Relations Committee for conducting 
full and thorough hearings on the implications of expanding NATO with 
the entry of Poland, Hungary, the Czech Republic and possibly later on, 
other invited nations. The American Legion is pleased that Congress and 
the administration have addressed this issue in a bipartisan approach 
and believes it is the right course in addressing and resolving the 
concerns of the American people with regard to this major foreign 
policy initiative. The American Legion urges this committee to report 
NATO enlargement favorably to the full Senate so it may provide its 
advice and consent to the addition of these states to the NATO Alliance 
in a prompt and timely manner.
    Mr. Chairman, this concludes my testimony. Thank you.

                               __________

                   SEVENTY-NINTH NATIONAL CONVENTION

                                   OF

                          THE AMERICAN LEGION

                            ORLANDO, FLORIDA

                        SEPTEMBER 2, 3, 4, 1997

RESOLUTION NO.:
                                                102

SUBJECT:
                                                POLICY ON NATO 
                                                EXPANSION

Origin:
                                                Maryland

Submitted By:
                                                Foreign Relations

3WHEREAS, The American Legion has long recognized that European 
security and preservation of the NATO Alliance are critical to 
America's vital national security interests; and

WHEREAS, The North Atlantic Treaty Organization of 1949 anticipated the 
addition of member states which has included Greece and Turkey in 1952, 
the Federal Republic of Germany in 1955 and Spain in 1982; and

WHEREAS, The American Legion wholeheartedly supported the 1994 U.S.-
sponsored initiative known as the Partnership for Peace (PFP) Program, 
including the concept of extending membership in NATO to Central and 
Eastern European nations on a case by case basis consistent with their 
commitments and participation in the PFP; and

WHEREAS, The American Legion believes that expanding NATO will: 1) make 
a stronger alliance, 2) protect against another European war, 3) defend 
against old European ethnic and border disputes, and 4) help to build 
an undivided Europe; and

WHEREAS, On April 22, 1997, the Senate created a bipartisan NATO 
Observer Group to work cooperatively with the Administration throughout 
the NATO Enlargement process; and

WHEREAS, Russia will be consulted on NATO Alliance issues but will have 
no veto authority or ability to delay entry into the Alliance for any 
country; and

WHEREAS, On May 27, 1997 NATO and Russia signed a ``Founding Act'' to 
create a more constructive relationship between the alliance and its 
former adversary; and

WHEREAS, At the Madrid NATO Summit meeting in July 1997, the members of 
the North Atlantic Treaty Organization extended invitations to Poland, 
Hungary and the Czech Republic to join the Alliance and formal 
accession talks are now underway with those states; and

WHEREAS, The first nations which received invitations to join NATO will 
not be the last and the Partnership For Peace Program will be enhanced 
for those nations not initially invited into the Alliance and; now, 
therefore, be it

RESOLVED, By The American Legion in National Convention assembled in 
Orlando, Florida, September 2, 3, 4, 1997, That The American Legion 
urges the President to continue to consult fully with the Congress 
throughout the process of NATO Expansion; and, be it further

RESOLVED, That The American Legion urges the Senate to conduct full and 
thorough hearings on the proposals to expand NATO with the entry of 
Poland, Hungary and the Czech Republic and at a later time other 
invited nations, and to resolve the issues and concerns which will 
address the implications of expanding the North Atlantic Treaty 
Organization in a bipartisan manner; and, be it finally

RESOLVED, That following this public debate, The American Legion urges 
the United States Senate to provide its advice and consent to the 
addition of these states to the NATO Alliance in a prompt and timely 
manner.

    Senator Smith. Thank you, Mr. Ciccolella. We appreciate it.
    We now call forward Mr. David Harris, Executive Director of 
the American Jewish Committee. Mr. Harris, welcome, and please 
go forward.

  STATEMENT OF DAVID A. HARRIS, EXECUTIVE DIRECTOR, AMERICAN 
              JEWISH COMMITTEE, NEW YORK, NEW YORK

    Mr. Harris. Good morning, Mr. Chairman.
    It is an honor to appear before the committee this morning 
to discuss with you why the American Jewish Committee supports 
the expansion of NATO.
    The American Jewish Committee, Mr. Chairman, was founded in 
1906 in response to a series of pogroms carried out by Czarist 
officials against Jews in Russia and elsewhere in Eastern 
Europe. In the 91 years since our founding, we have seen the 
horrible consequences produced by instability in Central and 
Eastern Europe. It is precisely because we carry with us the 
memory of those horrors and because we believe that America is 
best served by an active and vigorous foreign policy that the 
American Jewish Committee became the first Jewish organization 
in this country to publicly come out in support of NATO 
enlargement.
    We are convinced, Mr. Chairman, that opportunity in life is 
temporary, not permanent. It is either seized or it is lost. 
The opportunity presented by an expanded NATO is one that 
should not, must not, be lost, for an expanded NATO means 
greater stability and security for Central Europe, a region 
that has already been the cockpit for two World Wars that 
brought such horror to the world.
    Mr. Chairman, I have spent my professional and academic 
life involved with affairs in Russia and the surrounding 
region. I have lived and worked in the Soviet Union. I am 
convinced that to leave Europe divided at its old cold war 
boundaries, to ignore the lands to the East, to have NATO 
members turn their collective backs on Central Europe would be 
to ignore the lessons of history, the dangers to European and 
Western security that lurk there.
    From the Balkans to the Caucasus, more Europeans have died 
violently in this region in the past 5 years than in the 
previous 45. As Vaclav Havel, the distinguished President of 
the Czech Republic, said, ``Just as it is impossible for one-
half of a room to be forever warm and the other half cold, it 
is equally unthinkable that two different Europes should 
forever exist next to each other without detriment to both.''
    In addition, Mr. Chairman, retaining the North Atlantic 
Alliance in its cold war configuration would have meant 
continuing an historic injustice--the abandonment by the 
democratic West of the small nations of Central Europe. Let me 
remind us all that it happened in 1938 at Munich; it happened 
in 1945 at Yalta; and the West watched from the sidelines as 
Soviet power squashed fledgling and promising democratic 
movements in Hungary in 1956, in Czechoslovakia in 1968, and in 
Poland in 1981.
    An expanded NATO not only strengthens democracy in those 
nations embraced by the alliance at Madrid, but it encourages 
the other nations in the region to accelerate their own 
democratic and market reforms as well as resolving long-
simmering disputes.
    The 1994 Poland-Lithuania agreement on good neighborly 
relations and the 1996 Hungary-Romania bilateral friendship 
treaty are but two examples of this conflict resolution. 
Moreover, Mr. Chairman, integration in the Western Alliance 
offers a real safeguard for the rights of Jews and other 
minority communities, historically the target of national, 
religious, or ethnic hatreds in too many places.
    Throughout its history, NATO has been a collective defense 
pact only. Russian reaction to NATO's decision to extend 
membership to three former Soviet Bloc States has been far more 
restrained than many have suggested. Indeed, just as was the 
case prior to the introduction of NATO forces in the former 
Yugoslavia, opponents of NATO expansion have invoked supposed 
Russian opposition to any display of Western power largely in 
order to boost their own case against using it.
    The Founding Act signed by Russia and NATO in May does give 
Russia a voice in alliance affairs immediately, while those 
countries currently being invited will not have a seat at the 
table for at least 2 years.
    Mr. Chairman, I would like to add a word, if I may, as well 
about Senator Kerry's probing questions. It would be premature 
to become too specific today about the scope of a second or 
even a third tranche of NATO expansion. But it is, I believe, 
very important to keep alive NATO's openness, as demonstrated 
in Madrid, to further ways of expansion. To do otherwise would 
be to dash the hopes of tens of millions of Europeans, from the 
Balkans to the Baltics, that their future would not under any 
circumstance include membership in NATO and, therefore, to 
permit the risk of a recreation of European spheres of 
influence, a profoundly destabilizing step that could have 
unintended, indeed unforeseeable, consequences.
    At the very same time, though, the United States and NATO 
must make the Founding Act with Russia work both in letter and 
in spirit to ease Russia's historical fear of encirclement. 
This requires ongoing, careful, nurturing attention both to 
Russian--NATO and Russian--U.S. ties and to attend to those 
many areas of cooperation both current and potential while 
periodically reminding Moscow that the new NATO of today is not 
an alliance directed against it.
    Last, we should not look at NATO expansion as a zero--sum 
game where expansion means forfeiting our ties with Russia. 
That is simply wrong-headed. It is not the American intention, 
it is not NATO's intention, and it certainly ought not to be 
the Russian intention as it moves toward institutionalizing its 
democratic and market reforms.
    With the implosion of the Warsaw Pact and the Soviet Union, 
Europe is poised at one of those infrequent moments of 
historical definition where choices are clear and alternatives 
stark. We respectfully urge the U.S. Senate to grasp the 
significance of this moment, the chance to solidify the 
democratic ideal, and to enhance European and Western security.
    The history of our century teaches, or ought to teach, that 
American leadership is indispensable in building an undivided, 
democratic, and peaceful Europe, that leadership embodied today 
in the drive to NATO expansion continues a proud tradition and, 
therefore, that we are pleased to support it.
    Thank you, Mr. Chairman.
    [The prepared statement of Mr. Harris follows:]
                    Prepared Statement of Mr. Harris
    Mr. Chairman, it is an honor to appear before the Committee to 
discuss with you why the American Jewish Committee supports the 
expansion of NATO. The American Jewish Committee was founded in 1906 in 
response to a series of brutal pogroms carried out by Czarist officials 
against Russian Jews. In the ninety-one years since our founding we 
have seen the horrible consequences produced by instability in Central 
and Eastern Europe. It is because we carry with us the memory of those 
horrors, and because we believe that America is best served by an 
active and vigorous foreign policy, that the American Jewish Committee 
was the first Jewish organization in the United States to publicly come 
out in favor of NATO enlargement following the historic Madrid Summit.
    On June 26, we observed that ``An enlarged NATO will mean greater 
security and stability and also hasten the political and economic 
integration of Europe.'' This view was confirmed to us just last month 
when the AJC participated in a fact-finding visit to the three proposed 
new member countries--the Czech Republic, Hungary and Poland -organized 
by the Departments of State and Defense. This mission toured military 
facilities in the three countries and met with senior defense and 
military officials. It only confirmed our judgment that an enlarged 
NATO is good for the stability and security of the newly freed peoples 
of the region, is good for European security and integration, and is 
good for the United States.
    We are convinced that opportunity is temporary, not permanent. 
Either it is seized or it is lost. The opportunity presented by an 
expanded NATO is one that should not be lost. An expanded NATO means 
greater stability and security for Central Europe, a region that was 
the cockpit for the two world wars that brought such horror to the 
world--and to the Jewish people.
    Mr. Chairman, I have spent my professional and academic life 
involved with affairs in Russia and the surrounding region. I lived in 
the Soviet Union. I was National Coordinator of the historic Freedom 
Sunday for Soviet Jewry. I am convinced that to leave Europe divided at 
its old Cold War boundaries, to ignore the lands to the east, to have 
NATO members turn their collective backs on Central Europe, would be to 
ignore the dangers to European--and Western--security that lurk there. 
From the Balkans the Caucasus, more Europeans have died violently in 
this region in the last five years than in the previous 45. As Vaclav 
Havel, the distinguished president of the Czech Republic, noted: ``Just 
as it is impossible for one-half a room to be forever warm and the 
other half cold, it is equally unthinkable that two different Europes 
should forever exist next to each other without detriment to both--and 
it is the stabler and more prosperous one that would pay the higher 
price.''
    In addition, retaining the North Atlantic alliance in its Cold War 
configuration would have meant continuing an historic injustice--the 
abandonment by the democratic West of the small nations of Central 
Europe. It happened in 1938 at Munich and 1945 at Yalta, and the West 
watched from the sidelines as Soviet power squashed fledgling 
democratic movements in Hungary in 1956, Czechoslovakia in 1968, and 
Poland in 1981.
    An expanded NATO not only strengthens democracy in those nations 
embraced by the alliance at Madrid but encourages the other nations in 
the region to accelerate democratic and economic reforms, as well as 
resolve long-simmering disputes. The 1994 Poland-Lithuania agreement on 
good neighborly relations and military cooperation, that established a 
basis for friendly bilateral relations, and the 1996 Hungary-Romania 
bilateral friendship treaty, that extends mutual recognition of the 
rights of national minorities, are just two examples. Moreover, 
integration in the Western alliance offers a real safeguard for the 
rights of Jews and other minority communities, historically the target 
of national, religious or ethnic hatreds in too many places.
    Further, an expanded and strengthened NATO insures that sufficient 
military force and supporting infrastructure are in place in Southern 
Europe and along the Mediterranean littoral if need should arise for 
power projection by the Western democracies into neighboring regions in 
Eurasia.
    NATO throughout its 50-year history has been a collective defense 
pact only. Russian reaction to NATO's decision to extend membership to 
three former Soviet bloc states has been far more restrained than many 
had suggested. Indeed, just as was the case prior to the introduction 
of NATO forces in the former Yugoslavia, opponents of NATO expansion 
have invoked supposed Russian opposition to any display of Western 
power largely in order to bolster their own case against using it. The 
founding act signed by Russia and NATO in May gives Russia a voice in 
alliance affairs immediately, while the countries being invited now 
will not have a seat at the table for at least two years.
    With the implosion of the Warsaw Pact and the Soviet Union, Europe 
is poised at one of those infrequent moments of historical definition, 
when choices are clear and alternatives stark. We respectfully urge the 
United State Senate to grasp the significance of this moment, the 
chance to solidify the democratic ideal and enhance European--and 
Western--security, and support the proposed enlargement of NATO.
    The history of our century teaches that American leadership is 
indispensable in building an undivided, democratic, and peaceful 
Europe. That leadership, embodied today in the drive to NATO expansion, 
continues a proud tradition. The American Jewish Committee believes 
that, while the cost of NATO expansion will not be negligible, the cost 
of failure to assure European stability and security would be far 
higher. We therefore urge the Committee to support the Administration 
in its steady, incremental broadening of the Western Alliance.

    Senator Smith. Thank you, Mr. Harris. We appreciate your 
testimony very much.
    We are now pleased to call Mr. John T. Joyce, President of 
the International Union of Bricklayers and Allied Craftworkers 
to the witness table. We welcome you, sir.

 STATEMENT OF JOHN T. JOYCE, PRESIDENT, INTERNATIONAL UNION OF 
      BRICKLAYERS AND ALLIED CRAFTWORKERS, WASHINGTON, DC

    Mr. Joyce. Thank you, Mr. Chairman. I appreciate the 
opportunity to summarize the written remarks that I have 
presented to the committee supporting the expansion of NATO at 
this point.
    I think it is obvious to most people the fact that the 
labor movement in the United States, both directly and through 
our society more generally, made an enormous investment in 
waging and winning the cold war because we recognized the 
profound threat that Soviet communism posed to democracy and to 
free trade unions.
    Our experience working with trade unions in Central and 
Eastern Europe and not so incidentally with trade unions 
elsewhere tells us that the advances that have taken place in 
democracy in Central and Eastern Europe, such as they are, are 
fragile and that the dynamics that began with the collapse of 
the Soviet Union are very uncertain as to their outcome.
    I think too many people are dangerously sanguine on that 
particular point.
    It would, indeed, be a tragic waste of the investment that 
we have made as a society. It would be a tragic waste in terms 
of wasting that money itself and in the consequences that could 
relatively easily flow from it.
    Expansion of NATO is certainly a necessary part of the 
effort that is required at this point. It is, of course, 
necessary to also address the broader social, political, and 
economic issues that exist here, just as the Marshall Plan 
addressed those areas in the period immediately after the 
Second World War and assured the initial success of NATO.
    We, therefore, urge the committee's support for expansion 
of NATO. We express the hope that ratification will be not only 
bipartisan but overwhelming. We think it would be indeed 
unfortunate if at this time elements within Russia should 
erroneously begin to perceive signals that it would be possible 
to forestall the further expansion of NATO to those countries 
that meet the membership requirements of NATO that have been 
established.
    It would be extremely unfortunate if we saw a reemergence 
of the Sonnenfeldt doctrine that held that the primacy of 
Russia in terms of its sphere of influence in that area had to 
be the dominating factor in our foreign policy.
    Because we were able to resist that doctrine, we were 
successful in the cold war. It would be a shame if, at this 
juncture, we allowed that doctrine to reemerge and, therefore, 
make it possible to lose the peace.
    Thank you very much, Mr. Chairman.
    [The prepared statement of Mr. Joyce follows:]
                    Prepared Statement of Mr. Joyce
    When Lech Walesa, then the leader of the new independent trade 
union movement of Poland, met for the first time with a representative 
of the American trade union movement his first question was ``What 
about the Sonnenfeldt doctrine?''
    The Sonnenfeldt doctrine was the notion that the interests of the 
United States would best be served by maintaining or helping to 
maintain a stable relationship between the Soviet Union and its East 
European satellites. Furthermore, it said we should do nothing to 
disturb the stability of that relationship. The widespread view, the 
dominant view in the liberal and conservative communities, was that the 
Soviet system was here to stay.
    The American trade union movement rejected that notion and despite 
the protestations of two successive secretaries of state, one Democrat 
and one Republican, we continued to support the Solidarity trade union 
of Poland when it was forced to go underground in 1981. We were 
explicitly urged not to set up a fund to aid the Polish workers of 
Solidarity because we were ``meddling in very, very delicate waters'', 
and we might upset relations there. Whole theories and policies were 
based on the Sonnenfeldt Doctrine. And people were miseducated for a 
generation.
    But all the people of Central and Eastern Europe, not having been 
persuaded by the Sonnenfeldt doctrine, simply made a shambles of what 
was a staple of American foreign policy for years and years and years. 
Although more sophisticated analysts mistook workers underground for 
the dead and buried, the workers of Poland proved to be the vanguard of 
the revolution against communism.
    The trade union approach to foreign policy always understood that 
when the workers of Eastern Europe finally spoke for themselves they 
would have it as their aim to establish democracy. Now that so many of 
our assumptions have been proven true, three of those nations are 
candidates to join NATO, the alliance of democracies.
    The American trade union movement, along with our society, made an 
enormous investment in waging and winning the cold war. It would be a 
tragedy if we dissipated that investment by failing to take the next 
logical step necessary to advance the cause of democracy. Given the 
fragile nature of progress to date, modest expenditures on democracy 
building, are the least we can do to honor the sacrifices of blood and 
treasure already made.
    Vaclav Havei, the President of the Czech Republic has said ``the 
alliance should urgently remind itself that it is first and foremost an 
instrument of democracy intended to defend mutually held and created 
political and spiritual values. It must see itself as not as a pact of 
nations against a more or less obvious enemy, but as a guarantor of 
Euro-American civilization and thus as a pillar of global security.''
    His view reminds us of NATO's roots. In the preamble to its 
original charter the parties to the North Atlantic Treaty stated that 
``they are determined to safeguard the freedom, common heritage and 
civilization of their peoples, founded on principles of democracy, 
individual liberty and the rule of law''. And Article 2 further states 
that ``the parties will contribute toward the further development of 
peaceful and friendly international relations by strengthening their 
free institutions, by bringing about a better understanding of the 
principles upon which these institutions are founded, and by promoting 
the conditions of stability and well-being. They will seek to eliminate 
conflict in their international economic policies and will encourage 
economic collaboration between any or all of them.''
    Some of those who oppose NATO enlargement, act as if democracy is a 
modular technology which needs no more than the appropriate plug to 
ensure peace and stability. More accurately, democracy is like a 
flowering plant which requires the proper nurturing and nutrients to 
assure growth and survival. It would be foolish to believe that the 
collapse of communism means that there are no longer threats to the 
values of freedom and democracy we share.
    The dangers of our day come not from the current government in 
Moscow, but from local conflicts and ancient hatreds stoked by 
opportunistic nationalists and as the role of NATO in Bosnia has 
demonstrated, NATO is the only international institution capable of 
confronting and conquering such threats.
    We delude ourselves and risk the failure of this endeavor if we 
treat the enlargement of the alliance as no more than the sharing of 
military hardware. Instead as President Havel has suggested ``NATO 
expansion should be perceived as a continuous process, in which the 
nations of Central and Eastern Europe mature toward the meaning, values 
and goals of the enlarged and revived alliance.''
    Just as De Tocqueville noted the unique set of American 
institutions that assured the success of our American democracy, it is 
essential that we assist the emerging democracies of, Central and 
Eastern Europe to build enduring institutions of democracy and civil 
society in their own countries. The hatred that has poisoned what was 
once Yugoslavia is not unique to that country among all in Europe.
    And as the founders of NATO indicated in their original charter, 
the avoidance of economic conflict is also essential to stability. 
Security, I am saying, is no longer just a military term. We need to 
recognize that the salient issues of military consequence are a 
necessary, but not a sufficient aspect of an updated approach to 
security questions.
    The new democracies need both a strong elected government, with a 
military responsive to civilian authority and a strong private sector 
comprised of business, farmers, professionals and unions which all add 
to the defusion of power to the citizens in society. An economy or a 
government run by the same old bureaucrats in market or democratic 
dress will assure future inequity, demagoguery and the sort of 
instability that could spill over borders. Preemptive measures against 
these risks could in the end save the lives of American troops.
    The lessons of the Marshall Plan should not be lost on us. Those 
efforts were essential to a successful NATO in an earlier era. We 
ignore these issues only at our peril.
    To recognize that such problems are part of our responsibility is 
not the easiest path to take. But if we ignore the full nature of the 
challenges before us we will insure a far, far more difficult set of 
tasks will come when the failure to build the necessary civil society, 
the democratic and economic basis for long term stability, catches up 
with us.
    So I support the enlargement of NATO, but I urge Congress to 
concurrently support that expansion with the requisite assistance for 
the development of pluralist democracy that has been the essential to 
the success NATO has known to date.
    In the late 1990's, as in 1949, the parties will best ``contribute 
toward the further development of peaceful and friendly international 
relations by strengthening their free institutions, by bringing about a 
better understanding of the principles upon which these institutions 
are founded, and by promoting the conditions of stability and well 
being'' through the promotion of the principles of democracy.

    Senator Smith. Thank you very much, Mr. Joyce. We 
appreciate your testimony.
    Colonel Herb Harmon is next. We welcome you, sir and invite 
your testimony.

    STATEMENT OF COLONEL HERBERT N. HARMON, USMCR, NATIONAL 
 PRESIDENT, RESERVE OFFICERS ASSOCIATION OF THE UNITED STATES, 
                         WASHINGTON, DC

    Colonel Harmon. Thank you, Mr. Chairman.
    It is a privilege to be here today representing the nearly 
100,000 members of the Reserve Officers Association to let you 
know our position on the issue of NATO enlargement.
    Our association was established 75 years ago at the behest 
of General of the Armies John J. Pershing by commissioned 
officer veterans of World War I, known at that time as ``the 
Great War.'' ROA's founders were concerned about what they 
perceived as our Nation's drift into unilateral disarmament and 
isolationism. They believed that a strong military was the best 
defense against the threat of future wars.
    In 1950, President Harry S. Truman, a founding member of 
ROA Chapter 1 in Independence Missouri, signed our 
Congressional charter. That charter set forth our association's 
object and purpose--to support and promote the development and 
execution of ``a military policy for the United States that 
will provide adequate national security.''
    Mr. Chairman, our object and purpose remain unchanged and 
our association continues to speak out on those issues that 
affect our military policy and national defense. NATO 
enlargement is very much within our purview.
    This past July, at our annual National Convention in Kansas 
City, our general membership approved a resolution in support 
of NATO enlargement. This resolution recognizes the North 
Atlantic Treaty Organization as the most successful defensive 
alliance in history, one that has survived 50 years of 
unparalleled international tensions which, absent its 
existence, could have led to a Third World war.
    One great measure of NATO's success is the strategic 
relationship that we have been able to achieve in the post cold 
war world with Russia and the other, now independent, nations 
of the former Soviet Union. This strategic relationship is 
based upon mutual cooperation, dialog, confidence building, 
crisis prevention, and the Partnership for Peace with the 
nations of Central and Eastern Europe.
    This relationship recognizes the need for stability and 
mutual security among all of the nations of the North Atlantic 
region and fosters emerging trends toward closer integration 
within Europe.
    We believe that, over time, the essential defensive nature 
of the alliance will become clear to all parties and, with it, 
the realization that NATO threatens no one. NATO is and will 
remain a purely defensive alliance whose fundamental purpose is 
to preserve peace in the Euro-Atlantic area and to provide 
security to its members.
    I have just returned from Europe where I had the 
opportunity to visit with numerous military and civilian 
officials from Hungary, the Czech Republic, and Poland, as well 
as NATO officials and the military officers from the European 
Command. I was able to meet with embassy officials, visit with 
Hungarian Air Force pilots, witness military training in the 
Czech Republic, and receive briefings from officers of the 
Polish General Staff.
    In all of these encounters, I came away with a strong sense 
of the growing confidence of these now independent nations in 
the processes and institutions of democratic government as well 
as their sense of themselves as partners in the greater 
European community.
    To me, NATO enlargement means growing democracy.
    Studies on NATO enlargement indicate that it will 
contribute to enhanced stability and security for all countries 
in the Euro--Atlantic area by encouraging and supporting 
democratic reforms, including civilian and democratic control 
over the military.
    It will foster patterns and habits of cooperation, 
consultation, and consensus building that characterize 
relations among present members of the alliance. Enlargement 
will promote good neighborly relations in the whole Euro--
Atlantic area and increase transparency in defense planning and 
military budgets, and, thus, confidence among States. It will 
reinforce the tendency toward integration and cooperation in 
Europe and strengthen NATO's abilities to contribute to 
European and international security and to support peacekeeping 
activities in cooperation with the U.N.
    Finally, it will strengthen and broaden the Transatlantic 
partnership.
    The Reserve Officers Association of the United States 
strongly urges you to support NATO enlargement consistent with 
the United States policy. NATO enlargement is the logical 
consequence and fruit of the success that NATO has enjoyed 
since it was established in April, 1949. Enlargement is both 
the reward and the process that will further enable and secure 
the blessings of life, liberty, and the pursuit of happiness to 
NATO members and to provide increased stability to all peoples 
of the world.
    Thank you, Mr. Chairman.
    [The prepared statement of Colonel Harmon follows:]
                   Prepared Statement Colonel Harmon
    Mister Chairman and Members of the Committee, it is a privilege to 
be here this morning representing the nearly 100,000 members of the 
Reserve Officer's Association, to discuss ROA's position on the issue 
of NATO enlargement.
    Our association was established 75 years ago at the behest of 
General of the Armies John J. Pershing by commissioned officer veterans 
of the World War I, what was called then ``the Great War.'' RONs 
founders were concerned about what they perceived as our nation's drift 
into unilateral disarmament and isolationism. They believed that a 
strong military was the best defense against the threat of future wars.
    In 1950, President Harry S Truman, a founding member of ROA Chapter 
1 in Independence Missouri, signed our congressional charter. That 
charter set forth our association's object and purpose--to support and 
promote the development and execution of ``a military policy for the 
United States that will provide adequate national security. . . .'' 
Mister Chairman, our object and purpose remain unchanged, and our 
association continues to speak out on those issues that affect our 
military policy and national defense. NATO enlargement is very much 
within our purview, and for many of the same reasons that led General 
Pershing and his fellow veterans of the Great War to found ROA in 1922.
    This past July, at our annual National Convention in Kansas City, 
our general membership approved a resolution in support of NATO 
enlargement. This resolution (ROA Resolution No. 97-10) recognizes the 
North Atlantic Treaty Organization as the most successful defensive 
alliance in history, one that has survived 50 years of unparalleled 
international tensions, which absent its existence, could have led to a 
third world war.
    One great measure of NATO's success is the strategic relationship 
that we have been able to achieve in the post-Cold War world with 
Russia and the other, now independent nations of the former Soviet 
Union. This strategic relationship is based upon mutual cooperation, 
dialogue, confidence building, crisis prevention, and the Partnership 
for Peace with the nations of Central and Eastern Europe. This 
relationship recognizes the need for stability and mutual security 
among all of the nations of the North Atlantic region, and fosters 
emerging trends toward closer integration within Europe. We believe 
that over time the essential, defensive nature of the alliance will 
become clear to all parties, and with it the realization that NATO 
threatens no one. NATO is, and will remain, a purely defensive alliance 
whose fundamental purpose is to preserve peace in the Euro-Atlantic 
area and to provide security to its members.
    I have just returned from Europe, where I had the opportunity to 
visit with numerous military and civilian officials from Hungary, the 
Czech Republic, and Poland, as well NATO officials and US military 
officials from the European Command. I was able to meet with US embassy 
officials, visit with Hungarian air force pilots, witness military 
training in the Czech Republic, and receive briefings from officers of 
the Polish General Staff. In all of these encounters, I came away with 
a strong sense of the growing confidence of these now-independent 
nations in the processes and institutions of democratic government, as 
well as their sense of themselves as partners in the greater European 
community. To me, NATO enlargement means growing democracy.
    Studies on NATO enlargement indicate that it will contribute to 
enhanced stability and security for all countries in the Euro-Atlantic 
area by encouraging and supporting democratic reforms, including 
civilian and democratic control over the military. It will foster 
patterns and habits of cooperation, consultation, and consensus 
building that characterize relations among present members of the 
alliance. Enlargement will promote good-neighborly relations in the 
whole Euro-Atlantic area, and increase transparency in defense planning 
and military budgets and, thus, confidence among states. It will 
reinforce the tendency toward integration and cooperation in Europe, 
and strengthen NATO's ability to contribute to, European and 
international security and to support peacekeeping activities in 
cooperation with the UN. Finally, it will strengthen and broaden the 
transatlantic partnership.
    The Reserve Officers Association of the United States strongly 
urges you to support NATO enlargement consistent with United States 
policy. NATO enlargement is the logical consequence and fruit of the 
success that NATO has enjoyed since its establishment in April 1949. 
Enlargement is both the reward and the process that will further enable 
and secure the blessings of life, liberty, and the pursuit of happiness 
to NATO members, and provide increased stability to all peoples.

    Senator Smith. Thank you, Colonel and the Reserve Officers 
Association also for participating in this hearing.
    Colonel Harmon. Thank you very much.
    Senator Smith. We will call our final witness, Dr. Alvin 
Rubinstein of the Political Science Department of the 
University of Pennsylvania. We welcome you, Doctor.

    STATEMENT OF DR. ALVIN Z. RUBINSTEIN, POLITICAL SCIENCE 
     DEPARTMENT, UNIVERSITY OF PENNSYLVANIA, PHILADELPHIA, 
                          PENNSYLVANIA

    Dr. Rubinstein. It is a pleasure to be here and I very much 
appreciate the honor of appearing before the committee. I will 
try not to be more than my 5 minutes.
    I will limit my comments on the shortcomings of NATO 
enlargement to several interrelated issues that have been 
largely overlooked in the hearing so far: First, the U.S. 
national interest in Europe; second, the German question; and, 
finally, the effect of enlargement on U.S. policy and options 
in East Asia.
    America's vital interests on the European continent have 
been to prevent any hostile power from dominating the European 
land mass. Three times in this century the United States 
expended enormous efforts to defeat an aggressive power's quest 
for control of Europe. Twice the enemy was Germany, once the 
Soviet Union.
    Today, the U.S. led NATO alliance is the dominant military 
force on the continent. Strategically, conditions in Europe are 
conducive to a Pax Americana that is affordable, supportable, 
and credible. There is in place a structure of power different 
from any that existed in previous epochs. The United States is 
the preeminent power and seeks only to promote a durable peace. 
No European country has any prospect of supplanting its 
position.
    NATO anchors Germany in a U.S.-dominated security system, 
helps deepen the historic Franco-German reconciliation, and 
buys valuable time to advance West European integration.
    A secure strategic environment is predicated on stable 
relationships, and in NATO this means maintaining the present 
equilibrium of forces among the inter-dependent actors.
    Any introduction of new elements must affect the structure 
of power and the cohesion that have heretofore shaped the 
behavior of the alliance. Certainly no alliance has 
strengthened itself by embracing weak, dependent, resource poor 
new members, none of whom is in danger of attack.
    But utopian engineering is apt to trigger troublesome 
consequences with respect to Germany. Germany is already the 
most powerful country in Western Europe, a dominant member of 
the European Union, and commercially and financially the most 
influential actor in Central and Eastern Europe.
    NATO enlargement is a geostrategic gift that places Germany 
once again at the center of Europe. Far from resolving the old 
question of disproportionate German power in Europe, as was 
suggested here a few days ago, NATO enlargement stirs up 
unpleasant historical memories.
    One result may be rekindled uneasiness between Germany and 
France and between Germany and Russia. Another may be delayed 
European integration as France and Britain reassess the 
implications of Germany's newly enhanced status.
    Any geopolitical development, however well intentioned, 
that transforms Germany from an ordinary nation-state into a 
strategic hub radiating political and military, as well as 
economic, influence across much of Europe will pose problems 
for America's presently unchallenged dominance.
    Finally, there is an essential connection between the 
increased commitments the United States would make toward 
Europe through NATO enlargement and its ability to act 
effectively in a variety of volatile situations in East Asia.
    Whereas in Europe, political systems are stable, defense 
expenditures are declining, and territorial and ethnic 
irredentism marginalized, in East Asia very different trends 
prevail. Uncertainty in Asia means increased defense costs. How 
much of America's resources will need to be committed there? 
How extensive a power projection capability is required, and 
what will public sentiment support over the longer term?
    In light of these indeterminate variables in East Asia, 
prudence would suggest the United States not assume unnecessary 
responsibilities in Europe. Also, it is not true that U.S. 
credibility would suffer if NATO enlargement were rejected or 
were postponed for 5 to 10 years to allow prospective members 
to demonstrate that they do, in fact, meet the criteria for 
membership laid out in the original Partnership for Peace 
proposal. It is not the U.S. long-standing commitment to NATO 
that is being debated. The only issue is the enlargement of 
NATO.
    America's credibility is not being called into doubt, only 
President Clinton's judgment. No country will end its alliance 
with the United States as a consequence of the Senate's vote on 
enlargement. NATO will not wither away.
    Nor does the honor of the United States require that the 
Senate support a policy which the President cannot demonstrate 
is in the national interest. On the contrary, the honor and 
integrity of the democratic process require that Senators vote 
not for or against the President but for whatever policy they 
judge to be in the national interest.
    Thank you, Mr. Chairman.
    [The prepared statement of Dr. Rubinstein follows:]
                  Prepared Statement of Dr. Rubinstein
    The end of the Cold War and the collapse of the Soviet Union 
presented Europe with a unique opportunity to create an improved system 
of security that would preserve and deepen the peace that it has 
enjoyed since 1945. In the post-Cold War era, Europe seeks stability 
and security within a broad framework of growing integration and 
cooperation--a studied contrast to the 1945 to 1990 period when the 
continent was divided into two hostile, ideologically, militarily, and 
politically antithetical blocs. The question is how to proceed. The 
nascent European Union (EU) having proved too weak to provide effective 
leadership, the responsibility for uniting and protecting Europe in the 
next century, for want of a seemingly better alternative, has devolved 
upon NATO.
    The Central and East European countries believe that NATO and the 
EU are integrally connected, that membership in the former one will 
assure admission to the other. In June 1993, the EU spoke favorably 
albeit vaguely, of membership for the Czech Republic, Poland, Hungary, 
and Slovakia (the so-called Visegrad Four, an appellation that was soon 
discarded, since none of the group wanted to be tied to any of the 
others). But the impetus that energized NATO and its prospective 
hopefuls came not from the EU but the U.S.; the catalyst was not Europe 
is concern about its security, but U.S. domestic politics.

                   Clinton and Partnership for Peace

    The fall of 1993 was a difficult time for Bill Clinton. The new 
President was rebuffed by Congress in his exhaustive attempt to have a 
national health plan passed; criticized for mishandling U.S. 
involvement in a flawed U.N. exercise in nation-building in Somalia and 
for equivocating on Bosnia; beset by groups and governments concerned 
over the constitutional challenge to Yeltsin and the ominous rise of a 
truculent ultra-nationalistic Russian Right; and urged by supporters to 
avail himself of a ``peace dividend'' by reducing America's defense 
costs in Europe.
    Using a time-tested ploy, his advisers crafted a foreign policy 
initiative to enhance the President's sagging domestic prestige. At a 
NATO summit meeting in Brussels on 10-11 January 1994 President Clinton 
praised NATO and signaled his determination to strengthen it and extend 
its protective umbrella. He recalled a comment made by Walter Lippmann 
three days after the treaty had been signed in Washington: ``The pact 
will be remembered long after the conditions that have provoked it are 
no longer the main business of mankind. For the treaty recognizes and 
proclaims a community of interest which is much older than the conflict 
with the Soviet Union, and come what may, will survive it.'' \1\ More 
important, it was at this meeting that Clinton proclaimed the 
Partnership for Peace (PfP) proposal, which held out the prospect of 
NATO membership for the countries of Central and Eastern Europe, and 
the republics of the FSU, including Russia. Nevertheless, the timing 
and criteria for admission were deliberately left uncertain.
---------------------------------------------------------------------------
    \1\ William J. Clinton,``Partnership for Peace: Building a New 
Security for the 21st Century,'' U.S. Department of State Dispatch 
Supplement 5 (January 1994), 5.
---------------------------------------------------------------------------
    As initially envisaged, PfP was an invitation to prospective 
applicants to work with NATO for ``transparency in national defense 
planning and budgeting processes;'' ``ensuring democratic control of 
defense forces;'' developing closer military ties with NATO ``in order 
to undertake [joint] missions in the field of peacekeeping, search and 
rescue, humanitarian operations, and others as may subsequently be 
agreed;'' and fostering the training of ``armed forces that are better 
able to operate with those of NATO's.''\2\ However, before the end of 
the year, enlargement completely overshadowed this menu of low level 
cooperation in essentially military activities. PfP's purely military 
goals of participation, cooperation, confidence-building, and 
interoperability of forces were superseded by NATO enlargement's 
political considerations and inherently contradictory strategic 
purposes, that is, fostering security, promoting democracy, and dealing 
with Russia.
---------------------------------------------------------------------------
    \2\ ``Partnership for Peace: Framework Document,'' NATO Press 
Release Vl-l (1994) 2.
---------------------------------------------------------------------------

                  Clinton Expands U.S. Role In Europe

    With its abrupt embrace of NATO enlargement, the Clinton 
administration upped the ante of NATO's role in post-Cold War Europe, 
and it did so without benefit of any serious consultation with Congress 
or attempt to explain the implications of its policy to the American 
people. Following the Republican Party's control of both Houses of 
Congress as a result of the November 1994 mid-term Congressional 
elections, the administration adopted an even more activist stance in 
Europe to demonstrate its ``toughness'' in the face of Russia's 
opposition to the new U.S. policy. The ideological stimulus was 
supplied by strong advocates such as Richard Holbrook (at the time, 
ambassador to Germany and the President's trouble shooter in Bosnia) 
and Madeleine Albright (then ambassador to the U.N.), think-tanks such 
as RAND and the Brookings Institution, and a few prominent members of 
Congress such as Senator Richard Lugar and Senator Sam Nunn. On 21 
November 1994, then Secretary of State Warren Christopher made clear 
the irrevocable course on which the administration had embarked: ``NATO 
is and will remain the centerpiece of America's commitment to European 
security. But now our challenge is to extend the zone of security and 
stability that the Alliance has provided--to extend it across the 
continent to the east.'' \3\
---------------------------------------------------------------------------
    \3\ Warren Christopher, ``NATO: Extending Stability in Europe,'' 
U.S. Department of State Dispatch, 5, 48 (28 November 1994), 790.
---------------------------------------------------------------------------
    This expression of intent largely dispelled the fog of ambivalence 
that had enveloped U.S. policy. Whereas President Clinton himself had 
stated that NATO expansion ``will not depend upon the appearance of a 
new threat in Europe,'' his principal adviser on Russian affairs and 
close friend, Deputy Secretary of State Strobe Talbott, cautioned that 
the expansion of NATO would be determined by ``the overall security 
environment in Europe.'' \4\ However, once the President determined to 
press ahead with NATO enlargement, all equivocating interpretations 
disappeared. European allies were reassured, as were countries seeking 
NATO membership, and domestic groups anxious over Washington's 
conflicting views.
---------------------------------------------------------------------------
    \4\ Zbigniew Brzezinski, ``A Plan for Europe,'' Foreign Affairs, 
74,1 (January/February 1995), 28.
---------------------------------------------------------------------------
    In August 1995, Strobe Talbott, who had initially reacted coolly to 
enlargement because of its adverse consequences for U.S. relations with 
Russia, gave (or was assigned the task of giving) an official response 
to the public criticisms made by a blue ribbon group of retired 
diplomats and military leaders. He argued that NATO enlargement should 
be undertaken for three basic reasons. First, collective defense. 
Though acknowledging that ``the end of Soviet communism, the 
dissolution of the Warsaw Pact, and the breakup of the USSR have 
eliminated the threat that NATO was created to counter during the cold 
war,'' he nonetheless maintained that ``new threats may arise that 
would require NATO to protect the members and to deter attack.'' The 
possible threat he saw, though nowhere on the horizon, was Russia. 
Second, promotion of democracy. Admission to NATO would provide the 
countries of Central Europe and the former Soviet Union ``with 
additional incentives to strengthen their democratic and legal 
institutions, ensure civilian command of their armed forces, liberalize 
their economies, and respect human rights, including the rights of 
minorities.'' Third, regional peace and stability. In return for 
admission to NATO, new members would be expected ``to resolve disputes 
peacefully and contribute to peacekeeping operations.'' \5\ ( Note: 
Talbott never explained why these incentives were to be applicable to 
countries in Central and Eastern Europe but not to Russia as well.)
---------------------------------------------------------------------------
    \5\ Strobe Talbott, ``Why NATO Should Grow,'' The New York Review 
of Books (10 August 1995), 27. According to Michael McGwire, who offers 
a trenchant critique of the official rationale for NATO's expansion, 
Talbott's article reminded him ``of those in the Communist Party house 
organ Kommunist, where the losers in an internal Soviet debate were 
required to publicly recant by expounding the official party line.'' 
Michael McGwire, ``Russia and Security in Europe,'' in Five Years After 
the Fall: The Role of the Outside World in the Transformation of the 
Former USSR, edited by Karen Dawisha (Armonk, N.Y.: M.E. Sharpe, 
forthcoming).
---------------------------------------------------------------------------
    From the beginning, Clinton's policy on NATO enlargement was driven 
by domestic considerations. His announcement that he wanted the first 
group of countries admitted in 1999 on ``NATO's 50th anniversary and 
ten years after the fall of the Berlin Wall'' was made in Detroit in 
the final two weeks of a bitterly waged campaign for reelection. It was 
made to attract maximum support from the Central and East European 
ethnic groups who were crucial to the electoral outcome in the Mid-
Western part of the United States. Again, as in late 1993, there was no 
discussion, no consultation with Congress, and no explanation to the 
country of its implications. Soon after his reelection, Clinton 
obtained NATO's approval on 10 December 1996 for the timing of the 
first tranche: the NATO communique called for the convening of a Summit 
meeting in Madrid on 8-9 July 1997, one aim of which was ``inviting one 
or more of the countries which have expressed interest in joining the 
Alliance to begin accession negotiations.'' Accordingly, most observers 
concluded NATO enlargement a done deal.
    Perhaps so. But serious questions remain, and these may undergo 
close scrutiny by the U.S. Senate, which has the constitutional 
responsibility for reviewing the utility, feasibility, and costs of new 
treaty obligations. In the meanwhile, criticism is growing from a 
variety of leading figures as to whether NATO enlargement is in the 
national interest of the United States or any other member of the 
Alliance, or even the new invitees. Among the prominent Americans who 
have doubts are former Senator Sam Nunn, General John Galvin, who 
served as supreme allied commander in Europe, Jack Matlock, ambassador 
to the Soviet Union during the Gorbachev era, and policy advisers and 
arms control negotiators Paul Nitze and Jonathan Dean. Criticism 
focuses mainly on questions of security in Europe; the Russian Factor; 
Costs; the German Question; and the future of democratization in 
Central and Eastern Europe.

                   The Security Environment in Europe

    A January 1997 editorial in the prominent U.S. defense journal 
Aviation Week & Space Technology, which has close ties to the 
Department of Defense and the military-industrial community, derided as 
``breathtakingly complacent'' the view that NATO's ``imperial drive to 
bring former Soviet client states into the fold'' is consistent with 
its remaining ``a defensive alliance of likeminded states,'' and held 
that ``plunging ahead with enlargement is likely to result in a riskier 
world, not a safer one.'' \6\
---------------------------------------------------------------------------
    \6\ ``Back Off Expansion,'' Aviation Week & Space Technology, 
January 6, 1997, 70.
---------------------------------------------------------------------------
    A careful look at the security environment in Europe that NATO 
enlargers seek to remake reveals a Europe at peace and no power 
threatening a major war. For the first time in this century--indeed, in 
Europe's history--a European peace can be assured by the long-term 
security commitment of a non-European power, the United States. Such a 
commitment is far more likely to be sustained for a minimalist NATO 
that does not require unnecessary increases in expenditures by an 
American electorate that has already been shouldering heavy defense 
burdens for Western Europe's defense for almost six decades. From a 
geostrategic perspective, the dominant force on the European continent 
is the U.S.-led NATO alliance. It securely anchors a democratic Germany 
to the rest of Western Europe and no other power or coalition of powers 
poses any threat to its present hegemonic security community or 
security outreach.
    Eastward, stretching from Estonia to Bulgaria, a vast borderland 
has emerged from the collapse of the Soviet imperial system. It 
contains nine newly independent former Soviet satellites and three 
former Soviet imperial possessions. Together, they constitute an 
extensive buffer zone between Germany and Russia, the prime disrupters 
of Europe's peace since 1870. Far to the east lies Russia itself, a 
severely weakened empire shorn of its protective perimeters from the 
Baltic Sea to the Black Sea, and from Transcaucasia across Central Asia 
to China; bordered by eight of the fourteen weak and vulnerable Soviet 
republics that acquired instant independence when the Soviet Union was 
dissolved on 25 December 1991; marginalized as a great power; and 
uneasy over the potential of Political Islam. What is more, the Russian 
government presides over a society in disarray, a demoralized people, 
and a deteriorating, quasi-anarchical economy and political system. \7\
---------------------------------------------------------------------------
    \7\ Elaboration of the line of argument herein developed is set 
forth in Alvin Z. Rubinstein, ``The U.S. Stake in Russia,'' Orbis, Vol. 
41, No.1 (Winter 1997), 31-32.
---------------------------------------------------------------------------
    As in any alliance, so in NATO, threat is determined principally by 
the dominant power(s) who bear responsibility for the security of all 
the alliance members. Time and again, U.S. leaders have stated that 
there is not now any threat to the security of NATO or the countries of 
Central and Eastern Europe or the Baltic states; Russia is not 
considered a threat. Thus, the case for NATO enlargement is not being 
made on grounds of any ``clear and present danger'' to prospective 
members. Assuredly, enhanced security and peace are extremely 
important, yet on this count alone, NATO enlargement would not seem 
necessary. After all, there is in place a structure of power that 
distinguishes the present strategic environment from that which has 
existed over centuries.
    First, there is a functional hegemon, the United States, which is 
not located in Europe, which does not covet territory, and which seeks 
only to institutionalize the conditions for a long peace. Second, among 
the major European powers, no country has any prospect of overturning 
the present benign strategic situation and supplanting the U.S. 
position and role. Third, all the countries of Europe--large and small, 
powerful and weak, secure and vulnerable--can have a say in their 
future and in the creation of a viable and lasting security 
architecture in which to shelter in the decades ahead.
    Why, then, the avidity of the states of Central and Eastern Europe 
and the Baltic area to join NATO? Scholars of learning theory in 
international relations argue ``that balance of threat theory does not 
explain alliance choices,'' that states often opt for neutrality rather 
than alliances, depending on the experiences of their leaders. In this 
body of literature, there is support for the proposition ``that small 
powers do have real freedom of action in world politics and are not 
puppets following the whims of great powers,'' hence the very different 
behavior before and after World War II of Sweden, The Netherlands, 
Poland, Czechoslovakia, Finland, Yugoslavia, and so on. \8\ However, 
the data on why nations chose as they did are so diverse and open to 
various interpretations that we are reduced to assuming only that 
multiple explanations are possible. And in this process, historical 
memory and historical experience are crucial determinants.
---------------------------------------------------------------------------
    \8\ Dan Reiter, Crucible of Beliefs: Learning. Alliances, and World 
Wars (Ithaca: Cornell University Press, 1996), 214-215.
---------------------------------------------------------------------------
    In the late 1990s, most of the leaders, key elites, and electorates 
of prospective NATO members have had their political images and 
formative political years shaped by the experience of living under 
repressive Communist and Soviet rule from 1944-1945 on. The rush to 
join NATO is, in one sense, a continued flight from the shadow of 
Muscovite power and repression. This is understandable, but irrelevant 
to the strategic conditions in which they live today.
    The Cold War, though dangerous, did not lead to actual war, but it 
did leave the peoples of the former Soviet empire in Central and 
Eastern Europe and the Baltic region with a scarred psyche and a deep-
rooted suspicion of Russia that motivate their search for security 
guarantees and economic concessions from Western Europe and the United 
States. NATO enlargers, frozen in a Cold War mind set, place great 
emphasis on that period of U.S.-Soviet rivalry and extrapolate from it 
into the future. By so doing, they convey the impression that Russia, 
not Germany, was the principal catalyst of the great wars of the 
twentieth century that deranged Europe's peace and societal cohesion 
and that drew the United States into the continent's turbulent affairs.

                           The Russian Factor

    Especially noteworthy in questioning the wisdom of an enlarged NATO 
has been George F. Kennan, the Dean of Russian specialists in the 
United States. It was Kennan's article, ``The Sources of Soviet 
Conduct, published in early 1947 and arguably the most influential 
essay in the history of U.S. diplomacy, that served as the intellectual 
basis for the Containment Doctrine that shaped U.S. foreign policy 
during the 45-years of Cold War rivalry with the former Soviet union 
(FSU). His opposition today to NATO enlargement has galvanized ex-
diplomats, journalists, academics, and policy analysts to express their 
deep concerns.
    In an article in The New York Times in early February 1997, Kennan 
deplored not just President Clinton's peremptory decision but its 
timing and avoidance of substantive explanation. ``Bluntly stated,'' 
wrote Kennan, ``expanding NATO would be the most fateful error of 
American policy in the entire post-Cold War era:

Such a decision may be expected to inflame the nationalistic, anti-
Western and militaristic tendencies in Russian opinion; to have an 
adverse effect on the development of Russian democracy; to restore the 
atmosphere of the cold war to East-West relations, and to impel Russian 
foreign policy in directions decidedly not to our liking. \9\

    \9\ George F. Kennan, ``A Fateful Error,'' The New York Times, 
February 5, 1997, A23.
---------------------------------------------------------------------------
    In light of Kennan's experience and wisdom regarding Russian 
affairs, and considering the hopeful possibilities engendered by the 
changed political and security environment of the post-Cold War era, it 
is incumbent on us to provide a persuasive answer to his query, 
``should East-West relations become centered on the question of who 
would be allied with whom and, by implication, against whom in some 
fanciful, totally unforeseen and most improbable future military 
conflict?''
    Kennan's concern that NATO enlargement will complicate further 
efforts to proceed with nuclear downsizing is shared by Fred C. Ikle, 
Undersecretary of defense for Policy in the Reagan Administration. In 
testimony before the House Committee on National Security on 17 July 
1997 Ikle acknowledged the dangers inherent in ``loose nukes'' and 
weapons grade fissionable material scattered throughout Russia, and the 
possibility of theft of plutonium and enriched uranium. But he 
preferred to emphasize a different aspect of the problem, namely, his 
fear that in managing NATO enlargement Washington will be diverted from 
pressing ahead on the much higher priority nuclear issues: ``There is 
only so much time in high level meetings to cover multiple agendas. The 
nuclear issues that require Russian action are so important, so 
overarching, that we must focus on them all our leverage and influence 
with Moscow, all the `carrots and sticks' that we can command for this 
continuing negotiation with the Russian authorities.'' \10\
---------------------------------------------------------------------------
    \10\ Statement by the Honorable Fred C. Ikle before the Committee 
on National Security, U.S. House of Representatives, Washington, D.C., 
July 17, 1997.
---------------------------------------------------------------------------
    As it is, NATO enlargement has already had chilling effects on 
Russian-American relations. It has reopened a psychological and 
political divide, which will not easily or soon be bridged, the 
establishment of the Russia-NATO Permanent Council, to the contrary 
notwithstanding. This ceremonial Paris trumpery, which followed 
Moscow's accession on 27 May 1997 to the Russian-NATO Founding Act, 
will do little to allay Russian concern that the West is essentially 
anti-Russian. Any expansion to the east by a powerful military 
alliance, regardless of its peaceful pronouncements, can hardly be 
viewed as other than a potential threat. In January 1997, Mikhail 
Gorbachev, whose desire to see Russia a part of the ``European home'' 
and integrated into the Western-dominated international economic order 
cannot be doubted, made this point, lamenting the risk that enlargement 
places on all the breakthroughs to date in Russia's relations with the 
West. \11\ The spillover from the enlargement issue has affected 
crucial arms control issues. START II may eventually be ratified by the 
Duma, but the character and degree of cooperation needed to assure full 
and expedious compliance is in doubt. START III is problematic. 
Moreover, all signed arms control treaties, nuclear and nonnuclear, 
will probably become more difficult to negotiate, implement, and 
sustain. Professor Michael Mandelbaum of Johns Hopkins University has 
been in the forefront of those who are deeply skeptical. Dismissive of 
NATO enlargement, his position is that the arms control agreements 
concluded during the 1987 to 1993 period have, taken as a whole, 
created a common security that reduces ``the possibility of great power 
conflict'' and provides all European countries with solid confidence in 
the future stability and security in the region. Thus, beginning in 
1987, the Intermediate Range Nuclear Forces (INF) agreement, followed 
by a combination of confidence building measures (CBMs), lower levels 
of conventional armaments through the Conventional Forces in Europe 
(CFE) accord, and strategic arms reduction treaties (START I and START 
II), drastically altered the threshold of threat: ``a country bent on 
overturning the European status quo could not hope to mount a 
successful attack without extensive preparations, which would be 
readily detected and would plainly violate signed treaties.'' \12\ Even 
if Russia turned hostile, the probability is strong that this would 
result in the reimposition of ``a sharp line of division in Europe'' 
much farther to the east and to the unmistakable detriment of Russia's 
situation. \13\ According to Raymond Garthoff, a retired diplomat and 
member of The Brookings Institution, whatever eventuates, the very 
process of enlargement cannot help but leave a residue of suspicion and 
divisiveness; it ``has already made a mockery of the policy of the Bush 
and early Clinton administrations to create a post-Cold war partnership 
with Russia stretching from Vladivostok to Vancouver, and it is even 
undermining the conception of a Europe stretching from the Atlantic to 
the Urals celebrated at the Paris Summit of 1990 marking the end of the 
Cold War.'' \14\
---------------------------------------------------------------------------
    \11\ Mikhail Gorbachev, ``Expanding NATO Won't Bring More Peace on 
Earth,'' The New York Times, January 17, 1997.
    \12\ Michael Mandelbaum, The Dawn of Peace in Europe (New York: The 
Twentieth Century Fund, 1996), 102-103; 105.
    \13\ ibid., 144.
    \14\ Raymond L. Garthoff, ``Western Efforts to Shape Post-Soviet 
Behavior,'' in Karen Dawisha(ed.), The International Dimension of Post-
Communist Transitions in Russia and the New States of Eurasia (Armonk, 
N.Y.: M.E. Sharpe, 1997), 30.
---------------------------------------------------------------------------
    Without doubt, the nuclear issue with its attendant security 
implications, broadly conceived, is the central concern of most 
opponents to enlargement. Thomas Friedman, the diplomatic correspondent 
to The New York Times, for one, says that the United States would be 
much better off if President Clinton, Secretary of Defense William 
Cohen, and Secretary of State Madeleine Albright spent ``as much time 
on the threat that does exist--Russia's massive nuclear arsenal--as 
they have on the threat that doesn't exist--a Russian invasion of 
Poland.'' \15\ His commentaries repeatedly return to the theme that in 
the interests of peace and stability NATO should remain unchanged, both 
as to membership and focus--its primary aim being to deter nuclear war 
in Europe.
---------------------------------------------------------------------------
    \15\ Thomas L. Friedman, ``It's Unclear,'' The New York Times, June 
2, 1997, A 15.
---------------------------------------------------------------------------
    In sum, critics of NATO enlargement do not believe that any threat 
to the prevailing structure of power that serves the NATO community 
exists, and it is difficult to imagine any strategic principle or 
concern so mighty as to justify jeopardizing the future of this irenic 
environment. As Senator John Warner of Virginia observed to Secretary 
of State Albright, ``I come from the school if it's not broken, why try 
and fix it?'' \16\
---------------------------------------------------------------------------
    \16\  Quoted in R.W. Apple, Jr., ``Road to Approval is Rocky, And 
Gamble is Perilous,'' The New York Times, May 15, 1997, A 18.
---------------------------------------------------------------------------

                           The Cost Calculus

    President Clinton said NATO enlargement was not without cost or 
risk. In a report to Congress on 24 February 1997 he held that the 
costs would be modest, averaging no more than $150 million to $200 
million a year for the first ten years, basing his estimate on an in-
house State Department study. But even staunch NATO-boosters are uneasy 
with this minimalist figure. Several years ago, the highly respected 
Rand Corporation, known for its close ties to the Pentagon, calculated 
the cost at $3-5 billion per year over a ten year period, with the U.S. 
share being $1-$1.2 billion annually. The congressional Budget Office 
posits costs greater than Rand's by a factor of two or three, depending 
upon the assumptions used. \17\
---------------------------------------------------------------------------
    \17\ A useful starting point for moving into the thicket of direct 
and indirect (hidden) costs of NATO enlargement is: U.S. General 
Accounting Office: Report to Congressional Requesters, NATO 
Enlargement: Cost Estimates Developed To Date Are Notional (August 
1997, Washington, D.C.). GAO/NSIAD-97-209.
---------------------------------------------------------------------------
    Clearly, no one knows what enlargement will really cost, but the 
Clinton Administration's estimates contravene experience. one need look 
no further than the Bosnian operation for evidence. In late November 
1995, when the administration undertook to commit ground forces to 
Bosnia, it estimated the cost to the United States of helping to 
enforce the cease-fire at $1-1.2 billion for the year 1996. In fact, 
the cost to the United States was almost $4 billion; and by late 1997, 
about $7 billion. Notwithstanding Secretary of State Albright's 
assurance to a Senate committee that ``NATO enlargement is not a 
scholarship program,'' \18\ that is precisely what it is likely to 
resemble: long-term government guaranteed loans to enable recipients to 
pay for costly goods and services with a promise of eventual repayment. 
Prospective members would thus be forced to purchase weapons they 
cannot afford and do not need, but which they must acquire as the entry 
fee for membership in the NATO club. As two journalists noted, the only 
winners would be U.S. arms merchants for which enlargement would be the 
boon of the decade. \19\
---------------------------------------------------------------------------
    \18\ As quoted in Allison Mitchell, ``Clinton Girding for Stiff 
debate on NATO Issue,'' The New York Times, June 29, 1997, A 6.
    \19\ See Jeff Gerth and Tim Weiner, ``Arms Makers See A Bonanza In 
Selling NATO Expansion,'' The New York Times, June 29, 1997, 1; 8.
---------------------------------------------------------------------------
    Senators John Warner (Va) and Kay Bailey Hutchison (Texas) found 
the administration's cost estimates ``troubling because of its 
assumptions about burden sharing, or how much of the total cost of NATO 
enlargement will be borne by our European allies. According to the 
administration, the United States will pay just 15 percent or so of the 
direct enlargement costs. Other members will pay 50 percent, and the 
new members 35 percent.'' But they note that French President Jacques 
Chirac has said that France will not increase its spending. \20\ 
Indeed, Chirac, angered by Washington's rejection of Romania and 
Slovenia for membership in the first round that included Poland, the 
Czech Republic, and Hungary, is not alone in viewing the unilaterally 
accelerated process of enlargement as Clinton's payback to supportive 
domestic constituencies. And he has declared that new members ``must 
pay their own way. France does not intend to raise its contributions to 
NATO because of the cost of enlargement.'' \21\ Representative Barney 
Frank, a Democrat from Boston, seized on Chirac's statement to offer 
amendments (rejected, for the time being) to reduce defense spending at 
home, unless our European allies show a willingness to assume their 
fair share of the burden. \22\ Ronald Steel, a distinguished historian 
and frequent contributor to leading print media, observes that the 
Clinton Administration keeps assuring us ``that the rich West Europeans 
will cough up the money for their continental brethren, even though 
those same burghers have been vigorously cutting their own defense 
budgets.'' \23\ Even the consistently pro-enlargement Wall Street 
Journal has, on occasion, acknowledged that ``questions about how much 
defense NATO will offer its new members, the cost, and who will provide 
troops and pay the tab'' must be dealt with. \24\ Somewhere along the 
road to the ``Great Debate'' in the U.S. Senate over NATO enlargement 
deals are going to be made--and the compromises will have to be 
transparently mutual in character. In the Senate, the devil may well 
lie in the accounting process.
---------------------------------------------------------------------------
    \20\ John Warner and Kay Bailey Hutchison, ``The Missing NATO 
Debate,'' Washington Post, July 24, 1997.
    \21\ Elizabeth Neuffer and Brian McGrory, ``Leaders Sign 2 Security 
Agreements,'' Boston Globe, July 10, 1997, A 16.
    \22\ Chris Black, ``Frank Pushes For Sharing of NATO Costs,'' 
Boston Globe, July 22, 1997, A 6.
    \23\ Ronald Steel, ``Eastern Exposure,'' The New Republic, July 14 
& 21, 1997, 27.
    \24\ Carla Anne Robbins, ``Devil Is In Details of NATO Expansion,'' 
Wall Street Journal, August 9, 1996, A 6.
---------------------------------------------------------------------------

                          The German Ouestion

    Already the most powerful country in Western Europe and the 
dominant member in the EU, Germany is still far from attaining maximum 
economic strength and influence, in part because of the unexpectedly 
large and continuing drain on resources by the former East Germany. 
However, within a decade or so, it should hold the position of 
unmistakable economic-industrial strength that it held on the eve of 
the First and Second World Wars. Inevitably, NATO enlargement will not 
only reinforce Germany's claim to European leadership but also place 
Central and Eastern Europe securely under its economic and political 
influence; it will mean Germany's de facto colonization of the area. 
The positions of France and Great Britain will correspondingly 
diminish, with unforeseen and damaging consequences for European 
integration.
    Recall that twice in a generation Germany unleashed catastrophic 
``civil wars'' in the heartland of Western civilization. Today, 
however, Germany is a key EU partner and in the forefront of Western 
Europe's integration. As long as it remains a nonnuclear weapons power 
and a member of NATO, Europe's prospects for a long peace are bright. 
But much depends on U.S. leadership in NATO, which helps deepen the 
Franco-German reconciliation; gives time for strengthening the 
institutional bonds that are being forged to bind the West European 
states together; provides the nations of Central and Eastern Europe and 
the Baltic region with a chance for independent democratic development; 
and reassures Russia against another German threat materializing. Under 
present circumstances, a minimal U.S. military presence in NATO is 
itself sufficient to allay West European--and Russian--anxieties about 
the German phoenix, and to deter threats to the independence of most 
non-NATO nations situated between Germany and Russia.
    In the future, an increasingly powerful Germany will naturally seek 
a political role commensurate with its economic influence. Already 
indicative of the sea change in Germany's outlook is its growing 
assertiveness in foreign policy that may be dated from mid December 
1991 and the Yugoslav succession crisis. The key move, which came less 
than two weeks before the USSR's implosion, was the German government's 
announced intention to extend diplomatic recognition to Croatia and 
Slovenia, notwithstanding the requests for patience from Washington, 
Paris, and London, and the U.N. secretary-general. Confronted with 
German Foreign Minister Hans Dietrich Genscher's determination to go 
his own way, Britain and France sheepishly followed suit: so much for 
the EU's collective decision making. Genscher revealed a nationalistic 
outlook that some observers find worrisome. \25\ It was manifested not 
just in the Yugoslav crisis where traditional German interests in the 
Balkans were highlighted, but also in the EU where Genscher pressed for 
the German language to be accorded the same status as English and 
French; in the Far East, where he offered to mediate the knotty 
territorial dispute between Russia and Japan; and in Eastern Europe 
where German investment and trade have increased noticeably.
---------------------------------------------------------------------------
    \25\ For example, Jacob Heilbrunn,``Germany's New Right,'' Foreign 
Affairs, Vol. 75, No.6 (November-December 1996), 80-98.
---------------------------------------------------------------------------
    In all probability, Germany would be the biggest beneficiary of 
NATO enlargement. Its political and military elites see enlargement as 
the answer to Germany's complex Eastern Problem, which has three 
facets: the vulnerability of its borders to unwanted migrations from 
Eastern Europe and the countries of the former Soviet Union; the 
psychological feeling that Germans have of continuing ``to live at a 
front-line, albeit one which is characterized by open borders and major 
imbalances in wealth, stability and political culture''; and the 
aversion to again being squeezed between two adversarial blocs and the 
sense that Germany should take ``its natural geographic place, which is 
in the center of Europe, not at an artificial borderline of European 
subregions.'' \26\ The Bundeswehr likes the prospect of a cushioning 
security zone that would redefine the political boundaries of Europe in 
such a way that the Russians are kept out, the French pacified by 
symbolic involvement in East European matters, and the Americans 
enthusiastic over the idea of spreading democracy to new areas. It has 
entered into defense cooperation agreements with all the former Warsaw 
Pact members, and hopes that enlargement will result in the 
establishment of a new NATO command for Central and Eastern Europe, 
headed by a German. In addition, powerful economic interests in 
investment, banking, and trade reinforce Bonn's welcoming attitude. 
Indeed, no debate on the issue was deemed necessary by the Bundestag. 
Instead, a consensus has gradually emerged among the ruling Christian 
Democratic Union (CDU) (in coalition with the Free Democratic Party), 
the opposition social Democratic Party, and even part of the ``Green'' 
Party, to the effect that Germany should pursue its necessary and 
legitimate national interests in the East, preferably within the 
framework of NATO enlargement.
---------------------------------------------------------------------------
    \26\ Reinhardt Rummel, ``The German Debate on International 
Security Institutions,'' in Marco Carnovale (ed.), European Security 
and International Institutions After the Cold War (New York: St. 
Martin's Press, 1995), 187.
---------------------------------------------------------------------------
    At the same time, Bonn is unsparing in its courtship of Moscow, 
seeking by political gestures, diplomatic visits, and economic carrots 
to allay Russian concerns over NATO enlargement; and it continually 
reassures the Central and East Europeans and the Balts of its support 
for their eventual accession to NATO and the EU, thereby enhancing its 
position as their champion in West European council.
    But NATO enlargement will make Germany a more difficult alliance 
partner. It will intensify tensions arising out of competing national 
interests and residual national fears. With growing prominence on the 
continent, Germany's aspect has become more ``German'' and less 
``European,'' especially in the East. Klaus Kinkel, who succeeded 
Genscher in early 1992 as foreign minister, stirred up a hornet's nest 
when he demanded that the Czech Republic apologize and make restitution 
for the expulsion of the two to three million Sudeten Germans in 1945. 
\27\ Federal Minister of Finance Theo Waigel went even further, calling 
on the Czechs to recognize ``the Heimstrecht --the right of return--of 
the Sudeten Germans... [and] to confess the crime.'' \28\ More than two 
generations later, the furor over what happened in the Sudetenland has 
exposed raw historical memories. \29\ Alarmed at the consequences of 
escalating claims and counterclaims, on 21 January 1997 in Prague, the 
German and Czech governments signed a declaration of reconciliation 
containing reciprocal expressions of regret Germany apologizing for 
``the suffering and injustice'' and the policies of violence inflicted 
by Nazi Germany on the Czech people, and the Czech Republic deploring 
the ``great injustice and suffering'' caused innocent people by the 
1945 expulsion of more than two million ethnic Germans. \30\
---------------------------------------------------------------------------
    \27\ Alan Cowell, ``Memories of Wartime Brutalities Revive Czech 
German Animosity,'' The New York Times, 9 February 1996 1, A12; and 
Hans Koning, ``German Irredenta,'' The Atlantic Monthly, Vol. 278, No. 
1 (July 1996), 30-33.
    \28\ ``Waigel, Stroiber Take a Hard Line on the German-Czech 
Reconciliation at Meeting of Sudeten German Expellees,'' quoted in The 
Week in Germany,  31 May 1996, 1. Also, see ``World War Wound Reopens 
in Bonn: Expulsions by Czechs a Hot Issue,'' International Herald 
Tribune, 28 May 1996, 5.
    \29\ For an informative account, see Timothy W. Ryback, ''Dateline 
Sudetenland: Hostages to History,'' Foreign Policy, No. 105 (Winter 
1996-97), 162-178.
    \30\ Alan Cowell, ``A German-Czech Pact on Wartime Abuses,'' The 
New York Times, 11 December 1996; and Craig R. Whitney, ``Germans and 
Czechs Try to Heal Hatreds of the Nazi Era,'' The New York Times, 22 
January 1997, A3.
---------------------------------------------------------------------------
    Even so empathetic and astute an observer of German policy as 
Timothy Garton Ash evinces a touch of anxiety over signs that 
nationalism rather than Europeanism is beginning to characterize 
Germany's approach to the countries of Central and Eastern Europe. At 
the heart of his uneasiness is Germany's dichotomous approach to 
Western and Eastern Europe. He cites approvingly Elizabeth Wiskemann's 
writing in 1956 that if German-Slav relationships are to flourish in 
the future, it ``would call for exquisite tact . . . : the very same 
German who worked very well with the French or Italian or Benelux 
representatives in the West might find it traditionally too difficult 
to keep his manners as good in the East.'' \31\ In the twentieth 
century, the German record in Poland, the Czech Republic, and Russia, 
in particular, has been a sad one. Germany is now a democracy and 
certainly very different from what it was. Still, Ash wonders if it 
will be able to resist the temptations that come with supremacy, not 
excluding territorial revisionism. After all, in the past, he notes, 
``if strong states were next to weak states which had territory they 
coveted, and to which they could construct some historical claim, they 
sooner or later took it.'' \32\ While not believing that history 
repeats itself, he foresees inevitable tensions, which will require 
Germany to act with considerable delicacy and ``exceptional self-
restraint.'' After forty-five years of steadily working to widen the 
bounds of German power the Germans must now cultivate ``the new habit 
of not fully exerting the power they had. More dramatically still: they 
had the particular task of helping the consolidation of other 
democratic state-nations in territories where Germans had until quite 
recently lived and ruled.'' \33\ Although his magisterial work, In 
Europe's Name, predated the issue of NATO enlargement, in it Ash 
suggested that before Central and Eastern Europe could be integrated 
with Western Europe and admitted to the European Union the individual 
countries of the area ought first go through a nation building process, 
``consolidating the state-nation,'' essential for becoming ``secure, 
liberal, democratic states.'' \34\ His mood of cautious skepticism 
about the future of Germany and its relations with Central and Eastern 
Europe is one that the countries of the region would be well to 
consider carefully, as they rush to be embraced by NATO.
---------------------------------------------------------------------------
    \31\ Timothy Garton Ash, In Europe's Name: Germany and the Divided 
Continent (New York: Random House, 1993), 403.
    \32\ ibid., 406.
    \33\ ibid., 407-408.
    \34\ ibid.
---------------------------------------------------------------------------

               Central and Eastern Europe At a Crossroads

    Throughout this century, the countries of Central and Eastern 
Europe and the Baltic region have been door mats for aggressive great 
powers, repeatedly trampled on and viewed as marginal, expendable 
assets. Historically, this vast area of multiple ethnolinguistic, 
cultural groups, of indefensible borders, and of meager natural 
resources, served as a magnet for invaders and occupiers, in 
particular, Germanic and Slavic states. Two significant political 
processes shaped the struggles of the victimized peoples of ``the 
borderlands:'' first, their resistance, yet inevitable ``incorporation 
into one or another of the bureaucratic empires closing in on them, and 
second, the rivalry of the Great Powers for domination over the 
contested zones between them.'' \35\ During their protracted period of 
weakness, subjugation, and vulnerability, these diverse peoples failed 
in their efforts to play off the competing imperial powers on their 
flanks, and ultimately they became vassals of one or another great 
power.
---------------------------------------------------------------------------
    \35\ Alfred J. Rieber, ``Struggle Over the Borderlands,'' in S. 
Frederick Starr (ed.), The Legacy of History in Russia and the New 
States of Eurasia (Armonk, NY: M.E. Sharpe, 1994), 66.
---------------------------------------------------------------------------
    Viewed from a broad perspective, which includes the largely 
disappointing experiences of the new nations of Africa and the Middle 
East since decolonization, the history of the peoples and nations of 
borderlands teaches unequivocal lessons: develop strong internal 
politics and economies or risk conquest and dominion by expansionist 
powers or powerful neighbors; cooperate with similarly vulnerable 
neighbors or fall prey to foreign penetration and influence; neglect 
internal transformation to pursue marginal gains of dubious durability 
at the expense of equally vulnerable neighbors and the consequences 
will be satellitization in some form.
    The invitees--(Poland, the Czech Republic, Hungary)--believe that 
their security, stability, and long term prosperity lie in joining 
NATO, and that this will eventually result also in admission to the 
European Union. Are these assumptions the best ones, politically and 
geoeconomically, to drive policy?
    One relevant observation from the Cold War experience is that great 
powers are more willing to supply swords than plowshares: contrast the 
apparent eagerness of NATO countries to sell weapons to enable 
prospective members to contribute militarily to collective defense and 
new out-of-area missions with the reluctance of the EU to open its 
markets to non-member states, and its very tough bargaining in trade 
negotiations, as the Poles and others have discovered. George Soros 
sums it up well: ``The problems of Central and Eastern Europe require 
political integration and economic prosperity, not the extension of 
military alliances. The countries of the region need political, moral, 
and economic assurance that they are indeed part of the West and the 
world of open societies. To give them armies and military alliances 
instead misconstrues the threat. In fact, the expansion of NATO can 
easily turn into a self-fulfilling prophesy, generating the very 
dangers against which it is meant to defend.'' \36\
---------------------------------------------------------------------------
    \36\ George Soros, ``Can Europe Work?'', Foreign Affairs, Vol. 75, 
No. 5 (September-October 1996), 12.
---------------------------------------------------------------------------
    Moreover, whereas the timetable for admission of new NATO members 
is politically driven, compliance with the military criteria that 
applicants were to have met under the Partnership for Peace program 
having been waived or modified, the conditions for full membership in 
the EU are as tough as ever, and there are no signs in the EU's 
Parliament of plans to add new members. Indeed, it is on this very 
issue that Thomas Friedman, diplomatic correspondent for The New York 
Times, castigates EU members:

        What threatens them right now are all those new East European 
        free-market democracies, whose factories and farmers want to 
        export to Western Europe at prices that will undercut the West 
        Europeans and whose workers all flock to Western Europe for 
        jobs which would drive down wages. Russian missiles and Russian 
        tanks are a nebulous and distant danger to Western Europe. But 
        Polish hams and Polish workers are a clear and present danger. 
        So NATO expansion is the bone EU members throw the East 
        Europeans instead of letting them into the European common 
        market, which is what the East Europeans really want and need. 
        \37\
---------------------------------------------------------------------------
    \37\ Thomas L. Friedman, ``NATO or Tomato?'', The New York Times, 
22 January 1997, A21.

    Given the benign strategic environment of post-Cold War Europe , in 
Central and Eastern Europe and the Baltic region security should, first 
and foremost, be a matter of nation building. This is the period to 
foster internal cohesion, develop democratic institutions and 
processes, promote modernization, and strengthen regional cooperation. 
Though governing marginal lands that are militarily insignificant and 
burdened with a deplorable Soviet legacy of environmental degradation 
and an aging infrastructure, today's leaderships have yet another 
chance. Their predecessors, when confronted with choices, opted for 
parochial politics and strategic myopia. To paraphrase what the 
Englishman Harold Beglie (1871-1929) once said about Christianity, it 
is not that democratization and development were tried and found 
difficult, but that they were found difficult and not tried.
    The conflict between the Germanic and Slavic peoples is part of the 
``ancient'' history of Europe. It has been overtaken by new strategic-
military realities: nuclear weapons that preclude another invasion by a 
massive land army bent on conquest; a Germany firmly anchored in 
alliance with the United States and integration with Western Europe; 
and a Russia in sharp decline. Although the countries of Central and 
Eastern Europe cannot change their geography, they can adapt in a more 
positive fashion than heretofore and concentrate on transforming 
themselves into liberal, democratic societies where the rule of law, 
protection for minorities, the supremacy of civilian authority, and 
eco-political pluralism are nurtured. Each of the countries has a 
Russian problem which should be put in perspective and normalized as 
quickly as possible: dwelling on the past, with its injustices and 
victimization, is no way to build for the future. In this respect, the 
experience of France and Germany shows the redemptive and generative 
power of political reconciliation and economic integration, and should 
be emulated. Why should Poland not extend itself to do as much with 
Lithuania, the Czech Republic, or Ukraine; or the Czech Republic not 
follow suit with Hungary, Slovakia, and Poland; or Hungary not 
reconcile with Romania, Slovenia, Ukraine, and Slovakia? None of them 
can hope to accomplish anything meaningful alone; and none are economic 
``tigers'' who need only the reassuring protection of NATO membership. 
They lag in economic and political reforms, run high budget deficits 
that demand greater fiscal and monetary discipline, and they must do 
far more to encourage innovative entrepreneurial elites and attract 
foreign investment.
    True, some self-help steps have been taken, but hardly enough. 
Thus, in December 1992, Poland, the Czech Republic, Hungary, and 
Slovakia established the Central European Free Trade Agreement (CEFTA). 
Slovenia became a member on 1 January 1996. CEFTA's ambitious 
objectives included the elimination of restrictions on the automotive, 
electrical, and textiles industries. To date, progress has been 
erratic. Slovenian-Italian relations, long conflictual, show signs of 
functional cooperation in trade and transportation. \38\ The free trade 
agricultural agreement signed by the prime ministers of Estonia, 
Latvia, and Lithuania in June 1996 and put into effect on 1 January 
1997 is another promising, though timid, measure; timid, because it is 
hedged with clauses that allow for protectionist barriers. Time will 
show if the Baltic states have the political will to make their free 
trade area work. Poland could be a trading and transportation hub for 
all of north-central Europe, but this requires that its government 
commit at least as much energy and diplomatic assets to developing 
joint ventures with Lithuania, Ukraine, and the Czech Republic as it 
uses to court France and Germany in order to gain entry to NATO.
---------------------------------------------------------------------------
    \38\ ``Slovenia: Bridge in Europe,'' The Economist, 11 January 
1997, 49.
---------------------------------------------------------------------------

                              Observations

    The thesis advanced in this paper leans toward the position that 
NATO enlargement is not necessary to advance the goal of all European 
security, and that a minimalist NATO, for geostrategic and political 
reasons previously developed, may be the right policy, at the right 
time, for the right reasons.
    Hardly had the elation everywhere in Europe over the collapse of 
the USSR and the end of the Cold War subsided than a group of American 
analysts began hawking the need for a Greater NATO. Prominent among 
those who made the intellectual case for NATO's expansion were Richard 
Kugler, Ronald D. Asmus, and F. Stephen Larrabee, members of RAND, a 
think tank with close ties to the Pentagon. So effective have the NATO 
enlargers been that there was little discussion in the U.S. Senate 
issues until the ratification debate began in earnest in late 1997. 
Starting in 1993, when the case for keeping NATO in the post-Cold War 
era was popularized by the catchy phrase ``use it or lose it,'' the 
enlargers have pressed for an all-inclusive NATO, but one that excludes 
Russia. They know that nothing could undermine NATO enlargement in the 
Congress more than its inclusion. Shades of the pre-Marshall Plan days!
    But a close, comprehensive relationship with Moscow is a necessary 
U.S. and, I believe, Western priority because, however straitened its 
circumstances and diminished its power, Russia remains a nuclear 
superpower. Only the United States is equipped to deal effectively with 
Russia on a range of critical nuclear issues.
    NATO enlargers maintain that despite Russia's opposition to 
enlargement, there is nothing it can do to stop the process. But this 
misses an important point: the question is not what the Russians can 
do, but rather what they might not do. Russia's cooperation against 
nuclear smuggling, indiscriminate arms sales, violations of the nuclear 
nonproliferation treaty, illegal immigration, drug trafficking, and 
terrorism is crucial, if European security is to be meaningful and 
enhanced.
    Today the Central and East European countries face momentous 
choices--and dilemmas. They all want security, democratization, and 
development. But which goal should take priority? In face of the 
concrete realities of contemporary Europe, which is the most important 
to the transformation and future well-being of these long repressed and 
exploited societies? Some urge incorporation into NATO, arguing that 
only in this way can these countries prevent historic ethnic tensions 
from turning violent, as they did in Yugoslavia. Some see and abhor a 
power vacuum in the region. Thus, Henry Kissinger urges NATO's 
expansion to forestall the creation of ``a gray area in Eastern Europe 
between Germany and Russia, potentially tempting historic Russian 
drives to create political and strategic vacuums around its 
periphery.'' \39\
---------------------------------------------------------------------------
    \39\ Henry A. Kissinger, ``Beware: A Threat Abroad,'' Newsweek, 17 
June 1996, 4.
---------------------------------------------------------------------------
    At a minimum, such strategizing from a NATO-centric perspective 
will result in subordinating democratization and development in Central 
and Eastern Europe. As Michael Mandelbaum has observed, ``NATO is not 
an effective instrument for promoting either free markets or 
democracy.'' No alliance, it needs be stressed, has ever succeeded in 
advancing such goals. NATO is ``a military alliance, an association of 
some sovereign states directed against others. The 'other' in this case 
is Russia.'' \40\ There is still time, if the will exists, to reexamine 
all possibilities. small countries who aspire to be bishops but more 
often find themselves mere pawns might want to consider Cassius's 
warning:
---------------------------------------------------------------------------
    \40\ Michael Mandelbaum, ``Preserving the New Peace: The Case 
Against NATO Expansion,'' Foreign Affairs, Vol. 74, No. 3 (May/June 
1995), 9-10.

        Men at some time are masters of their fates: The fault, dear 
        Brutus, is not in our stars, But in ourselves, that we are 
        underlings.
                                                      Julius Caesar
                                                     Act 1, Scene 2

    Senator Smith. Thank you, Doctor, for your contribution and 
all of you who contributed, we thank you.
    This committee hearing is adjourned.
    [Whereupon, at 12:15 p.m., the committee adjourned.]



                            A P P E N D I X

                               Appendix 1

                       Hearing of October 7, 1997

                                                    October 3, 1997

                               MEMORANDUM

TO:
                          Members, Committee on Foreign Relations

THROUGH:
                          James W. Nance and Edwin K. Hall

FROM:
                          Steve Biegun, Beth Wilson, and Mike Haltzel

SUBJECT:
                          Hearing on the Strategic Rationale for NATO 
                        Enlargement

    On Tuesday, October 7, 1997 at 10:00 a.m., the Committee on Foreign 
Relations will hold a hearing on the Strategic Rationale for NATO 
Enlargement.
    Senator Helms will preside.

                                Overview

    The Foreign Relations Committee has scheduled a series of six 
hearings this fall to examine all elements of NATO enlargement. (One or 
two additional hearings will be scheduled early next year after the 
treaty is formally transmitted to the Senate). The first two hearings 
will provide an overview of the arguments for and against NATO 
enlargement with Administration and private witnesses. Subsequent 
hearings will address costs, benefits and burden sharing; the 
qualifications of Poland, Hungary and the Czech Republic for NATO 
membership; the NATO-Russia relationship; and public views. This memo, 
prepared with the assistance of Paul Gallis from the Congressional 
Research Service, includes an overview of the aforementioned topics. 
Memos with more detailed analysis will be provided for the later 
hearings.

                   NATO: From Cold War to Enlargement

Cold War
     NATO was established on August 24, 1949, with the entry into force 
of the Washington Treaty, as an alliance of mutual defense among 
democratic and market oriented governments in North America and Western 
Europe. Original members included the United States, Canada, and ten 
European countries emerging from the destruction of World War II (Great 
Britain, France, Belgium, the Netherlands, Portugal, Denmark, Norway, 
Luxembourg, Iceland and Italy). NATO has been central to peace and 
stability in Europe for almost fifty years, and serves as the principal 
vehicle through which the United States maintains its relationship and 
manifests its influence with its European allies.
    During the Cold War NATO served as a bulwark against the threat of 
the Soviet Union and its Warsaw Pact satellites. The U.S. strategic 
nuclear guarantee served as a deterrent to Soviet aggression, and U.S. 
conventional forces stationed in Europe, reaching over 300,000 at their 
peak, were evidence that the United States would meet its commitment to 
collective defense under Article 5 of the Washington Treaty (the part 
of the Washington Treaty which obligates NATO members to come to each 
other's defense). The collapse of communism demonstrated NATO's success 
in fending off the massive, external threat posed by the Soviet Union. 
But NATO continues to fulfill a second role equally important as the 
defense against communism. After two World Wars in the first half of 
the century into which the United States was inevitably drawn, the 
close relationship among NATO members allowed countries to lay aside 
historical grievances and develop democratic traditions and market 
economies to the enormous benefit of themselves, their neighbors and 
the United States.
    To date, the alliance has been enlarged on three separate 
occasions--to include Greece and Turkey in 1952, the Federal Republic 
of Germany in 1955, and Spain in 1982. A process has been set in motion 
to expand the membership of NATO yet again to include several Central 
and Eastern European nations that emerged from Soviet domination with 
the collapse of communism. Changes under consideration in NATO extend 
beyond the question of adding new members. The current enlargement 
debate, to include Poland, Hungary and the Czech Republic as full 
members of NATO, is occurring at the same time as an important debate 
over NATO's mission in post-Cold War Europe.
New Missions
    The Soviet Union's collapse in 1991 and the current disarray of the 
Russian military have, in the view of NATO, largely eliminated any 
immediate, conventional threat to Western Europe and the United States. 
In 1991, as the Soviet Union teetered on the verge of collapse, NATO 
members agreed to a new alliance purpose in a document known as the 
Strategic Concept. The Strategic Concept reiterates the importance of 
collective defense, but it notes that, with the emergence of 
independent democratic states in Central Europe, ``the political 
division of Europe that was the source of the military confrontation of 
the Cold War period has... been overcome.'' The allies agreed, even 
before the now evident decline of Russia, that risks to security were 
from ``instabilities that may arise from the serious economic, social 
and political difficulties, including ethnic rivalries and territorial 
disputes'' in Europe. Proliferation of weapons of mass destruction, 
disrupted access to vital resources, and terrorism are also noted.
    While NATO's core mission remains collective defense, the Strategic 
Concept outlines a leaner approach to security for the post-Cold War 
environment. Militarily, the allies agreed to move away from a 
positional forward defense and develop forces to counter ``diverse and 
multi-directional risks.'' Such forces would ``require enhanced 
flexibility and mobility and an assured capability for augmentation 
when necessary.... This ability to build up by reinforcement, by 
mobilizing reserves, or by reconstituting forces, must be in proportion 
to potential threats....'' The themes of risks rather than threats, and 
lighter forces capable of rapid reinforcement and reconstitution have 
been central elements in Administration efforts to develop a strategic 
rationale for enlargement.
    As an inevitable follow-on to the Strategic Concept, the risks to 
peace in post-Cold War Europe that have replaced the Soviet threat have 
given rise to consideration of new missions for NATO, such as 
peacekeeping and crisis management. However, differences are evident 
over such issues as whether to expand NATO's purpose beyond collective 
defense, how to bring stability to Bosnia, and whether the European 
allies possess the will and capacity to accomplish such new missions 
themselves, with limited U.S. involvement. The debate over new missions 
will also affect burden sharing in the alliance, perhaps more so than 
that of expansion itself.
    Critics point out that consideration of new missions for NATO will 
be problematic for the alliance. While NATO has been relatively 
successful in maintaining consensus for the narrow mission of the 
territorial defense of its members, consensus on peacekeeping or crisis 
prevention will be quite complicated. Proposals under consideration 
that would tie such deployments to the approval of the United Nations 
or the Organization for Security and Cooperation in Europe (OSCE) could 
subject NATO decisions to the consensus of self-interested motives of 
undemocratic nations that have membership in those organizations. 
Finally, because the United States is the leading military power in 
NATO and has force projection capabilities far superior to most of the 
allies, the costs associated with a peacekeeping oriented mandate will 
inevitably fall disproportionately upon the United States military.
Enlargement
    Administration officials have cited a range of U.S. interests that 
enlargement could serve: strengthening states that share a belief in 
democracy; development of free-market economies open to U.S. investment 
and trade; securing allies willing to share cooperative efforts in an 
array of global issues; and preserving a Europe free of domination by 
any one power. Critics have been concerned that enlargement might 
isolate and antagonize Russia, that it may financially overburden the 
allies in a time of shrinking defense budgets, and that it may create 
new political divisions in Europe. Some also believed that admitting 
new members with weak militaries and recently developed democratic 
practices might dilute the military capability and political like-
mindedness of the alliance, and deflect the alliance from its core 
mission of collective defense. Concern has also arisen over whether 
arrangements agreed to allay Moscow's concerns have given Russian 
leaders a role in NATO decision making.
    While some allies initially expressed hesitation over enlargement, 
NATO members preliminarily endorsed the expansion of the alliance at a 
January 1994, NATO summit. On balance, the allies believe that 
enlargement, coupled with later expansion of the European Union (EU) 
and the continued engagement of the United States, will enhance 
stability on the continent. In Madrid, on July 8, 1997, the allies 
unanimously agreed to invite Poland, Hungary and the Czech Republic to 
begin accession talks. The allies pledged to leave the door open to 
future candidates, but did not commit themselves to a date for 
additional enlargement or to particular countries for consideration.

                               Key Issues

Strategic Rationale
    The Administration continues to describe collective defense as the 
core of the alliance, but believes that NATO has other, closely 
related, purposes as well. At a Senate Armed Services Committee hearing 
in April 1997, Secretary Albright was asked to explain who the alliance 
is defending against. She responded:

        The threat is basically...the instability within the region 
        which has in fact created two world wars. But there is also the 
        possibility of an outside threat. There is a possibility of 
        threats from various parts outside the region, to the south, we 
        have to guard against. And, on the off chance that in fact 
        Russia does not turn out the way we are hoping it will and its 
        current leadership wants, NATO is there.

    Central Europe for centuries has been a region of instability. 
Supporters of enlargement believe that admitting qualified new members 
is a means not only to secure gains from the end of the Cold War, but 
an historic opportunity to develop a community of states that embraces 
democracy and free markets and sets aside enduring ethnic and border 
tensions that have caused conflict. In addition, in this view, 
enlargement sends a clear signal to Russia that while the era of 
intimidation of its neighbors is at an end, the opportunity is at hand 
for Moscow to seek cooperation with its European neighbors and the 
United States to bring stability to the entire continent.
    Critics of enlargement tend to believe that a reformed Russia, 
still controlling a nuclear arsenal, is the key foreign policy interest 
for the United States and its allies. Enlargement, in this view, will 
humiliate Russia by taking from its orbit a region that it believes is 
within its historic sphere of influence, and serve as an inducement to 
nationalists to overturn Russian reformers' efforts to work 
constructively with the West in such areas as arms control and conflict 
prevention. In addition, they believe that Central Europe's experiment 
with democracy may be but a brief moment in centuries of turbulence, 
and that western publics are not prepared to guarantee the security of 
such a region when scarce resources might be utilized for domestic 
needs rather than for defense.
The Candidate States
    Poland, Hungary and the Czech Republic have suffered repeated 
divisions and subjugation by empires to their east and west during the 
last several centuries. With the collapse of the Soviet empire in 
Central and Eastern Europe, these countries restored sovereign, 
democratic governments for the first time since the aftermath of World 
War II. The impetus for NATO enlargement, which first gained momentum 
in 1993, was largely driven by the concern of anti-communist Eastern 
European leaders such as President Lech Walesa of Poland and President 
Vaclav Havel of the Czech Republic, who feared that Russia would seek 
to reassert influence over former Soviet satellite states. It is the 
hopes of the leaders of Poland, Hungary and the Czech Republic that 
NATO membership will provide a stable security environment as their 
countries and others in the region deepen their drive toward democracy 
and market economies on the Western periphery of a Russia whose future 
is far from certain.
    Public opinion in Poland and Hungary favors entry into NATO, in 
Poland overwhelmingly and in Hungary strongly. In the Czech Republic, 
polls show a narrower margin of support on the issue of enlargement. 
The governments and parliaments of all three candidate states support 
NATO membership as a means to enhance stability. Due to their concern 
over the return of an aggressive Russia, they view the Article 5 
commitment as the principal, but mostly unstated, reason for joining 
the alliance.
    Poland, Hungary and the Czech Republic have each held several 
elections judged free and fair since regaining its independence. Each 
has made progress in privatizing its economy and is experiencing 
economic growth. The three candidate states have accepted NATO's 
requirement of assuming the necessary military responsibilities should 
they enter the alliance. Each now enjoys civilian control of the 
military, although each remains encumbered, to differing degrees, with 
armed forces top heavy with officers and only partially trained in NATO 
doctrine and practices. They are at different stages of modernizing and 
restructuring their armed forces, and each has outlined plans to ensure 
that defense expenditures are sufficient to meet the obligations of 
NATO membership.
    Each candidate state is a member of a range of European 
institutions, including the OSCE and the Council of Europe. The 
European Union is considering the three countries (and others) as 
possible candidates for membership, to be formally named at an EU 
summit in December 1997. NATO and the EU have both required candidate 
states to settle border and ethnic disputes to qualify for membership. 
To this end, Poland, Hungary and the Czech Republic have signed 
agreements with neighboring states, and the leading political parties 
in each of the three countries have given strong evidence of dedication 
to the settlement of ethnic and border disputes.
Costs, Benefits, and Burden Sharing
    In a February 1997, ``Report to Congress on the Enlargement of 
NATO: Rationale, Benefits, Costs, and Implications'', the Department of 
Defense outlined its analysis of the costs of enlargement. (NATO is 
drafting its own cost study of enlargement, which is due to be 
completed in December 1997). The Pentagon study is premised upon the 
collapse of the Russian threat, the need for fulfilling the defense 
requirements of the Strategic Concept, and the potential contribution 
of the candidate states to NATO's new missions.
    The Administration estimates that 12 years (1997-2009) would elapse 
before the three states might fully contribute to collective defense. 
The estimated total cost (combined U.S., fifteen NATO allies and three 
candidate states) of enlargement will be $27-35 billion. The study 
assumes that current members would deploy no substantial forces on the 
territory of new members, but it does note that NATO defense costs 
would be appreciably higher in the event of a renewed Russian threat--
with or without enlargement.
    Focus on this issue should include three distinct points. The first 
point is the cost of accepting three new members into the alliance. 
According to the Pentagon estimates, the cost of NATO enlargement will 
be divided among the United States (15%), the new members (35%), and 
the other existing members of NATO (50%). The dollar amount from the 
United States for this purpose is estimated at $150-$200 million per 
year from 1999-2009.
    The second category of expense, the cost to the new members to meet 
the military requirements of NATO membership, is estimated at $10-13 
billion over twelve years--an amount that Poland, Hungary and the Czech 
Republic have publicly committed to meet. All three countries have 
stable democratic governments, and economic reforms have progressed to 
a degree that NATO defense expenditures can reasonably be met. Poland's 
economic growth rate this year is running at 5.5 percent, with Hungary 
and the Czech Republic not far behind.
    The third category of expense, the cost for existing alliance 
members to meet obligations to pay a fair share of the cost of NATO 
obligations as agreed in the Strategic Concept, is estimated at $4.5-
$5.5 billion. This represents commitments already made but not yet 
achieved by the allies. In fact, European defense budgets are shrinking 
and it is this latter category of cost sharing that must be met by the 
Europeans if NATO membership is to remain beneficial to U.S. interests.
    Assumptions of the threat to NATO and what constitutes an 
``adequate'' defense have driven estimates in the two other enlargement 
cost studies of note, offered by the RAND Corporation (a national 
security think tank) and the Congressional Budget Office (CBO). Both of 
these studies examine escalating threat scenarios, coupled to the cost 
of correspondingly increased defense postures. RAND's total cost 
estimates for NATO enlargement range from $10 billion to $110 billion 
over 10-15 years. The low end of the RAND study's estimate assumes a 
minimal threat, with new members bearing the costs of military 
modernization; the high-end estimate assumes a substantial forward 
deployment of current members' forces on new members' territory coupled 
with a resurgent Russian threat.
    CBO assessed enlargement costs under five possible scenarios, 
ranging from assisting a new member engaged in a border skirmish or a 
conflict with a regional power, to the permanent stationing of the 
forces of current member states on the territory of new members to 
prepare for a broader conflict with Russia as the adversary. According 
to CBO, over 15 years the estimated range of total costs would be $60 
to $125 billion, with the total U.S. share ranging from $4.8 to $18.9 
billion.
    Allied governments do not agree with the cost of enlargement as 
defined by the Administration (or the two private studies). Due to 
their differing assumptions about threats and required responses, and 
in view of their publics' desire for declining defense budgets, most 
NATO allies think the cost of NATO enlargement should be far less. 
French President Chirac has said: ``We have adopted a very simple 
position: Enlargement must not cost anything in net terms'' because 
there is no threat. ``In reality, NATO is a peacekeeping body, a crisis 
management system, and accordingly can afford much lighter resources to 
cover enlargement.'' The former British Ambassador to the United States 
has said that the Administration report assumes a greater threat than 
warranted, and that U.S. officials are ``using arguments about 
enlargement to leverage a better performance [from allies] on [NATO] 
force goals.'' Both of these remarks, which are representative of 
thinking in several allied capitals, raise questions about the future 
capabilities of NATO and the willingness of current allies to devote 
resources sufficient to meet their military obligations.
    While defense burden sharing inside NATO remains unequal, the 
American-led NATO alliance provides the best forum for the United 
States to press the European democracies to continue to meet their 
obligations, not only for European defense but, even more importantly, 
for the global defense of mutual interests. It is no coincidence that 
the integrated, well-trained forces of the U.S. and its European allies 
formed the spearhead of the successful attack against Iraq during the 
Persian Gulf War. This was a direct result of cooperation among members 
of NATO.
    Maintaining the abilities of NATO to respond to future crises will 
be a vital U.S. interest if the Europeans can be pressed to share the 
burden. Without NATO, the global defense burden of the U.S. would 
likely increase. The ability of the allies to coordinate with U.S. 
forces in a military crisis would be reduced and the net result would 
probably be more instances where the United States is forced to either 
``go it alone'' or stay out of conflicts that could have the potential, 
as was the case in the first half of the century, ultimately to bring 
the U.S. in anyway.
NATO-Russia Relations
    Many allies, particularly Germany, France, and Italy, were 
initially concerned that enlargement would jeopardize improved 
relations with Russia and inspire a nationalist backlash injurious to 
western interests. In this view, an angry Russia would cause 
instability and tension in Central Europe. To avoid such a development, 
NATO endorsed an effort to reach agreement with Moscow over a forum for 
consultation.
    NATO and Russia formalized consultative procedures in a document 
called the Founding Act, which was signed on May 27, 1997. The Founding 
Act established a Permanent Joint Council (PJC) for NATO-Russia 
consultations. Secretary Albright has said that the Council is a 
``forum for consultation, cooperation, and--where possible--joint 
action. It will not have the power to dilute, delay, or block NATO 
decisions, nor will it supplant NATO's North Atlantic Council'' (SASC 
hearings, April 1997). Russia has ``a voice but not a veto,'' and 
appropriate issues for discussion include proliferation, the 
safekeeping of nuclear arsenals, and coordination of responses to 
``humanitarian crises and threats to peace.''
    The NATO-Russia relationship has been strained by three years of 
strident Russian opposition to NATO enlargement. In the assessment of 
many observers, Russian objections are primarily aimed at achieving 
maximum assurance that NATO will pose no future threat to Russia. 
Others conclude that Russia is simply irreconcilably opposed to NATO 
enlargement, or that Russian leaders are using the issue, without 
concern for the consequences, to outmaneuver nationalistic political 
opponents at home.
    Specifically, the Russian government is seeking assurance that NATO 
enlargement will not lead to the deployment of NATO conventional 
infrastructure or nuclear weapons directed at Russia. On the question 
of conventional capabilities, NATO has resisted any permanent 
constraints that would lead new members in Central and Eastern Europe 
to be less secure than other members of the alliance. Nonetheless, NATO 
formally declared on March 14, 1997, that ``in the current and 
foreseeable security environment the alliance will carry out its 
collective defense and other missions by ensuring the necessary 
interoperability, integration, and capability for reinforcement rather 
than by additional permanent stationing of substantial combat forces.'' 
In the case of the latter point, related to the deployment of nuclear 
weapons, NATO stated on December 10, 1996 that its members have ``no 
intention, no plan, and no reason'' to deploy nuclear weapons in new 
member states.
    Aside from the official statements of intent by NATO on 
conventional and nuclear deployments in new member states, two treaties 
offer assurances to both Russia and NATO on these issues: the 
Conventional Armed Forces in Europe Treaty (CFE) and the START II 
Treaty. The premise of the CFE Treaty, which was ratified by the Senate 
in 1991, is that conventional armaments reductions would create a more 
balanced and stable military situation in Europe. It establishes 
regional and national limits on certain categories of military 
equipment, including tanks, artillery, armored fighting vehicles, 
fixed-wing aircraft, and attack helicopters among the members of NATO 
and former members of the Warsaw Pact (as well as their successor 
states). The adaptation of the CFE Treaty is currently under 
negotiation in order to make it relevant to the post-Cold War security 
environment in Europe.
    An emotional element of the Russian complaint about an increased 
conventional threat as NATO enlarges is that NATO will then be on 
Russian borders. An enlarged NATO may indeed approach the borders of 
Ukraine and Belarus, but these are not Russian territory. The small 
piece of Russian territory that an enlarged NATO would border, 
Kaliningrad, has questionable strategic value to Russia and is not 
contiguous with the rest of Russia. A better example of the 
relationship envisioned by NATO between new members and Russia can be 
found between Russia and Norway. Norway, an original NATO member, has 
shared a border with Russia (and before that the Soviet Union) without 
threatening Russia. In fact, Norway has no foreign forces on its 
territory, it has no nuclear weapons on its territory, it has no 
substantial, forward-deployed conventional forces, and it maintains 
good relations with Russia. (It even provides foreign aid to Russia).
    The avenue for Russia to receive legally binding assurance against 
a nuclear threat is the START II Treaty, which was ratified by the 
Senate in 1995 and is pending approval in the Russian Duma. This arms 
control agreement requires the United States and Russia to reduce 
nuclear weapons holdings to 3,000-3,500 warheads each. The Clinton 
administration has committed to begin negotiations on a START III 
Treaty, with further reductions to a range of 2,000-2,500 each, if 
Russia approves the START II Treaty. While a START III Treaty is far 
from a forgone conclusion--with many complicated issues dividing the 
two sides and an internal U.S. debate over how low the United States 
can take its level of strategic nuclear weapons and retain effective 
deterrence--it is through these negotiations that the Russian 
government can gain increased assurances and security from the nuclear 
holdings of NATO members.
    Proponents of the NATO-Russian Founding Act see this measure as a 
definitive symbol of NATO's desire to work with, not against Russia. It 
addresses a widely held view--including among potential members of NATO 
in Central Europe--that isolating Russia would undermine European 
security. The Founding Act establishes a forum for Russia to have a 
voice in European security, and it has allowed Russia to save face as 
NATO almost inevitably enlarges.
    Critics, however, contend that the NATO-Russia Founding Act 
provides Russia with a status inside NATO in advance of Central 
European states seeking membership. Furthermore, Russia's status has 
been achieved through a political agreement among NATO members while 
Central European states are required to gain the approval of member 
states through ratification. On a separate matter, critics point out 
that because difficult decisions at NATO are not made by casting votes 
or using vetoes, but rather through a careful process of building 
consensus, the ``voice but not a veto'' construct actually gives the 
Russian government equal footing with members of the alliance on 
virtually any subject considered in the Permanent Joint Council. 
Finally, critics assert that while a NATO-Russia dialogue has some 
appeal in the abstract, when held up against the concrete, contemporary 
challenges of European security, the ability to reach a common approach 
between NATO and Russia on issues such as Bosnia will be problematic if 
not impossible.
Bosnia
    The long war in Bosnia ended when the United States brokered the 
1995 Dayton Accord to establish a multi-ethnic, non-partitioned state. 
The NATO-led Stabilization Force (SFOR) oversees and enforces military 
aspects of the accord, which the parties themselves have in large part 
successfully implemented. Implementation of non-military provisions 
that would consolidate peace and political stability has been less 
successful. National Security Advisor Berger said September 23, 1997, 
that Bosnia will ``remain a source of dangerous instability in Europe'' 
unless the international community remains engaged after the end of the 
SFOR mandate on June 30, 1998. Secretary of defense William Cohen, in 
an October 1-2, 1997, meeting with his NATO counterparts, stated that 
no final decision had been made about a post-SFOR force in Bosnia. 
States contributing to SFOR also differ on whether the NATO force 
should become more engaged in missions such as capturing war criminals 
in Bosnia. Many European governments maintain an ``in together, out 
together'' policy: if U.S. forces leave, theirs will depart as well. 
The United States supplies 31% of the forces for SFOR, Britain 19.3%, 
France 9.1%, and Germany 7.3%. Germany has absorbed 300,000 refugees 
from the former Yugoslavia, at a cost of $2.5 billion a year.
    Bosnia may affect the debate over NATO enlargement because western 
engagement there is seen as a test of the Europeans' willingness to 
share the burden of bringing stability to their own continent. In this 
view, France, for example, demands an enhanced leadership role for 
Europeans in the alliance, but at the same time the Europeans refuse to 
commit to ensuring stability in Bosnia without a U.S. ground presence 
and leadership. Some European officials counter that the United States 
cannot be resolute in guaranteeing the security of Poland, the Czech 
Republic, and Hungary if it lacks the resolve to bring peace to Bosnia, 
which is clearly causing instability in neighboring regions. In these 
officials' view, if a key new mission of an enlarged NATO is crisis 
management, then Bosnia is a crucial test that the alliance can not 
fail and still hope to retain its vitality.

                       Timetable for Enlargement

    Accession negotiations with the three candidate states began in 
September 1997, and NATO intends to sign a protocol for amendment of 
the Washington Treaty to admit Poland, Hungary and the Czech Republic 
at a December 15-16, 1997, meeting of NATO foreign ministers. The 
Administration expects to transmit the protocol to the Senate in 
January 1998. If the member states approve the protocols, the alliance 
wishes to admit the three states in April 1999 on NATO's 50th 
anniversary.
        




                      MEETING THE CHALLENGES OF A

                          POST-COLD WAR WORLD:

                          NATO ENLARGEMENT AND

                         U.S.-RUSSIA RELATIONS




                            C O N T E N T S

                               __________
                                                                   Page

Letter of Transmittal............................................   341

 I. Policy Recommendations..........................................345
II. Observations....................................................346
III.Status Reports on Leading Candidate Countries...................351

    A. Poland....................................................   351
    B. The Czech Republic........................................   355
    C. Hungary...................................................   358
    D. Slovenia..................................................   362
IV. Roster of Meetings in Russia and Central Europe.................366

                                ADDENDA

A. Speech by Senator Biden at Warsaw University, March 25, 1997..   371
B. The North Atlantic Treaty (Washington, DC, April 4, 1949).....   376
C. Chronology of NATO Enlargement................................   379
D. Helsinki Summit Declaration (March 21, 1997)..................   381
E. North Atlantic Council Ministerial Communique (December 10, 
  1996)..........................................................   383
F. Statement by the North Atlantic Council (March 14, 1997)......   394
G. NATO Enlargement Facilitation Act of 1996.....................   395
H. Selected Bibliography on NATO Enlargement.....................   400
I. Map of Europe with Members of NATO and the Partnership for 
  Peace..........................................................   403

                                 (339)



                         LETTER OF TRANSMITTAL

                              ----------                              

                                                      May 13, 1997.
The Hon. Jesse Helms,
Chairman, Committee on Foreign Relations,
Washington, DC.

    Dear Mr. Chairman. During the week of March 23, I traveled 
to Europe to learn more about the process of the enlargement of 
the North Atlantic Treaty Organization and its likely effect 
upon our relations with the Russian Federation. This report is 
based upon an extensive series of meetings held during that 
trip and background reports by several agencies of the U.S. 
Government, including the Department of State, the United 
States Information Agency, the Department of Defense, and the 
Congressional Research Service of the Library of Congress.
    The trip immediately followed the U.S.-Russia summit 
meeting in Helsinki, Finland and took me first to Moscow, and 
then to the capitals of the four countries named in the 1996 
``NATO Enlargement Facilitation Act''--Poland, the Czech 
Republic, Hungary, and Slovenia.
    In traveling to these five countries, I was accompanied by 
Dr. Michael Haltzel, Professional Staff Member of the Foreign 
Relations Committee, and Commander Sean Fogarty of the U.S. 
Navy. Our group was given invaluable assistance by the 
Embassies of the United States in Moscow, Warsaw, Prague, 
Budapest, and Ljubljana.
    Mr. Chairman, for political, economic, strategic, and 
cultural reasons, Europe remains an area of vital interest to 
the United States and, therefore, stability on the continent is 
fundamental to the well-being of our country. The often painful 
history of the twentieth century has demonstrated that the 
United States must play a leading role in organizing the 
security of Europe. From World War I at the beginning of this 
century to Bosnia and Herzegovina in the mid-1990's, without 
American leadership the countries of Europe have proven unable 
to resolve their differences peacefully.
    Over the last decade, the end of the cold war and the 
collapse of Communism have completely altered the face of 
Europe. Newly independent states in Central and Eastern Europe 
are striving to create and solidify political democracy and 
free markets. For most of these countries it is a difficult 
process, which, if not put into a larger framework, could spin 
out of control.
    It is in this context that the enlargement of NATO must be 
seen. During the cold war, NATO provided the security umbrella 
under which former enemies in Western Europe were able to 
cooperate and build highly successful societies. The 
enlargement of the alliance can now serve to move the zone of 
stability eastward to Central Europe, thereby preventing a 
1930's--type renationalization of that historically volatile 
region. For the United States this translates into investing 
today in a modernized, enlarged NATO in order to avoid, once 
again, having to spill incalculably more blood and expend more 
resources to settle conflict tomorrow.
    NATO enlargement will reach a crucial stage on July 8-9, 
1997 in Madrid, Spain when the alliance is expected to extend 
an invitation to membership to one or more candidate countries. 
In order for enlargement to proceed, however, both our current 
NATO allies and the candidate countries invited to join in 
Madrid, must agree to shoulder their fair share of financial 
costs and all mutual obligations. My discussions with Central 
European leaders convinced me that this basic message needs to 
be driven home.
    The failure of our current and future allies to pull their 
weight would surely cause support for NATO in the United States 
to wane. America's 50-year-long commitment to the alliance has 
been predicated upon equitable division of burdens. The clear 
and understandable tendency among the American people and some 
of its leaders to look inward is growing. I believe, however, 
that this isolationist impulse is dangerous, and it is up to 
the President and the Congress to persuade Americans that we 
must continue to engage Europe.
    Russia, also undergoing a comprehensive and difficult 
transition from totalitarianism to free-market democracy, will 
continue to be one of the major players in determining whether 
Europe remains secure. It is essential, therefore, that 
enlarging NATO be accompanied by a broader and deeper 
relationship with Russia. Some observers doubt that 
simultaneously achieving both goals is possible. I disagree.
    This report reflects my strong belief that NATO enlargement 
need not adversely affect U.S. relations with Russia. From 
Communist leader Zyuganov, to liberal leader Yavlinsky, to 
nationalist leader General Lebed', no Russian politician with 
whom I met believed that NATO enlargement posed a security 
threat to Russia. Rather, their opposition to enlargement 
reflected a deeper psychological problem of coming to grips 
with the loss of empire and a fear of Moscow's being 
marginalized in the changed world of the 21st century.
    There is much that we can do to allay their misgivings. By 
stabilizing Central and Eastern Europe, NATO enlargement can 
induce Moscow to reorient its political and economic policies 
westward toward Europe and the United States. Moreover, before 
Madrid, NATO and Russia may reach agreement on a charter that 
will outline mechanisms for enhanced consultation and 
cooperation, without adversely affecting the ability of NATO to 
function as the world's most powerful, defensive military 
alliance. Finally, through intensified trade, investment, and 
technical assistance the United States and Western Europe can 
help Russia overcome the real threats to her security--crime, 
corruption, environmental degradation, and loosely guarded 
nuclear, chemical, and biological weapons and material.
    Security does not come cheaply, and maintaining NATO is not 
inexpensive. American taxpayers deserve to understand the 
benefits of their continuing to support the alliance now that 
its mission has broadened to projecting security rather than 
the old cold war task of confronting a single aggressive enemy.
    I know that you agree on the importance of these issues, 
and I look forward to working with you to ensure that the U.S. 
Senate and the American people are fully informed as the 
process of NATO enlargement continues.
      Sincerely,
                                      Joseph R. Biden, Jr.,
                                            Ranking Member.
                       I. Policy Recommendations

    1. Initiate a national debate on NATO enlargement.--No 
foreign policy, no matter how well formulated, can be sustained 
without the informed consent of the American people. Therefore, 
a national debate should be launched to explore the costs, 
obligations, and benefits to the United States of NATO 
enlargement. To begin that debate, the Senate Committee on 
Foreign Relations should hold a series of comprehensive 
hearings on NATO enlargement and relations with Russia in both 
the Subcommittee on European Affairs and the Full Committee.

    2. Immediately engage European alliance partners on funding 
NATO enlargement.--Before the U.S. Senate votes on enlargement 
in 1998, there must be a clear understanding with our NATO 
Allies of how the costs will be shared. Therefore, the U.S. 
Government should without delay engage our European NATO 
partners to urge them to agree to shouldering, with Canada, the 
50 percent of the direct costs of NATO enlargement and the 
costs of power projection enhancements called for by the 
administration in the February 1997 Pentagon study.

    3. Support the invitation to admission to NATO of four 
countries at Madrid.--The U.S. Government should without delay 
announce its support for the invitation to admission to NATO at 
the July 8-9, 1997 summit in Madrid of Poland, the Czech 
Republic, Hungary, and Slovenia, a move which will extend the 
zone of stability into Central and Eastern Europe. The 
declaration of support should remind the four countries of 
their responsibility to shoulder part of the costs of 
enlargement.

    4. Undertake a program to strengthen cooperation with those 
countries not invited at Madrid.--The U.S. Government should 
without delay reiterate that NATO enlargement is not a single 
event, but a process. There will be additional rounds of 
enlargement, and no country should be automatically excluded if 
it meets the membership criteria. In that connection, the 
United States should present a program to NATO to strengthen 
political and military cooperation with candidate countries not 
invited to join the alliance at Madrid. This program could 
include an enhanced Partnership for Peace, intensive 
participation through the new Atlantic Partnership Council, or 
regional initiatives.

    5. Immediately engage NATO partners on Bosnia.--The U.S. 
Government should redouble its efforts to convince our European 
NATO partners, particularly the United Kingdom and France, to 
continue to maintain ground forces in Bosnia and Herzegovina 
after July 1, 1998, to be augmented by U.S. air, naval, 
communications, and intelligence support, with a U.S. rapid 
reaction force in ``over-the-horizon'' proximity.

    6. Refocus and strengthen U.S. engagement with Russia.--
After 5 years of providing technical assistance to Russia it is 
time to shift our focus: to projects to encourage trade and 
investment and to grassroots partnerships designed to help 
create a civil society. In this regard, the administration's 
proposal labeled the ``Partnership for Freedom,'' provides a 
good conceptual framework, so long as viable Russian 
institutions for partnerships and investment can be identified.

    7. Ensure continued support for the Nunn-Lugar Cooperative 
Threat Reduction Program.--The Cooperative Threat Reduction 
Program, commonly known as the ``Nunn-Lugar Program,'' is a 
joint effort with Russia, Ukraine, Belarus, and Kazakstan to 
dismantle the Soviet war machine. By providing the authority 
and financing to destroy production capabilities, delivery 
vehicles, and weapons and materials of mass destruction, the 
program has reduced the threats to the United States and its 
allies and friends from nuclear, chemical, and biological 
weapons. Because nuclear, chemical, and biological stockpiles 
still remain in the states of the former Soviet Union, however, 
sabotage, theft, and unlawful exports remain serious problems. 
The ``Nunn-Lugar Program'' should continue to be supported by 
the Congress.

    8. Maintain support for Radio Free Europe/Radio Liberty.--
Radio Free Europe/Radio Liberty, now headquartered in Prague, 
remains an important instrument in advancing the fundamental 
U.S. foreign policy objective in Central and Eastern Europe and 
Russia: the consolidation of democracy. Although a free press 
is beginning to take root in the region, RFE/RL still has a 
dual function: to keep honest those who would seek to silence 
the press, and to provide a model of how independent media 
should operate in a free society. This function is not one 
conceived in the abstract. The people of Central and Eastern 
Europe and Russia continue to turn to RFE/RL because it is 
often perceived as the most unbiased available source of news. 
U.S. Government support for the radios must be maintained.

                            II. Observations

    For political, economic, and security reasons the 
maintenance of stability in Europe remains a fundamental 
component of United States foreign policy. In order to 
guarantee that stability, a continued American military 
presence in Europe is essential. Yet with the collapse of 
Communism in most of Europe, many Americans have begun to 
question the continued need for the North Atlantic Treaty 
Organization (NATO). For that reason alone, the United States 
must be profoundly concerned that the security structures of 
the last 50 years be adapted to meet the challenges of the 21st 
century. Important elements in that process involve redefining 
the alliance's mission and increasing NATO's membership to 
reflect the dramatic changes that have occurred in Central 
Europe since 1989.
    Contrary to fears expressed in some quarters, NATO 
enlargement need not adversely affect U.S. relations with 
Russia over the long term. Rather, it and the proposed NATO-
Russia Charter can be important steps in definitively shaping a 
new European security structure, thereby helping to persuade 
Moscow to orient its foreign political and economic policies 
westward toward Europe and the United States. Over time, Moscow 
can come to realize that the enlargement of NATO will move the 
zone of stability eastward to Central Europe, thereby 
preventing a 1930's-type renationalization of that historically 
volatile region.
    In order for enlargement to proceed, however, both our 
current NATO allies and the candidate countries invited to join 
at the Madrid summit on July 8-9, 1997 must agree to shoulder 
their fair share of financial costs and all mutual obligations. 
This agreement is the sine qua non of the continued viability 
of NATO.
    Although few Russians like NATO enlargement, policymakers 
in Moscow have accepted it as a fait accompli. Moreover, no 
Russian leader whom I met on my trip--from Communist leader 
Zyuganov, to liberal leader Yavlinsky, to nationalist leader 
General Lebed'--believed that NATO enlargement constitutes a 
security threat to Russia. Nearly all politicians and experts 
whom I met understood the non-aggressiveness implicit in NATO's 
``three no's``--the alliance's declarations of having no 
reason, intention, or plan in the current and foreseeable 
security environment permanently to station nuclear weapons or 
substantial combat forces of current members on the territory 
of new members.
    Rather, the Kremlin's opposition to enlargement is largely 
a psychological question connected with the loss of empire, 
wounded pride, and--most importantly--an uncertainty about 
Russia's place in the world of the 21st century. As part of 
this uncertainty, most Russian leaders are worried about being 
marginalized, and as a result they are eager to move forward 
with its bilateral relationship with the United States.
    Although China or even Iran are occasionally mentioned in 
the press and in Moscow as potential alternatives to a Western 
orientation, except for tactical cooperation like arms sales to 
China, or broad declarations of increased Sino-Russian 
cooperation, these options are recognized by nearly everyone in 
the Russian policy community as not being substitutes for 
improved relations with the West.
    In a sense the Helsinki Summit may have marked a watershed 
in Russian foreign policy in that it forced the Russians to 
confront the fact that they are no longer the Soviet Union, a 
superpower. For the last 5 years they have focused almost 
entirely on pressing domestic matters, without adequately 
paying attention to the fundamental changes in Central Europe 
and the need for long-term stability there. Closer to home, 
Russia is still struggling to come to terms with an independent 
Ukraine that has its own independent foreign policy. Russian 
Foreign Minister Evgenii Primakov has a vision of a tighter 
Confederation of Independent States (CIS), but in practice 
Moscow has carried out a clumsy policy, even toward Belarus. In 
that regard, one might say that the debates of the 1840's and 
1850's between the Slavophiles and Westernizers are still going 
on. Unfortunately until now the current Westernizers have 
seemed unsure how to achieve their goal, since they have no 
firm grasp as to how Russia is going to interact with the 
international economy. The recent addition of the young and 
sophisticated Anatolii Chubais and Boris Nemtsov as First 
Deputy Chairmen of Yeltsin's government augurs well for better 
comprehension of the West in general and of NATO enlargement in 
particular.
    Symptomatic of Russia's uneven progress toward Western-
style democracy is the increasing corruption of the news media, 
especially the electronic media. Grigorii Yavlinsky, leader of 
the Yabloko Party in the State Duma, told me that every 
television channel is now propagandizing for someone. 
Therefore, he said, the U.S.-run Radio Liberty is essential for 
Russians who want to get unbiased news.
    Despite the heated rhetoric, several political figures in 
Moscow acknowledged to me that Russia's biggest problems are 
home-grown domestic ones. These include widespread corruption, 
violent crime, insufficient legal infrastructure for foreign 
investment, environmental degradation, and loosely guarded 
nuclear, chemical, and biological weapons and material.
    The United States should continue to engage Russia 
politically and militarily by means of the NATO-Russia Charter, 
which is currently being negotiated. Whatever institutional 
arrangements emerge, they must, of course, not adversely affect 
the ability of NATO to function as the world's most powerful, 
defensive military alliance. President Clinton's dictum, ``a 
voice but not a veto,'' must be strictly observed.
    Moreover, arms control agreements with Russia must be 
ratified and expanded. Of especial importance is getting the 
State Duma to ratify the START II Treaty and then, together 
with the United States, to move on to further reductions in 
START III. The Treaty on Conventional Armed Forces in Europe 
(CFE) must also be adapted to reflect the changed environment.
    In addition, it is vitally important that the United States 
continue its economic engagement with Russia, not through 
massive infusions of money, which Moscow, especially if it 
cleans up its corruption, does not need, but more through 
broadened investment and trade, expanded grassroots 
partnerships, and some targeted technical assistance. 
Significantly, not a single senior official in Warsaw, Prague, 
Budapest, or Ljubljana whom I met wanted to isolate Russia from 
the West.
    The central, and compelling rationale for enlarging NATO is 
that adding selected new members would extend the zone of 
stability to Central Europe. NATO was the umbrella that 
permitted the post-war rapprochement between France and 
Germany, that reintegrated Italy and Spain back into Europe, 
and that has kept the feud between Greece and Turkey from 
escalating to warfare. The question for today is not ``enlarge 
NATO or remain the same.'' The status quo is simply not an 
option. If there were to be no NATO enlargement, the countries 
between Germany and Russia would inevitably seek other means to 
protect themselves, and a potentially destabilizing 
renationalization of Central Europe would likely result.
    Enlargement must be accompanied by a redefinition of NATO's 
mission. The alliance's primary mission as outlined in Article 
5 of the Washington Treaty of April 4, 1949 remains the same: 
treating an attack on one member as an attack on all and 
responding through the use of armed force if necessary. In 
addition, in the current post-cold war situation, non-Article 5 
missions like peacekeeping operations, sometimes in cooperation 
with non-NATO powers have become possible. The cooperative SFOR 
effort in Bosnia and Herzegovina with Russia and several other 
non-NATO countries is one example.
    The candidates for membership in NATO must understand and 
accept the obligations of membership. One of these is assuming 
the financial burden of modernizing their armed forces and 
making them interoperable with those of NATO members. Other 
obligations are military, such as agreeing to come to the aid 
of Allies, as described in Article 5; allowing basing of NATO 
troops on their territory, if necessary; and allowing 
overflights of NATO aircraft, if necessary.
    The February 1997 Pentagon study on NATO proposed a 
distribution of direct costs of enlargement whereby 50 percent 
would be assumed by current non-U.S. members (i.e. Western 
Europe and Canada), 35 percent by the new members, and 15 
percent by the United States. Calculating these ratios begins 
with the estimate that about 40 percent of direct enlargement 
enhancements could be nationally funded, and 60 percent common 
funded.
    The expected U.S. contribution of $150-200 million per year 
for 10 years, although a small fraction of the total defense 
budget, is nonetheless not trivial, given current domestic 
demands to balance the U.S. Federal budget. These costs are 
also likely understated. Prospective new NATO members must keep 
that basic political fact of life in mind, lest they get the 
erroneous impression that their accession to the alliance would 
be a painless, free ride. In spite of the undeniable strains 
that meeting NATO enlargement costs will put on Central 
European countries who are still in transition from command to 
free-market economies, the candidate countries must make the 
financial means available if they expect current members to 
ratify their accession to membership. As I told one Polish 
military official, ``if you want to fly first class, you have 
to buy a first class ticket.''
    The 50 percent share of direct enlargement costs allocated 
to the Western European NATO partners and Canada may, in fact, 
be politically more difficult than the 35 percent allocated to 
the new members. Moreover, current non-U.S. NATO members are 
called upon to pay for power projection enhancements, which the 
United States made in the 1980's. The Pentagon study calculates 
the cost for these enhancements to be in the $8-10 billion 
range.
    Further complicating matters is the fact that the 11 
European NATO members who are also members of the European 
Union are currently engaged in painful budget cutting in order 
to meet the Maastricht convergence criteria for Economic and 
Monetary Union (EMU) on January 1, 1999. Nonetheless, for NATO 
to remain a vibrant organization with the United States 
continuing to play a lead role, the non-U.S. members must 
assume their fair share of direct enlargement costs.
    I fear that a coincidence of events in the late spring of 
1998 may make Senate ratification of NATO enlargement 
problematical. Just when the Senate is likely to be voting on 
amending the Washington Treaty to accept new members, American 
ground forces will be completing their withdrawal from Bosnia 
and Herzegovina. As it now stands, European NATO allies will 
follow suit, insisting on ``in together, out together,'' 
despite a U.S. offer to make air, naval, communications, and 
intelligence assets available to a European-led follow-on 
force, with an American Rapid Reaction Force on standby alert 
``over the horizon'' in Hungary or Italy.
    U.S. Senators, mindful of the repeated calls by some 
European NATO members, led by France, for more European 
leadership in the alliance and a sturdier ``European pillar'' 
within NATO, may see in the European refusal to maintain troops 
in Bosnia evidence of inequitable burden-sharing or, worse 
still, may question the worth of NATO altogether. Hence, I 
believe that our European NATO partners, especially France and 
the United Kingdom, should reconsider their unwillingness to 
lead a post-SFOR ground force in Bosnia after mid-1998.
    International organizations other than NATO also have 
meaningful security components and should be encouraged to 
intensify their efforts. The Organization for Security and 
Cooperation in Europe (OSCE), which during the past few years 
has undertaken conflict-prevention, crisis management, and 
electoral missions in Nagorno-Karabakh, Abkhazia, Chechnya, 
Bosnia, and Albania, will likely continue to grow in 
importance. The United States is playing an increasingly 
important role in the OSCE.
    The European Union (EU) plays a profound role in 
stabilizing the continent. With a combined gross domestic 
product that is larger than that of the United States, the 15 
members of the EU are forming ``an ever closer union'' with 
greater political and economic integration. The EU's immense 
economic clout has made it vital to the development of Central 
and Eastern Europe, and it is therefore virtually inconceivable 
that even a non-NATO EU member state would be the object of 
aggression.
    The EU hopes some day to create a common foreign and 
security policy, and in the recent past France concentrated on 
giving the EU an independent military dimension through the 
Western European Union (WEU). After the Gulf War, which 
revealed how far the U.S. was ahead of Europe in military 
technology, and with NATO's endorsement of a European security 
and defense identity within the alliance, which would allow 
European members to carry out contingency operations under the 
political control and strategic direction of the WEU, Paris 
reconsidered and now intends to re-enter NATO's integrated 
command. Its demand, however, for European control of the 
Southern Command in Naples--a step rejected by the United 
States--is complicating the issue.
    There is, though, a sub-surface tension between NATO and 
the EU. From the early 1990's the EU firmly proclaimed that 
NATO enlargement had to precede EU expansion (the accession of 
Austria, Finland, and Sweden excepted). Some observers have 
feared that the EU has used NATO enlargement as a pretext for 
postponing the admission of qualified Central and Eastern 
European countries. Now that NATO has set a 1999 date for 
completion of its first round of enlargement, the EU should 
move ahead with its own expansion. The year 2002 has been cited 
as a target date. When I raised this issue in the four Central 
European capitals that I visited, it elicited emotional 
responses.
    Public opinion polls in Poland, the Czech Republic, 
Hungary, and Slovenia reveal that, to a greater or lesser 
degree, the citizenries are unclear about the mutual military 
obligations that NATO membership entails. With these data in 
mind, I urged the four national governments to quickly embark 
upon public education campaigns so that invitations to join 
NATO in Madrid in July will not catch their populations off 
guard and unaware of the action their governments are 
proposing.
    The process of NATO enlargement must not lead to the 
drawing of new lines through Europe. In order to prevent such a 
development, NATO must make unmistakably clear that the first 
round of enlargement is not the last, but rather the beginning 
of an ongoing process. Moreover, NATO should conclude 
agreements to strengthen and deepen ties with candidate 
countries that do not receive invitations at Madrid, in 
preparation for their joining the alliance at a future date.
    All four Central European countries that I visited--Poland, 
the Czech Republic, Hungary, and Slovenia--appear to have 
fulfilled the basic criteria for NATO membership: political 
democracy, free-market economy, civilian control of the 
military, peaceful relations with neighbors, and a commitment 
to NATO principles and trans-Atlantic security. Their progress 
in committing resources for enhancing their military 
preparedness and in achieving Interoperability with NATO, 
however, varies considerably. Status reports for the four 
countries, which follow, illustrate these differences.

           III. Status Reports on Leading Candidate Countries

A. Poland

    Poland might be described as a divided society united only 
in its overwhelming desire to become a NATO member. Polling 
done by the United States Information Agency (USIA) shows 
public support in Poland for NATO membership at about 90 
percent, the highest of any country in Central or Eastern 
Europe. In addition, only in Poland and Albania do majorities 
support sending their troops to defend another NATO country. 
Poland was the only country polled in 1996 in which a majority 
favored allowing regular, routine overflights by NATO aircraft, 
and with Albania was the only one to favor (by 52 percent to 38 
percent) the stationing of NATO troops on its soil, and was the 
only one with a majority (67 percent--up from 45 percent in 
1995) favoring regular, routine exercises by NATO forces on its 
territory.
    Currently Poland is spending 2.3 percent of its GDP on 
defense, a percentage which will almost certainly have to rise 
to meet the demands of modernization and Interoperability. Yet 
this funding may be difficult to produce. When asked by USIA 
whether they would favor increasing the percentage of the 
national budget spent on the military rather than, for example, 
on education and health care, only 16 percent of Poles agreed, 
while 74 percent opposed. This result is not surprising, given 
the hardships most Poles endured in the transition from a 
command to a market economy. Despite the existence of a well 
worked out Polish plan to fund military modernization and NATO 
Interoperability, my discussions in Warsaw revealed 
misconceptions about how much aid was likely to be forthcoming 
from the United States.
    Foreign observers give credit to the current administration 
of President Aleksander Kwasniewski for having greatly improved 
Polish-Jewish relations after a period of insensitivity under 
former President Lech Walesa. A Law on the Status of the Jewish 
Faith was waiting Presidential signature at the time of my 
visit. It was to give surviving Jewish communities the right to 
ask for communal property back.
    Four issues will likely be central to the fall 1997 Polish 
Parliamentary elections: first, abortion and the role of the 
Catholic Church in society--the Church seems unsure of its 
role, and the parish priests are the key players; second, 
protection for the agricultural sector, which still employs 35 
percent of the work force, more than in any other 
industrialized country; third, privatization of the big state 
industries like energy, steel, copper, coal, energy, and the 
banks; and fourth, coming to terms with the past--whether or 
how to deal with individuals who were members of, or cooperated 
with, the Communist secret police before 1989.
    If the conservative-nationalist Solidarity Electoral Action 
(AWS) coalition wins a majority in the Parliament this fall, 
there will almost certainly be friction between Parliament and 
the President on domestic affairs. It is important to note, 
however, that the foreign policy views of the leftist and 
rightist blocs are nearly identical.
    Poland has made a successful transition to a free-market 
economy. Since 1993, Poland has had one of the highest growth 
rates in Europe, with annual growth of 5 percent to 7 percent. 
The sweeping economic reforms implemented in 1989 have paid 
off, and the private sector today accounts for almost 70 
percent of economic output. Small and medium-scale 
privatization has proved successful, but the privatization of 
large enterprises is proving difficult. A mass privatization 
voucher plan has spread ownership of more than four hundred 
enterprises broadly among the population.
    Most of the Polish officer corps was trained in Moscow 
during the days of the Warsaw Pact, and some Communist patterns 
of thinking remain. During the last 16 months, though, the 
Polish military has undergone huge change. The General Staff, 
paramount until Kwasniewski's election, has been included in 
and subordinated to the Ministry of Defense. A land force 
command has been created. Overall, the military has been 
downsized to 220,000 men, a drop of 50 percent since the days 
of the Warsaw Pact, and the intention is to reduce the size of 
the army further to 180,000 over the next 5 years. Plans call 
for 50 percent of the armed forces to be professionals. The 
Polish cabinet has introduced legislation on reducing mandatory 
military service from 18 to 12 months. The army has reorganized 
itself from a regimental to a brigade structure in order to 
participate in NATO and has redeployed away from its western 
border into four military districts.
    On March 10, 1997, the Kwasniewski government replaced 
Chief of Staff General Tadeusz Wilecki, who had stubbornly 
refused to acknowledge civilian control of the military, with 
General Henryk Szumski. A few days before my arrival, several 
Wilecki subordinates such as the commander of the Warsaw 
district and some deputy chiefs of the General Staff were 
relieved of their commands, although they remain active duty 
officers. General Wilecki could conceivably come back to a 
powerful position in some function, but it seems unlikely.
    The new Polish military structure is an amalgam of NATO and 
Polish forms. The quality of life for Polish soldiers has gone 
down, but nearly all of the military wants to join NATO. It 
will take five to 10 years to develop true civilian military 
expertise, including members of Parliament who can adequately 
supervise the uniformed military. Presently, for example, there 
is only one Parliamentary staffer working on military affairs.
    While not a direct cost of joining NATO, procurement of new 
military equipment will be the most costly aspect of upgrading 
the Polish armed forces. The four main items for procurement 
are a multi-role fighter aircraft; anti-tank missiles and 
avionics, both for the Polish-made Huzar helicopter; and radio 
equipment (this contract already has been let to the French 
firm Thompson).
    Poland may have to procure additional new equipment after 
it joins NATO and is assigned a role in the common defense of 
the alliance. The civilian defense ministry has taken over the 
procurement function from military officials, but questions 
remain about the openness of the bidding process. Equipment 
modernization is estimated by the defense ministry to cost 
$7.76 billion over 15 years, equal to an additional 20 percent 
of defense spending.
    As for the direct costs of enlargement, Polish political 
leaders are unanimous in their commitment to assume this 
burden. According to the recent study by the Euro-Atlantic 
Association, the costs of achieving Interoperability for Poland 
will be about $1.26 billion over 15 years, and the total cost 
of Polish membership in NATO will be $1.5 billion over 15 years 
(adding in Poland's share of NATO's common budgets). This cost, 
about $100 million per year, represents about 4 percent of the 
defense budget.
    Polish officials recognize the importance of 
Interoperability to their candidacy, and they have undertaken a 
number of technical steps to achieve this. These include 
English-language training for liaison officers so they can 
communicate with Allied units, mapping software that converts 
Polish symbols to NATO standard symbols so plans can be shared, 
and secure phones so Polish officers can speak with NATO 
officers. To date, 3,540 officers have been rated proficient in 
a Western language--2,730 of those in English--and plans call 
for achieving the necessary level of language skill among the 
officer corps by 1999.
    Poland has adapted its regulations, planning and command 
procedures to meet NATO standards, and it is decentralizing its 
command structure. Documents pertaining to NATO military 
procedures are being translated. An Identification Friend or 
Foe (IFF) system compatible with NATO's is in place, and 
efforts continue to reorganize the air traffic control system. 
Poland is focusing first on core units that would participate 
in NATO out-of-area missions and need to be interoperable 
shortly after Poland joins NATO. There are plans to extend an 
interoperable capability to other units over time.
    The air and naval forces are the most advanced in 
Interoperability, with 95 percent of those having ``fast-
alert'' communications capability with NATO. The army, while 
only 45 percent interoperable in this manner, should reach 100 
percent by 2002. In addition, the Polish battalion with the 
SFOR mission in Bosnia is implementing NATO procedures through 
first-hand cooperation with the alliance.
    In January 1997, Poland reported that of the 20 
Interoperability Objectives Poland accepted in 1995 a total of 
six had been completed, 11 had been partially completed, and 
three had not yet been started. New Interoperability Objectives 
are being negotiated and should be agreed upon by May 1997.
    Future plans for achieving Interoperability will certainly 
include command exercises at the corps level, operational and 
tactical training, tactical exercises, and computer-simulation 
exercises. Other changes, like integration into the NATO 
command structure and upgrading some military infrastructure, 
will have to wait until Poland actually joins NATO--this 
because the alliance must draw up plans for the defense of 
Poland and because Poland does not yet have access to 
classified NATO documents. The recent Pentagon study states 
that initial levels of Interoperability need not be achieved 
until 2001 because of the current benign threat environment.
    Active Polish participation in NATO/Partnership for Peace 
(PFP) exercises has allowed mid-level officers the chance to 
familiarize themselves with NATO procedure, improve language 
skills, and build contacts with future allies' officers. Poland 
hosted the first PFP exercise and in 1996 took part in 18 
exercises. In 1997, Warsaw plans to join in 26 NATO/PFP 
exercises and in 24 ``In the Spirit of PFP'' exercises.
    Polish officials see their country as playing a role in 
reaching out to Eastern European countries like Ukraine and the 
Baltic states, helping to integrate those countries into a 
united Europe. Poland's relations with all its neighbors are 
good (though they maintain contacts with opponents of the neo-
dictatorship in Belarus and raise human rights concerns with 
the ruling Lukashenka regime). Warsaw is an advocate of early 
NATO membership for the Baltic states, especially Lithuania, 
with whom it is developing a joint peacekeeping battalion, 
which is expected to be ready in 1998.
    Polish military cooperation with the Federal Republic of 
Germany, its large and powerful neighbor to the west, is 
extensive, second only to that with the United States.
    The Polish Sejm, or lower house of Parliament, must approve 
NATO membership by a simple majority. No opposition is 
foreseen. A proposal by some government politicians to hold a 
referendum has drawn criticism as an unnecessary measure.
    Despite Poland's progress toward NATO membership, there is 
a pervasive fear that something will go wrong in the end. 
Interior Minister Siemiatkowski (the functional counterpart to 
the American FBI Director) recently stated that Polish 
counterintelligence had uncovered a KGB plot to subvert 
Poland's candidacy before the Madrid summit, and there is 
concern that NATO's efforts to placate Russia over enlargement 
will somehow result in Poland's becoming a second-class member 
of NATO. The abortive French plan for an April 1997 five-power 
summit to discuss European security was strongly opposed by 
Poland, which saw it as another Yalta deciding Polish security 
by outside powers, i.e. Warsaw's ultimate nightmare.

B. The Czech Republic

    The Czech Republic is widely considered to be an early 
candidate for NATO membership, having been so designated by 
Congress in the 1996 NATO Enlargement Facilitation Act. The 
country's split from Slovakia in 1993 was peaceful, and its 
potential invitation is not expected to be linked to Slovakia's 
increasingly poor prospects for early NATO membership.
    Prague sees NATO as the guarantor of European security. 
Czech governmental leaders have consistently expressed a 
priority interest in early entry into NATO and a stated 
willingness to bear the burdens and responsibilities involved 
in such membership.
    By most accounts, the Czech Republic meets the general 
condition of adhering to NATO norms and principles, and it has 
a democratically elected government with effective democratic 
institutions. The Czech government under Prime Minister Vaclav 
Klaus has given priority to the country's transformation to a 
free market economy. The country has a history of democracy 
dating back to the 1918 founding of Czechoslovakia, the only 
democracy in Central Europe between the World Wars.
    The Czech Republic held fully free and fair elections in 
1996, electing the lower house of Parliament in the spring and 
the newly created Senate in the fall. Both elections returned 
Prime Minister Klaus to power as head of a three-party center-
right coalition.
    Czechoslovak armed forces were already undergoing 
restructuring and redeployment at the time of the 1993 split of 
the Czechoslovak federation. By mutual agreement, the assets 
and equipment of federal armed forces were split on a 2:1 ratio 
(Czech to Slovak). The division was basically completed and the 
Army of the Czech Republic was created by the time the split 
became effective on January 1, 1993. The Army of the Czech 
Republic, which includes land, air, and air defense forces, 
embarked on a major transformation and down-sizing effort in 
July 1993.
    The Czech government adopted a ``Military Strategy of the 
Czech Republic'' in December 1994. The document included a set 
of principles related to international security and the defense 
of the country, and outlined plans for the further 
restructuring of the armed forces. The Czech government is 
currently preparing an additional ``legislative package'' of 
defense-and security-related laws, which it aims to complete by 
July 1997, when the Madrid summit takes place.
    Prague maintains mandatory conscription, but has reduced 
the term of service to 12 months and aims to move toward a 
professional army. The uniformed military of the Czech Republic 
has been reduced from 106,000 in 1993 (year of the split) to 
about 61,000 in 1996. Currently the armed forces are 44 percent 
professional; the intent is to raise that to 53 percent by 
2006.
    The Czech Ministry of Defense, headed by a civilian Defense 
Minister, oversees the Army of the Czech Republic, civil 
protection, and other agencies. The General Staff is 
subordinate to the Ministry of Defense. By the Czech 
constitution, both houses of Parliament must consent to the 
stationing of Czech troops abroad. The Senate must approve the 
stationing of foreign troops on Czech soil.
    In 1995, the Czech Republic undertook twelve PFP 
Interoperability Objectives. Naval Interoperability Objectives 
do not apply to the Czech Republic. In the view of the Czech 
Republic, as of January 1997 it had completed none of the 
objectives. Plans are in hand to reach the Objectives by 2005, 
and this estimate is probably accurate in light of the time 
required to train the requisite number of English or French 
speaking members of the armed forces, equip all aircraft with 
Western standard air navigation and Identification Friend or 
Foe (IFF) equipment, and convert all Czech maps to NATO 
standard.
    The Czech authorities and NATO officials plan to reach 
agreement on 1997-99 Interoperability Objectives, which will 
introduce increments to the 1995-97 Objectives and add new 
Objectives, by May 1997.
    The Czech Republic has contributed a mechanized battalion 
and staff officers, totaling about 700 men, to IFOR and SFOR. 
At home, this participation has improved the relatively low 
public opinion of the country's armed forces. It should also be 
noted that Czech soldiers served with the U.S.-led coalition in 
the Persian Gulf War.
    Czech participation in Partnership for Peace activities has 
been high. In 1996, the Czech armed forces participated in 11 
NATO/PFP exercises, three national PFP exercises, and 17 
national ``in the Spirit of PFP'' exercises. Participation in 
more than 60 PFP exercises is planned for 1997. Prague has 
bilateral programs in support of PFP and NATO Interoperability 
with 20 NATO and other PFP countries. The Czech Republic also 
participates in the U.S. regional Airspace Initiative (RAI).
    The U.S. State Department characterizes the Czech 
Parliament as a ``vociferous and increasingly powerful player 
on defense issues.'' While lacking trained civilian defense 
experts, a legacy of the Warsaw Pact that also affects the 
Defense Ministry, Parliament's oversight ``has been real and 
effective, and Members have not been shy'' in questioning 
military restructuring plans and proposed defense budgets. 
Parliament is expected to enact a law this year that will 
codify the mission of the armed forces and the civilian command 
structure mandated in the Czech constitution.
    Defense spending in 1997 is to comprise 1.8 to 2.0 percent 
of GDP, and the government has committed to increase this 
figure by 0.1 percentage point every year, until it reaches 2.1 
to 2.3 percent in 2000.
    There is concern among some in the Czech defense 
establishment that these modest increases will prove 
insufficient to undertake needed equipment modernization, 
including the purchase of advanced fighter aircraft, at the 
same time the government attempts to raise officer salaries and 
make other quality of life improvements for soldiers. The 
government maintains that continued strong economic growth, 
combined with cuts in headquarters and defense ministry staffs, 
will result in enough money being available for these areas.
    The Czech economy benefited from the rapid stabilization 
and liberalization measures adopted by the Klaus government 
soon after it came to power in the wake of Communism's 
collapse. Economic growth was 4.7 percent in 1996 and is 
projected at about the same in 1997. Inflation is 7.4 percent, 
the lowest in the region, and unemployment is also low, at 3.5 
percent. Per capita income is about $5,100. About 70 percent of 
economic output comes from the private sector.
    Serious problems, however, have recently emerged. Financial 
scandals affecting the country's stock market and banking 
system have come to light. Moreover, after the harsh winter of 
1996-97, industrial production has slowed, the budget deficit 
remains high, the foreign trade deficit is skyrocketing, and 
wages are rapidly out-pacing the growth of labor productivity. 
The Czech government claims that these problems are not 
systemic and can be rectified. In mid-April, Prime Minister 
Klaus announced a budget package cutting about $900 million in 
projected expenses for this year. In deference to the country's 
NATO candidacy, defense expenditures will suffer less than 
other sectors.
    After many years of difficult negotiations, government 
leaders from the Czech Republic and the Federal Republic of 
Germany signed a declaration on bilateral reconciliation in 
January 1997. The final text included an expression of regret 
for the Nazi crimes inflicted on the Czech people, as well as 
an expression of regret on the Czech side for the suffering 
caused by the post-war expulsion of 2.5 million Sudeten Germans 
from Czechoslovakia. It also included a German pledge to 
promote the Czech Republic's bid to join NATO and the EU. The 
declaration was approved by both houses of the Czech Parliament 
after stormy debates.
    For years the Czech government had de-emphasized regional 
approaches to Western integration. Recently, however, it has 
moved toward a trend of greater coordination with other 
countries in Central Europe aspiring to NATO membership, 
especially Poland and Hungary. The form of this cooperation has 
involved intensive bilateral consultations and exchanges of 
information. The Czech Republic and Poland may issue a joint 
memorandum before the July NATO summit.
    Relations with Slovakia are generally good, although in 
April 1997, subsequent to my trip, a public personal squabble 
erupted between Czech President Vaclav Havel and Slovak Prime 
Minister Vladimir Meciar. U.S. Secretary of State Madeleine 
Albright quickly reassured the Czechs that this dispute would 
not adversely affect their NATO candidacy. Most matters related 
to the split-up of Czechoslovakia have been resolved, including 
a minor border adjustment, and there remain strong people-to-
people contacts between the two states. Relations with Austria 
are warm, with strong economic links.
    Just a few days before the Helsinki summit, Russia's 
Ambassador to the Czech Republic publicly warned Prague that 
key bilateral agreements on arms purchases and energy 
deliveries might be jeopardized if it joined NATO. President 
Havel and Czech Foreign Minister Josef Zieleniec reacted 
strongly against this clumsy threat, saying that it 
demonstrated precisely why it was important for the Czech 
Republic to join Western political, security, and economic 
organizations as quickly as possible.
    Public support for NATO membership, as gauged in various 
public opinion surveys, has remained somewhat low and some 
polls have recorded a decline in support in the last few years. 
According to a Czech poll taken in December 1996, 38 percent 
responded favorably while 35 percent responded negatively. A 
USIA survey taken earlier in 1996 recorded a higher percentage 
of those polled in favor of NATO membership (51 percent in 
favor vs. 33 percent opposed).
    A majority of the Czech public opposes the deployment of 
nuclear weapons or foreign troops on Czech territory, neither 
of which, however, are currently conditions to NATO membership. 
In January 1997, the Czech Ministry of Defense announced a 
public relations campaign on the country's entry into NATO to 
boost popular support for the alliance. President Havel has 
also begun to speak on increasing domestic support for NATO 
enlargement.
    Should an accession protocol with NATO be reached, the 
Czech President will seek the consent of both chambers of 
Parliament, which must approve the treaty by simple majority. 
Two parties in Parliament, the right-wing Republican Party and 
the Communist Party, are against NATO membership. The Czech 
Republic is scheduled to hold its next general elections in 
June 1998.
    The governing coalition and opposition are currently split 
over whether to hold a referendum on NATO entry. The leading 
opposition party, the Social Democratic Party (CSSD), supports 
membership in NATO, but insists on holding a referendum. Some 
parties favor holding a referendum on membership in the 
European Union, which involves issues of national sovereignty, 
but not in NATO. President Havel and Prime Minister Klaus have 
stated that they see no reason why the Czech Republic's entry 
into NATO should be subject to a referendum.

C. Hungary

    Hungary has consistently expressed high interest in joining 
NATO and is widely considered to be an early candidate for NATO 
membership, having been so designated by Congress in the 1996 
NATO Enlargement Facilitation Act. A concern over the years 
regarding Hungary's prospects for integration with NATO has 
been over unresolved tensions with Hungary's neighboring states 
that could affect regional security and stability; this concern 
has been largely alleviated by the conclusion and ratification 
of bilateral treaties with Slovakia and Romania.
    Entry into NATO and the European Union has been the top 
foreign policy priority of successive Hungarian governments 
since the end of Communist rule. Moreover, the foreign policy 
objective of joining the NATO alliance has remained universal 
across the political spectrum. All seven parties represented in 
Parliament share NATO membership as a foreign and defense 
policy priority. The Hungarian government maintains a permanent 
liaison office to NATO and the WEU in Brussels. Since late 
1995, Hungary has completed four rounds of intensified dialog 
on NATO enlargement in Brussels.
    In late 1995, the Parliament passed a Law on the 
Restructuring of the Hungarian Defense Forces that streamlined 
the command structure, spelled out civilian defense oversight, 
and ordered a ``build down'' with the end strength of the 
uniformed military mandated not to exceed 52,200 by the end of 
1997. To put this down-sizing in perspective, the armed forces 
numbered more than 140,000 as recently as 1990. A long-term aim 
is to achieve an all-volunteer armed force.
    The Hungarian government is retiring its senior officer 
corps as rapidly as possible and has established training and 
retraining centers for commanders and officers. Already most of 
the senior military leadership have received some Western 
military training, including the current occupant of the merged 
position of commander and chief of staff of the armed forces 
who is a graduate of the U.S. Army War College, as is his 
deputy.
    The Defense Act of 1993 established a system of civilian 
control over the military. The Act gave the Ministry of Defense 
administrative responsibility for the armed forces, while 
Parliament controls the defense budget and must approve the 
deployment of the armed forces abroad. The defense committee of 
Parliament has been active in the area of budget and 
expenditure issues. Additional power-sharing refinements are 
likely to be outlined in a new constitution, which may be 
considered by Parliament in late 1997.
    After the democratic changes in 1989-90, the share of the 
national budget for defense underwent a 6-year decline. This 
year for the first time in 7 years, the government increased 
the defense budget, by 22 percent to $604.7 million. The 
official defense budget still represents only about 1.4 percent 
of GDP. This figure, however, does not include funding for 
border guards, civil defense, military owned industries, the 
value of Russian equipment obtained as debt offset, or funding 
support from the U.S. added to the official budget, these items 
raise military related activities to approximately 2.0 percent 
of GDP. Major procurement items such as short-range defensive 
missiles fall outside the defense budget, further complicating 
comparisons with Western defense budgets. The Hungarian 
military budget is only partially funded by the central 
governmental fund, so the Ministry of Defense must generate a 
portion of its income from ministry-owned property. For the 
1997 budget this amounts to 14 percent.
    Western officials who meet regularly with Hungarian 
governmental agencies on the NATO membership issue report that 
the Hungarians do not approach the problem by saying, ``here is 
the dollar-amount that our membership will cost.'' Rather, they 
ask what they have to do to qualify for membership and how far 
along they are. These officials believe that the Hungarians 
understand the costs, but many of them feel that the West can 
afford them better than they can.
    (Two weeks after my visit to Budapest, the Hungarian 
Atlantic Council and the Defense Ministry released a cost study 
of enlargement. Based on the Pentagon study's assumptions and 
on only Poland, the Czech Republic, and Hungary entering NATO 
in the first round, the Hungarians calculated a total 
enlargement cost to their country of between $2.6 billion and 
$3.5 billion, representing an increase of slightly more than 
one-third over current defense spending. No attempt was made to 
calculate the necessary increase in defense costs if Hungary 
did not enter NATO.)
    An additional factor in defense costs in Hungary is a gap 
between policy and implementation; the top government officials 
understand the issues, but the middle-level ones are slow to 
carry out the orders. A particularly irritating example of this 
behavior concerns the draft ``Omnibus Agreement'' on issues 
affecting the Status of Forces Agreement on U.S. forces in 
Hungary. The Hungarian tax and customs officials haven't gotten 
the message and continue to tax the U.S. forces stationed 
there.
    To be fair, however, when assessing defense outlays, one 
must keep in mind that a few years ago Hungary was the next 
candidate for bankruptcy a la Mexico. It now seems to have 
turned the corner. As Hungary's economy improves, it will be 
able to commit more resources to defense.
    The current limited resources have severely constrained 
procurement and modernization possibilities, forcing Budapest 
to delay heavy equipment purchases like planes for 1 year. 
Instead the Hungarians are concentrating on achieving 
Interoperability with regard to language, radios, maps, and the 
like.
    The Hungarian government implemented economic reform 
measures in March 1995 that have been successful in stabilizing 
the economy and cutting budget deficits. Economic growth, 
though, remains modest, with an increase of 1.0 percent for the 
year ending September 30, 1996. Unemployment hovers between 10 
percent and 11 percent. Inflation was 23 percent in 1996 and is 
expected to drop to 17-18 percent in 1997. The government 
budget deficit was 3.7 percent of GDP in 1996, below the 
International Monetary Fund target of 4 percent. The private 
sector now accounts for 75 percent of Hungarian economic 
output, and 70 percent of trade is with advanced industrial 
countries. While the general economic situation is starting to 
look better, farmers and professionals remain dissatisfied.
    Hungary is one of 27 participant countries in NATO's 
Partnership for Peace program. Hungary signed the PFP framework 
document on February 8, 1994 and submitted its Individual 
Partnership Program, the blueprint for each partner's planned 
areas of cooperation with NATO, on November 15, 1994. Hungary 
also participates in other PFP programs such as the Planning 
and Review Process, launched in January 1995, which is designed 
to further Interoperability and transparency in defense 
planning.
    In 1995, Hungary undertook 17 Interoperability Objectives. 
Some Objectives do not apply, since Hungary has no Navy. A 
national plan was agreed upon to segment the approach to the 
Objectives into three phases of 6 months each. Hungary has 
reported to NATO that it has reached one of the Objectives and 
that it expects to complete the remaining 16 by September 30, 
1997. This may be an overly optimistic assessment in view of 
the volume of material requiring translation into Hungarian and 
the lead-time required to receive, fit, and train on new 
equipment before initial operational capability can be met.
    Not surprisingly, given the totally different structure of 
Hungarian, a Finno-Ugric--not an Indo-European--language, 
capability in English is the greatest problem facing the 
Hungarian officer corps. At present only about 10 percent of 
them have achieved a working knowledge of English. Hungary is 
training nearly 35 potential NATO staff officers per year at 
its national language center, emphasizing English skills to 
improve Interoperability with NATO and peacekeeping operations. 
Top priorities for achieving Interoperability include joining 
the U.S.-sponsored Regional Airspace Initiative, developing a 
``NATO brigade'' that can work closely with the alliance, and 
building peacekeeping capacity.
    In contrast to exercises and planning, NATO launched its 
first large-scale peacekeeping mission in Bosnia beginning in 
late 1995. Several non-NATO countries have served in NATO's 
Implementation Force (IFOR) and follow-on Stabilization Force 
(SFOR). Hungary contributed an engineering battalion of 350 
troops to IFOR, based in Okucani, Croatia through December 
1996. A similar Hungarian engineering battalion of up to 500 
troops was approved for SFOR by the Hungarian Parliament in 
December 1996.
    In a deal overwhelmingly approved by the Hungarian 
Parliament in late 1995, the United States leased part of a 
military base at Taszar in southern Hungary as a staging and 
logistics area for thousands of U.S. troops en route to and 
supporting NATO operations in Bosnia. In addition to serving as 
an important component of the IFOR operation, the Taszar base 
has become part of an educational process that is enabling the 
Hungarian armed forces to ``think and act NATO,'' according to 
a U.S. defense official. The presence of NATO forces in Hungary 
has also bolstered general optimism in Hungary regarding 
Hungary's prospects for joining the alliance. In December 1996, 
the lease was extended for another 2 years. Hungarians also 
point out that several years earlier they provided airspace for 
NATO use to orbit AWACS aircraft so that the aircraft could 
have a better viewing angle into Bosnia and Herzegovina.
    After the 1994 elections, the government of Prime Minister 
Gyula Horn emphasized reconciliation with Slovakia and Romania, 
two countries with large ethnic Hungarian minorities and with 
which Budapest has had territorial disputes whose roots date 
back to the Trianon Treaty after World War I. The prospect of 
NATO membership is widely credited as a prime motivation for 
Hungary to resolve outstanding issues with these two neighbors.
    After difficult negotiations, the Horn government was 
successful in reaching two landmark basic treaties with 
Slovakia and Romania, which called for a full normalization of 
bilateral relations and recognition of mutual borders. The 
treaty with Slovakia was signed in March 1995 and ratified by 
the Hungarian Parliament in June 1995. The treaty with Romania 
was signed in September 1996 and ratified by the Hungarian 
Parliament in December. Hungary has also concluded numerous 
military agreements, including an ``open skies'' accord, with 
Romania.
    Hungarian politicians have emphasized that it would be in 
their country's interest to have neighboring Slovakia and 
Romania also join the Atlantic Alliance and that it would 
promote their respective candidacies. They have opposed, 
however, any formal linkage of Hungary's admission with that of 
any other country.
    In 1996, Hungary also normalized relations with the Federal 
Republic of Yugoslavia, where there is a sizable ethnic 
Hungarian minority in the Serbian Vojvodina, but it has not 
embarked on negotiations on a comprehensive bilateral treaty.
    Hungarian public opinion continues to favor membership in 
NATO, though slightly less fervently than in other countries 
such as Poland. The latest USIA poll of the Hungarian general 
public demonstrated a 2-to-1 majority of those surveyed 
generally in favor of NATO membership. Less support, however, 
was registered for various specific actions that might (but not 
necessarily) accompany NATO membership, such as the stationing 
of foreign troops in Hungary (1996: 49 percent against vs. 44 
percent for--a significant increase in support since 1995 when 
only 34 percent was for vs. 59 percent against), increasing 
Hungary's military budget, or allowing regular, routine 
overflights over Hungarian territory (36 percent for vs. 57 
percent against in 1996, virtually unchanged since 1995).
    Should an accession treaty with NATO be reached, the 
Hungarian government will submit it to the unicameral National 
Assembly for ratification by majority vote, as with any other 
international treaty. Ratification is highly likely, but there 
is an interesting mirror-image between the United States and 
Hungary. In the U.S. older Senators tend to be Euro-centric, 
while younger ones tend to focus on Asia and Latin America and 
increasingly question the relevance of NATO. In Hungary the 
older people who grew up under Communism tend to harbor anti-
Western feelings, while the younger people are overwhelmingly 
pro-Western.
    At the beginning of its term in mid-1994, the Horn 
government indicated that the question of membership in both 
NATO and the European Union should be subject to a popular 
referendum at the appropriate time. At this point, the 
Hungarian government does not have specific plans to hold a 
referendum on joining NATO. Under Hungarian law, any group may 
initiate a popular referendum after collecting 100,000 
signatures.
    The moral issue is a strong one in Hungary, where older 
people feel doubly betrayed by the West: at Yalta in 1945, and 
in the Hungarian Revolution of 1956. Hungarians feel that they 
are no less worthy of NATO membership than the Turks or the 
Spaniards. In addition, they argue that American private 
investment would be reassured by Hungarian membership.

D. Slovenia

    Slovenia, the final of the four leading candidates for 
admission to NATO in the first group, is unique in several 
ways. First of all, it is the only serious candidate for 
admission that was never a member of the Warsaw Pact--the 
former Yugoslavia of which Slovenia was a part until 1991 was a 
leader of the nonaligned movement. As a result, Russia does not 
harbor the visceral hostility to Slovenia's joining NATO that 
it reserves for former Warsaw Pact members, and especially to 
former republics of the Soviet Union. Moreover, Slovenia is not 
saddled with a huge inventory of non-state-of-the-art 
equipment.
    Second, Slovenia is by far the wealthiest of all the 
candidates for NATO admission. Its per capita GDP now exceeds 
that of two European Union members--Greece and Portugal--and 
will probably pass that of EU members Ireland and Spain in the 
near future. Hence, more than other candidates Slovenia should 
be capable of paying the costs of modernization and 
integration.
    Third, Slovenia is the only candidate to have recently 
fought, and won, a war--albeit a short and limited one. In 10 
days in the early summer of 1991 the fledgling Slovenian Army, 
which was essentially only a Home Guard, managed to inflict 
enough damage on the Serb-led Yugoslav National Army to induce 
it to withdraw and tacitly recognize Slovenian independence.
    Finally, unlike Poland and, to a lesser extent the Czech 
Republic and Hungary, Slovenia cannot count upon a large 
population of Americans who trace their roots to Slovenia and 
can mount well-financed advocacy campaigns for Senate 
ratification on Slovenia's behalf.
    A potential negative factor for NATO admission is that, 
like Hungary, Slovenia borders upon an area of conflict, part 
of the former Yugoslavia. Its border with northwestern Croatia, 
however, is now more placid than Hungary's with Eastern 
Slavonia and the Serbian Vojvodina. Moreover, Slovenia's 
geographical position in one way works in its favor for NATO 
membership. It would provide geographical continguity between 
Italy and Hungary.
    A final important point is that Slovenia's admission in the 
first group would show the rest of the successor states of the 
former Yugoslavia that creating a political democracy, building 
a free-market economy, and fulfilling other NATO criteria can 
result in their admission--i.e. Despite the appalling conflict 
of the 1990's, they will not be eternally consigned to the 
``outs'' in Europe. On the other hand, postponing the admission 
of the candidate country with the best record of meeting NATO 
criteria and fulfilling objectives would send a chilling 
message to the democrats who hope to succeed Croatian President 
Tudjman. I feel that it would be a serious mistake to hold back 
any country now deserving of NATO membership in order 
artificially to strengthen the pool for the second round of 
enlargement.
    Slovenia has been mentioned as a possible first round 
candidate for NATO membership only recently. The Biden language 
in the 1996 NATO Enlargement Facilitation Act included Slovenia 
with the Czech Republic, Hungary and Poland as a country having 
made significant steps toward qualifying for NATO membership.
    In a speech to Slovenia's Parliament in January 1997, 
Slovenian Prime Minister Janez Drnovsek said that NATO 
membership is ``one of Slovenia's foreign policy priorities'' 
and is ``very important for Slovenia's long-term security.'' He 
said the processes of joining NATO and joining the European 
Union, another main goal of Slovenian foreign policy, are 
closely connected.
    In an October 1996 interview, Drnovsek said Slovenia wanted 
to be included in the first round of NATO enlargement and 
stressed that NATO membership would have positive, indirect 
effects on Slovenia's economy.
    Slovenia meets the political criteria for NATO membership 
set out in the 1995 Enlargement Study. The 1996 State 
Department Human Rights Report says that Slovenia has a 
``vigorous, open, and democratic system,'' with an independent 
judiciary. The report says the government ``fully respected the 
human rights of its citizens'' and that ethnic minorities are 
treated fairly.
    Slovenia's armed forces are engaged in a reform and 
restructuring effort. Government officials note that less 
reform and restructuring is needed for Slovenia than for other 
NATO candidate members, since Slovenia was never part of the 
Warsaw Pact, and indeed never had a fully fledged army until 
after independence. For this reason, they argue, Slovenia has a 
nearly clean slate on which to create a new, NATO-oriented 
army.
    At the time of Slovenia's independence in June 1991, 
Slovenia's armed forces consisted of territorial defense 
forces, somewhat similar in nature to U.S. National Guard 
units. Since that time, Slovenia has taken steps to form 
``mobile units,'' which are active duty, professional forces. 
There are about 5,000 professional officers, NCOs and soldiers 
in Slovenia's army of 12,000 men. About 7,000 men are 
conscripted each year into the army, and serve for 7 months. 
The territorial defense reserves are being reduced from 75,000 
men to 45,000-50,000 men in order to free up resources for the 
professional core of the army.
    An important part of Slovenian army reform efforts is the 
creation of a 700-man motorized infantry battalion that will be 
earmarked for participation in international peacekeeping 
activities. Slovenian army procurement efforts are focused on 
supplying this unit with modern, NATO-compatible equipment. The 
first company of this battalion is scheduled to be ready this 
year, and it is planned that the entire unit will be ready in 
1998.
    Other structural modifications underway include the 
conversion of infantry units to artillery, communications, and 
engineering units. Aside from equipping the peacekeeping 
battalion, other procurement priorities for Slovenia are air 
defense, anti-armor weapons, and communications systems.
    Slovenia's 1997 defense budget is $250 million. In 
addition, a separate military procurement budget provides 
another $60 million. Slovenia's defense spending comprises 1.7 
percent of the country's GDP. Until recently it seemed, 
however, that there might be limits to the willingness of 
Slovenia to increase defense spending to modernize its armed 
forces. In December 1996, then Defense Minister Jelko Kacin 
said that neither his Liberal Democratic Party nor any other 
Slovenian political party supports increasing defense 
expenditures beyond 2 percent of GDP. Subsequent to our visit--
and perhaps influenced by it--on April 17, 1997 in a joint 
declaration all the parties represented in the Slovenian 
Parliament voted not only to support NATO membership, but also 
stated that Slovenia is able and ready to cover its share of 
the costs of membership.
    Slovenia has made rapid progress in economic reform. It has 
the highest per capita Gross Domestic Product (GDP) in Central 
and Eastern Europe, as well as the highest international credit 
rating of any country in the region. The average annual wage is 
$12,300. Slovenia's budget deficit is a mere 0.2 percent of 
GDP, compared to the EU average of 4.7 percent.
    Economic growth was 3.5 percent in 1996 and is forecast at 
4 percent in 1997. Following the loss of traditional markets in 
the other republics of Yugoslavia, Slovenian businesses have 
found markets in Western and Central Europe, which now account 
for 75 percent of Slovenian exports. Inflation is 9.5 percent, 
and unemployment is 14 percent. As of 1995, the private sector 
accounted for 45 percent of the Slovenian economy. With ``A 
grade'' credit ratings awarded in 1996 by all three leading 
international credit rating agencies, Slovenia is the highest 
rated country in the region.
    Yet during the past several months doubts have arisen about 
Slovenia's ability to maintain its fast track reform and, 
especially, over its apparent unwillingness to open its economy 
to foreign participation. Slovenes seem unsure about the price 
they are willing to pay to enter Western institutions. This 
insecurity has shown itself most clearly in a debate over 
whether foreigners should be allowed to buy property (a debate 
that also occurred in Austria and Finland before they joined 
the European Union). In addition, there are concerns in 
Slovenia about too much foreign investment and anxiety about 
losing control over key sectors of industry and commerce. The 
central bank recently took actions to curb foreign capital 
inflows and restrictions were put on some direct investments by 
non-residents. Largely because of these moves, share prices on 
the new Ljubljana stock exchange fell nearly 25 percent in the 
early spring of 1997.
    Civilian control of Slovenia's military is exercised in 
several ways. According to the constitution, the National 
Assembly approves the defense budget and conducts oversight of 
military and intelligence programs. The defense minister, a 
civilian, exercises control over the development and 
organization of the armed forces through the General Staff. The 
President is commander-in-chief of the armed forces, and 
appoints top military officers.
    In 1995, Slovenia undertook seven Interoperability 
Objectives. Ljubljana reported that as of January 1997 all are 
at least partially completed. Since Slovenia has no combat 
aircraft or naval vessels, many Interoperability Objectives do 
not apply. Slovenia is providing officers with English-language 
training, including sending about 25 officers per year to study 
at U.S. military institutions as part of the U.S. international 
Military Education and Training (IMET) program. It has also 
sent officers to study in Germany and Austria.
    Officials note that Slovenia has bought and will continue 
to buy NATO-compatible weaponry for its units, as well as NATO-
compatible communications equipment. Slovenia also plans in the 
future to develop an air defense system that will be compatible 
with NATO. Slovenia joined NATO's Partnership for Peace program 
in March 1994 and has participated in many PFP exercises.
    In May 1996, Slovenia signed an agreement with the United 
States on military cooperation, which contained provisions for 
the exchange of classified information. Slovenia has offered to 
assist the NATO-led Stabilization Force (SFOR) in Bosnia. It 
offered the use of a Slovenian airport, landmine removal 
training, the services of logistics officers, and 1,000 beds in 
Slovenian hospitals for use in case of an emergency. There are 
no Slovenian ground forces in Bosnia.
    Since gaining independence, Slovenia has had some 
difficulties with two of its neighbors, Italy and Croatia. In 
the case of Italy, the dispute has been resolved, and Italy now 
supports Slovenian membership in NATO and the EU. The dispute 
centered on the property of between 100,000 and 350,000 
Italians who left their communities after World War II, when a 
slice of formerly Italian territory became part of Communist 
Yugoslavia. Italy wants Slovenia to allow these Italians the 
right to reclaim their former property or at least have the 
same right as Slovenian citizens to purchase their former 
property. Slovenia's Parliament last year agreed to allow 
foreigners to own real estate in Slovenia within 4 years of the 
coming into force of an EU association agreement, which was 
signed in June 1996.
    Slovenia's relationship with Croatia has been somewhat 
clouded by disputes arising from the breakup of Yugoslavia, 
including the division of property and assets and the exact 
demarcation of the Slovenia-Croatia border, particularly the 
sea border in Piran Bay. Slovenia notes that the way the sea 
border is now drawn blocks her access to the open sea, and it 
wants to modify the border to rectify the situation, which 
Croatia has refused to do. Although not all of these issues 
have been settled, observers believe that they are normal 
disagreements between largely friendly neighboring states, and 
not serious enough to pose a threat to regional stability.
    According to the Slovenian constitution, the National 
Assembly adopts international agreements by a majority of 
deputies present and voting. The constitution also contains 
provisions for holding referenda, whose questions are adopted 
by a simple majority of those voting.
    A majority of Slovenes appears to favor NATO membership. A 
USIA poll, conducted in the spring and summer of 1996, showed 
32 percent of those polled ``strongly favoring'' NATO 
membership for Slovenia and 39 percent ``somewhat favoring'' 
it. Thirteen percent ``somewhat oppose'' NATO membership and 11 
percent ``strongly oppose'' it. A more recent poll taken on 
March 1, 1997 by Delo, the leading daily newspaper in Slovenia, 
showed 66 percent for membership in NATO and strong support for 
meeting the costs of admission.
    According to the 1996 USIA survey, a majority of Slovenes 
opposes the stationing of NATO troops in Slovenia (63 percent 
to 32 percent), regular overflights of Slovenia by NATO planes 
(59 percent to 37 percent), sending Slovenian troops to defend 
other NATO countries (58 percent to 38 percent), and increasing 
defense spending at the expense of social spending (63 percent 
to 9 percent). Slovenes are divided nearly equally (49 percent 
for vs. 48 percent against) on the question of holding regular 
NATO exercises on Slovenian territory.
    As noted above, except for Poland, groups polled in the 
USIA survey from other potential candidates for membership in 
NATO showed a similar pattern of support for NATO membership in 
general, but ambivalence or opposition to accepting some of the 
responsibilities that may come with that membership.
    The polling data suggest that, just as U.S. Members of 
Congress must take to the American people an open and frank 
debate on the merits of enlarging NATO, so too must European 
candidate country legislators take an informal debate to their 
publics. The challenge of the next several months is to ensure 
that a stronger, more secure Europe emerges, based on informed, 
democratic consensus.

          IV. Roster of Meetings in Russia and Central Europe

                          (March 23-28, 1997)

Moscow, Russian Federation

Grigorii Yavlinsky, Member of the State Duma and Duma Leader of 
        the Yabloko Party
Gennadiy Zyuganov, Member of the State Duma and Leader of the 
        Communist Party
General (ret.) Aleksandr Lebed', Chairman, Russian Popular 
        Republican Party
Ivan Rybkin, Chairman, National Security Council
Iurii Baturin, Secretary, National Defense Council
Artur Chilingarov, Deputy Speaker and Member of the State Duma 
        (Russia's Regions Party)
Mikhail Iur'ev, Deputy Speaker and Member of the State Duma 
        (Yabloko Party)
Ella Pamfilova, Member of the State Duma (Russia's Regions 
        Party)
Vladimir Semago, Member of the State Duma (Communist Party)
Evgenii Kozhokin, Director, Russian Institute of Strategic 
        Studies
Andrei Fedorov, President, Polis Foundation
Sergei Rogov, Director, U.S.A. And Canada Institute
Sergei Oznobishchev, Director, Institute of Strategic 
        Assessments
Dmitrii Trenin, Senior Associate, Moscow Carnegie Center

Warsaw, Poland

Wlodzimierz Cimoszewicz, Prime Minister
Marek Siwiec, Secretary of State and Head, National Security 
        Committee
Eugeniusz Wyzner, Acting Foreign Minister
Andrzej Karkoszka, Deputy Minister of Defense
General Henryk Szumski, Chief of Staff, Polish Army
Krzysztof Wegrzyn, Deputy Minister of Defense
Henryk Szlajfer, Director, Institute of International Affairs
Marek Dukasziewicz, Undersecretary, National Security Bureau, 
        Presidential Chancellery
Jan Borkowski, Deputy Foreign Minister
Adam Struzik, Marshal of the Senate
Janusz Onyszkiewicz, Vice-Chairman, Sejm Defense Committee
Wlodzimierz Konarski, Advisor to the Prime Minister on Foreign 
        and Defense Policy
Radek Sikorski, Movement for the Reconstruction of Poland (ROP) 
        and former Minister of Defense
Hanna Gronkiewicz-Waltz, President, National Bank of Poland
Longin Pastusiak, Member, Sejm Foreign Affairs Committee
Romuald Szeremetiew, Defense Advisor, Solidarity Electoral 
        Action (AWS)
Krzysztof Kalicki, PEKAO S.A. Bank and former Deputy Finance 
        Minister for Military Procurement
Andrzej Ananicz, Lech Walesa Institute
Boguslaw Grabowski, First Petrol Bank and Member, Solidarity 
        Electoral Action (AWS)
Adam Bromke, Advisor to the Prime Minister
Cezary Stypulkowski, Chairman, Bank Handlowy
Kazimierz Dziewanowski, Former Polish Ambassador to the United 
        States
Jadwiga Staniszkis, Professor, Warsaw University and Advisor to 
        Solidarity Electoral Action (AWS)
Prague, Czech Republic

Vaclav Havel, President
Josef Zieleniec, Foreign Minister
Miloslav Vyborny, Minister of Defense
General Jiri Nekvasil, Chief, General Staff
Vladimir Suman, Deputy Minister of Defense
Milos Zeman, Speaker of Parliament and Leader, Social 
        Democratic Party
Michael Zantovsky, Chairman, Senate Foreign Relations Committee 
        and Chairman, Civic Democratic Alliance
Egon Lansky, Senator (Social Democratic Party) and Foreign 
        Policy Advisor to the Speaker
Hana Sevcikova, Director, North American Department, Ministry 
        of Foreign Affairs
Jaromir Novotny, Chief, Foreign Affairs Directorate, Ministry 
        of Defense
Pavel Telicka, Director-General of Multilateral Affairs, 
        Ministry of Foreign Affairs
Pavel Seifter, Foreign Policy Advisor to the President
Jan Kramek, Vice Chairman, Senate Foreign Relations Committee 
        (ODS Party)
Vitezslav Matuska, Vice Chairman, Senate Foreign Relations 
        Committee (CSSD Party)
Oldrich Docekal, Member, Senate Foreign Relations Committee 
        (KDU-CSL Party)
Vilem Holan, Chairman, Foreign Affairs Committee, Chamber of 
        Deputies (KDU-CSL Party)
Petr Necas, Chairman, Defense and Security Committee, Chamber 
        of Deputies (ODS Party)
Michal Lobkowicz, Vice-Chairman, Foreign Affairs Committee, 
        Chamber of Deputies (ODS Party)
Milos Titz, Vice-Chairman, Defense and Security Committee, 
        Chamber of Deputies (ODS Party)
Daniel Kroupa, Member, Chamber of Deputies (ODA Party)

Budapest, Hungary

Gyula Horn, Prime Minister
Laszlo Kovacs, Minister of Foreign Affairs
Istvan Szent-Ivanyi, Deputy Minister of Foreign Affairs
Andre Erdos, Deputy State Secretary, Ministry of Foreign 
        Affairs
Geza Jeszenszky, Member, Foreign Affairs Committee of 
        Parliament (Hungarian Democratic Forum), and former 
        Foreign Minister
Istvan Gyarmati, Deputy State Secretary for International 
        Affairs and NATO Integration, Ministry of Defense
General Janos Sagi, Chief of Staff, Hungarian Air Force
Matyas Eorsi, Chairman, Foreign Affairs Committee of Parliament
Andras Barsony, Vice Chairman, Foreign Affairs Committee of 
        Parliament (Socialist Party)
Bela Gyuricza, Vice Chairman, Defense Committee of Parliament 
        (Alliance of Young Democrats)
Tamas Bauer, Member of Parliament (Free Democratic Party)
Imre Szekeres, Parliamentary Leader, Socialist Party
Tamas Sepsey, Member of Parliament (Hungarian Democratic Forum)
Istvan Varga, Member of Parliament (Hungarian Democratic 
        People's Party)
Ferenc Szakal, Member of Parliament (Christian Democratic 
        Party)
Gabor Szentivanyi, Spokesman, Ministry of Foreign Affairs
Csaba Korosi, Deputy Director, NATO Department, Ministry of 
        Foreign Affairs
Istvan Emri, Deputy Director, North America Department, 
        Ministry of Foreign Affairs

Ljubljana, Slovenia

Milan Kucan, President
Janez Drnovsek, Prime Minister
Zoran Thaler, Minister of Foreign Affairs
Tit Turnsek, Minister of Defense
General Albin Gutman, Chief of Staff, Armed Forces
Janez Podobnik, Speaker of Parliament
Jelko Kacin, Chairman, Parliamentary Committee on International 
        Affairs, and former Minister of Defense
Ivo Vaigl, State Secretary, Ministry of Foreign Affairs
Lojze Peterle, Member of Parliament and Leader, Christian 
        Democratic Party
Janez Jansa, Member of Parliament and Leader, Social Democratic 
        Party
Borut Pahor, Member of Parliament and Leader, United List -
        Social Democrats
Zmago Jelincic, Member of Parliament and Leader, Nationalist 
        Party
Dimitri Rupel, Mayor of Ljubljana and former Foreign Minister
Ernest Petric, Slovenian Ambassador to the United States
                                ADDENDA

    A. Speech by Senator Biden at Warsaw University, March 25, 1997

                            POLAND AND NATO

                      Senator Joseph R. Biden, Jr.

speech before the euro-atlantic association warsaw university, warsaw, 
                                 poland

    I would like to thank Mr. Onyszkiewicz for his kind 
introduction, and to thank the Euro-Atlantic Association for 
the invitation to speak here today at Warsaw University. I am 
privileged and honored to appear before so many of Poland's top 
minds in the field of international security. Your association 
has made a solid contribution to the cause of cooperation 
between Poland and the Euro-Atlantic Community, and it is clear 
from your reports that the men and women in this room today 
understand the solemn responsibilities and burdens that Poland 
must assume if it joins the North Atlantic Treaty Organization. 
I thank you for your work in this area.
    Before I discuss Poland's progress toward qualifying for 
alliance membership, I would like very briefly to make clear my 
own feelings at the present time with regard to NATO 
enlargement. As I have said in my country on numerous 
occasions, I am in favor of enlargement in principle, but there 
are several questions that need answering to my satisfaction 
before I would vote to admit any candidate country.
    These issues include an understanding in candidate 
countries of all the obligations that go with membership, many 
details of candidates' political and military readiness, 
popular willingness to sacrifice in order to pay for costs of 
enlargement, willingness on the part of our current European 
NATO allies to pay their fair share of enlargement costs, and a 
well conceived NATO policy toward Russia.
    I hope to gain an insight into many of these issues on my 
current fact-finding trip. Other answers may emerge in the 
coming months. So to sum up--while I am a proponent of NATO 
enlargement, I would not want anyone in this room to believe 
that I have already made up my mind about how I might or might 
not vote some time next year when the U.S. Senate will probably 
decide whether to amend the Washington Treaty to allow one or 
more Central European countries to join the alliance.
    Having said all that, I would now like to narrow my focus 
and return to a discussion of Poland. In the 8 years since the 
Communist government and Solidarity sat down for roundtable 
talks on the future of Poland, your country has made remarkable 
progress toward returning to its historic Western orientation 
and toward ensuring political and economic freedom for its 
people. The shock therapy program that many questioned early on 
has proven to have been the right course, as Poland has enjoyed 
growth rates for the past 5 years that rival those of the 
world's most dynamic economies.
    In the political field, Poland has shown that its 
democratic roots never died. Changes in political power have 
come peacefully, at the ballot box, and once again this fall 
the Polish people will freely decide the composition of their 
government.
    Regardless of who wins those elections, I believe that one 
unchanging attitude will be Poland's desire to join NATO. I met 
today with many of the top leaders of your government and 
Parliament, and it is clear to me that joining the alliance is 
the top foreign policy priority of all leading politicians and, 
most likely, of everyone in this room. Poland is moving in the 
right direction to meet the criteria for membership set out in 
NATO's 1995 Enlargement Study. But now is not the time to sit 
back and declare victory.
    Let me, then, touch on five areas of my concern in deciding 
whether Poland should be invited to become a NATO member. Some 
of these are purely political or economic, like minority 
rights, freedom of the press, and privatization. Others are 
military-specific, like civilian control of the military and 
Interoperability. In some of these areas Poland has already 
answered my concerns and now must only avoid backsliding. In 
others, while progress has been made, further work remains.
    First, I would like to address one of the truly great 
accomplishments of the current government and the 
administration of President Kwasniewski: the tremendous 
progress toward better relations with Poland's minority 
communities. Although relations with Poland's German, 
Belarusian, Lithuanian, and Ukrainian communities are of 
interest to us in the United States--and, I might add, seem to 
be in good shape--our largest concern has been the relations 
between the Polish government and the Jewish community.
    The history of Polish-Jewish relations has been a tragic 
one of two peoples who have suffered greatly and endured brutal 
foreign occupations throughout the centuries. The greatest 
tragedy, of course, came during World War II. Six years of 
fighting and occupation cost the Polish nation millions of its 
best and brightest, and it cost the Jewish people in Poland 
their very existence, as Nazi criminals exterminated an entire 
culture in Central Europe. The war was followed by 
reprehensible instances of anti-Semitic violence and 
discrimination against survivors, which the Communist 
authorities either tacitly accepted or even instigated for 
their own purposes.
    Understandably, the Jewish people have a special concern 
that the Holocaust be remembered in a manner consistent with 
their cultural and religious sensibilities. The Polish 
government is to be commended for working with local 
authorities to ensure that the death camp at Auschwitz-Birkenau 
is preserved in a manner that honors the memory of the one 
million Jews who were killed there.
    Moreover, the Polish Jewish community has a right to expect 
protection from physical persecution. In this regard, I was 
heartened to see the quick condemnation by Polish political 
leaders of the dastardly fire bombing of the synagogue in 
Warsaw last month. Such acts of hatred clearly must not, and 
will not be permitted in a free Poland.
    NATO is an alliance of democracies, so I hope you--as a 
candidate for membership in that alliance--will allow me to 
offer as my second theme some advice on a cornerstone of 
democracy: a free press. In 1791, the same year that Poland 
promulgated the first constitution in Europe, our American 
forefathers proclaimed a Bill of Rights that would protect the 
liberties essential for a free people. The First Amendment 
guaranteed the freedom of the press, because our founders 
recognized that this was paramount in a democracy.
    Today in Poland, while the printed press is completely 
free, I have some concerns about the broadcast media, 
particularly of Polish state television. Government 
interference in the content of the television news is not 
acceptable in any democracy. State-owned television must offer 
editorial independence to its journalists. The government 
cannot hire and fire journalists because it likes or does not 
like what they report.
    I tell you here today as a politician that a free press can 
be a great source of distress, but you are going to have to get 
used to it if you are going to lead a democracy. Harry Truman, 
the American president who oversaw the creation of NATO, once 
said of politics: ``If you can't stand the heat, get out of the 
kitchen.'' I say to the leaders of this vibrant democracy: you 
will have to learn to take the heat from independent media. 
Considering the great strides you have taken so far, I have 
little doubt that you are up to the challenge.
    Every country, of course, has the right to choose its own 
economic system. Here again, though, we see that all NATO 
member states have free-market economies with the private 
sector playing the leading role. In that context, the third 
area I would like to address is privatization. Again, I commend 
the steps that you have made in this area. Small and medium 
enterprises are in private hands, and new, private businesses 
continue to be created. In addition, the mass privatization 
plan represents a major step toward giving the Polish people a 
direct stake in the economic future of their country.
    But this is not the time to stop. I believe that large, 
state-owned enterprises should also be placed into the hands of 
private owners, so that they can be operated with economic, 
rather than political, interests in mind. For Poland to be in 
the vanguard of Western economies in the 21st century, 
businesses like banks, the energy sector, the state airline, 
the state copper producer, and the telecommunications monopoly 
will have to be privatized.
    The final two issues I would like to address have a more 
direct relationship to Poland's bid for NATO membership. The 
first of these is civilian control over the military. Ever 
since we began to consider Poland's request to join the 
alliance, this has been one of the areas of greatest concern. 
It is unthinkable for the leadership of the military in a NATO 
country to dictate who will be its country's minister of 
defense. It is unthinkable for the leadership of a NATO 
military to raise any doubt about its willingness to carry out 
the commands of elected officials and their duly appointed 
ministers.
    Earlier this month, Poland took a significant step forward 
in this direction with the appointment of General Szumski, whom 
I met this morning, to be the Chief of the General Staff. I was 
pleased to hear the general state his vision for a military 
``that is apolitical, skilled, and well-organized.'' His 
appointment helps to assure us that control of the Polish 
military is in civilian hands.
    Again, however, the task needs to be completed. Poland must 
root out any remnant of the old resistance to civilian control. 
Of course, I am not telling the members of this distinguished 
audience anything that they do not already know. Your 1995 
study, entitled ``Poland-NATO,'' called for all of these 
developments in the Polish defense establishment. This kind of 
clear, forward thinking translated into policy has surely 
helped Poland's bid for NATO membership.
    The final issue on which I would like to focus is 
Interoperability. Poland has taken great strides toward 
implementing NATO's recommendation on how to allow its military 
to work with alliance forces in joint operations. While areas 
like language training, mapping software, and radios may seem 
mundane, they are at the heart of Interoperability. The work 
that is being done is these areas is essential if Poland is to 
join the alliance.
    Here too, I should note the role that the Euro-Atlantic 
Association is playing in this process. The cost study that you 
released earlier this year represents--to the best of my 
knowledge--the first effort in a Central European country to 
estimate what it would cost to join NATO. Achieving 
Interoperability is the one direct cost of NATO enlargement, 
and it is the one cost that all members must share if the 
alliance admits new members. Although the United States will 
contribute to meeting common alliance costs, it will subsidize 
neither Western Europe's nor Central Europe's share.
    The government and Parliamentary leaders I met with today 
were firm in their commitment to pay Poland's share of the 
costs of enlargement. This is a fundamental issue: a 
willingness to assume this responsibility is essential if 
Poland and some of its neighbors are to join NATO. As I said 
earlier, one of my main concerns is that NATO enlargement not 
place an undue burden on the American taxpayer. While the 
United States will pay its fair share of the direct costs of 
enlargement, others must do their part too.
    In addition to the direct costs related to 
Interoperability, there are indirect costs related to 
enlargement. First is the cost of modernizing Central European 
militaries. I have learned today about the Polish government's 
plan for modernization, which Poland must undertake whether or 
not it joins NATO. I will evaluate this plan in the months 
ahead as I make up my mind about NATO enlargement, and I expect 
that the other leading candidates for membership will offer 
similar plans to pay for their own defense modernization.
    While the United States may offer some modest, technical 
assistance, the burden of military modernization must be borne 
by you and your neighbors. As you have learned throughout your 
country's difficult history, freedom isn't free, and security 
is not cheap. Today, when 6 percent annual economic growth is 
rapidly raising the Polish standard of living, the political 
will is present. My friends, nothing is permanent, and that 
political will must continue if growth slows or the economy 
turns downward.
    I am well aware that 90 percent of Poles want to join NATO. 
I remind them today that if you do join, just as NATO will 
stand ready to assist Poland in its hour of need, so too must 
you commit your country to contribute to the defense of your 
new allies. This would entail a financial cost to your people 
and a human cost to your soldiers.
    The other indirect cost of NATO enlargement must be borne 
by our current allies. In the post-cold war world, NATO is no 
longer directed against a common threat. NATO is transforming 
itself to meet new challenges outside the territories of its 
member states, in regions where stability is not assured. In 
order to carry out these missions, NATO must develop new 
capabilities to allow its members to project power beyond their 
borders and lift troops, equipment and supplies to areas where 
the conflicts of the future may arise.
    I am troubled by indications in some West European 
countries that there may be resistance to funding this power 
projection capability. For 40 years American taxpayers 
undertook the obligation of helping to defend Western Europe, 
thereby allowing that region to recover from the devastation of 
World War II and enjoy unprecedented prosperity. Now it is time 
for the people of Western Europe to invest in the security of 
their continent for the next century. If NATO is to remain 
viable, our allies must commit themselves to develop the 
capabilities that will be needed for new roles and missions, 
the same capabilities that would allow the alliance to defend 
new members if enlargement occurs.
    Let me be blunt: if our West European allies shrink from 
this responsibility, not just enlargement, but NATO itself will 
be in jeopardy.
    Let me also say a word here about Poland's efforts to join 
the European Union. I am fully cognizant of the unique 
experiment in governance upon which the EU has embarked. It is 
an immensely complex undertaking. Nonetheless, I find it 
unconscionable that the richest countries on the Continent are 
delaying membership for the countries of Central Europe. I see 
no justification for keeping countries with vibrant market 
economies outside the European Union, special interest groups 
and institutional growing pains notwithstanding.
    Poland has taken giant steps toward making its laws 
compatible with those of the European Union, and its commitment 
to a free-market economy is unquestioned. The countries of 
Central Europe that meet the criteria for EU membership should 
be admitted to the Union in the very near future, and I hope 
you will press this point with EU leaders whenever the 
opportunity arises.
    As for NATO, we must be attentive to the effect that 
enlargement will have on those countries not invited to join in 
the first group. I will not support any enlargement that does 
not enhance the security of the United States, of our current 
allies, of new members, and of those countries remaining 
outside of NATO.
    The most important country in this last category is, of 
course, Russia. We all understand that a new European security 
architecture will collapse without a strong Russian pillar. We 
must understand Russia's legitimate security concerns, and to 
the extent we can, we should work to ensure that these concerns 
are heard and taken into account by the alliance.
    This does not mean, however, that the West should calmly 
leave unchallenged the old, stale, Stalinist stereotypes of 
NATO. NATO has always been a purely defensive alliance, and it 
will remain so. NATO is speaking out for reduced armament 
levels in Europe, not increased. However forthcoming NATO is, 
it must not make concessions either on the enlargement process 
or on the ability of current and future NATO members to take 
whatever action they deem necessary to maintain the readiness 
of the alliance.
    In the months ahead, the governments of the United States, 
our NATO allies, and the Central European democracies will work 
to devise a plan for allowing the alliance to admit new 
members. When this work is completed, perhaps by the end of 
this year, it will become the duty of the U.S. Senate and of 
the 15 other member countries, according to their own 
procedures, to review this plan to be certain it is in their 
interests. It will be my duty, and that of my colleagues, to 
ask the hard questions about this plan: Will it add to the 
security of our country? Will it add to the security of our 
allies? Will the costs be distributed fairly?
    I can tell you today that I am very impressed by the steps 
that Poland has taken to meet the political and military 
criteria for NATO membership. Poland has come far in 
transforming a failed political and economic system into a 
thriving free-market democracy. I encourage you to persist in 
your efforts, to continue working closely with us and our 
partners, and to prepare your people to assume the burdens of 
helping to defend the Western Alliance.
    But this role is nothing new for the Polish nation. 
Throughout history, your soldiers endeavored to fight and die, 
as they said so eloquently, ``for your freedom, and for ours.'' 
I hope the Polish people remain firm in their commitment to 
defending democracy, both at home and in the larger Western 
community.
    Thank you for your attention.

                              ----------                              


      B. The North Atlantic Treaty (Washington, DC, April 4, 1949)

    The Parties to this Treaty reaffirm their faith in the 
purposes and principles of the Charter of the United Nations 
and their desire to live in peace with all peoples and all 
governments. They are determined to safeguard the freedom, 
common heritage and civilization of their peoples, founded on 
the principles of democracy, individual liberty and the rule of 
law. They seek to promote stability and well-being in the North 
Atlantic area. They are resolved to unite their efforts for 
collective defense and for the preservation of peace and 
security. They therefore agree to this North Atlantic Treaty:

                               Article 1

    The Parties undertake, as set forth in the Charter of the 
United Nations, to settle any international dispute in which 
they may be involved by peaceful means in such a manner that 
international peace and security and justice are not 
endangered, and to refrain in their international relations 
from the threat or use of force in any manner inconsistent with 
the purposes of the United Nations.

                               Article 2

    The Parties will contribute toward the further development 
of peaceful and friendly international relations by 
strengthening their free institutions, by bringing about a 
better understanding of the principles upon which these 
institutions are founded, and by promoting conditions of 
stability and well-being. They will seek to eliminate conflict 
in their international economic policies and will encourage 
economic collaboration between any or all of them.

                               Article 3

    In order more effectively to achieve the objectives of this 
Treaty, the Parties, separately and jointly, by means of 
continuous and effective self-help and mutual aid, will 
maintain and develop their individual and collective capacity 
to resist armed attack.

                               Article 4

    The Parties will consult together whenever, in the opinion 
of any of them, the territorial integrity, political 
independence or security of any of the Parties is threatened

                               Article 5

    The Parties agree that an armed attack against one or more 
of them in Europe or North America shall be considered an 
attack against them all and consequently they agree that, if 
such an armed attack occurs, each of them, in exercise of the 
right of individual or collective self-defense recognized by 
Article 51 of the Charter of the United Nations, will assist 
the Party or Parties so attacked by taking forthwith, 
individually and in concert with the other Parties, such action 
as it deems necessary, including the use of armed force, to 
restore and maintain the security of the North Atlantic area.
    Any such armed attack and all measures taken as a result 
thereof shall immediately be reported to the Security Council. 
Such measures shall be terminated when the Security Council has 
taken the measures necessary to restore and maintain 
international peace and security. \1\
---------------------------------------------------------------------------
    \1\ The definition of the territories to which Article 5 applies 
was revised by Article 2 of the Protocol to the North Atlantic Treaty 
on the accession of Greece and Turkey and by the Protocols signed on 
the accession of the Federal Republic of Germany and of Spain.
---------------------------------------------------------------------------

                               Article 6

    For the purpose of Article 5, an armed attack on one or 
more of the Parties is deemed to include an armed attack:

        on the territory of any of the Parties in Europe or 
        North America, on the Algerian Departments of France 
        \2\ on the territory of Turkey or on the Islands under 
        the jurisdiction of any of the Parties in the North 
        Atlantic area north of the Tropic of Cancer; on the 
        forces, vessels, or aircraft of any of the Parties, 
        when in or over these territories or any other area in 
        Europe in which occupation forces of any of the Parties 
        were stationed on the date when the Treaty entered into 
        force or the Mediterranean Sea or the North Atlantic 
        area north of the Tropic of Cancer.
---------------------------------------------------------------------------
    \2\ On January 16,1963, the North Atlantic Council heard a 
declaration by the French Representative who recalled that by the vote 
on self-determination on July 1, 1962, the Algerian people had 
pronounced itself in favor of the independence of Algeria in co-
operation with France. In consequence, the President of the French 
Republic had on July 3, 1962, formally recognized the independence of 
Algeria. The result was that the ``Algerian departments of France'' no 
longer existed as such, and that at the same time the fact that they 
were mentioned in the North Atlantic Treaty had no longer any bearing. 
Following this statement the Council noted that insofar as the former 
Algerian Departments of France were concerned, the relevant clauses of 
this Treaty had become inapplicable as from July 3, 1962.
---------------------------------------------------------------------------

                               Article 7

    This Treaty does not affect, and shall not be interpreted 
as affecting in any way the rights and obligations under the 
Charter of the Parties which are members of the United Nations, 
or the primary responsibility of the Security Council for the 
maintenance of international peace and security.

                               Article 8

    Each Party declares that none of the international 
engagements now in force between it and any other of the 
Parties or any third State is in conflict with the provisions 
of this Treaty, and undertakes not to enter into any 
international engagement in conflict with this Treaty.

                               Article 9

    The Parties hereby establish a Council, on which each of 
them shall be represented, to consider matters concerning the 
implementation of this Treaty. The Council shall be so 
organized as to be able to meet promptly at any time. The 
Council shall set up such subsidiary bodies as may be 
necessary; in particular it shall establish immediately a 
defense committee which shall recommend measures for the 
implementation of Articles 3 and 5.

                               Article 10

    The Parties may, by unanimous agreement, invite any other 
European State in a position to further the principles of this 
Treaty and to contribute to the security of the North Atlantic 
area to accede to this Treaty. Any State so invited may become 
a Party to the Treaty by depositing its instrument of accession 
with the Government of the United States of America. The 
Government of the United States of America will inform each of 
the Parties of the deposit of each such instrument of 
accession.

                               Article 11

    This Treaty shall be ratified and its provisions carried 
out by the Parties in accordance with their respective 
constitutional processes. The instruments of ratification shall 
be deposited as soon as possible with the Government of the 
United States of America, which will notify all the other 
signatories of each deposit. The Treaty shall enter into force 
between the States which have ratified it as soon as the 
ratifications of the majority of the signatories, including the 
ratifications of Belgium, Canada, France, Luxembourg, the 
Netherlands, the United Kingdom and the United States, have 
been deposited and shall come into effect with respect to other 
States on the date of the deposit of their ratifications.

                               Article 12

    After the Treaty has been in force for 10 years, or at any 
time thereafter, the Parties shall, if any of them so requests, 
consult together for the purpose of reviewing the Treaty, 
having regard for the factors then affecting peace and security 
in the North Atlantic area, including the development of 
universal as well as regional arrangements under the Charter of 
the United Nations for the maintenance of international peace 
and security.

                               Article 13

    After the Treaty has been in force for 20 years, any Party 
may cease to be a Party 1 year after its notice of denunciation 
has been given to the Government of the United States of 
America, which will inform the Governments of the other Parties 
of the deposit of each notice of denunciation.

                               Article 14

    This Treaty, of which the English and French texts are 
equally authentic, shall be deposited in the archives of the 
Government of the United States of America. Duly certified 
copies will be transmitted by that Government to the 
Governments of other signatories.

                              ----------                              


                   C. Chronology of NATO Enlargement

    04/04/49--The United States, Britain, France, Italy, 
Denmark, Norway, Portugal, Iceland, Canada, and the Benelux 
countries (12 in total) sign the Washington Treaty on forming 
the North Atlantic Treaty Organization (NATO). (Greece and 
Turkey join NATO in 1952, Germany in 1955, and Spain in 1982.)

    01/10-11/94--At a summit meeting in Brussels, Belgium, NATO 
countries launch the Partnership for Peace (PFP) program of 
cooperation to former Warsaw Pact countries. The summit 
document also states that the alliance ``expects and would 
welcome NATO expansion that would reach to democratic states to 
our east as part of an evolutionary process.''

    11/02/94--President Clinton signs into law P.L. 103-447, 
which includes the ``NATO Participation Act of 1994.'' The Act 
expresses the sense of Congress that Poland, Hungary, the Czech 
Republic, and Slovakia should be considered for NATO 
membership.

    12/01-02/94--At a North Atlantic Council (NAC) meeting in 
Brussels, NATO foreign ministers initiate a study process that 
is to determine the ``how and why'' of enlargement of the 
alliance. It is agreed that the results of the study will be 
presented at the December 1995 ministerial meeting.

    09/28/95--NATO releases its ``Study on NATO Enlargement.''

    12/05/95--On the basis of the study on enlargement, NATO 
foreign ministers decide that the next phase of the enlargement 
process will entail: intensified, individual dialogue with 
interested partner countries; enhancement of the Partnership 
for Peace; and further consideration of internal adaptation of 
the alliance in preparation for enlargement. Since then, 12 
countries express interest in joining NATO and enter the so-
called ``16+1'' dialogs: Albania, Bulgaria, the Czech Republic, 
Estonia, the Former Yugoslav Republic of Macedonia, Hungary, 
Latvia, Lithuania, Poland, Romania, Slovakia, and Slovenia.

    02/12/96--President Clinton signs into law P. 104-107, 
which contains the ``NATO Participation Act Amendments of 
1995.'' The act expands military assistance programs to a 
number of Central European countries, but does not designate 
specific countries as eligible for NATO membership.

    09/23/96--The Fiscal Year 1997 Defense Authorization bill 
(S. 1745) becomes law (P.L. 104-201). It includes an amendment 
calling for a study to be conducted by the administration and 
transmitted to Congress that will analyze the potential costs 
and strategic implications of alliance expansion.

    09/30/96--The President signs into law P.L. 104-208, an 
omnibus appropriations bill for Fiscal Year 1997, which 
includes the ``NATO Enlargement Facilitation Act of 1996.'' The 
Act authorizes funds for the military assistance programs 
established in the 1994 NATO Participation Act. It designates 
Poland, Hungary, the Czech Republic, and Slovenia as having 
made the most progress toward achieving the stated criteria for 
NATO membership.

    10/22/96--At a re-election campaign speech in Detroit, 
Michigan, President Clinton pledges that, ``by 1999 . . . the 
first group of countries we invite to join should be full-
fledged members of NATO.'' The President does not specify which 
countries will be invited.

    12/09-10/96--At a ministerial meeting in Brussels, NATO 
foreign ministers announce that the leaders of NATO countries 
will convene a summit meeting in Madrid on July 8-9, 1997, and 
will formally invite ``one or more'' countries to begin 
accession negotiations with the alliance. The NAC also declares 
that NATO counties have ``no intention, no plan, and no reason 
to deploy nuclear weapons on the territory of new members,'' 
nor does it foresee any future need to do so.

    02/24/97--In accordance with P.L. 104-201 (Section 1048), 
the administration issues a report to Congress on the 
enlargement of the North Atlantic Alliance.

    05/28-30/97--NATO's North Atlantic Council ministerial 
meeting in Sintra, Portugal.

    06/12-13/97--NATO Defense Ministers' meeting in Portugal. 
NATO enlargement will be among the subjects of discussion.

    07/08-09/97--NATO summit in Madrid. The principal issues 
will be enlargement, NATO's new missions, Bosnia, and combined 
joint task forces (CJTF). NATO has stated that it will invite 
``one or more'' countries to begin accession negotiations.

    end of 1997--NATO hopes to complete accession negotiations 
with candidate states for membership.

    spring-summer 1998--The U.S. Senate may vote on accession 
protocols for candidate countries seeking NATO membership.

    April 1999--Target date for entry of new members into NATO.

                              ----------                              


                     D. Helsinki Summit Declaration

                            THE WHITE HOUSE

                     Office of the Press Secretary

                           Helsinki, Finland

                                              For Immediate Release
                                                     March 21, 1997

                            Joint Statement

            joint u.s.-russian statement on european security

    Presidents Clinton and Yeltsin discussed the present 
security situation in the Euro-Atlantic region. They reaffirmed 
their commitment to the shared goal of building a stable, 
secure, integrated and undivided democratic Europe. The roles 
of the United States and Russia as powers with worldwide 
responsibilities place upon them a special requirement to 
cooperate closely to this end. They confirmed that this 
cooperation will be guided by the spirit of openness and 
pragmatism which has increasingly come to characterize the 
U.S.-Russian relationship in recent years.
    Recalling their May 1995 Joint Statement on European 
Security, the Presidents noted that lasting peace in Europe 
should be based on the integration of all of the continent into 
a series of mutually supporting institutions and relationships 
that ensure that there will be no return to division or 
confrontation. No institution by itself can ensure security. 
The Presidents agreed that the evolution of security structures 
should be managed in a way that threatens no state and that 
advances the goal of building a more stable and integrated 
Europe. This evolution should be based on a broad commitment to 
the principles of the Organization for Security and Cooperation 
in Europe as enshrined in the Helsinki Final Act, the Budapest 
Code of Conduct and other OSCE documents, including respect for 
human rights, democracy and political pluralism, the 
sovereignty and territorial integrity of all states, and their 
inherent right to choose the means to ensure their own 
security.
    The Presidents are convinced that strengthening the OSCE, 
whose potential has yet to be fully realized, meets the 
interests of the United States and Russia. The Presidents 
expressed their satisfaction with the outcome of the Lisbon 
Summit of the OSCE and agreed on the importance of implementing 
its decisions, both to define further the goals of security 
cooperation and to continue to devise innovative methods for 
carrying out the growing number of tasks the OSCE has assumed.
    They underscored their commitment to enhance the 
operational capability of the OSCE as the only framework for 
European security cooperation providing for full and equal 
participation of all states. The rule of consensus should 
remain an inviolable basis for OSCE decisionmaking. The 
Presidents reaffirmed their commitment to work together in the 
ongoing OSCE effort to develop a model for security in Europe 
which takes account of the radically changed situation on the 
eve of the 21st century and the decisions of the Lisbon Summit 
concerning a charter on European security. The OSCE's essential 
role in Bosnia and Herzegovina and its ability to develop new 
forms of peacekeeping and conflict prevention should also be 
actively pursued.
    In their talks in Helsinki, the two Presidents paid special 
attention to the question of relations between the North 
Atlantic Treaty Organization and the Russian Federation. They 
continued to disagree on the issue of NATO enlargement. In 
order to minimize the potential consequences of this 
disagreement, the Presidents agreed that they should work, both 
together and with others, on a document that will establish 
cooperation between NATO and Russia as an important element of 
a new comprehensive European security system. Signed by the 
leaders of the NATO countries and Russia, this document would 
be an enduring commitment at the highest political level. They 
further agreed that the NATO-Russia relationship, as defined in 
this document, should provide for consultation, coordination 
and, to the maximum extent possible where appropriate, joint 
decisionmaking and action on security issues of common concern.
    The Presidents noted that the NATO-Russia document would 
reflect and contribute both to the profound transformation of 
NATO, including its political and peacekeeping dimension, and 
to the new realities of Russia as it builds a democratic 
society. It will also reflect the shared commitment of both 
NATO and Russia to develop their relations in a manner that 
enhances mutual security.
    The Presidents recalled the historic significance of the 
Treaty on Conventional Armed Forces in Europe in establishing 
the trust necessary to build a common security space on the 
continent in the interest of all states in Europe, whether or 
not they belong to a military or political alliance, and to 
continue to preclude any destabilizing buildup of forces in 
different regions of Europe. The Presidents stressed the 
importance of adapting the CFE Treaty. They agreed on the need 
to accelerate negotiations among CFE parties with a view to 
concluding by late spring or early summer of 1997 a framework 
agreement setting forth the basic elements of an adapted CFE 
Treaty, in accordance with the objectives and principles of the 
Document on Scope and Parameters agreed at Lisbon in December 
1996.
    President Yeltsin underscored Russian concerns that NATO 
enlargement will lead to a potentially threatening buildup of 
permanently stationed combat forces of NATO near to Russia. 
President Clinton stressed that the alliance contemplates 
nothing of the kind.
    President Yeltsin welcomed President Clinton's statements 
and affirmed that Russia would exercise similar restraint in 
its conventional force deployments in Europe.
    President Clinton also noted NATO's policy on nuclear 
weapons deployments, as articulated by the North Atlantic 
Council on December 10, 1996, that NATO members have ``no 
intention, no plan and no reason'' to deploy nuclear weapons on 
the territory of states that are not now members of the 
alliance, nor do they foresee any future need to do so. 
President Clinton noted NATO's willingness to include specific 
reference to this policy in the NATO-Russia document.
    President Yeltsin spoke in favor of including such a 
reference in the document. The Presidents agreed that the 
United States, Russia and all their partners in Europe face 
many common security challenges that can best be addressed 
through cooperation among all the states of the Euro-Atlantic 
area. They pledged to intensify their efforts to build on the 
common ground identified in their meetings in Helsinki to 
improve the effectiveness of European security institutions, 
including by concluding the agreements and arrangements 
outlined in this statement.

                                      

FOR THE
UNITED STATES OF AMERICA:
      /S/

                                     FOR THE
                                     RUSSIAN FEDERATION:
                                                 /S/
      
                              ----------                              


         E. North Atlantic Council communique December 10, 1996

                    Press communique M-NAC-2 (96)165

                 held at nato hq, brussels, 10 dec 1996

    Final Communique issued at the Ministerial Meeting of the 
North Atlantic Council

    1. As we look ahead, the new NATO is taking shape, 
reflecting the fundamental changes in the security environment 
in Europe and the enduring vitality of the transatlantic 
partnership which underpins our endeavors. The broad vision of 
this new NATO and its role in the development of a new European 
security architecture was set out at the 1994 Brussels Summit 
and further defined at our last meeting in Berlin.
    The alliance's adaptation and reform is well underway. We 
will take this process forward today. The alliance is resolved 
to preserve its political and military strength, ensuring its 
ability to carry out the full range of its missions--as IFOR 
and its planned successor SFOR in Bosnia and Herzegovina 
clearly show. We have issued a separate statement in this 
regard. The alliance will continue to strengthen European 
security by maintaining its capability for collective defense, 
admitting new members, expanding and strengthening cooperative 
relationships with all partners, including building a strong 
security partnership with Russia and a distinctive relationship 
with Ukraine, and realizing the European Security and Defense 
Identity within the alliance.
    The evolution of the alliance takes place in the context of 
our aim to help build a truly cooperative European security 
structure. We welcome as a contribution the important decisions 
taken at the recent OSCE Summit in Lisbon and the decision by 
the States Parties to the CFE Treaty to begin negotiations in 
early 1997 with a view toward adapting the Treaty to the 
changing security environment in Europe.

    2. Against this background, we have decided to recommend to 
our Heads of State and Government to convene a Summit meeting 
in Madrid on 8/9 July 1997 to set the course for the alliance 
as it moves toward the 21st century, consolidating Euro-
Atlantic security. To achieve this aim, major decisions will 
have to be taken by the time of the Summit concerning NATO's 
internal adaptation, the opening of the alliance and its 
ability to carry out all its new roles and missions. The agenda 
for our Summit will include:

        agreeing a new command structure, which enables all 
        Allies to participate fully, and further advancing the 
        implementation of the Combined Joint Task Forces (CJTF) 
        concept, in order to enhance the alliance's ability to 
        carry out the full range of its missions, while 
        preserving the capability for collective defense, based 
        on a strong transatlantic partnership;

        finalizing, to the satisfaction of all Allies, all the 
        necessary arrangements for the European Security and 
        Defense Identity (ESDI) within NATO, which will allow 
        for the preparation and conduct of WEU-led operations 
        with the participation of all European Allies if they 
        were so to choose; inviting one or more of the 
        countries which have expressed interest in joining the 
        alliance to begin accession negotiations;

        pledging that the alliance will remain open to the 
        accession of further members and will remain ready to 
        pursue consultations with nations seeking NATO 
        membership, as it has done in the past;

        strengthening cooperative relations with all our 
        partners including through an enhanced Partnership for 
        Peace (PfP) and the initiative to establish an Atlantic 
        Partnership Council;

        intensifying and consolidating relations with Russia 
        beyond the Partnership for Peace by aiming at reaching 
        an agreement at the earliest possible date on the 
        development of a strong, stable and enduring security 
        partnership;

        further developing an enhanced relationship with 
        Ukraine;

        enhancing our Mediterranean dialog;

        further developing our ability to carry out new roles 
        and missions relating to conflict prevention and crisis 
        management; and further enhancing our political and 
        defense efforts against the proliferation of nuclear, 
        biological and chemical weapons and their delivery 
        means.

    3. We warmly welcome the decision of the Government of 
Spain, endorsed by the Spanish Parliament on 14 November 1996, 
to take the necessary steps to participate in the alliance's 
new structure. Spain's participation will further strengthen 
the cohesion and military effectiveness of the alliance, as it 
takes on new roles and missions, reinforce the transatlantic 
link and help develop ESDI within the alliance.

    4. Stability and security in the whole Euro-Atlantic area 
are our primary goal. We want to help build cooperative 
European security structures which extend to countries 
throughout the whole of Europe without excluding anyone or 
creating dividing lines. Recent decisions at the OSCE Summit 
meeting in Lisbon on European security cooperation and the 
decision to adapt the CFE Treaty to the new European security 
environment establish a cooperative foundation for our common 
security. The alliance, for its part, has developed a broad 
pattern of intensive cooperation with North Atlantic 
Cooperation Council (NACC) and PfP Partner countries and with 
other international organizations and is thereby contributing 
to security and stability in the Euro-Atlantic area. With the 
same aim, we are now working toward opening the alliance to new 
members; developing ever-closer and deeper cooperative ties 
with all Partner countries who so wish; building a strong, 
stable and enduring security partnership with Russia; 
strengthening our relationship with Ukraine; and enhancing our 
Mediterranean dialog.

    5. We reaffirm that the nuclear forces of the Allies 
continue to play a unique and essential role in the alliance's 
strategy of war prevention. New members, who will be full 
members of the alliance in all respects, will be expected to 
support the concept of deterrence and the essential role 
nuclear weapons play in the alliance's strategy. Enlarging the 
alliance will not require a change in NATO's current nuclear 
posture and therefore, NATO countries have no intention, no 
plan, and no reason to deploy nuclear weapons on the territory 
of new members nor any need to change any aspect of NATO's 
nuclear posture or nuclear policy--and we do not foresee any 
future need to do so.

    6. A number of countries have long-standing aspirations to 
become full members of our alliance and have undertaken 
intensive and wide-ranging preparations and reforms with this 
aim in mind. We are now in a position to recommend to our Heads 
of State and Government to invite at next year's Summit meeting 
one or more countries which have participated in the 
intensified dialog process, to start accession negotiations 
with the alliance. Our goal is to welcome the new member(s) by 
the time of NATO's 50th anniversary in 1999. We pledge that the 
alliance will remain open to the accession of further members 
in accordance with Article 10 of the Washington Treaty. We will 
remain ready to pursue consultations with nations seeking NATO 
membership, as we have done in the past.
    We are satisfied with the intensified, individual dialog 
which the alliance has been conducting throughout this year 
with interested partners. This dialog has improved their 
understanding of specific and practical details of how the 
alliance works. It has provided the alliance in turn with a 
better understanding of where these countries stand in their 
internal development as well as in the resolution of any 
external issues with neighboring countries. We have tasked the 
Council in Permanent Session to prepare comprehensive 
recommendations for decisions to be taken by the Summit on 
which country or countries to invite to begin accession 
negotiations. The process should include:

        an intensified dialog with interested Partner countries 
        including in a ``16+1'' format, as appropriate;

        analysis, on the basis of further political guidance to 
        be elaborated by the Council in Permanent Session, of 
        the relevant factors associated with the admission of 
        potential new members;

        preparation of recommendations on the adaptation of 
        alliance structures necessary to integrate new members 
        into the alliance;

        preparation of a plan for conducting the accession 
        talks with one or more new members.

    7. We look forward to tomorrow's meeting of the NACC, which 
will mark its fifth anniversary. The NACC has provided us over 
the years with a valued opportunity to consult regularly with 
our partners on political and security issues. Through NACC and 
Partnership for Peace, we have achieved the development of 
common approaches to European security and brought the NACC 
countries closer together in a spirit of cooperation and a 
common commitment to European security. We are committed to 
ensuring that the NACC goals of enhancing transparency and 
confidence in security matters among member states remain 
central to future cooperation. In order to derive maximum 
benefit from our NACC meetings, we want to move toward further 
deepening our political dialog and giving it more focus.

    8. We are pleased with the dynamic development of 
Partnership for Peace and the role it plays in building 
European security cooperation. The Partnership for Peace will 
continue as a permanent element of the alliance's cooperative 
effort to contribute to the development of a more stable 
European security area and, with those partners seeking to join 
NATO, will also facilitate their preparations to meet the 
responsibilities of membership in the alliance. Substantial 
progress has been achieved in enhancing the scope and substance 
of our Partnership cooperation, in particular the growing range 
of exercises, the broadening and deepening of the PfP Planning 
and Review Process, the intensification of work on civil-
military relations, and civil emergency planning and disaster 
relief. In the current IFOR operation, in which 13 Partner 
countries are cooperating with alliance armed forces, the 
Partnership for Peace has proved its value with regard both to 
political commitment to joint crisis management and to military 
Interoperability.
    We want to develop on the basis of transparency ever-closer 
and deeper cooperative ties open to all Partner countries by 
making the Partnership more operational; strengthening its 
political consultation element, taking full account of the 
respective activities of the OSCE and the relevant European 
institutions such as the WEU and the EU; and involving partners 
more in operations planning and Partnership decisionmaking. To 
this end, the alliance has set up a Senior Level Group to 
develop by the time of the Summit meeting a clearly 
strengthened and thus more attractive Partnership for Peace. We 
have received an interim report on the ongoing work and agree 
that work should begin without delay to implement its 
recommendations. These include:

        enhancing the political dimension of the Partnership 
        through increasing opportunities for political 
        consultations;

        expanding the agreed fields of military missions within 
        PfP to the full range of the alliance's new missions, 
        as appropriate, including Peace Support operations over 
        and above previously agreed areas;

        broadening the NATO/PfP exercise program in accordance 
        with the expanded scope of the Partnership;

        enabling Partner countries to participate in the 
        planning and execution of PfP activities (exercises and 
        operations);

        involving partners more substantively and actively in 
        PfP-related parts of the regular peacetime work of 
        NATO's Military Authorities;

        affording the appropriate opportunity to partners who 
        join future NATO-led PfP operations to contribute to 
        the provision of political guidance for oversight over 
        such operations, drawing on the experience gained in 
        Operation Joint Endeavor;

        examining, together with partners, the possible 
        modalities for the elaboration of a political-military 
        framework for PfP operations, building on the current 
        work of the Political-Military Steering Committee;

        enhancing Partner participation in decisionmaking for 
        PfP programs issues;

        increasing regional cooperation within the Partnership 
        provided it remains open to all partners and remains an 
        integral part of the overall PfP;

        expanding the Planning and Review Process; and

        as soon as the Brussels Agreement on the Status of 
        Missions and Representatives of Third States to NATO 
        comes into force, offering partners the opportunity to 
        establish diplomatic missions with NATO.

We have tasked the Council in Permanent Session to ensure 
implementation of these recommendations without delay and to 
continue the work on the enhancement of Partnership for Peace 
and also to review its common funding and resource 
implications, with a view to providing a further report by the 
SLG with recommendations for decisions at the time of the 
Spring Ministerial meeting.

    9. With the rapid growth of our activities under both NACC 
and PfP, we have identified a need for greater coherence in our 
cooperation in a framework which will establish with partners a 
more meaningful and productive cooperative and consultative 
process, building on the elements of NACC and PfP which we and 
our partners deem most valuable. To this end, we have agreed to 
work with partners on the initiative to establish an Atlantic 
Partnership Council (APC) as a single new cooperative 
mechanism, which would form a framework for enhanced efforts in 
both practical cooperation under PfP and an expanded political 
dimension of Partnership. We have accordingly tasked the 
Council in Permanent Session to draw up the modalities for such 
a council, in close coordination with partners, by the time of 
our next meeting.

    10. We affirm our support for the political and economic 
reform process in the Russian Federation. We welcome the 
landmark Presidential elections in Russia. We applaud the 
progress toward a lasting, peaceful settlement of the conflict 
in Chechnya.
    A broad process of integration and cooperation is underway 
in Europe; Russia is a part of it through its membership in the 
OSCE and the Council of Europe and its relationship with NATO 
as well as the European Union and the WEU. The pattern of 
consultations anchored by our regular ``16+1'' discussions, 
provide a firm foundation on which to build. We welcome 
Russia's participation in Partnership for Peace and encourage 
it to take full advantage of the opportunities which the 
Partnership offers.
    We value the close and effective cooperation between Russia 
and NATO in IFOR. This cooperation demonstrates that NATO and 
Russia can collaborate effectively in the construction of 
cooperative security structures in Europe. We appreciate and 
welcome Russia's readiness to contribute to a follow-on 
operation to consolidate peace in Bosnia and Herzegovina. We 
look forward to continuing the experience of working closely 
together, which we believe will have a lasting, positive impact 
on our relationship.
    Today, we reiterate our commitment to a strong, stable, and 
enduring security partnership between NATO and Russia. This 
partnership demonstrates that European security has entered a 
fundamentally new, more promising era. It constitutes an 
important element of the developing European cooperative 
security architecture to which Russia has an essential 
contribution to make. It will further enhance stability and 
security in the Euro-Atlantic area. By the time of the Summit, 
we aim to reach agreement with the Russian Federation on 
arrangements that can deepen and widen the scope of our current 
relationship and provide a framework for its future 
development. We want to ensure that NATO and Russia have a 
strong, flexible means to consult and cooperate as part of our 
evolving relationship. Agreement might be expressed in a 
document or could take the form of a Charter, which could 
encompass:

        the shared principles that will form the basis of our 
        relationship;

        a broad set of areas of practical cooperation in 
        particular in the political, military, economic, 
        environmental, scientific, peacekeeping, armaments, 
        non-proliferation, arms control and civil emergency 
        planning fields;

        mechanisms for regular and ad hoc consultations; and

        mechanisms for military liaison and cooperation.

We therefore task the Council in Permanent Session to develop 
further guidance on these matters on the basis of which the 
Secretary General could explore with Russia the possibility of 
such agreement.

    11. We continue to support Ukraine as it develops as a 
democratic nation and a market economy. The maintenance of 
Ukraine's independence, territorial integrity and sovereignty 
is a crucial factor for stability and security in Europe.
    Ukraine's development of a strong, enduring relationship 
with NATO is an important aspect of the emerging European 
security architecture. We greatly value the active 
participation of Ukraine in the Partnership for Peace and look 
forward to next year's exercise near Lviv. We also value 
Ukraine's cooperation with European institutions such as the EU 
and the WEU. Ukraine has made an important contribution to IFOR 
and UNTAES, and we welcome its commitment to contribute to a 
follow-on operation to consolidate peace in Bosnia and 
Herzegovina.
    We welcome the continued development of our broad 
cooperation beyond PfP. We note with satisfaction the recent 
meeting between the alliance and Ukraine on issues related to 
the proliferation of weapons of mass destruction. We welcome 
the progress made toward establishing a NATO information office 
in Kyiv, and look forward to its opening in the near future. We 
welcome Ukraine's active interest in further enhancing its 
relations with the alliance. We are committed to the 
development in coming months, through high level and other 
consultations, of a distinctive and effective NATO-Ukraine 
relationship, which could be formalized, possibly by the time 
of the Summit, building on the document on enhanced NATO-
Ukraine relations agreed in September 1995, and taking into 
account recent Ukrainian proposals.

    12. We support the Middle East peace process, and urge all 
participants to remain firmly committed to it.
    We reaffirm our conviction that security in Europe is 
closely linked with security and stability in the 
Mediterranean, and that the Mediterranean dimension is 
consequently one of the various components of the European 
security architecture. In this regard, as part of the 
adaptation of the alliance, we will work toward enhancing our 
relations with non-NATO Mediterranean countries through our 
dialog.
    The dialog complements other international efforts, such as 
those undertaken by the Barcelona process, the OSCE and the WEU 
without creating any division of labor. We welcome the report 
of the Council in Permanent Session on the progress of and 
recommendations for future steps to develop the dialog with 
Mediterranean countries through political dialog and other 
activities agreed by the alliance. Egypt, Israel, Jordan, 
Mauritania, Morocco and Tunisia have reiterated their interest 
in the development of our relations. We have decided to enhance 
our Mediterranean dialog in a progressive way and have tasked 
the Council in Permanent Session to report at our next meeting 
on the implementation of the activities foreseen in the report 
as well as on the scope for further development.

    13. We are carrying forward the process of the alliance's 
internal adaptation, with the fundamental objectives of 
ensuring the alliance's military effectiveness, maintaining the 
transatlantic link, and developing the ESDI within NATO. In 
keeping with the decisions taken by NATO Heads of State and 
Government at the 1994 Summit Meeting and by the Ministerial 
meetings in June this year in Berlin and Brussels and with a 
view to preparing for the Summit next year, our primary focus 
has been on three closely linked issues: the development of a 
new command structure for the alliance; the implementation of 
the CJTF concept; and the development of the ESDI within NATO.

    14. We welcome the progress made in the development of the 
future command structure, noting that two structural 
alternatives have been selected by the Military Committee for 
future assessment and subsequent political consideration and 
agree the proposed way ahead. We urge the Council in Permanent 
Session and the Military Committee to complete the work as 
quickly as possible. Once approved, this new command structure 
will help ensure the alliance's military effectiveness so that 
it is able, in the changing security environment facing Europe, 
to perform its traditional mission of collective defense and 
through flexible and agreed procedures to undertake new roles 
in changing circumstances and to provide for increased 
participation by Partner countries. It will constitute a 
renovated, single multinational command structure, reflecting 
the strategic situation in Europe and enabling all Allies to 
participate fully.

    15. We welcome the progress made toward realizing the CJTF 
concept, on the basis of the Overall Politico-Military 
Framework approved by us last June. We direct the Council in 
Permanent Session and the NATO Military Authorities to pursue 
vigorously their work on this concept, bearing in mind its 
importance for future alliance operations, including the 
possible involvement of nations outside the alliance, as well 
as for the development of ESDI.

    16. We are pleased with the progress made in developing the 
appropriate arrangements for ESDI within NATO, as decided at 
the Brussels Summit and at our meeting last June in Berlin. The 
newly created Policy Coordination Group has contributed 
significantly to this process.

    17. We note in particular the steps taken toward 
implementing the concept of separable but not separate 
capabilities:

        the decisions of the Council in Permanent Session on 
        political guidance concerning the elaboration of 
        European command arrangements within NATO able to 
        prepare and conduct WEU-led operations;

        the decisions of the Council in Permanent Session 
        regarding the arrangements for identifying NATO 
        capabilities and assets which might be made available 
        to the WEU for a WEU-led operation;

        the progress to date on arrangements for the release, 
        monitoring and return or recall of alliance assets and 
        capabilities;

        the decision of the Council in Permanent Session with 
        respect to modalities of cooperation with the WEU;

        the progress on work regarding planning and conducting 
        exercising for WEU-led operations, following receipt of 
        illustrative profiles for WEU missions.

    18. We have directed the Council in Permanent Session to 
submit to the Spring 1997 Ministerial meetings a report on the 
adaptation of alliance structures and procedures related to the 
future command structure, on the implementation of the CJTF 
concept, and on further progress with recommendations for 
decisions in the development of ESDI within the alliance.

    19. We welcome the close and intensifying cooperation 
between NATO and the WEU. At their meeting in Ostend on 19 
November 1996, WEU Ministers agreed that it would be valuable 
for WEU to become actively involved in the alliance's defense 
planning process and expressed their readiness to participate. 
Early agreement is now being sought in the WEU on the 
participation of all European Allies in WEU-led operations 
using NATO assets and capabilities, as well as in planning and 
preparing for such operations. This would be a key contribution 
to the development of ESDI within the alliance. We have tasked 
the Council in Permanent Session to develop the NATO-WEU 
relationship further in order to ensure effective cooperation 
in preparing for possible WEU-led operations.

    20. We are pleased with the successful outcome of the OSCE 
Summit in Lisbon and, in particular, the adoption of a 
declaration on security as a result of work on a Common and 
Comprehensive Security Model for the 21st Century. The Lisbon 
Summit has created a security framework in which all European 
states can participate on an equal footing. The Security Model 
adopted in Lisbon is a comprehensive expression of the endeavor 
to strengthen security and stability. It complements the 
mutually reinforcing efforts of NATO and other European and 
transatlantic institutions and organizations. We attach great 
importance to the role of the OSCE as a primary instrument in 
preventive diplomacy, conflict prevention, post-conflict 
rehabilitation and regional security cooperation, as well as to 
the enhancement of its operational capabilities to carry out 
these tasks. We believe the OSCE, as the only pan-European 
security organization, has an essential role to play in 
European peace and stability. We are committed to supporting 
its comprehensive approach to security. The principles and 
commitments on which the OSCE is built provide the standards 
for the development of a comprehensive and cooperative European 
security structure.
    We commend the OSCE for its essential contribution to the 
implementation of civil aspects of the Peace Agreement for 
Bosnia and Herzegovina, particularly in supervising the 
preparation and conduct of the elections, in promoting and 
monitoring human rights and in overseeing the implementation of 
agreed confidence--and security--building measures and sub-
regional arms control agreements. The OSCE thereby demonstrates 
its central role in contributing to regional stability and 
security.
    We are pleased with the support given by IFOR to the OSCE 
in carrying out its tasks. The cooperation between OSCE and 
IFOR is a good example of our concept of mutually reinforcing 
organizations. The practical assistance given by NATO to the 
OSCE in helping to establish measures to verify the confidence-
building and arms control agreements of the Dayton Accords 
testifies to a growing cooperation between NATO and the OSCE. 
We reiterate our readiness to further develop the cooperation 
between the two organizations. The democratic and economic 
development, independence, sovereignty and territorial 
integrity of all states are essential factors for stability and 
security in the Euro-Atlantic area. We commend the OSCE for its 
mediation efforts in a number of regional conflicts through its 
various missions, and recognize the valuable work of the High 
Commissioner on National Minorities. We support the efforts of 
the Minsk Group to achieve a political settlement of the 
conflict in and around Nagorno-Karabakh.
    The OSCE acquis in the field of disarmament, arms control, 
and confidence-and security-building measures continues to 
contribute significantly to political and military stability. 
We consider the full implementation, the further development, 
and if necessary, the adaptation of these measures to be 
indispensable elements in our effort to further enhance the 
European security architecture. We welcome the recent adoption 
by the Forum for Security Cooperation of the Framework for Arms 
Control and its Future Agenda.

    21. The CFE Treaty is a fundamental cornerstone of security 
and stability for all in the Euro-Atlantic area. We are 
committed to maintain and strengthen it. Consistent with our 
broader goal of enhancing political cooperation and military 
stability in a Europe without dividing lines, we welcome the 
decision of the 30 States Parties to the CFE Treaty on 1 
December 1996 in Lisbon to launch negotiations to adapt the 
Treaty to the changing security environment in Europe. We look 
forward to beginning negotiations in the Joint Consultative 
Group in Vienna in January 1997 on the basis of the scope and 
parameters (Terms of Reference) document agreed in Lisbon.
    Our common goal is to enhance security for all States 
Parties, irrespective of whether they belong to an alliance, 
and preserve their right to choose and change their security 
arrangements. Within the broader political context of enhanced 
security for all, this process should strengthen the 
cooperative pattern of relationships between States Parties, 
based on mutual confidence, transparency, stability and 
predictability. Committed, like the other States Parties, to 
adapting the Treaty by developing mechanisms which will enhance 
the Treaty's viability and effectiveness, we will pursue steps 
to review the Treaty's group structure, to adapt the Treaty 
system of limitations and to enhance its verification and 
information provisions. To that end, the members of the 
alliance will develop and table proposals for the negotiations 
in Vienna.
    We reaffirm our support for the CFE Flank Agreement, 
reached at this year's Review Conference in Vienna. We urge all 
States Parties who have not yet done so to approve this 
Agreement before the end of the extended provisional 
application period.
    We will play our full part in the intensive continuing 
efforts directed at resolving outstanding implementation 
issues.
    The members of the alliance reaffirm the commitment made at 
Lisbon to exercise restraint during the period of negotiations 
as foreseen in the document in relation to the current postures 
and capabilities of their conventional armed forces--in 
particular, with respect to their levels of forces and 
deployments--in the Treaty's area of application. As decided in 
Lisbon, this commitment is without prejudice to the outcome of 
the negotiations, or to voluntary decisions by the individual 
States Parties to reduce their force levels or deployments, or 
to their legitimate security interests. We believe that the CFE 
Treaty must continue to play a key role in ensuring military 
stability into the 21st century, and are committed to adapting 
it expeditiously in order to take account of new security 
challenges.

    22. We emphasize the importance of the START Treaties for 
international stability and security. We note with satisfaction 
the progress made by the United States and the Russian 
Federation in the implementation of START I. We urge the 
Russian Federation to follow the United States in ratifying the 
START II Treaty. We welcome the successful conclusion and 
signing by the great majority of U.N. Members of the 
Comprehensive Test Ban Treaty, and we urge all other nations to 
sign this important international arms control agreement. We 
look forward to the early start of negotiations on a Fissile 
Material Cut-Off Treaty.
    We are pleased that the Chemical Weapons Convention will 
soon enter into force and we look forward to its early 
implementation. We welcome the fact that States Parties to the 
Biological and Toxin Weapons Convention have at the Fourth 
Review Conference in Geneva in December 1996 again solemnly 
declared their recognition that effective verification could 
reinforce the Convention.
    Recognising the heightened concern of the international 
community of the suffering and casualties caused by anti-
personnel mines, we support the vigorous pursuit of an 
effective, legally binding international agreement to ban the 
use, stockpiling, production and transfer of antipersonnel 
mines and, as an important step to this end, support the early 
ratification of the revised Second Protocol of the Convention 
on Inhumane Weapons.
    We urge the early ratification of the Treaty on Open Skies 
by those states which have not already ratified.

    23. Proliferation of nuclear, biological and chemical 
weapons and their delivery means continues to be a matter of 
serious concern to us. Progress in expanding and intensifying 
NATO's political and defense efforts against proliferation, as 
directed by NATO Heads of State and Government in January 1994, 
is an integral part of NATO's adaptation to the new security 
environment. These efforts also contribute to NATO's ability to 
conduct new roles and missions. We remain committed to 
preventing proliferation in the first place, or, if it occurs, 
to reversing it through diplomatic means. The alliance is 
improving its capabilities to address the risks posed by 
proliferation. We welcome further consultations and cooperation 
with Partner countries to address the common security risks 
posed by proliferation. We note with satisfaction the report of 
the alliance's Joint Committee on Proliferation on the 
activities of the Senior Political-Military Group on 
Proliferation and the Senior Defense Group on Proliferation and 
direct them to continue their vital efforts.
    We attach particular importance to a solid preparation of 
the first preparatory committee of the strengthened review 
process of the Nuclear Non-Proliferation Treaty (NPT), 
scheduled for April 1997. This process will significantly 
contribute to the further strengthening of the NPT, which is 
the cornerstone of the global non-proliferation system.

    24. We reaffirm our commitment to the alliance's common-
funded programs.
    We note with appreciation the progress made in moving 
existing resources to the highest priority programs, such as 
Partnership for Peace and the support of enhanced information 
activities in Moscow and Kyiv. We have directed the Council in 
Permanent Session to keep under review the allocation of 
resources in order to ensure their optimal use. We have also 
directed the Council in Permanent Session to identify the 
implications of adaptation for NATO's common-funded budgets and 
to make appropriate recommendations for dealing with these.

    25. We continue to support all efforts to combat terrorism, 
which constitutes a serious threat to peace, security and 
stability.

    26. The Spring 1997 meeting of the North Atlantic Council 
in Ministerial Session will be held in Sintra, Portugal, on 29 
May.

                              ----------                              


       F. Statement by the North Atlantic Council, March 14, 1997

                             Press Release

                                 (97)27

    At its meeting today, the North Atlantic Council, under the 
chairmanship of the Secretary General, Mr. Javier Solana, 
decided to issue the following Unilateral Statement:

        ``In the current and foreseeable security environment, 
        the alliance will carry out its collective defense and 
        other missions by ensuring the necessary 
        Interoperability, integration and capability for 
        reinforcement rather than by additional permanent 
        stationing of substantial combat forces.''

                              ----------                              


              G. NATO Enlargement Facilitation Act of 1996

 Making Omnibus Consolidated Appropriations for Fiscal Year 1997 Title 
             VI--NATO Enlargement Facilitation Act of 1996

                         sec. 601. short title.

    This title may be cited as the `NATO Enlargement 
Facilitation Act of 1996'.

                          sec. 602. findings.

    The Congress makes the following findings:
    (1) Since 1949, the North Atlantic Treaty Organization 
(NATO) has played an essential role in guaranteeing the 
security, freedom, and prosperity of the United States and its 
partners in the alliance.
    (2) The NATO alliance is, and has been since its inception, 
purely defensive in character, and it poses no threat to any 
nation. The enlargement of the NATO alliance to include as full 
and equal members emerging democracies in Central and Eastern 
Europe will serve to reinforce stability and security in Europe 
by fostering their integration into the structures which have 
created and sustained peace in Europe since 1945. Their 
admission into NATO will not threaten any nation. America's 
security, freedom, and prosperity remain linked to the security 
of the countries of Europe.
    (3) The sustained commitment of the member countries of 
NATO to a mutual defense has made possible the democratic 
transformation of Central and Eastern Europe. Members of the 
alliance can and should play a critical role in addressing the 
security challenges of the post-cold war era and in creating 
the stable environment needed for those emerging democracies in 
Central and Eastern Europe to successfully complete political 
and economic transformation.
    (4) The United States continues to regard the political 
independence and territorial integrity of all emerging 
democracies in Central and Eastern Europe as vital to European 
peace and security.
    (5) The active involvement by the countries of Central and 
Eastern Europe has made the Partnership for Peace program an 
important forum to foster cooperation between NATO and those 
countries seeking NATO membership.
    (6) NATO has enlarged its membership on 3 different 
occasions since 1949.
    (7) Congress supports the admission of qualified new 
members to NATO and the European Union at an early date and has 
sought to facilitate the admission of qualified new members 
into NATO.
    (8) Lasting security and stability in Europe requires not 
only the military integration of emerging democracies in 
Central and Eastern Europe into existing European structures, 
but also the eventual economic and political integration of 
these countries into existing European structures.
    (9) As new members of NATO assume the responsibilities of 
alliance membership, the costs of maintaining stability in 
Europe should be shared more widely. Facilitation of the 
enlargement process will require current members of NATO, and 
the United States in particular, to demonstrate the political 
will needed to build on successful ongoing programs such as the 
Warsaw Initiative and the Partnership for Peace by making 
available the resources necessary to supplement efforts 
prospective new members are themselves undertaking.
    (10) New members will be full members of the alliance, 
enjoying all rights and assuming all the obligations under the 
North Atlantic Treaty, signed at Washington on April 4, 1949 
(hereafter in this Act referred to as the ``Washington 
Treaty'').
    (11) In order to assist emerging democracies in Central and 
Eastern Europe that have expressed interest in joining NATO to 
be prepared to assume the responsibilities of NATO membership, 
the United States should encourage and support efforts by such 
countries to develop force structures and force modernization 
priorities that will enable such countries to contribute to the 
full range of NATO missions, including, most importantly, 
territorial defense of the alliance.
    (12) Cooperative regional peacekeeping initiatives 
involving emerging democracies in Central and Eastern Europe 
that have expressed interest in joining NATO, such as the 
Baltic Peacekeeping Battalion, the Polish-Lithuanian Joint 
Peacekeeping Force, and the Polish-Ukrainian Peacekeeping 
Force, can make an important contribution to European peace and 
security and international peacekeeping efforts, can assist 
those countries preparing to assume the responsibilities of 
possible NATO membership, and accordingly should receive 
appropriate support from the United States.
    (13) NATO remains the only multilateral security 
organization capable of conducting effective military 
operations and preserving security and stability of the Euro-
Atlantic region.
    (14) NATO is an important diplomatic forum and has played a 
positive role in defusing tensions between members of the 
alliance and, as a result, no military action has occurred 
between two alliance member states since the inception of NATO 
in 1949.
    (15) The admission to NATO of emerging democracies in 
Central and Eastern Europe which are found to be in a position 
to further the principles of the Washington Treaty would 
contribute to international peace and enhance the security of 
the region. Countries which have become democracies and 
established market economies, which practice good neighborly 
relations, and which have established effective democratic 
civilian control over their defense establishments and attained 
a degree of Interoperability with NATO, should be evaluated for 
their potential to further the principles of the Washington 
Treaty.
    (16) Democratic civilian control of defense forces is an 
essential element in the process of preparation for those 
states interested in possible NATO membership.
    (17) Protection and promotion of fundamental freedoms and 
human rights is an integral aspect of genuine security, and in 
evaluating requests for membership in NATO, the human rights 
records of the emerging democracies in Central and Eastern 
Europe should be evaluated according to their commitments to 
fulfill in good faith the human rights obligations of the 
Charter of the United Nations, the principles of the Universal 
Declaration on Human Rights, and the Helsinki Final Act.
    (18) A number of Central and Eastern European countries 
have expressed interest in NATO membership, and have taken 
concrete steps to demonstrate this commitment, including their 
participation in Partnership for Peace activities.
    (19) The Caucasus region remains important geographically 
and politically to the future security of Central Europe. As 
NATO proceeds with the process of enlargement, the United 
States and NATO should continue to examine means to strengthen 
the sovereignty and enhance the security of United Nations 
recognized countries in that region.
    (20) In recognition that not all countries which have 
requested membership in NATO will necessarily qualify at the 
same pace, the accession date for each new member will vary.
    (21) The provision of additional NATO transition assistance 
should include those emerging democracies most ready for closer 
ties with NATO and should be designed to assist other countries 
meeting specified criteria of eligibility to move forward 
toward eventual NATO membership.
    (22) The Congress of the United States finds in particular 
that Poland, Hungary, and the Czech Republic have made 
significant progress toward achieving the criteria set forth in 
section 203(d)(3) of the NATO Participation Act of 1994 and 
should be eligible for the additional assistance described in 
this Act.
    (23) The evaluation of future membership in NATO for 
emerging democracies in Central and Eastern Europe should be 
based on the progress of those nations in meeting criteria for 
NATO membership, which require enhancement of NATO's security 
and the approval of all NATO members.
    (a) IN GENERAL-The following countries are designated as 
eligible to receive assistance under the program established 
under section 203(a) of the NATO Participation Act of 1994 and 
shall be deemed to have been so designated pursuant to section 
203(d)(1) of such Act: Poland, Hungary, and the Czech Republic.
    (b) DESIGNATION OF SLOVENIA-Effective 90 days after the 
date of enactment of this Act, Slovenia is designated as 
eligible to receive assistance under the program established 
under section 203(a) of the NATO Participation Act of 1994, and 
shall be deemed to have been so designated pursuant to section 
203(d) of such Act, unless the President certifies to Congress 
prior to such effective date that Slovenia fails to meet the 
criteria under section 203(d)(3) of such Act.
    (c) DESIGNATION OF OTHER COUNTRIES--The President shall 
designate other emerging democracies in Central and Eastern 
Europe as eligible to receive assistance under the program 
established under section 203(a) of such Act if such 
countries--

(1) have expressed a clear desire to join NATO;
(2) have begun an individualized dialog with NATO in 
        preparation for accession;
(3) are strategically significant to an effective NATO defense; 
        and
(4) meet the other criteria outlined in section 203(d)(3) of 
        the NATO Participation Act of 1994 (title II of Public 
        Law 103-447; 22 U.S.C. 1928 note).

    (d) RULE OF CONSTRUCTION--Nothing in this section precludes 
the designation by the President of Estonia, Latvia, Lithuania, 
Romania, Slovakia, Bulgaria, Albania, Moldova, Ukraine, or any 
other emerging democracy in Central and Eastern Europe pursuant 
to section 203(d) of the NATO Participation Act of 1994 as 
eligible to receive assistance under the program established 
under section 203(a) of such Act.

    sec. 607. authorization of appropriations for nato enlargement 
                              assistance.

    (a) IN GENERAL--There are authorized to be appropriated 
$60,000,000 for fiscal year 1997 for the program established 
under section 203(a) of the NATO Participation Act of 1994.
    (b) AVAILABILITY--Of the funds authorized to be 
appropriated by subsection
    (a)--

        (1) not less than $20,000,000 shall be available for 
        the cost, as defined in section 502(5) of the Credit 
        Reform Act of 1990, of direct loans pursuant to the 
        authority of section 203(c)(4) of the NATO 
        Participation Act of 1994 (relating to the ``Foreign 
        Military Financing Program'');

        (2) not less than $30,000,000 shall be available for 
        assistance on a grant basis pursuant to the authority 
        of section 203(c)(4) of the NATO Participation Act of 
        1994 (relating to the ``Foreign Military Financing 
        Program''); and

        (3) not more than $10,000,000 shall be available for 
        assistance pursuant to the authority of section 
        203(c)(3) of the NATO Participation Act of 1994 
        (relating to international military education and 
        training).

    (c) RULE OF CONSTRUCTION--Amounts authorized to be 
appropriated under this section are authorized to be 
appropriated in addition to such amounts as otherwise may be 
available for such purposes.

   sec. 608. regional airspace initiative and partnership for peace 
                     information management system.

    (a) IN GENERAL--To the extent provided in advance in 
appropriations acts for such purposes, funds described in 
subsection (b) are authorized to be made available to support 
the implementation of the Regional Airspace Initiative and the 
Partnership for Peace Information Management System,including--

        (1) the procurement of items in support of these 
        programs; and

        (2) the transfer of such items to countries 
        participating in these programs.

    (b) FUNDS DESCRIBED--Funds described in this subsection are 
funds that are available--

        (1) during any fiscal year under the NATO Participation 
        Act of 1994 with respect to countries eligible for 
        assistance under that Act; or

        (2) during fiscal year 1997 under any Act to carry out 
        the Warsaw Initiative.

                   sec. 609. excess defense articles.

    (a) PRIORITY DELIVERY--Notwithstanding any other provision 
of law, the delivery of excess defense articles under the 
authority of section 203(c) (1) and (2) of the NATO 
Participation Act of 1994 and section 516 of the Foreign 
Assistance Act of 1961 shall be given priority to the maximum 
extent feasible over the delivery of such excess defense 
articles to all other countries except those countries referred 
to in section 541 of the Foreign Operations, Export Financing, 
and Related Programs Appropriations Act, 1995 (Public Law 103-
306; 108 Stat. 1640).
    (b) COOPERATIVE REGIONAL PEACEKEEPING INITIATIVES--The 
Congress encourages the President to provide excess defense 
articles and other appropriate assistance to cooperative 
regional peacekeeping initiatives involving emerging 
democracies in Central and Eastern Europe that have expressed 
an interest in joining NATO in order to enhance their ability 
to contribute to European peace and security and international 
peacekeeping efforts.

             sec. 610. modernization of defense capability.

    The Congress endorses efforts by the United States to 
modernize the defense capability of Poland, Hungary, the Czech 
Republic, Slovenia, and any other countries designated by the 
President pursuant to section 203(d) of the NATO Participation 
Act of 1994, by exploring with such countries options for the 
sale or lease to such countries of weapons systems compatible 
with those used by NATO members, including air defense systems, 
advanced fighter aircraft, and telecommunications 
infrastructure.

                 sec. 611. termination of eligibility.

    (a) TERMINATION OF ELIGIBILITY--The eligibility of a 
country designated pursuant to subsection (a) or (b) of section 
606 or pursuant to section 203(d) of the NATO Participation Act 
of 1994 may be terminated upon a determination by the President 
that such country does not meet the criteria set forth in 
section 203(d)(3) of the NATO Participation Act of 1994.
    (b) NOTIFICATION--At least 15 days before terminating the 
eligibility of any country pursuant to subsection (a), the 
President shall notify the congressional committees specified 
in section 634A of the Foreign Assistance Act of 1961 in 
accordance with the procedures applicable to reprogramming 
notifications under that section.

     sec. 612. conforming amendments to the nato participation act.

    The NATO Participation Act of 1994 (title II of Public Law 
103-447; 22 U.S.C. 1928 note) is amended in sections 203(a), 
203(d)(1), and 203(d)(2) by striking ``countries emerging from 
Communist domination'' each place it appears and inserting 
``emerging democracies in Central and Eastern Europe''.

                              ----------                              


              H. Selected Bibliography on NATO Enlargement

    Albright, Madeleine, ``Why Bigger is Better,'' The 
Economist, February 15, 1997, pp. 21-23.
    Albright Press Conference at NATO Headquarters, Transcript, 
February 18, 1997.
    ``Americans on Expanding NATO: a Study of U.S. Public 
Attitudes,'' by Kull, Steven. Program on International Policy 
Attitudes, University of Maryland, February 13, 1997.
    Blackwill, Robert; Horelick, Arnold; and Nunn, Sam, 
``Stopping the Decline in U.S.-Russian Relations,'' RAND Paper 
P-7986, December 1996.
    Blackwill, Robert; ``Russian Policy toward the CFE 
Regime,'' Paper commissioned for the Center for European 
Strategy Research, 25 November 1996.
    Central European Defense Industries and NATO Enlargement: 
Issues for U.S. Policy, by Szayna, Thomas S. RAND Corporation. 
January 1996. 32 pages.
    Clinton, President William J. Remarks to the Community in 
Detroit, Michigan, October 22, 1996 (call for ``next historic 
step'' in evolution of NATO). Weekly Compilation of 
Presidential Documents, Vol. 32, No. 43, pp. 2137-2144.
    The Costs of Expanding the NATO alliance. Congressional 
Budget Office. March 1996. 71 pages.
    The Defense Program Question: The Military and Budgetary 
Dimension of NATO Expansion, by Kugler, Richard L. RAND 
Corporation. April 24, 1995.
    ``Don't Isolate Us: a Russian View of NATO Expansion,'' by 
Pushkov, Alexei K. National Interest, No. 47, Spring 1997: pp. 
58-63.
    ``Enlarging NATO: the Russia Factor,'' by Kugler, Richard 
L.; Kozintseva, Marianna V. Santa Monica, CA, Rand Corporation, 
1996. 267 pages.
    The European Defense Pillar of the Transatlantic Alliance, 
ed. by Grapin, Jacqueline. Washington, DC, The European 
Institute. 1997. 52 pages.
    Final Communique of the NAC Ministerial Meeting, December 
10, 1996.
    Hoffman, David, ``Few Russians Worry About Bigger NATO,'' 
Washington Post, February 7, 1997.
    ``Military Dimensions of NATO Enlargement,'' Address by 
Naumann, General Klaus, to the North Atlantic Assembly, 16 
February 1997.
    NATO and Bosnia: A Looming Transatlantic Debate, by Sloan, 
Stanley R. Congressional Research Service, Library of Congress. 
CRS Report 97-480F. April 22, 1997. 6 pages.
    ``NATO and the Have-nots; Reassurance after Enlargement,'' 
by Asmus, Ronald D.; Larrabee, F. Stephen. Foreign Affairs, v. 
75, Nov.-Dec. 1996: pp. 13-20.
    NATO: Congress Addresses Expansion of the Alliance, by 
Gallis, Paul. Congressional Research Service. Library of 
Congress. CRS Issue Brief 95076, updated regularly.
    NATO Enlargement: NATO and U.S. Actions Taken to Facilitate 
Enlargement. U.S. General Accounting Office. May 6, 1996. 31 
pages.
    ``NATO Enlargement: What's the Rush?'' by Garfinkle, Adam. 
National Interest, No. 46, Winter 1996-97: pp. 102-111.
    NATO Enlargement and Russia, by Woehrel, Steven J. 
Congressional Research Service, Library of Congress. CRS Report 
97-477F. April 21, 1997. 6 pages.
    NATO Enlargement and the Former European Neutrals, by 
Sloan, Stanley R. Congressional Research Service, Library of 
Congress. CRS Report 97-249F. February 18, 1997. 6 pages.
    ``NATO Enlargement's American Hurdle; the Perils of 
Misjudging our Political Will,'' by Rosner, Jeremy D. Foreign 
Affairs, v. 75, July Aug. 1996: pp. 9-16.
    NATO Expansion: Senate Advice and Consent, by Ackerman, 
David M. Congressional Research Service. Library of Congress. 
CRS Report 97-170A. February 4, 1997.
    NATO Expansion: Time to Reconsider, by the British American 
Security Information Council and the Centre for European 
Security and Disarmament. November 25, 1996. 14 pages.
    NATO Handbook, 1996, NATO Office of Information and Press, 
Brussels.
    NATO: July 1997 Madrid Summit Agenda, by Sloan, Stanley R. 
Congressional Research Service. Library of Congress. CRS Report 
97-443F. April 10, 1997. 6 pages.
    Prague, NATO, and European Security, by Blank, Stephen J. 
Carlisle Barracks, PA., Strategic Studies Institute, U.S. Army 
War College, 1996. 37 pages.
    Report to the Congress on the Enlargement of the North 
Atlantic Treaty Organization: Rationale, Benefits, Costs and 
Implications. Bureau of European and Canadian Affairs. U.S. 
Department of State. February 24, 1997.
    Report to the U.S. Congress by the Secretary of Defense on 
Allied Contributions to the Common Defense. U.S. Department of 
Defense. March 1997.
    Should NATO Expand? Report of an Independent Task Force. 
New York, Council on Foreign Relations, 1995. 33 pages.
    ``Small is Beautiful: the Case Against the Enlargement of 
NATO.'' RUSI (Journal of the Royal United Services Institute 
for Defense Studies), V. 141, August 1996. Pp. 58-64.
    Study on NATO Enlargement, North Atlantic Treaty 
Organization, September 1995.
    Study on NATO Enlargement: Destabilizing Europe, by 
Butcher, Martin; Kokkinides, Tasos; Plesch, Daniel. British 
American Security Information Council and Centre for European 
Security and Disarmament. 1997. 18 pages.
    U.S. Military Strategy in the 21st Century, by Blechman, 
Barry M.; Nagy, Paul N. Arlington, VA, 1997. 107 pages.
    U.S.-Russia Summit, March 20-21, 1997: Outcome and 
Implications, by Nichol, James P. Congressional Research 
Service. Library of Congress. CRS Report 97-419F. April 3, 
1997. 6 pages.
    ``What Will NATO Enlargement Cost?'' by Asmus, Ronald; 
Kugler, Richard; and Larrabee, F. Stephen. Survival, Autumn 
1996, pp. 5-26.
    Will NATO Go East? The Debate Over Enlarging the Atlantic 
Alliance, ed. By Haglund, David G. Kingston, Ont., Canada, 
1996. 234 pages.

                              ----------                              


        I. Members of NATO and the Partnership for peace Program



           Prepared Statement of Senator Russell D. Feingold
    Thank you, Mr. Chairman. Welcome, Secretary Albright.
    As you know, this is the first of five scheduled hearings on the 
question of the proposed expansion of the North Atlantic Treaty 
Organization, arguably one of America's most important post-war 
alliances.
    Today, we have the honor of hearing the testimony of our esteemed 
Secretary of State who will give us an overview of the Administration's 
strategic rationale behind the decision to support NATO's invitation to 
three potential new members. I am sure she will explain this in the 
clear, eloquent fashion that is typical of her style, and I look 
forward to hearing from her.
    Throughout the last half of this century, NATO has been a critical 
force in maintaining peace and security in Europe. Following the 
collapse of the Soviet Union, the members of the alliance faced a new 
challenge: what would be the role of NATO in the new world order?
    In September 1995, NATO members began to investigate in earnest the 
possibility of expanding to include former Soviet satellites, and 
issued guidelines for potential new members. These guidelines include 
an established democracy, economic reforms, respect for human rights, 
good relations with neighboring countries, a civilian-controlled 
military, and ability to contribute to the security interests of NATO.
    For the time being, the United States and our NATO partners have 
determined that three countries meet this criteria: Poland, Hungary, 
and the Czech Republic, as was announced in July of this year. After 
the alliance formalizes the process in December, a ``protocol of 
accession'' will have to be ratified by each member Parliament.
    Today, the Senate begins its constitutional responsibility to 
provide advice and consent to the President on the proposed amendment 
to the historic North Atlantic Treaty of 1949, the protocol of 
accession to include these three new members. Although this will be the 
fourth time the Senate will consider enlarging the alliance, this 
decision is likely to impact U.S. foreign policy for years to come.
    Clearly, we are now at the beginning of an historic debate.
    And, like in any decision that will have such weighty consequences, 
we will have very serious questions to ask. Many members of this 
Committee, or of the Senate at large, have specific concerns about the 
three countries that were invited to join the alliance. Was three the 
right number? What happens to the nations that were left out? Will the 
Baltic countries and the Ukraine face new dangers?
    Other members may worry about the economic consequences of NATO 
expansion. Will the economic benefits that new NATO members receive 
cause unnecessary conflict with those countries that did not qualify 
for membership? How will the United States react to such conflict?
    Let me take this opportunity to express my concern, and the concern 
of my constituents, that the people of Eastern Europe must never again 
be subjected to the kind of tyranny they endured under the Soviet 
regime. I understand the aspirations of these countries to protect 
their new-found freedom and I sympathize with those in Eastern Europe 
who feel an expanded NATO will offer a critical firewall against any 
new threat to peace and democracy. I am hopeful that I will be able to 
support the enlargement of NATO as a way to insure there will be no 
return to the domination of the past.
    I do have some concerns about the specifics that I know are shared 
by many other Members of Congress, about the commitment -- financial 
and otherwise -- the United States will undertake as it pursues 
enlargement of the alliance.
    How much is this really going to cost us?
    There have been at least three major studies conducted to assess 
the potential costs of NATO expansion by highly respected governmental 
and non-governmental entities. Yet each of these analyses makes 
different assumptions about what types of costs actually can be 
attributed to expansion, per se, and different assumptions about the 
potential threats that NATO will face over the next decade. Depending 
on which study you read, the U.S. share of the costs of NATO expansion 
could be anywhere form $2 billion to $7 billion. What that means is we 
could be up or down $5 billion depending on whose assumptions you 
believe.
    Now I know it is extremely difficult to make an accurate assessment 
of costs when there are probably hundreds of variables that we can not 
control. But we are talking about a commitment on the part of the U.S. 
taxpayer to support a military alliance against a somewhat undefined 
threat, and $5 billion is a lot of money.
    I recognize that these higher figures assume a resurgent Russian 
threat, an assumption that I hope is as unlikely as I think it is. But 
even if you remove this assumption, we are still playing with numbers 
that differ by hundreds of millions of dollars.
    In the same year that we have finally passed legislation that will 
help us get to balanced budget, what are the implications of assuming a 
new commitment where our cost estimates may be off by hundreds of 
millions of dollars?
    As I have indicated, this is certainly not to say that I oppose the 
plan for expansion that the Secretary will present to us today. What I 
am saying is that I have some serious concerns about the extent of the 
commitment that we are making here, and I hope the Secretary will be 
able to respond to some of these concerns today. I also look forward to 
participating in the series of hearings that the Chairman has planned, 
during which I know we will pursue this issue of cost and burden-
sharing more thoroughly than may be possible at this hearing.
    Clearly, this issue is enormously important for the President, for 
the Congress, for the American public, and for the people who suffered 
under the Soviet yolk for so long. I am honored to be able to 
participate in this debate as a member of this Committee and I look 
forward to hearing the testimony of Secretary Albright.

                               __________

                 United States Department of State,
                                    Washington, DC.  20520,
                                                 November 25, 1997.
The Hon. Jesse Helms,
Chairman,
Committee on Foreign Relations,
United States Senate.

    Dear Mr. Chairman: Following the October 7, 1997 hearing at which 
Secretary of State Madeleine Albright testified, additional questions 
were submitted for the record. Please find enclosed the responses to 
those questions.
    If we can be of further assistance to you, please do not hesitate 
to contact us.
      Sincerely,
                                    Barbara Larkin,
                                       Assistant Secretary,
                                               Legislative Affairs.

                               __________

  Responses of Secretary Albright to Questions Asked by Senator Helms
    Question 1. Secretary Albright, in your testimony you indicated 
that from the Founding Act, and through the Permanent Joint Council 
(PJC), that Russia will have a voice but not a veto in NATO decision 
making. What reciprocal access will NATO have in Moscow, with the 
Russian government and the Russian military General Staff, that will 
ensure that NATO has a reciprocal voice but not a veto in Russian 
political-military decision making?
    Answer. The Founding Act, and the Permanent Joint Council it 
created, are based on the principles of reciprocity and transparency. 
The PJC is very much a two-way street: it gives Russia a voice on 
European security issues in which it has a legitimate interest; but it 
does not give Russia a role in the decision-making of North Atlantic 
Council or a veto over NATO's decision making or actions. At the same 
time, it provides a forum through which NATO has a voice on Russian 
policies/issues that affect the Alliance's broader security interests 
in Europe; but neither does NATO receive a veto over Russian decision 
making. It is a forum where both sides can voice their views on 
relevant security issues.
     The PJC also provides NATO the means to insist upon the same 
degree of transparency and candor from Russia regarding its own 
policies, and an opportunity for the Alliance to formally offer its 
views on those policies.
    The Founding Act also provides for creation of reciprocal military 
liaison missions at respective headquarters. Just as we expect Russia 
to establish a mission at SHAPE, so NATO expects to establish a mission 
at the Russian military's General Staff Headquarters or the Russian 
Ministry of Defense. Formal arrangements for the reciprocal military 
missions have not been agreed.
    Question 2. What is the universe of issues which NATO has agreed to 
discuss in the PJC? (Please submit in unclassified form.)
    Answer. Section III of the Founding Act lists a menu of issues on 
which NATO and Russia can consult and strive to cooperate, and where 
appropriate, act together. NATO is not required to discuss at once all 
the issues for consultation provided for by the Founding Act or to 
begin work on them in the PJC. In fact, the initial NATO-Russia work 
program is limited to only some of these issues. Holding consultations 
does not mean soliciting Russian input prior to NATO deciding its own 
policy. On matters of NATO policy, NATO will decide its own position 
among its own members before consulting with Russia. NATO also remains 
free to make its own independent decisions. Possible areas for 
consultation include:

   issues of common interest related to security and stability 
        in the Euro-Atlantic area or to concrete crises, including the 
        contribution of NATO and Russia to security and stability in 
        this area;
   conflict prevention, including preventive diplomacy, crisis 
        management and conflict resolution taking into account the role 
        and responsibility of the UN and the OSCE and the work of these 
        organizations in these fields;
   joint operations, including peace keeping operations, on a 
        case-by-case basis, under the authority of the UN Security 
        Council or the responsibility of the OSCE, and if Combined 
        Joint Task Forces (CJTF) are used in such cases, participation 
        in them at an early stage;
   participation of Russia in Euro-Atlantic Partnership Council 
        and Partnership for Peace:
   exchange of information and consultation on strategy, 
        defense policy, the military doctrines of NATO and Russia, and 
        budgets and infrastructure development programs;
   arms control issues;
   nuclear safety issues, across their full spectrum;
   preventing the proliferation of nuclear, biological and 
        chemical weapons, and their delivery means, combating nuclear 
        trafficking and strengthening cooperation in specific arms 
        control areas, including political and defense aspects of 
        proliferation;
   possible cooperation on Theater Missile Defense;
   enhanced regional air traffic safety, increased air traffic 
        capacity and reciprocal exchanges, as appropriate, to promote 
        confidence through increased measures of transparency and 
        exchanges of information in relation to air defense and related 
        aspects of airspace management/control. This will include 
        exploring possible cooperation on appropriate air defense 
        related matters.
   increasing transparency, predictability and mutual 
        confidence regarding the size and roles of the conventional 
        forces of Member States of NATO and Russia;
   reciprocal information exchanges, as appropriate, on nuclear 
        weapons issues, including doctrines and strategy of NATO-and 
        Russia;
   coordinating a program of expanded cooperation between 
        respective military establishments;
   pursing possible armaments-related cooperation through 
        association of Russia with NATO's Conference of National 
        Armaments Directors;
   conversion of defense industries;
   developing mutually agreed cooperative projects in defense-
        related economic, environmental and scientific fields;
   conducting joint initiatives and exercises in civil 
        emergency preparedness and disaster relief;
   combatting terrorism and drug trafficking;
   improving public understanding of evolving relations between 
        NATO and Russia, including the establishment of a NATO 
        documentation center or information office in Moscow.

    Question 3. What are the agreed rules and procedures for 
establishing an agenda, conducting meetings, and implementing any 
action from the PJC? (Please submit in unclassified form.)
    Answer. The PJC rules of procedure is a NATO classified document. 
The U.S. cannot unilaterally declassify the document or distribute its 
contents in unclassified form. Consistent with the terms of reference 
for the Senate NATO Observer Group (SNOG), the Department made 
available the classified version of these rules to the SNOG. The 
Department of State would be happy to provide a classified briefing in 
a secure room on Capitol Hill for interested Members of Congress and 
their staff.
    Question 4. If Russia brings up an issue that NATO has decided is 
not appropriate for discussion in the PJC, how will that issue be 
resolved?
    Answer. If NATO decides not to address an issue within the PJC, it 
will not be addressed, let alone resolved, within that forum. If Russia 
proposes or raises an issue that NATO has decided it will not discuss, 
within the PJC or that is not subject to discussion in the PJC (e.g. 
internal Alliance matters, such as enlargement), the Secretary General 
and Allies will apprise the Russian representatives either prior to or 
during a PJC meeting that the Alliance will not agree to discuss the 
issue. If the issue is the purview of another forum or negotiating 
body, such as the OSCE or one of its constituent elements, NATO will 
suggest that Russia raise the issue in that forum.
    Question 5. How are financial contributions shared between NATO and 
Russia to pay for the Permanent Joint Council?
    Answer. NATO and Russia have agreed to share all costs associated 
with the Founding Act, including operation of the Permanent Joint 
Council and activities conducted under its auspices. NATO and Russia 
are currently engaged in working out the detailed arrangements for 
determining and distributing those costs, including how to evaluate 
such in-kind contributions as interpreting services.
    U.S. policy is to ensure that costs are shared equitably between 
NATO and Russia. Russia's willingness to assume an equitable share of 
the costs is one of the factors NATO will consider in assessing the 
degree of Russian interest in and commitment to developing the NATO-
Russia relationship.
    Question 6. Please describe the location, composition, and purpose 
of any delegation of Russian civilian or military officials who are or 
will be assigned in any capacity to NATO, to SHAPE, to any regional 
command of NATO, or any other facility which has as its purpose making 
or implementing NATO policies?
    Answer. Unlike many of NATO's Partners, Russia does not have a 
Mission or Liaison Office located at NATO Headquarters. Under the 
Founding Act, Russia agreed to create a mission to NATO which would 
include political and military representatives to the respective 
components of the PJC. Presently the Russian bilateral Embassy in 
Brussels also serves as the Russian Liaison Office to NATO. This 
facility is not co-located with any NATO facilities or installations. 
In preparing for and participating in the meetings/activities of the 
PJC, Russia has to date relied upon existing personnel at its Embassy 
in Brussels.
    The PJC has been working since late July. Its military component 
has not yet begun work, however. On October 20, Russia named its 
military representative to the PJC, Lt. General Viktor Zavarzin. The 
Founding Act provides for Russia to establish military liaison missions 
at various levels at NATO; the Alliance will establish reciprocal 
missions in the. Russian military command structure. The detailed 
arrangements to implement this commitment remain to be worked out 
between NATO and Russia. This will be one of the first issues taken up 
by the PJC's military component when it begins work.
    As part of the SFOR operation, there is a Russian Liaison Office at 
SHAPE, which is responsible for coordinating Russian participation in 
SFOR. The office is headed by General Krivalopov, Commander of the 
Russian forces in SFOR.
    Question 7. The Committee has been informed that agreement has 
already been reached at NATO to accept a Russian military 
representative at SHAPE, as well as Russian military observers at 
SACEUR and SACLANT. What measures will be taken to ensure that such 
representatives and observers do not have or gain access to sensitive 
information that would damage the security of NATO or its members?
    Answer. Russia named its military representative to NATO on October 
20, but work on the PJC's military component has not yet begun. Nor 
have any arrangements been agreed regarding reciprocal military liaison 
missions provided for in the Founding Act.
    The U.S. and the Alliance take the issue of security very 
seriously. The U.S. and Allies will not allow Russian military 
officials access to sensitive information that would damage the 
security of NATO, the U.S., or other Alliance members.
    The Alliance already has some experience with sharing sensitive 
information with Russians and ensuring that this takes place without 
damaging the security of NATO, the U.S. or other Alliance members. As 
part of NATO's SFOR operation, the Alliance is sharing some sensitive 
operational information with participating partners, including Russia. 
The Alliance has put in place mechanisms which allow the Russian 
Liaison Officer at SHAPE responsible for coordinating Russian 
involvement in SFOR access to information on a need-to-know basis on 
the same basis as other Partners.
    The Alliance is also sharing tactical information with Russian 
military units in Bosnia.
    Question 8. What reciprocal access is being provided by Russia to 
allow NATO military observers to be assigned to any Russian equivalent 
of NATO regional commands?
    Answer. To support the military components of the Permanent Joint 
Council and the enhanced military cooperation envisioned by the 
Founding Act, the Act provides for NATO and Russia to establish 
military liaison missions at various levels on the basis of 
reciprocity. To date, NATO and Russia have not made any arrangements to 
establish military liaison missions, either at NATO or in Russia.
    The NATO-Russia relationship is a two way street. The Founding Act 
explicitly commits NATO and Russia to develop their relationship on the 
basis of reciprocity. This commitment was undertaken at the highest 
political level both within the Alliance and in Russia and applies to 
military as well as diplomatic relations. The NATO-Russia Work Plan 
calls for both NATO and Russia to establish military liaison missions. 
In other words, any Russian military liaison missions will have 
appropriate NATO counterparts.
    Question 9. With the exception of the ill-considered Perry-Grachev 
agreement, by standard practice the United States works to achieve 
consensus at the North Atlantic Council (NAC) prior to forwarding 
positions related to the Conventional Armed Forces in Europe (CFE) 
Treaty to the Joint Consultative Group (JCG) in Vienna. will any NAC 
decisions be discussed at the PJC before being presented at the JCG?
    Answer. There is a fundamental difference between the NATO High 
Level Task Force on Arms Control (HLTF) and the NATO-Russia Permanent 
Joint Council (PJC).
    The HLTF coordinates Alliance.policy with regard to the Treaty on 
Conventional Armed Forces in Europe (CFE). The U.S. has consistently 
sought the maximum possible degree of Allied discussion and 
collaboration within the HLTF in the development of NATO negotiating 
positions. We will continue to do so.
    As discussed during the Senate Foreign Relations Committee's 
hearings on the ratification of the CFE Flank Agreement last May, the 
content of discussions between Secretary of Defense Perry and Russian 
Defense Minister Grachev on the CFE flank issue was factored into 
intra-Alliance discussions that formed the basis for subsequent HLTF-
agreed negotiating positions.
    By contrast, the PJC provides a forum for the general exchange.of 
views between NATO and Russia. While arms control issues in general, 
including CFE, may be raised by either side in general terms within the 
PJC, we have made clear that the PJC is not for prior coordination of 
negotiating positions or joint decision-making on CFE ``at 17.'' 
Neither, we have stressed repeatedly, can it be seen as a substitute 
for the Vienna negotiations on CFE, where all states party to the 
Treaty are represented.
    The HLTF occasionally conducts informal consultations with CFE 
Treaty partners outside the Alliance in ``16-plus'' format. Following 
its meeting on October 7-8. the HLTF initiated a regular series of 
``16-plus-3'' consultations with invitee states Poland, Hungary and the 
Czech Republic. On past occasions, the HLTF has also conducted ``16-
plus-1'' consultations with Russia and Ukraine, and broader 
consultations with all 30 CFE states. These are not decision-making 
sessions but informational in nature.
    Question 10. Will any issues related to future NATO enlargement, 
including the process of negotiating membership of the current 
candidates be allowed on the agenda of the PJC?
    Answer. No. Section II, paragraph two of the Founding Act states 
very clearly that ``consultations will not extend to internal matters 
of either NATO, NATO member states or Russia.'' Enlargement, both the 
present accession negotiations with Poland, Hungary and the Czech 
Republic, and possible future rounds, is an internal Alliance matter 
and not subject to consultation in the PJC. As in the past, NATO may 
inform Russia of decisions and actions it has taken regarding 
enlargement, but such decisions will not become the subject of decision 
making in the PJC.
    Question 11. Can you assure the Congress that under no 
circumstances would any deliberations occur in the Permanent Joint 
Council regarding the stationing of nuclear weapons on the soil of new 
members or the stationing of conventional forces on the soil of new 
members?
    Answer. The Permanent Joint Council (PJC) is not a negotiating 
forum. NATO's position on these issues is clear, as expressed in 
unilateral Alliance policy statements and reflected in the NATO-Russia 
Founding Act. On nuclear weapons, the NAC Ministerial Communique of 
December 10 declared that ``NATO countries have no intention, no plan, 
and no reason to deploy nuclear weapons on the territory of new members 
nor any need to change any aspect of NATO's nuclear posture or policy -
- and we do not see any future need to do so.'' In the NATO-Russia 
Founding Act, it is recognized that NATO's statement means that it has 
no plan and no reason to establish nuclear weapon storage sites on the 
territory of new members, whether through the construction of new 
nuclear storage facilities or the adaptation of old nuclear storage 
facilities. On conventional forces, NATO has said that ``in the current 
and foreseeable security environment, the Alliance will carry out its 
collective defense and other missions by ensuring the necessary 
interoperability integration and capability for reinforcement rather 
than by additional permanent stationing of combat forces.'' These are 
statements of Alliance policy, and not legally binding constraints.''
    To the extent that Russian officials raise issues related to NATO 
nuclear policy and the future stationing of NATO conventional forces on 
the territory of new member states, it is our strong view that Allies 
should respond by reiterating established and well-known Alliance 
policy.
    Question 12. Do Poland, Hungary and the Czech Republic have any 
input into the decisions formulated by NATO prior to meetings of the 
Permanent Joint Council?
    Answer. NATO has agreed to appropriate arrangements during the 
period leading to the accession of Poland, Hungary and the Czech 
Republic to involve them in Alliance activities. This is in keeping 
with the commitment made by NATO Heads of State and Government at 
Madrid. The goal is to keep the invitees as up-to-date as possible on 
major Alliance policy issues, including developments in the PJC, 
without involving them directly in decision-making prior to their 
accession. Between now and December when the accession protocols are 
signed, this will involve briefings on the activities of major NATO 
committees, and in some cases, participation in meetings as observers.
    After the accession protocols are signed, Poland, Hungary and the 
Czech Republic will be allowed to participate in Alliance fora and will 
be able to speak and offer their views without taking part in decision-
making. They will also participate in the biannual NATO Ministerials. 
They will not be permitted to participate in meetings of the Permanent 
Joint Council or in decisions on the conduct of business in the PJC.
    The North Atlantic Council (NAC) is the supreme decision-making 
body of the Alliance. Only NATO members enjoy decision-making authority 
within the NAC. Poland, Hungary and the Czech Republic will not have 
the same rights to participate in the formulation of Alliance policy 
until they accede to the North Atlantic Treaty. Allowing the invitees 
to participate in decision-making before they are members of the 
Alliance is inconsistent with the Article 9 of the North Atlantic 
Treaty and could be seen as a violation of the prerogatives of the U.S. 
Senate or Allied legislatures, which must ratify the accession 
protocols.
    Question 13. What status will Poland, Hungary and the Czech 
Republic have at NATO and at the Permanent Joint Council after the 
expected signing of membership protocols in mid-December?
    Answer. From the signature of the accession protocols to accession, 
Poland, Hungary and the Czech Republic will be involved in Alliance 
activities through both briefings and participation in Alliance fora, 
including the NAC. They will have the opportunity to speak, but will 
not be able to take part in decision-making.
    Poland, Hungary, and the Czech Republic will not be given the 
opportunity to attend:

   restricted sessions of the NAC;
   meetings when issues related to their accession are 
        discussed;
   meetings when a NATO ally requests a discussion among NATO 
        Allies only.

    With the exception of the Nuclear Planning Group, the invitees will 
be present at Ministerial meetings, either during the meetings as 
appropriate or in a separate 16+3 session.
    Poland, Hungary and the Czech Republic will not participate in PJC 
meetings, meetings of the NATO-Ukraine Commission, or in Mediterranean 
Cooperation Group meetings, but they will receive briefings on these 
meetings.
    Question 14. What is the value of discussing NATO nuclear doctrine 
at the PJC?
    Answer. NATO nuclear doctrine has evolved to reflect the changing 
political and security environment in post-Cold War Europe. We have 
made this clear to the Russians and other countries in the context of 
discussing NATO enlargement. We are prepared to explain this evolution 
to Russia so that Russia may gain a better understanding of NATO's 
nuclear deterrent and its continued value in today's environment.
    The PJC is designed to encourage a two-way discussion on these 
issues. We would like to gain greater insight into Russia's nuclear 
doctrine, how it has changed over the past few years, and future plans. 
The PJC provides a unique opportunity to engage Russia on these very 
important matters.
    We believe that discussion of NATO nuclear doctrine will enhance 
stability in the overall strategic relationship between NATO and 
Russia.
    Question 15. NATO is reportedly undertaking its own study of the 
costs of enlargement. When will that study be completed? Is there a 
significant difference between the Clinton Administration and the 
Allies on the costs being discussed? Will you accept a Cost estimate 
that is different from the one that the Defense Department reported to 
Congress in February 1997? How do you respond to the charge of some 
British officials that the Administration cost estimate is driven by a 
U.S. effort to pressure the allies to meet force goals?
    Answer. NATO's work on enlargement costs is scheduled to be largely 
completed by the end of November and will be considered by NATO 
Ministers at the December Ministerials.
    The NATO cost study will estimate costs of enlargement in all three 
of NATO's common budgets; the civil budget, the military budget, and 
the NATO Security Investment Program (NSIP)(infrastructure). While the 
NATO study should provide an accurate estimate of common costs, the 
study will likely not address other costs, such as the direct, national 
costs that will be paid by new and old members to improve their 
military capabilities to meet the military requirements of an enlarged 
NATO. These direct or national costs were included in the Department of 
Defense study. The U.S. study also was based on 4 new members, not just 
the 3 that have been invited. In addition, the initial results of work 
being conducted by NATO military staff suggest that the military 
infrastructure in the three invited States is more readily usable by 
NATO than previously anticipated. For all these reasons, the NATO cost 
study will develop a different estimate than the earlier U.S. study.
    For the reasons stated above, we expect the NATO cost study to 
generate a lower estimate than the earlier Department of Defense study. 
A lower NATO estimate could be acceptable provided that the military 
requirements and capabilities have been correctly defined by the NATO 
military authorities, and endorsed by the North Atlantic Council. We 
are working closely with the Department of Defense to ensure that NATO 
establishes requirements for military capabilities that are 
commensurate with our assessment of the security environment and the 
forces and capabilities we believe will be needed to defend an enlarged 
NATO and effectively conduct other operations.
    Our desire for Allies to meet their agreed force goals is a 
continuing priority. Obviously, there is cause for concern that 
existing shortfalls in established force goals could be exacerbated in 
an enlarged NATO if Allies do not continue to take steps to correct 
these deficiencies. This could be the case, for example, in the 
capability to provide reinforcement. That said, the cost study was 
conducted on the basis of assumptions that certain military 
capabilities will be required by an enlarged alliance, and not as a 
tool for exerting pressure on Allies.
    Question 16. What are the potential security risks of discussing 
NATO military strategy at the PJC?
    Answer. We do not envisage security risks as a result of discussing 
nuclear doctrine at the PJC. NATO's nuclear doctrine is decided only by 
members of NATO and the decisions are made by the NAC.
    The discussion with Russia are designed to lead to a better 
understanding on the part of NATO and Russia on the nuclear doctrine of 
each. NATO's nuclear doctrine is well known and we do not intend to 
delve into any issue that would compromise NATO's security 
arrangements.
    Question 17. What is the value of discussing NATO military strategy 
at the PJC?
    Answer. The Founding Act provides for the exchange of information 
and consultation between NATO and Russia on strategy, defense policy 
and military doctrines. This is consistent with NATO's past approach to 
relations with Russia, which included providing explanations on NATO's 
general policy on a full range of issues, including the Alliance's 
basic military doctrine and defense policy.
    Under the Founding Act such consultations will only occur after 
NATO has decided its strategy for itself, and only after its members 
have all agreed that they wish to hold such discussions with Russia. 
They will not extend to a level of detail that could in any way 
compromise the effectiveness of NATO's military forces.
    This arrangement serves our interest because NATO-Russia 
cooperation and consultation is a two way street. For example, we can 
use such discussions to raise our concerns about Russia's military 
developments and to promote greater transparency between NATO and 
Russia.
    Question 18. What are the potential security risks of discussing 
NATO nuclear doctrine at the PJC?
    Answer. We believe that there are few or no potential security 
risks associated with explaining NATO military strategy to Russia in 
the PJC because these discussions will not involve sensitive 
information whose compromise would be damaging. Furthermore, NATO will 
enter these discussions only after the Alliance has reached consensus 
on its own policies, and on how it will present and address this issue.
    Question 19. Do Europeans support the findings of the February 1997 
Department of Defense study that projects fifty percent of the direct 
costs of NATO enlargement will be carried by Canada and the European 
members of NATO (fifteen percent by the United States and thirty-five 
percent by the new members)?
    Answer. Our European allies have neither formally accepted nor 
rejected the Department of Defense notional estimate of enlargement 
costs, but during the NATO Summit in Madrid they reaffirmed that the 
costs of enlargement will be borne.
    NATO itself is now working on an enlargement cost study that is 
scheduled to be completed by the end of November and will be considered 
by NATO Ministers at the December Ministerial. The NATO study will 
estimate costs of enlargement borne by all three of NATO's common 
budgets; the civil budget, the military budget, and the NATO Security 
Investment Program (NSIP) (infrastructure).
    In part, the NATO study will be based on detailed site surveys by 
NATO military experts, at the actual facilities that will require 
upgrading. This will lead to a more accurate estimate of common costs 
than DoD's. The NATO study likely will not address other costs, such as 
the direct, national costs that will be paid by new and old members to 
improve their military capabilities to meet the military requirements 
of an enlarged NATO. In addition, the U.S. study was based on 4 new 
members, not just the 3 that have been invited; therefore, the NATO 
cost study will develop a different estimate than the earlier U.S. 
study.
    For the reasons stated above, we expect the NATO cost study to 
produce a lower estimate than the earlier Department of Defense study. 
A lower NATO estimate could be acceptable provided that the military 
requirements and capabilities have been correctly defined by the NATO 
military authorities, and endorsed by the North Atlantic Council. We 
are working closely with the Department of Defense to ensure that NATO 
establishes requirements for military capabilities that are 
commensurate with our assessment of the security environment and the 
forces and capabilities we believe will be needed to defend an enlarged 
NATO and effectively conduct other operations.
    In preparing its notional estimate of enlargement costs, the 
Department of Defense assumed that NATO would consider common-funding 
of enlargement-related requirements in the three invited countries that 
fall within these general principles and criteria.
    Funding of equipment and personnel costs are examples of 
requirements that would very likely not meet the criteria for common-
funding, and would therefore fall under national responsibility for 
funding.
    The estimated U.S. share of about $1.5-2.0 billion for NATO common 
funds is based on the assumption that criteria and cost shares would 
remain relatively constant. Therefore, any significant change to either 
the criteria for what kinds of programs will be common funded, or the 
allocation of cost shares for those common funded programs, would 
change the DOD estimated U.S. costs. No such changes are expected.
    NATO is currently completing its own enlargement cost study. The 
NATO study will be finished by the end of November and will be 
considered by NATO Ministers at the December Ministerial. While final 
cost estimates have not yet been determined, the .modalities for 
arriving at these numbers has been agreed by all NATO nations. The 
agreed modalities require that existing criteria will be used to 
determine which items will receive common funding, and the respective 
cost shares for nations.
    Question 20. Secretary Albright, in response to a question you 
indicated that the other NATO allies are current in paying for the 
obligations of NATO membership. Yet, in a report provided to the 
Congress earlier this year, the Administration estimated that the other 
NATO allies must pay $8-10 billion from 1997-2009 for regional 
reinforcement enhancements. Are non-U.S. allied expenditures' for 
regional enhancements obligations that the allies already have agreed 
to fulfill, notwithstanding NATO expansion? When did the allies agree 
to those obligations? Are the Allies current in meeting those 
obligations: Do projections of allied defense expenditures show a 
commitment to meeting those obligations: Please provide as specifically 
as possible, a breakdown of those obligations. Please identify on a 
country-by-country basis a comparison of obligations and actual 
capabilities for all NATO members.
    Answer. The statement that the other NATO allies are current in 
paying for the obligations of NATO membership specifically refers to 
payment of the three common budgets; the civil budget, the military 
budget, and the NATO Security Investment Program (NSIP) 
(infrastructure).
    As part of the NATO defense review process, nations consider 
military requirements identified by the NATO military authorities for 
Alliance missions. Nations indicate their willingness to support these 
requirements by agreeing to accept as ``force goals,'' the provision of 
specified capabilities. Force goals are not NATO common funded, but are 
largely nationally funded programs. Once accepted by nations, force 
goals serve as a statement of national intent to provide a given 
capability.
    In 1991, NATO completed a comprehensive review of the changing 
European security environment, and published its new Strategic Concept. 
A key element of the 1991 Strategic Concept was agreement to rely less 
on forward-deployed, pre-positioned troops, and more on reinforcement 
capabilities. Many allies accepted force goals to improve their overall 
ability to provide reinforcement forces. We knew in 1991 that this was 
to be a long-term project, just as the United States expects it to take 
a number of years whenever we field completely new capabilities. The 
necessity to improve Alliance reinforcement capability will become even 
more important with NATO enlargement,
    Although we believe that we still have a long way to go, we are 
nonetheless encouraged by the considerable progress made by several 
allies:

   The UK, for example already has the capability to deploy and 
        sustain a division-size force of 20-25,000 troops in a Gulf 
        war-style scenario;
   France is establishing a Rapid Reaction Force (FAR) designed 
        for rapid response in both European and overseas contingencies;
   Italy is upgrading its ability to project forces to crisis 
        areas as they recently demonstrated through their leadership 
        role in Albania; and
   Germany is also increasing its capability to deploy forces. 
        A Crisis Reaction Force (CRF) of 50,000 troops is being formed, 
        with the first 10,000 troops to be ready by late 1997. Clear 
        evidence of Germany's commitment to this goal is seen in its 
        contribution of 2,500 troops in Bosnia.

    It is clear that more work needs to be done to improve the 
capability of the European forces for mobility, deployability and 
sustainability, and senior U.S. officials in Washington and NATO 
continue to press them to do so. However, it must be noted that the 
Europeans have agreed to these commitments, and that they continue 
working toward their fulfillment. We will continue our vigilance in 
encouraging further progress.
    Question 21. Do you envision a scenario in which NATO should first 
seek approval of the United Nations or the Organization for Security 
and Cooperation in Europe (OSCE)? Does the United States feel that a 
consensus from either the OSCE or the U.N. Security Council -- with 
Russia and China as members -- is an appropriate precondition for NATO 
missions?
    Answer. The North Atlantic Council is the supreme Allied decision-
making body. Neither the United Nations Security Council nor the OSCE 
can prevent NATO from taking military action it deems appropriate. The 
United States does not believe that a mandate from the U.N. or the OSCE 
is or should be required for NATO to undertake military missions.
    The North Atlantic Treaty makes several references to the United 
Nations Charter and its principles. As signatories to the North 
Atlantic Treaty, Allies explicitly reaffirm their faith in its 
principles. The Treaty's most important article, Article 5, which 
pledges signatories to consider an attack on any party to the Treaty as 
an attack on all NATO members, is explicitly built upon the right of 
individual or collective self-defense recognized by Article 51 of the 
U.N. Charter. Similarly, NATO members have agreed to uphold and support 
the principles of the Organization for Security and Cooperation in 
Europe. NATO's enlargement study makes support for these principles a 
prerequisite for NATO membership.
    Support for the principles of the U.N. Charter or the OSCE does not 
translate however, into a requirement for a mandate from one or both 
organizations before NATO can act.
    Question 22. Will NATO retain as its central mission the collective 
territorial defense of its membership? Will all current and future 
members be required to maintain forces to meet this mission?
    Answer. NATO remains first and foremost a collective defense 
Alliance and in admitting new members, the Alliance will provide those 
countries the security guarantee contained in Article V of the 
Washington Treaty. In 1991 under the strategic concept adopted by NATO 
heads of state and government, it was recognized that the Alliance with 
its military capabilities could make a contribution to overall 
stability in Europe in the period after the end of the Cold War. These 
new missions will not replace NATO's basic collective defense role but 
they will complement it and permit NATO to deal with sources of 
instability in Europe. In the current security environment, the force 
requirements for collective defense are similar to those for new 
missions like Bosnia.
    Article 3 of the Washington Treaty specifically requires the 
Parties to ``...maintain and develop their individual and collective 
capacity to resist armed attack.'' Obviously the threat to members of 
the Alliance including the potential new members has been significantly 
reduced since the end of the Cold War and NATO has said that it no 
longer sees Russia as a threat. At the same time, to fulfill its 
commitments under Article V the Alliance must plan for and maintain the 
capabilities to meet potential new threats to Alliance members.
    All current members (with the exception of Iceland which has no 
military forces; as well as Spain and France which are not yet 
integrated into NATO's military structure) commit forces for the common 
defense of the Alliance. 'All Allies have indicated a willingness to 
contribute to the common defense under Article V if the requirement 
arises.
    A condition of eligibility to be invited to join the Alliance 
expressly carries with it, a commitment for prospective new members to 
agree to all provisions of the Washington Treaty. We will expect the 
new members of the Alliance to make their own contribution to NATO's 
collective defense capabilities and they have indicated that they will 
do so.
    Question 23. Has Russia asked to be admitted to NATO?
    Answer. No.
    Question 24. Under what circumstances would Russia be admitted to 
NATO?
    Answer. Russia has not expressed an interest in joining NATO, nor 
has NATO been contemplating Russian membership, so this is a highly 
speculative question.
    NATO membership is open to all European democracies who express 
interest, meet the requirements for membership and whose inclusion the 
Alliance believes will contribute to the overall security of its 
members. We believe that there is a value in not preemptively excluding 
any European state. And for that position to be credible, it must 
include Russia.
    Question 25. Why is membership in the European Union not sufficient 
in addressing the security concerns of countries in Central and Eastern 
Europe?
    Answer. NATO and EU membership are not an either/or choice. Both 
NATO and the European Union are embarked upon significant processes of 
internal and external adaptation aimed at meeting the challenges of the 
post Cold War era. Both institutions have unique contributions to make 
in developing a new political structure in Europe. But the two 
institutions do not serve the same purpose or have the same 
capabilities. Through the accession process, the EU will encourage 
applicants to demonstrate their commitment to democracy and market 
economies and to establish good relations with their neighbors. This 
process has already led to more stability and more economic and 
political reform. The EU, however, lacks NATO's military capability and 
it is only European, not Transatlantic. The U.S. is not a member of the 
EU.
    We are not in Europe to take care of their security needs; we are 
there to defend our own security interests. If there is one thing this 
century has taught us, it is that an unstable Europe is as dangerous 
for us as it is for them.
    It is also in our interests to remain engaged in Europe because our 
security interests extend beyond Europe -- to the Middle East, the Gulf 
and beyond -- and our NATO allies have been invaluable partners in many 
of our efforts in these regions.
    While we believe it is important for us to remain involved . in 
Europe, we are at the same time building a stronger role for the 
Europeans within the Alliance. NATO enlargement is one element of 
NATO's adaptation, which includes building a European Security and 
Defense Identity (ESDI) within NATO. ESDI will enable our European 
allies to act alone, without us, using NATO assets.

                               __________

 Responses of Secretary Albright to Questions Asked by Senator Feingold
    Question 1. What does the NATO experience in Bosnia tell us about 
the expansion of the Alliance? Is Bosnia the new face of NATO? How does 
U.S. Policy in the Balkans over the next several months impact on U.S. 
Policy towards NATO expansion? How closely are these two issues 
related?
    Answer. In 1991 under the strategic concept adopted by NATO heads. 
of state and government, it was recognized that the Alliance with its 
military capabilities could make a contribution to overall stability in 
Europe in the period after the end of the Cold War. NATO's force (IFOR 
and now SFOR) in Bosnia is such a contribution and is one type of the 
future new missions of the Alliance. These new missions will not 
replace NATO's basic collective defense role but they will complement 
it and permit NATO to deal with sources of instability in Europe. In 
the current security environment, the force requirements for collective 
defense are similar to those for new missions like Bosnia.
    NATO efforts in Bosnia have made a significant contribution to the 
implementation of the Dayton Peace Accords and if a similar 
contribution could be made in another area of instability, NATO should 
consider if it could play a role. IFOR and now SFOR have included the 
participation of all NATO member nations, many Partnership for Peace 
countries (including the Czech Republic, Hungary and Poland), Russia 
and other non-NATO countries.
    NATO remains first and foremost a collective defense Alliance and 
in admitting new members, the Alliance will provide those countries the 
security guarantee contained in Article V of the Washington Treaty. 
Obviously the threat to members of the Alliance including the potential 
new members has been significantly reduced since the end of the Cold 
War and NATO has said that it no longer sees Russia as a threat. At the 
same time, to fulfill its commitments under Article V the Alliance must 
plan for and maintain the capabilities to meet potential new threats to 
Alliance members. We will expect the new members of the Alliance to 
make their own contribution to NATO's collective defense capabilities.
    Question 2. Many observers are concerned that the round of NATO 
enlargement that is currently being debated will leave Ukraine and the 
Baltics exposed to greater Russian pressure. The potential danger of 
this could worsen in the coming years, as these countries seek to gain 
NATO accession themselves. My colleague in the House, David Obey has 
warned that this region could become a ``no-man's land'' between NATO 
and Russia that is in danger of becoming a battle-ground in some future 
conflict. How do you respond to this analysis? Do you think that 
expanding NATO eastward will create an artificial focus of conflict 
that might not otherwise be there?
    Answer. I would not agree with this analysis. Our purpose in 
enlarging NATO is not to create divisions, but to end them. That is why 
we insisted upon strong open door language in the Madrid Declaration 
whereby the process of enlargement can continue.
    At the same time, we have created institutional relationships with 
all of these countries through the EAPC and the Partnership for Peace 
which manifest the Alliance's interest in maintaining strong relations 
with them. With Ukraine, NATO has established a Charter on a 
Distinctive Partnership, reflecting the Alliance's view that Ukraine is 
of special importance to European security and warrants a special 
approach.
    We have also stated consistently that NATO enlargement is an 
transparent process that does not threaten the security of any country. 
We have also stated that no emerging European democracy is excluded by 
reasons of geography from membership in the Alliance.
    Finally, we have worked within NATO to develop a constructive 
relationship with Russia through the Founding Act and the creation of 
the NATO-Russia PJC to ensure that Russia plays an appropriate role in 
Europe's security structures In the Founding Act, we reaffirmed the 
principle that every state has the inherent right to choose the means 
to ensure its own security. This principle was also reiterated by 
President Clinton and President Yeltsin in Helsinki.
    Question 3. In your April testimony before the Senate Armed 
Services Committee, you said that if an institution like NATO did not 
exist that we would want to create one. ``We would want to build the 
strongest possible partnership with those European nations that share 
our values and our interests,'' you said.
    If NATO did not exist today and we did want to create such an 
organization, what would it look like? Which countries would it 
include? What do you think Russia's role would be?
    Can you envision a time when Russia might be a part of such an 
entity? Why or why not?
    Answer. NATO has been the most successful Alliance in history. If 
NATO did not exist today and we were to create such an organization, I 
expect it would look very much like the NATO that will be the result of 
our current process of adaptation: A NATO that is larger, stronger, and 
able to address the new security situation in Europe and prevent new 
conflicts from arising.
    The goal of NATO' s adaptation is to create a new NATO, internally 
restructured, fully able to carry out its core and traditional 
missions, also equipped for new roles and missions, and open to new 
members and deeper partnerships with the rest of Europe. Enlargement is 
one key element of this adaptation. By admitting new members to NATO, 
we extend the zone of stability and security which NATO provides and we 
expand the area in Europe where wars are not likely to happen. By 
keeping the door open to membership, we foster continued efforts at 
integration and cooperation. The door will be open to any European 
country which is willing and able to shoulder the responsibilities and 
obligations of membership; the open door remains open in concept to 
Russia as well, although Russia has not expressed an interest in 
joining the Alliance.
    Other key elements include enhanced Partnership for Peace and 
creation of the Euro-Atlantic Partnership Council, which strengthen 
NATO's relations with its partners; the NATO-Russia Founding Act and 
establishment of the NATO-Russia Permanent Joint Council, which begins 
a new chapter in the relationship between NATO and Russia; and the 
NATO-Ukraine Charter.
    Internal adaptation, including the Combined Joint Task Force 
concept, building a European Security and Defense Identity within the 
Alliance, and restructuring NATO's military commands, will make NATO 
stronger and better able to deal with the challenges of the current and 
future European security environment.
    Question 4. The allies say that their forces will leave Bosnia in 
June 1998 if U.S. forces depart. When might the allies be able to 
manage operations such as the one in Bosnia by themselves? Do you 
believe that the allies are developing sufficient logistics and 
communications to share an appropriate part of the burden for future 
such operations?
    Answer. The NATO-led operation in Bosnia and Herzegovina (IFOR and 
now SFOR) has been effective because it has involved the participation 
of the whole Alliance as well as many non-NATO countries. About 3/4 of 
SFOR's personnel come from European Allies or non-NATO partners of the 
Alliance. All our NATO Allies and many PfP partners have made 
contributions to IFOR and SFOR. Our European Allies have also provided 
substantial contributions to other aspects of the peace effort in 
Bosnia.
    To maintain NATO's capability as a collective defense Alliance 
capable of providing a credible security guarantee to its members, it 
is important that it maintain its unified command structure and 
integrated capabilities. It is for that reason that we have resisted 
efforts to develop a totally separate European collective defense 
structure. Even in this period of reduced threat, we believe it is 
important to maintain NATO as an Alliance predicated on the 
participation of every member nation, not made on the basis of 
individual countries or groups of countries.
    That said the United States has strongly supported the development 
of the European Security and Defense Identity (ESDI), within NATO. 
Building ESDI within NATO will give the European Allies greater 
responsibility and visibility within the Alliance while at the same 
time maintaining its strategic unity. In that case, it has been agreed 
that European Allies would be able to draw on the common assets of the 
Alliance rather than developing costly and new independent ones. 
Whether a unified NATO operation or one by Europeans alone drawing on 
NATO assets is appropriate for any given mission including Bosnia in 
the future should be determined by the actual situation and 
capabilities required.
    Question 5. As you know, there are three key analyses of the 
potential costs of NATO expansion currently circulating: one prepared 
by the Administration in a report to Congress, one by the Congressional 
Budget Office, and one by the RAND corporation. In response to a 
congressional request, the General Accounting Office prepared a report 
to compare the findings, and the relevant assumptions of these three 
studies. In general, the GAO found that the Administration's 
assumptions were reasonable, but noted that it was difficult, if not 
impossible, to verify some of the Administration's cost estimates 
because there was insufficient supporting documentation. In some cases, 
Administration estimates were base on ``expert judgment,'' rather than 
on surveys of actual facilities. As a result, GAO warns that the actual 
cost of NATO expansion could be substantially higher or lower than the 
Administration's estimate of between $27 and $35 billion.
    Can you explain a little of the methodology used in arriving at the 
Administration cost estimates? Without supporting documentation, how 
confident is the Administration about its estimates?
    Answer. Since the invited countries had not yet been selected, it 
was not possible for any of the three cost studies mentioned here to be 
based on thorough site surveys of actual infrastructure and facilities. 
The principal difference between the studies lies in the assumptions 
upon which the estimates are based. In the case of the Administration's 
study, the Department of Defense based its estimate on a 
``capabilities-based'' analysis to ascertain the costs of developing 
the kinds of military capabilities that the Alliance would need from 
both new and current members, in the projected European security 
environment. The CBO study, on the other hand, based its estimates on a 
renewed imminent and significant Russian threat and a commensurate NATO 
response that included prepositioning of material and forward-
stationing of troops in new member countries. Finally, the RAND study 
differed from the Department of Defense less in its underlying 
assumptions, than in the degree to which certain capabilities would be 
upgraded. The RAND study, for example, calls for slightly more 
extensive upgrading of air command and control, logistics, and 
infrastructure, as well as a more ambitious program of exercises. While 
the GAO critique stated that much of DoD's cost estimates were 
unverifiable, they also acknowledged that the methodology and 
assumptions were reasonable, given the analytic situation confronted, 
as well as the fact that none of the candidate countries could be 
visited and analyzed directly.
    Question 6. The Administration's cost estimates of NATO expansion 
also assume that current NATO members would on average maintain 
constant, real defense spending levels through the year 2009. Some 
analysts argue that this assumption may be unreasonably optimistic, 
particularly given the economic requirements associated with entry into 
the European Monetary Union.
    What assurances, if any, have you received from our European allies 
regarding their NATO-related defense spending over the next decade or 
so? How do these negotiations affect U.S. policy toward NATO expansion 
and/or the assumptions used to estimate the cost of expansion?
    Answer. It is an indisputable fact that NATO enlargement will 
entail some additional costs to current members. At the NATO Summit in 
Madrid, Allies agreed there would be costs; that the costs would be 
manageable; and that the resources needed to meet them would be 
provided. It is impossible to predict the future with absolute 
certainty, and while some analysts may question the willingness of 
current NATO members to maintain constant, real defense spending 
through the year 2009, we are confident that our allies will meet their 
obligations. This is not based on wishful thinking, but on a proven 
track record. The fact is that our NATO allies consistently pay 
approximately 75% of all NATO common costs, while the U.S. pays about 
25%.
    Question 7. As part of the rationale for its analysis in the 
Administration's report to Congress, the Department of Defense, the 
lead agency preparing the report, made several assumptions, including 
that NATO would continue to use existing criteria for determining which 
items would be funded in common and for allocating costs among members.
    Can you elaborate on what this assumption means and how it impacted 
DOD's cost analysis?
    Answer. One of the basic assumptions of the DoD study was that NATO 
will continue to use existing criteria for determining which items 
would be funded in common and for allocating costs among members. As 
you know, the DOD study explained that there would be three types of 
costs estimated to total $27-35 billion over the period 1997-2009:

   the ``direct costs of enlargement'' about 60% of which would 
        include all NATO common funded costs (about $9-12 billion, of 
        which the U.S. share would be $1.5-2.0 billion);
   the cost of military restructuring for new allies ($10-13 
        billion); and
   the cost of improving regional reinforcement capabilities 
        for current allies ($8-10 billion)

    The basic principle for NATO common funding of infrastructure needs 
is that they will be based on the security needs of the Alliance, with 
particular emphasis on meeting requirements for the provision of common 
communications, command and control, information gathering, mobility, 
flexibility of employment, reinforcement activities, logistics and re-
supply, training support, exercise facilities, and consultation. To 
balance resource limitations against priorities of military necessity, 
NATO common funding eligibility is focused on provision of 
infrastructure requirements which are over and above those which could 
reasonably be expected to be funded from national resources.
    Question 8. Please elaborate on how the criteria for membership in 
NATO, including respect for human rights, good relations with 
neighboring states, and civilian control of the military, are 
compatible with United States national interests-in-Eastern Europe.
    Answer. While there are no set criteria for membership in NATO, 
there are several basic principles, including the ones mentioned, which 
underpin democratic societies and which are benchmarks each prospective 
member must meet. These principles are not hurdles to NATO membership, 
but rather are guarantees that the Alliance will continue to be as 
effective and capable in the future as it has been in the past. 
Countries which meet these benchmarks have demonstrated that they share 
NATO's principles and values. Poland, Hungary, and the Czech Republic 
have met all of these benchmarks.
    By extending the zone of stability and security which NATO provides 
to the countries to NATO's east, we further our goal of an undivided, 
democratic, and peaceful Europe.
    The United States is a European power. Two world wars in this 
century have taught us that when Europe and America stand apart, we pay 
a terrible price. We know that we cannot take Europe's security for 
granted.
    By enlarging NATO to Poland, Hungary and the Czech Republic, we 
expand the area in Europe where wars are not likely to happen. By 
making clear that we will fight, if necessary, to defend our allies, we 
make it less likely that our troops will ever be called upon to do so. 
We have seen in Bosnia what happens when instability and insecurity in 
Europe are allowed to fester. We have an opportunity to make it less 
likely that such a conflict will happen again.
    Poland, Hungary, and the Czech Republic are committed to NATO and 
accept its shared responsibility. Their admission will make NATO 
stronger and more cohesive, and will decrease the likelihood of 
conflicts that could involve our troops or threaten our security. That 
is why a stronger NATO is in our interests.
    Enhancing security in Poland, Hungary and the Czech Republic will 
help consolidate democracy and stability in these countries. We want 
them to succeed and we want them to be safe. Enhancing their security 
by admitting them to NATO is the surest and most cost effective way to 
prevent a major threat to security in the region.
                               Appendix 2

                       Hearing of October 9, 1997

           NATO Expansion: A Bridge to the Nineteenth Century

                           Michael Mandelbaum

                               June 1997
                           TABLE OF CONTENTS

 I. Executive Summary...............................................420
II. Arguments for Expansion.........................................421
III.National Attitudes Toward Expansion.............................427

IV. The Costs of NATO Expansion.....................................430
 V. Conclusion......................................................436

About the Author.................................................   438
                                   I.

                           Executive Summary

    The extension of full membership in the North Atlantic 
Treaty Organization (NATO) to three Central European countries, 
Poland, Hungary, and the Czech Republic, which the Clinton 
administration plans to announce at a NATO summit meeting in 
Madrid in July 1997, would be, in the words of the 
distinguished historian and diplomat George Kennan, ``the most 
fateful error of American policy in the entire post-Cold War 
era'' \1\. This is so for two related reasons.
---------------------------------------------------------------------------
    \1\ George F. Kennan, ``A Fateful Error'', The New York Times, 
February 5, 1997.
---------------------------------------------------------------------------
    First, expanding NATO would bring no benefits. None of the 
reasons cited in favor of it stands up to scrutiny. It will 
promote neither democracy nor stability; nor will it fill a 
security vacuum between Germany and Russia or discharge a 
Western moral obligation to the Central Europeans. It is also 
unnecessary to proceed with expansion in order to avoid a 
damaging blow to Western credibility that the failure to 
proceed would inflict. Finally, enlarging the alliance is an 
unnecessary and ineffective way to contain a potentially 
resurgent Russia.
    Because there is nothing to be gained from it, NATO 
expansion is a bad idea. It is also a dangerous idea, because 
there is a great deal to be lost if it goes forward. Expansion 
would impose costs on Europe and the United States. Just how 
great they would be cannot be known in advance: the future is, 
after all, unpredictable. But they might be substantial. This 
is the second reason that expansion would be a fateful blunder.
    The prospect of expansion has already damaged the West's 
relations with Russia. Furthermore, the reality of expansion 
would draw a new line of division in Europe, creating a ``grey 
zone'' of vulnerable countries between NATO's new eastern 
border and Russia. In this geopolitical no-man's land would be 
located new democracies whose survival and prosperity are 
important to the West but whose security the expansion of NATO 
would jeopardize.
    There is a final danger to Western interests from NATO 
expansion that is little discussed but potentially serious. 
Because its costs military and political as well as economic 
could be steep, and because expansion would create a number of 
difficult problems that the American Congress and the American 
people would have to confront, it could undercut public support 
for Alliance membership in the one country that is 
indispensable to NATO: the United States.
                                  II.

                      The Arguments for Expansion

    NATO expansion, its proponents claim, will consolidate 
democracy in the countries that join \2\. And, in fact, such an 
outcome is virtually guaranteed: Poland, Hungary and the Czech 
Republic are already democracies. But they will remain 
democracies regardless of whether they join the Atlantic 
Alliance. Democracy is threatened in none of them. Freedom of 
speech, of assembly, of the press and of religion are firmly 
established in every one. Each has conducted free, fair 
elections regularly since 1989. \3\
---------------------------------------------------------------------------
    \2\ ``The second reason [for expanding NATO] is to defend Europe's 
gains toward democracy, peace, and integration''. Secretary of State 
Madeleine Albright, Testimony before the Senate Armed Services 
Committee, April 23, 1997, Transcript p. 12.
    \3\ The political scientist Samuel Huntington has posited the ``two 
turnover test'' for democratic stability, according to which democracy 
may be considered firmly established when political power changes hands 
peacefully not just once but twice. Counting the surrender of power by 
their Communist regimes, all three countries have passed this test.
---------------------------------------------------------------------------
    When the three Central European countries seek inclusion in 
the European Union (EU) an organization considerably more 
relevant to their present needs than is NATO they themselves 
emphasize, rightly, their impeccable democratic credentials. It 
verges, in fact, on an ethnic insult to suggest that they are 
incapable of governing themselves in a democratic fashion 
without assistance from the West. Finland and Israel, for 
example, established solid democracies after World War II under 
far less favorable circumstances. The Finns had a long border 
with the Soviet Union, against which it had fought in World War 
II. The Israelis, who lacked any history of independence, let 
alone democracy, had to absorb several times their original 
population in refugees from every continent in the world, and 
were surrounded by countries sworn to their destruction. It 
would be insulting to suggest that Poles, Hungarians, and 
Czechs are less capable of democratic politics than Finns and 
Israelis. It would also be untrue.
     Nevertheless, if democracy were threatened in any of the 
three countries, there is no basis in logic or history for the 
belief that NATO membership would be an effective way to 
reinforce it \4\. While most NATO members have been democracies 
for most of the history of the Alliance, the one is not 
necessarily the cause of the other. The German Federal Republic 
did become democratic after World War II, but the fact that it 
was occupied by the Western powers was of greater importance 
than its membership in the Atlantic Alliance into which it was 
not in any case fully integrated until the mid-1950s, by which 
time West German democracy was well established. Furthermore, 
Greece, Turkey, and Portugal have all had spells of 
undemocratic rule while members of NATO.
---------------------------------------------------------------------------
    \4\ The international organization in which membership could have 
salutary effects on the health of democracy in formerly Communist 
Europe is the European Union. See Michael Mandelbaum, The Dawn of Peace 
in Europe, (New York: The Twentieth Century Fund, 1996), p. 50.
---------------------------------------------------------------------------
    Moreover, if the assumption that NATO membership is an 
effective way to promote democracy is correct, the planned 
expansion will admit the wrong countries. In Russia and Ukraine 
democracy is shakier than it is in Central Europe, and the 
stakes for the West are far higher. But Russia and Ukraine are 
not being considered for NATO membership. \5\
---------------------------------------------------------------------------
    \5\ Publicly the Clinton administration maintains that no country, 
including Russia, is ruled out for NATO membership. Privately, 
apparently, the message is different. According to Russia's Ambassador 
to the United States, Yuli Vorontsov, ``When the decision [to expand 
NATO] was originally floated, I came to the State Department and had a 
long talk with the then assistant secretary of state, Mr. [Richard C.] 
Holbrooke. I said, `have you thought about Russia while you were 
putting forward this idea of enlargement of NATO?' And his answer was 
very honest. He said, `No, not at all; you have nothing to do with 
that.' `Aha,' I said, `that's very interesting, and what about 
invitation for Russia to join enlarged NATO?' He said, `Anybody but 
Russia; no.' . . . And from all the quarters I received that kind of 
answer: `Anyone but Russia; not you.' '' Transcript of Panel II, ``The 
Emerging NATO-Russia Charter and Relationship,'' Conference on Russia 
and NATO, Washington, D.C., The George Washington University, February 
4, 1997.
---------------------------------------------------------------------------
    The democracy-promotion rationale for expansion, baseless 
as it is, has spawned a variant: NATO should expand to Central 
Europe because the countries there are already democracies. \6\ 
In this way, what was originally and essentially a military 
alliance would become a club of democratic sovereign states. It 
is not at all clear, however, why there needs to be such a 
club, or what it would do, or why the already-existing Council 
of Europe does not suffice for this purpose. And even if there 
were answers, let alone good answers, to these questions, a 
final question would remain: why aren't the other democracies 
of formerly Communist Europe being admitted to NATO? \7\
---------------------------------------------------------------------------
    \6\ One feature of internal governance that proponents of expansion 
sometimes cite as a criterion for, and sometimes as consequence of, 
Alliance membership is civilian control of the military. (``We are 
looking [in assessing potential NATO members] to make sure that there 
is civilian control over the military . . .'' Secretary of Defense 
William Cohen, Senate Armed Services Committee, April 23, 1997, 
Transcript p. 38.) Desirable as this undoubtedly is under most 
circumstances, civilians do not fully control the military in all 
countries that currently belong to NATO. Civilian control has almost 
never been part of the political life of modern Turkey. (Nor, given the 
present Islamic government in Ankara, would unchallenged civilian 
control necessarily have happy consequences for Turkey or for the 
West.) Nor, finally, does civilian control of the military necessarily 
go hand in hand with democracy. Stalin, after all, exercised effective 
control over his military.
    \7\ The Clinton administration asserts, without being specific, 
that the first wave of expansion will not be the last one. But this 
begs the question of why, if the Alliance is to become a club of 
democracies, other democracies will have to wait to join.
---------------------------------------------------------------------------
    Along with the promotion of democracy, the reason most 
often cited for expanding NATO to Central Europe is that this 
will promote ``stability'' there. What this seems to mean is 
that NATO membership will prevent outbreaks of Bosnia-style 
ethnic conflicts. \8\ As in the case of democracy, stability of 
this kind, within the three countries to be admitted, is 
guaranteed with NATO membership because it is also guaranteed 
without NATO membership. There is no chance of Bosnia-style 
eruptions of ethnic strife in Poland, Hungary, and the Czech 
Republic, which are now among the most ethnically homogeneous 
countries in Europe. \9\
---------------------------------------------------------------------------
    \8\ ``The enemy today is not the former Soviet Union. The enemy 
today is instability. The enemy today we can see taking place in 
countries like Albania, Bosnia, where you have ethnic rivalries, where 
you have religious confrontations . . . All of that instability is 
something that we have to face. And if we have countries who have 
longed for participation in the kind of democratic ideals that we 
share, to make them part of NATO would help stabilize the region and 
make peace and prosperity that much more secure''. Cohen, Senate Armed 
Services Committee, April 23, 1997, p. 31.
    \9\ Janusz Onyskiewicz, formerly Minister of Defense in Poland and 
before 1989 a hero of the Solidarity movement, is reported to have 
said: ``The fact is that all of our countries have elements like those 
that destroyed the former Yugoslavia''. (Strobe Talbott, ``Why NATO 
Should Grow,'' The New York Review of Books, August 10, 1995, Reprint 
p. 4.) Just what or where these ``elements'' are in Poland, Hungary, 
and the Czech Republic neither he nor anyone else has ever specified.
    On the other hand, NATO membership is not necessarily the solution 
for ethnic conflict where it does exist. Turkey, a long-time NATO 
member, is host to a protracted, bloody conflict between the government 
and ethnic Kurds.
---------------------------------------------------------------------------
    If there were the remotest possibility that any of the 
three would become ``another Bosnia'' it is unlikely that the 
Clinton administration would be seeking to take responsibility 
for them by including them in an American-led alliance. The 
American public has displayed no enthusiasm for intervening in 
bitter, tangled ethnic conflicts in the formerly Communist 
world. And, in fact, the formerly Communist countries that do 
have ethnic problems are not being invited to join the Atlantic 
Alliance.
    The argument that expansion will promote stability, like 
the democracy-promotion argument, also has a variant namely 
that the mere prospect of NATO membership has already helped to 
calm potentially explosive quarrels. Cited as evidence are the 
accords signed by the Hungarian government with the governments 
of Romania and Slovakia, both of which have ethnic Hungarian 
minorities within their borders. \10\
---------------------------------------------------------------------------
    \10\ ``And just the prospect of NATO membership has, in fact, 
helped deal with a long-standing problem between Hungary and Romania.'' 
Albright, Senate Armed Services Committee, April 23, 1997, p. 62.
    The prospect of NATO membership has apparently also, however, 
helped to worsen relations between Central European neighbors. See 
Christine Spolar, ``Bids to Join NATO Put Czech and Slovak at Odds,'' 
The Washington, Post,  April 13, 1997, p. A26.
---------------------------------------------------------------------------
    This assumes that these governments would never have made a 
good-faith effort to resolve their differences without the 
incentive of NATO membership; such a presumption belies their 
status as civilized peoples who are capable of acting 
reasonably without being bribed to do so. Moreover, if the lure 
of membership in a Western international organization is 
necessary to induce good behavior by those Central European 
democracies, it stands to reason that the prospect of European 
Union membership is at least as potent an incentive as that of 
belonging to NATO, if not more so.
    Finally, even if the prospect of NATO membership could 
have, or even has had, a beneficial effect on the relations 
among some of the countries of Central Europe, this does not 
mean that expansion serves vital American interests.
    However important the stakes in these disputes may be for 
the parties directly concerned, they are of far less 
consequence for the United States. \11\ Indeed, it is the 
United States that would have the chief responsibility for the 
security guarantee that is allegedly necessary to settle them. 
At issue between Hungary and Slovakia is, among other things, 
the right of ethnic Hungarians in Slovakia to use the Hungarian 
language. Perhaps Bratislava, the Slovak capital, ought to have 
Hungarian-language street signs, but this is hardly the 
business of the United States or the Atlantic Alliance. America 
cannot and should not be held responsible for settling every 
ethnic and national dispute everywhere. It is the countries 
directly involved that bear that responsibility.
---------------------------------------------------------------------------
    \11\ The Clinton administration has sought to connect stability in 
Central Europe to American interests by invoking the great European 
disasters of the twentieth century. The version of history on which 
this is based is, to put it charitably, dubious. NATO expansion, 
according to Secretary Albright, is designed to prevent ``the 
instability within the region which has, in fact, created two world 
wars''. (Senate Armed Services Committee, April 23, 1997, p. 85.) This 
is wrong on two counts. First, World War I did not begin in the region 
that the administration is planning to incorporate into NATO. It began 
in southern, not central Europe, in the Balkans--in fact in the city of 
Sarajevo where, in June 1914, the heir to the imperial Austrian throne 
was assassinated by a Serb nationalist. Second, the cause of the two 
world wars was not instability rooted in ethnic conflict. It was 
aggression--in both cases by Germany. This is neither an obscure nor a 
contentious point. Hitler's responsibility for World War II was clear 
from the moment that conflict began. German responsibility for the 
first war was the subject of political and historiographical 
controversy for decades but that controversy was settled by Fritz 
Fischer's two volumes, Germany's Aims in the First World War and The 
War of Illusions, both available in English translation. (New York: W. 
W. Norton, 1970 and 1975.) In both 1914 and 1939 a world war began 
because Germany sought to expand its power and the sphere of its 
control in Europe by force. Instability, of the kind that is possible 
in formerly Communist Europe (although not in the three countries the 
Clinton administration proposes to admit to NATO) was the occasion for 
a major war in 1914 but not in either 1908 or 1912-13, when lesser wars 
were fought in the Balkans, by the choice of the European great powers.
---------------------------------------------------------------------------
    President Clinton won reelection in 1996 with the slogan 
``opportunity and responsibility.'' While the government can 
help to provide opportunity for American citizens, he said, it 
is up to them to take advantage of it. Surely this applies to 
Central Europe as well. By winning the Cold War, the United 
States and its allies have given the countries of the region 
the opportunity to determine their own destinies. It is up to 
the Central Europeans to do so in appropriate ways. All the 
evidence to date suggests that they have done and will continue 
to do just that, whether or not they join NATO.
    A third argument advanced for extending NATO membership to 
Poland, Hungary, and the Czech Republic is that the United 
States and the West have a special moral obligation to do so. 
This is not true, either.
    In its most strident form, this proposition holds that the 
United States and Great Britain ``sold out'' the Poles at Yalta 
in 1945, deliberately consigning them to the Soviet sphere of 
influence when they could have been saved from Communist 
tyranny, \12\ and that Washington deliberately invited the 
Hungarian people to rise up against Moscow in the fall of 1956 
with the promise that the West would come to their aid if they 
did, only to break that promise. Both assertions are false. The 
conduct of Franklin Roosevelt and Winston Churchill at Yalta is 
open to retrospective criticism, as are American-sponsored 
radio broadcasts to Hungary at the time of the uprising in 
Budapest in 1956. But the United States could not have 
dislodged Soviet troops from Poland in 1945 (who arrived there 
as part of the war against Hitler, in which the Soviet Union 
was an American ally) without another war. Nor was the United 
States exclusively, or even mainly, responsible for the 
Hungarian uprising, which also could not have been effectively 
supported without running the risk of war with the Soviet 
Union, a war that in 1956 could have involved the use of 
nuclear weapons by both sides.
---------------------------------------------------------------------------
    \12\ ``For all of them [current and former American officials 
supporting NATO expansion] there was a moral dimension to the issue. 
Abandoned to Stalin's tender mercies at the 1945 Yalta summit, the 
captive nations of the Soviet empire had a clear right to be drawn into 
and embraced by the security of the West''. Martin Walker, ``East looks 
West to escape bear hug,'' Guardian Weekly, February 23, 1997, p. 6.
---------------------------------------------------------------------------
    Even though American leaders were not responsible for the 
Cold War fate of Poland and Hungary, the United States did not 
simply abandon them to it. On the contrary, Washington led a 
forty-year struggle against the Soviet Union, the occupier of 
Poland and Hungary, which ended in their liberation in 1989. To 
be sure, Poland, Hungary, and Czechoslovakia suffered under 
Communist rule, but so did others, like the Balts and the 
Ukrainians, who are not being offered membership. Suffering 
does not, in and of itself, create for the United States a 
moral obligation to offer anyone NATO membership. Indeed, if 
suffering is the standard, Russia should be a prime candidate 
for NATO membership. After all, judged by the criterion of 
numbers of citizens killed under Communist rule, no European 
people suffered more under Communism than the Russians.
    There is a fourth argument advanced in favor of expansion, 
and it is one that at least bears on the Alliance's actual 
mission: security. In the wake of the Cold War it is argued 
that there is a ``vacuum'' in Europe between Germany and 
Russia. Ultimately something will fill it. That something ought 
to be NATO instead, presumably, of something less benign. \13\
---------------------------------------------------------------------------
    \13\ ``A security vacuum in Central Europe exists today and could 
arouse unnecessary temptation among nationalists and those we suspect 
of nostalgia for power blocs and regional dominance''. Vaclav Havel, 
``NATO's Quality of Life'', The New York Times, May 13, 1997, p. A25.
---------------------------------------------------------------------------
    In fact, there is no security vacuum in Europe. Instead, 
there is already in place a new unprecedented and highly 
desirable system of security, which is described in depth in my 
book The Dawn of Peace in Europe. \14\ This ``common security 
order'' is made up of the changes in the map of Europe brought 
about by the collapse of the Soviet Union; the transformations 
in the governments that have occurred in the wake of the end of 
Communism; and the changes in the military balance produced by 
the series of treaties to reduce nuclear and non-nuclear 
weapons in Europe, concluded between 1987 and 1993. This common 
security order gives Europe the best of all possible worlds. It 
ought to be the purpose of American policy to reinforce it. 
Whatever else it may accomplish, NATO expansion fails to do 
that.
---------------------------------------------------------------------------
    \14\ See chapters 4-6.
---------------------------------------------------------------------------
    The arms accords deserve special mention. They are similar 
in form to those signed earlier in the Cold War but radically 
different in content. Two of their features make Europe a more 
secure place than it has ever been in its modern history: the 
first is transparency--according to which all signatory 
countries can know what arms all others have and what the 
others are doing with them; and the second is defense 
dominance-- meaning that military forces are configured to make 
them useful for defending, but not for seizing territory. \15\
---------------------------------------------------------------------------
    \15\ See The Dawn of Peace in Europe, Chapters 5-6.
---------------------------------------------------------------------------
    It is odd that these accords have received so little post-
Cold War attention in the United States, for they reflect well 
on both major American political parties. During the last two 
decades of the Cold War, Democrats were devoted to arms 
control, which they regarded as central to American foreign 
policy. Yet now, when more sweeping and important agreements 
are in place than even they ever imagined were possible during 
the 1970s and 1980s, the Clinton administration has chosen to 
downgrade their importance for European security in favor of 
NATO expansion.
    Republicans placed less emphasis on arms control as a 
vehicle for enhancing Western security. They were often 
skeptical of, and sometimes explicitly opposed to, the treaties 
of the 1970s. But the accords that form the heart of Europe's 
new post-Cold War common security order were designed and 
concluded by two Republican presidents, Ronald Reagan and 
George Bush, with precisely the aim of correcting what they saw 
as the flaws of the earlier accords. These later agreements are 
considerable diplomatic achievements. If they, and the common 
security order to which they are central, endure they will be 
seen in retrospect as monuments to far-sighted American foreign 
policy. In the best case, they will be for the post-Cold War 
era what the Marshall Plan and the Truman Doctrine were for the 
Cold War.
    NATO has an important place in this new order and it is, 
therefore, important that NATO remain in place in its present 
form. In its current configuration it is at once an 
organization that can build confidence among all the sovereign 
states of Europe, a mechanism for assuring the security of 
Germany and thereby relieving the Germans of the need to 
conduct an independent security policy, and provide insurance 
against the resurgence of Russian imperial policy to its West, 
in which case the Atlantic Alliance would be needed to counter 
the threat. It is not true that a single, formal, overarching 
security organization is necessary to ensure peace in Europe. 
Such an organization is not possible, nor is it required for 
the purpose of preventing the kind of major war that would 
directly affect the United States. \16\
---------------------------------------------------------------------------
    \16\ On the infeasibility of a European police force to cope with 
conflicts like the one in Bosnia, see The Dawn of Peace in Europe, 
chapter 2.
---------------------------------------------------------------------------
    If neither democracy, stability, morality nor security is a 
good reason to expand NATO, then why proceed with it? The 
proponents have an answer: credibility. The process of 
expansion, they say, has gone too far to stop because stopping 
would have devastating consequences for America's standing and 
leadership in the world. \17\
---------------------------------------------------------------------------
    \17\ ``Since there can be no going back--to abandon long-standing 
promises because of a Russian tantrum would bust the alliance . . .'' 
``NATO goes a-wooing'', The Economist, January 25, 1997, p. 15. In 
fact, going forward with expansion is more likely to ``bust the 
alliance'' than stopping it. (See below, Section IV). For that reason, 
a decision to stop would be greeted by current NATO members with a 
collective sigh of relief.
    The Clinton administration's political strategy for securing the 
two-thirds vote in the Senate necessary to expand NATO is apparently to 
issue invitations to the prospective new members in July, then assert 
that, no matter how high the costs involved, the failure to approve 
expansion would have dreadful, earth-shattering results.
---------------------------------------------------------------------------
    While the other arguments in favor of expansion are hollow, 
this one is merely outdated. It made sense during the Cold War, 
when the United States and its allies confronted a hostile, 
militant, heavily armed adversary around the world. Communism 
was a global movement, whose branches were connected through 
its world headquarters in Moscow. From this feature of Cold War 
international politics arose the fear that a Western defeat, 
retreat, or show of irresolution in one place would invite 
pressure, even aggression, elsewhere. Such was the logic behind 
the American decision in June 1950 to fight in Korea, a place 
of no intrinsic importance to the United States but where a 
defeat could, American policymakers feared, have adverse 
effects in places that were important. It was the reason for 
standing firm in West Berlin, which, because it was located 
inside East Germany, could not be successfully defended against 
a determined Communist assault. It was also the reason for 
fighting in Vietnam and for the decision of the Nixon 
administration, upon inheriting responsibility for the war in 
1969, to continue rather than abandon it even though the 
American public had turned against it and the chances of 
prevailing were slight. \18\
---------------------------------------------------------------------------
    \18\ In the words of Henry Kissinger, in an article originally 
published in January, 1969, just before he joined the Nixon 
administration: ``Unquestionably, the failure to analyze adequately the 
geopolitical importance of Vietnam [in 1961 and 1962] contributed to 
the current dilemma. But the commitment of five hundred thousand 
Americans has settled the issue of the importance of Vietnam. For what 
is involved now is confidence in American promises. However fashionable 
it is to ridicule the terms `credibility' or `prestige,' they are not 
empty phrases; other nations can gear their actions to ours only if 
they can count on our steadiness''. ``The Vietnam Negotiations'', 
reprinted in Kissinger, American Foreign Policy, New York: W. W. 
Norton, 1969, p. 112.
---------------------------------------------------------------------------
    Whether the failure to stand firm in these past episodes 
would have triggered the adverse consequences American 
officials feared cannot, of course, be known. But their fears 
were not groundless; the dangerous consequences were at least 
conceivable. In the wake of the Cold War, however, such 
consequences are not conceivable. The circumstances that made 
Cold War fears plausible have disappeared. Communism in Europe 
is gone; the Soviet Union has disintegrated; the armed forces 
that made them both dangerous are in a state of collapse. If 
NATO does not expand to Central Europe, this will not bring the 
Soviet army into West Berlin: Berlin is no longer divided and 
the Soviet army no longer exists. The end of the Cold War means 
that the world is safe for the United States to reconsider ill-
advised foreign policies and correct them.
    There is a final purpose that expanding NATO to Central 
Europe is supposed to serve: containing a resurgent Russia 
that, some day, will again threaten its neighbors to the West. 
This pro-expansion argument differs from the others in two 
important ways: it is both coherent and logical, and it is at 
least plausible.
    The source of its plausibility is Russian history. Russia 
has recurrently threatened, and often occupied, its neighbors 
to the west. In truth, it is the fear that this pattern will 
one day be repeated, amid doubts about the sturdiness of 
Russia's own commitments to democracy, that lies behind the 
Central Europeans' desire to join the Atlantic Alliance. \19\
---------------------------------------------------------------------------
    \19\ ``At a recent Budapest seminar, a small group of conservative 
foreign-policy experts discussed tactics for winning U.S. Senate 
ratification of a revised NATO treaty. `Why can't we tell the truth? 
That we need membership because we're afraid of Russia?' someone in the 
audience asked. The evening's speaker, a visiting American professor, 
delicately suggested that Hungary would do better `emphasizing the 
positive.' '' Carla Anne Robbins, ``Hungary's NATO Bid Illustrates the 
Hopes, Risks in Central Europe'', The Wall Street Journal, January 2, 
1997, p. 1.
---------------------------------------------------------------------------
    The possibility that circumstances will arise under which 
it might be sensible to expand NATO eastward cannot be ruled 
out. But such circumstances lie far in the future. Russia does 
not now threaten its western neighbors. The war in Chechnya, 
awful as it was, bears eloquent testimony to the utter 
incompetence of the Russian military, which would be hard-
pressed to invade its western neighbors successfully when it 
has proven incapable, in Chechnya, of successfully invading 
itself. \20\ Nor is there any chance that Russia could regain 
the social cohesion, economic productivity and military power 
necessary to mount such a challenge for years, perhaps even for 
decades. If Russia should embark on a course of overturning the 
post- Cold War settlement, as Hitler did to the post-World War 
I settlement, the West would have considerable advance warning 
and, thus, ample time to prepare a response.
---------------------------------------------------------------------------
    \20\ On this point see Anatol Lieven, ``Russia's Military Nadir'', 
The National Interest, Summer, 1996.
---------------------------------------------------------------------------
    The anti-Russian case for the immediate expansion of NATO 
rests on three propositions, all of which are without 
substance. The first is that Russia is bound to resume an 
imperial foreign policy to the west. \21\ But Russia is not 
bound to do anything. Aggression is not programmed into Russian 
genes. The Russian nation can change its historical patterns of 
behavior. Other nations have done so.
---------------------------------------------------------------------------
    \21\ ``Russia is already getting back on its feet geopolitically, 
even before it gets back on its feet economically. The only potential 
great-power security problem in Central Europe is the lengthening 
shadow of Russian strength, and NATO still has the job of 
counterbalancing it. Russia is a force of nature; all this is 
inevitable''. Peter Rodman, ``4 More for NATO'', The Washington Post, 
December 13, 1994, p. A27. ``Russia, with its resources and educated 
population, will rise again and--if history is guide--will threaten 
again . . . '' William Safire, ``Clinton's Good Deed'', The New York 
Times, May 7, 1997, p. A35.
---------------------------------------------------------------------------
    The second proposition is that the West must respond to 
what will ultimately be a threat from Russia now because when 
the threat materializes the West will be cowed into passivity. 
The precedent for such Western behavior is, of course, the 
dismal response of the democracies to Hitler between the two 
world wars. But American foreign policy throughout the Cold War 
teaches precisely the opposite lesson. The United States did 
respond--some would say over- responded--to real or perceived 
challenges from the Soviet Union. \22\ Not only is Russia not 
predestined to threaten its neighbors, but the West is not 
predestined to flinch if this does happen.
---------------------------------------------------------------------------
    \22\ On this point see The Dawn of Peace in Europe, pp. 165-6.
---------------------------------------------------------------------------
    The third proposition is that NATO expansion will decrease 
the likelihood of a revival of Russian imperial behavior toward 
its western neighbors and strengthen democracy at home. \23\ 
This view is vehemently and virtually unanimously contested, 
however, by those who have the greatest stake in Russian 
democracy and in peaceful Russian relations with the rest of 
the world: Russian democrats themselves. They oppose NATO 
expansion precisely because they believe it will give aid and 
comfort to the worst elements in Russian public life, the 
forces of nationalism, chauvinism, and imperialism. \24\
---------------------------------------------------------------------------
    \23\ According to Zbigniew Brzezinski, ``We should not be shy in 
saying that NATO expansion will help a democratic Russia and hurt an 
imperialistic Russia.'' Quoted in George Melloan, ``Russia's Neighbors 
Worry About `Yalta II,' '' The Wall Street Journal, February 24, 1997, 
p. A23.
    \24\ It is not only Russians with impeccable democratic credentials 
who say this. According to General Alexander Lebed, briefly President 
Yeltsin's national security advisor and considered a leading candidate 
for the Russian presidency in the future, writing in the newspaper 
Izvestia in March, 1997, ``If the sense of loss and humiliation that 
comes with defeat is allowed to fester in the Russian mentality, it may 
lead to an inferiority complex that can only be overcome by gaining new 
victories, preferably over old rivals. That is also a big mistake. 
Unfortunately, the political and military expansion of NATO to the East 
makes it probable that both of these mistakes will be committed''. 
Translation distributed by the LA Times Syndicate, March 17, 1997.
    Nor is such an analysis confined to Russians. Professor Richard 
Pipes of Harvard, perhaps the most distinguished historian of the 
Russian revolution and, on the basis both of his scholarship and 
service in the Reagan administration, hardly someone who is unaware of 
or insensitive to historical Russian patterns of imperialism, has 
written: ``First and foremost among Western initiatives likely to 
provoke a violent reaction and to intensify chauvinism is the proposed 
expansion of NATO to Eastern Europe. This action, intended to enhance 
the sense of security of the Poles, Hungarians, and Czechs, will 
produce the contrary effect among the Russians''. Pipes, ``Russian 
Foreign Policy in Historical Perspective'', Harvard International 
Review, XIX:1, Winter, 1996-7, p. 57.
---------------------------------------------------------------------------
    Even assuming, however, that the pro-containment arguments 
were valid, the particular expansion that is being planned is 
ill-conceived, for it does not extend membership far enough to 
the east. Even if it is inevitable that Russia will pose a 
threat to its neighbors, it will not threaten the countries 
slated for NATO membership. Poland, Hungary, and the Czech 
Republic are no longer Russia's neighbors. None has a real 
border with Russia. The countries that do share borders with 
Russia and thus would be threatened--Estonia, Latvia, 
Lithuania, and Ukraine--are not being invited to join the 
Alliance. In this sense the Clinton administration's policy on 
NATO expansion is perfectly nonsensical: those who--under the 
only set of assumptions under which expansion makes sense--need 
NATO won't get it; and those who get it don't need it.
                                  III.

                  National Attitudes Toward Expansion

    If the expansion of NATO to Central Europe is a bad idea, 
if there is so little to be said for it--indeed if, as is 
argued here, there is nothing to be said for it why was it 
proposed in the first place? Why has it attracted the support 
it now enjoys?
    Even in the countries of Central Europe that are scheduled 
to join, support is uneven at best. In the Czech Republic, for 
example, a December 1996 poll revealed that ``only 38% of 
Czechs are in favor of their country joining NATO . . . . Some 
35% were opposed, while 27% were undecided''. \25\ Popular 
support is more substantial in Poland, but Poland is a special 
case. For one thing it was occupied by Russia not for 50, but 
for 200 years. For another, it has more pressing security 
concerns than the other two because of its border with 
Kaliningrad, a Russian enclave on the Baltic. While these 
concerns are legitimate, they are not urgent--though they 
should be addressed. \26\ But formal NATO membership is not the 
optimal way to do so.
---------------------------------------------------------------------------
    \25\ Open Media Research Institute Daily Digest, December 5, 1996.
    \26\ See the suggestions in section V, below.
---------------------------------------------------------------------------
    It is the political elites in Central Europe who wish to 
join NATO, for reasons that are rooted in their histories. 
Theirs are small, weak, vulnerable countries, located between 
two more powerful and often predatory European nations: Germany 
and Russia. The lesson they draw from history is that Europe 
may once again be divided between or among rival powers, in 
which case they will be forced to be part of a bloc dominated 
by those more powerful than they. In those circumstances, they 
understandably wish to have chosen their affiliation rather 
than having had it imposed on them, as it was after World War 
II and so often before. \27\
---------------------------------------------------------------------------
    \27\ Some of them give reasons that bear little resemblance to the 
Alliance's original and essential purpose. For example, Czech President 
Vaclav Havel has said in an interview that ``NATO will have to 
transform itself significantly as it expands `so it can deal with 
completely different tasks than it dealt with in the Cold War,' 
including combating the movement of crime and drugs into member states, 
regional conflicts such as Bosnia, and terrorism''. Jim Hoagland, ``At 
Center Stage for Havel: NATO'', The Washington Post, May 9, 1996, p. 
A23. If NATO is an effective force for restricting the flow of 
narcotics (something for which there is no evidence) then the leading 
candidates for NATO membership from the American point of view ought to 
be Colombia and Mexico.
---------------------------------------------------------------------------
    By declaring that NATO must and will expand, and through 
the emphasis on the further integration of the EU under the 
terms of the 1991 Maastricht Treaty, the West has 
mischievously, if unintentionally, reinforced the idea of a 
``membership'' or ``fortress'' Europe. These initiatives have 
helped to propagate the image of a Europe in which each country 
is either fully European--that is a full member of the two main 
organizations, NATO and the EU, and therefore inside the 
fortress and safe--or not a full member, not a full-fledged 
European, and thus outside the fortress and vulnerable. The 
Central Europeans' anxieties are compounded by the fact that, 
for both good and bad reasons, they are not being offered 
immediate membership in the European Union. NATO membership has 
thus become a kind of consolation prize.
    But history is not destined to repeat itself. Europe is not 
destined to be polarized again between rival camps or blocs. 
\28\ This picture of Europe was valid during the Cold War. It 
is not valid now. It would be absurd, for example, to maintain 
that Finland, Sweden and Switzerland, none of them full members 
of both the EU and NATO, are somehow not European. It is also 
dangerous to define Europe in this way. For it is desirable 
that Russia be as fully a part of Europe as is possible. But 
Russia cannot now be a full member of the two Western 
international organizations.
---------------------------------------------------------------------------
    \28\ If this should occur, it will not, given Russia's present 
weakness, occur quickly. There will be considerable advance warning, 
and thus ample opportunity to ensure that Central Europe remains part 
of the West.
---------------------------------------------------------------------------
    The main impetus for expansion comes from the executive 
branch of the American government. And if the rationales for 
the American push for expansion are hollow, the origins of that 
policy are mysterious. \29\ At the end of 1993, it was American 
policy to bring Russia into the international community and to 
assist the Russians in their historic transition from a 
centrally- planned to a market economy. The Clinton 
administration had introduced an ingenious and constructive 
innovation in European security, the Partnership for Peace, 
which made possible military cooperation between NATO and non-
members of the Alliance without alienating or excluding any of 
them, including Russia. Suddenly, without warning, on a trip to 
Central Europe at the beginning of 1994, President Clinton 
announced that the question was no longer whether, but rather 
when, NATO would expand to Central Europe. Why did he do so?
---------------------------------------------------------------------------
    \29\ The Administration's decision to expand NATO was made ``in 
characteristic Clinton administration style, without a structured 
evaluation of competing viewpoints, without political debate, and over 
the initial objections of senior military officers''. R.W. Apple Jr., 
``Road to Approval is Rocky, And the Gamble is Perilous'', The New York 
Times, May 15, 1997, p. A1.
---------------------------------------------------------------------------
    One journalistic reconstruction of this decision imputes it 
in no small part to considerations of domestic politics. The 
president, according to this account, was concerned about being 
vulnerable, in his anticipated reelection campaign in 1996, to 
the charge that he had done too little for the countries of 
Central Europe, a charge that would resonate with American 
voters of Central European ancestry, many clustered in 
electorally important states. NATO expansion was driven, 
according to this account, by ethnic politics in the United 
States. \30\
---------------------------------------------------------------------------
    \30\ See the three articles on NATO expansion in The Washington 
Post, July 5, 6, and 7, 1995. For another perspective on the origins of 
the Clinton administration's policy on this issue see Tyler Marshall, 
``NATO's Eastern Growth a Giant Step or Stumble?'', Los Angeles Times, 
April 13, 1997, p. 1.
---------------------------------------------------------------------------
    Ethnic politics in the United States are neither avoidable 
nor necessarily undesirable. It is a good, not a bad thing for 
the United States to have close relations with Poland, Hungary, 
and the Czech Republic, which are, after all, friendly, 
democratic, and decidedly pro-American countries. But there is 
no reason that these relations should take the form of official 
membership in NATO, and there are very good reasons, to be 
discussed below, \31\ that this should not be the case.
---------------------------------------------------------------------------
    \31\ See section IV below.
---------------------------------------------------------------------------
    The Western Europeans, the defense of whom was, after all, 
the founding rationale for NATO, are decidedly unenthusiastic 
about expanding the organization eastward. Germany is a partial 
exception, and an important one. The Germans have officially 
declared their support for expansion; at the same time, they 
have emphatically stressed the need to conciliate Russia. The 
German government has been torn: it has felt that, on the one 
hand, it would be wrong for Germany to oppose what Poland 
favors because of Germany's brutal treatment of the Poles 
during World War II. On the other hand, it is convinced that 
good relations between Russia and the West are essential for 
European, and especially German, security.
    In addition, the Germans and the other Western Europeans 
have been cajoled into going along with expansion by the 
contention of American officials that this is necessary for 
what really matters to them: sustaining the commitment of the 
United States to Europe. The abiding European fear is that the 
United States will go home. They are right that this would be 
bad for them as well, ultimately, as for the United States. But 
they are wrong if they believe that expanding NATO to Central 
Europe will strengthen American security ties to Europe. 
Unfortunately, it is likely to have exactly the opposite 
effect. \32\
---------------------------------------------------------------------------
    \32\ See section IV below.
---------------------------------------------------------------------------
    One European country does, of course, have strong and 
entirely unambivalent feelings about NATO expansion. The entire 
Russian political class, representing all points of the 
political spectrum, opposes it. Still, it is important to 
distinguish among different bases for opposition. While Russian 
Communists and Russian nationalists are publicly opposed, 
privately they are not entirely displeased at the prospect 
because NATO expansion gives them an issue on which they can 
hope to mobilize public support for themselves. The Russian 
public is, on this issue, generally uninterested and 
uninformed; it is far more concerned with domestic matters. 
Although it is not yet intense, however, opposition to NATO 
expansion is widespread in the Russian public. A January 1997 
poll found that 50 percent of respondents opposed the admission 
of former Soviet republics into NATO and 41 percent said former 
Warsaw Pact members should not join. The proportion of 
respondents supporting the idea of admitting former Soviet 
republics to the Atlantic Alliance was 13 percent; in the case 
of former Warsaw Pact members it was 15 percent. \33\ In 
Russia, as in other countries, it is the political elites who 
define the desirable foreign policies and then seek to mobilize 
support for them. The poll findings confirm what observers of 
Russia have warned: that NATO expansion is an issue that has 
the potential to arouse popular feelings of danger and 
vulnerability and discredit those who argue in favor of cordial 
relations with and integration into the West. \34\ Expansion 
is, in addition, a step toward redividing Europe, which 
Communists and nationalists tend to favor. For these reasons, 
of course, Russia's democrats are deeply opposed to expansion.
---------------------------------------------------------------------------
    \33\ Open Media Research Institute Daily Digest, January 21, 1997.
    \34\ ``Paranoia in Russia feeds on itself, seeking and finding 
confirmation in everything that happens--emphatically including the 
recent Western decision to expand NATO up to the very borders of the 
former Soviet Union. . . I know no Russian, regardless of political 
orientation, who favors it. To the contrary, NATO's projected expansion 
plays directly into the hands of the nationalists who exploit fears of 
the West to argue that Russia must reconstruct the empire and rebuild 
the military in order to hold its own in an unfriendly world''. Richard 
Pipes, ``Russia's Past, Russia's Future'', Commentary, June, 1996, p. 
35.
---------------------------------------------------------------------------
    Indeed, these democrats feel betrayed by the plan to expand 
NATO. They believe that it reneges on the terms on which 
Germany was unified and the Cold War ended. At the time of 
unification, they believe, Mikhail Gorbachev and Eduard 
Shevardnadze, the leaders of the Soviet Union, were promised, 
by officials of the United States and the German Federal 
Republic, that if a united Germany were included in NATO the 
alliance would not expand further eastward. There is now a 
debate about whether there was such a pledge, the form the 
pledge took if there was one, and whether it was meant to apply 
only to the territory of the former German Democratic Republic 
during the transition period when Soviet troops were still 
stationed there. The Russians believe it was intended to cover 
all of Europe east of Germany indefinitely. \35\
---------------------------------------------------------------------------
    \35\ On this debate, which is far from settled, see The Dawn of 
Peace in Europe, pp. 62-3.
---------------------------------------------------------------------------
    According to high level accounts, the West conveyed 
assurances of some kind. \36\ Embracing the narrowest 
interpretation of what these assurances were puts the United 
States in the position of saying to the Russians that they have 
no standing to complain that the United States has gone back on 
its word because what they received were only spoken words. 
Russia is, in effect, out of luck because it didn't get 
Washington's promises in writing. This is not the basis on 
which American foreign policy has traditionally been conducted, 
nor is it a good basis for conducting it in the future, toward 
Russia or any other country.
---------------------------------------------------------------------------
    \36\ Testimony to Congress, Ambassador Jack F. Matlock, Jr., May 3, 
1995, page 1 and 2.
---------------------------------------------------------------------------
    Whatever the precise details of the assurances the West 
conveyed to Moscow in 1990, NATO expansion would violate the 
spirit in which the Cold War was ended. That spirit of 
cooperation and friendship can be seen in retrospect to have 
been based on three principles that were, until 1994, broadly 
understood and faithfully observed if not officially codified. 
The first of them was transparency, which means that no secret 
agreements or private deals are permitted in matters of 
security. The second was the principle of consensus, according 
to which every country must consent to any major change in the 
architecture of European security. The third principle was 
inclusion, which implies that Russia will be welcomed into the 
Western and international community.
    NATO expansion, as contemplated, would violate the third of 
these principles by excluding Russia. It would violate the 
first because the Clinton administration has steadfastly 
refused to say what other countries will be admitted, when, or 
by what criteria they will be selected. And it would violate 
the second because expansion is being undertaken against the 
wishes and over the objections of Russia. NATO expansion would 
in fact be the first major change in the security architecture 
of Europe since the deployment of Western intermediate-range 
missiles in 1983 to be undertaken against Russian wishes. All 
the other changes were made with the consent first of the 
Soviet Union and then, after 1991, of Russia. The common 
security order that emerged from these changes is 
extraordinarily favorable to the West, in general, and to the 
United States, in particular. This new order was made in 
America--the terms of the arms treaties were largely drawn up 
in Washington--with the exception of those parts so favorable 
to Western interests, Ukrainian independence above all, that 
they were never even thought possible. Russia accepted all of 
these changes, which gives them legitimacy in Russian eyes, 
legitimacy that is, in turn, a priceless asset for the West. 
And to the extent that Russia considers these new security 
arrangements legitimate, the West does not have to enforce 
them. \37\ NATO expansion would discard this asset, and the 
West would get nothing in return. This is a considerable cost 
of expanding NATO, but it is not the only one.
---------------------------------------------------------------------------
    \37\ The reverse is also, of course, true. According to former Bush 
administration official Robert Zoellick, a supporter of NATO expansion, 
``This is one of those times in history where the world's leading 
nation has to determine the rules for the future''. (Marshall, ``NATO's 
Eastern Growth . . .'', p. 1.) If the Russians do not accept these 
rules, however, and there is no evidence that they will be reconciled 
to an expanded NATO, especially one including former Soviet republics, 
the ``world's leading nation,'' the United States, will have to enforce 
them. This will not necessarily be cheap.
                                  IV.

                      The Costs of NATO Expansion

    In its relations with Russia the West is already paying a 
price for NATO expansion. The relationship with Russia that the 
United States enjoyed from 1990 to 1994 is gone. Perhaps the 
high point of that relationship came in 1994 when President 
Clinton was able pick up the telephone, call his friend the 
President of Russia, ask that Russia remove its remaining 
troops from the three Baltic countries, and have Boris Yeltsin 
comply. The withdrawal of Russian troops from the Baltic states 
had, to be sure, a number of causes, but not the least of them 
was the context in which it took place: a particular 
relationship between Russia and the West, one based on common 
interests and goals, one that presumed cooperation between 
them.
    In the wake of the announcement of the intention to expand 
NATO, and in no small part because of that announcement, the 
fundamental presumption of Russian foreign policy has been 
reversed. It has now become a matter of principle for Russia 
not to cooperate with the West, to demonstrate that it is not 
subservient to the United States, that it cannot be pushed 
around, and that it remains a forceful and independent presence 
on the world stage. NATO expansion has helped to dislodge a 
Russian foreign policy of cooperation with the West and replace 
it with a foreign policy of pique. Resentment of the United 
States was, for example, one motive for the meeting between 
Yeltsin and Chinese leader Jiang Zemin in April 1997, at which 
the two leaders pointedly declared their opposition to what 
they termed American aspirations for global hegemony. The 
resentment that has resulted from the plan to expand NATO has 
reduced Russian willingness to cooperate with the United States 
in the ongoing American efforts to isolate and deter Iraq and 
Iran. To be sure, Russia, like Western Europe, has economic 
reasons for friendlier relations with both than the United 
States deems appropriate. But NATO expansion has weakened the 
counterbalancing motive to side with Washington.
    The most serious damage to relations with Russia inflicted 
by the prospect of NATO expansion is on the issue that affects 
the United States the most directly: the control and reduction 
of Russia's nuclear weapons. There are thousands of them, many 
aimed at North America. \38\ The principal treaty designed to 
reduce them, START II, must be ratified in the Russian 
parliament, the Duma. But the Duma has refused to do so because 
of the prospect of NATO expansion. Thus Americans will pay for 
NATO expansion by forfeiting the opportunity to reduce the 
threat to themselves. And, because the arguments in favor of 
expanding NATO are hollow, they will pay this price for no 
benefit to themselves.
---------------------------------------------------------------------------
    \38\ At the Paris signing ``what was intended as a strictly 
ceremonial occasion . . . took an uncertain turn. The ensuing confusion 
showed vividly how the West's relationship with Russia can still be a 
frustrating and uncertain affair . . . As if to demonstrate [Yeltsin's] 
goodwill, he then made an impromptu announcement that . . . [Russia 
would make] a unilateral pledge to remove the nuclear warheads from 
Russian missiles aimed at NATO nations. . . A Yeltsin spokesman said 
his boss was not promising to remove the missiles' nuclear explosives, 
only to `deprogram' them so they are not targeted on NATO nations. This 
is a symbolic gesture, since missiles can be reprogrammed within 
minutes; Russia has already reached deprogramming agreements with the 
United States, France and Britain''. John F. Harris, ``Russia-NATO Pact 
Gives Moscow a Voice on European Security'', The Washington Post, May 
15, 1997, p. A30.
---------------------------------------------------------------------------
    The Clinton administration claims that it has a strategy 
for minimizing the damage NATO expansion inflicts on the 
American relationship with Russia: the negotiation of a charter 
governing relations between NATO and Russia. This ``Founding 
Act'', signed on May 27 in Paris, however, is all too likely to 
lend itself to differing interpretations, then disappointment, 
then acrimony. This was, after all, the fate of the Soviet-
American ``declarations of principle'' signed by Richard Nixon 
and Leonid Brezhnev during the period of detente in the early 
1970s. Disagreement about the status of this charter surfaced 
even before it was concluded. At their meeting in Helsinki, 
Finland, in March 1997, Presidents Yeltsin and Clinton were 
each asked what role, under the terms of the charter, Russia 
would have in NATO's affairs. They gave incompatible answers: 
Yeltsin said that decisions about European security would be 
reached by ``consensus''--implying that Russia would have a 
veto over them. Clinton denied this. Russia would have, he 
said, ``a voice not a veto'', which is, of course, precisely 
what Russia would have without a charter. \39\ Ironically, 
Russia has already effectively exercised a veto over NATO's 
policy on expansion: the fear of an angry Russian reaction is 
the only reason that the Baltic states, whose claims to NATO 
membership are far stronger than those of the Central 
Europeans, are not being invited to join the Alliance.
---------------------------------------------------------------------------
    \39\ This potentially explosive dispute continued when agreement on 
the terms of the ``founding act'' was announced. In an address to the 
Russian public, Boris Yeltsin said: ``Just as this document says, 
decisions are to be made only by consensus...If Russia is against any 
decision, this decision does not go through. I believe this is 
critically important''. Unnamed Clinton administration officials, 
however, ``brushed aside this assertion, saying it applies only to 
decisions by the new NATO-Russia council, which will deal with such 
matters as joint peacekeeping operations, conflict prevention and 
combating terrorism. They said the alliance has reserved the right to 
continue making its own decisions through the North Atlantic Council, 
its principal political organ, and other bodies on which Russia will 
have no seat. A senior White House official said the alliance will not 
`in any way be subordinated' to the NATO-Russia council''. David 
Hoffman, ``NATO, Russia Agree on New Ties'', The Washington Post, May 
15, 1997, p. A30.
---------------------------------------------------------------------------
    Nor will Russians regard the charter as the product of a 
genuine negotiation with NATO, for the simple reason that it 
was not. The Clinton administration has insisted that it will 
expand NATO regardless of Russia's wishes, and that some issues 
will be off limits to negotiation even if Russia seeks to 
include them. Russians will, therefore, be correct in 
concluding that the charter is as much the result of American 
dictation as of Russian-American negotiation.
    Furthermore, what the administration has advertised as the 
likely contents of the new arrangements between NATO and Russia 
are not strategically sensible. The American government has 
said that NATO ``has no plans'' to station any of its troops or 
its nuclear weapons on the territories of the new Central 
European members. But including the Central Europeans in the 
Alliance makes sense only if they are threatened by Russia. And 
if they are threatened, it is foolish, indeed dangerous, not to 
take the military measures necessary to deter a Russian attack 
on them. In this way--but not in this way alone--NATO expansion 
as planned is either unnecessary or irresponsible.
    While the principle of consensus is fundamental to the 
post-Cold War settlement in Europe, Western policy toward 
Europe cannot be based on the requirement for Russian consent 
under any and all circumstances. It was desirable, and 
necessary, to adopt policies to which Russians objected during 
the Cold War, and it might some day be necessary to do so once 
again. But Russian objections, Russian unhappiness, and the 
lack of Russian cooperation on issues of importance--the direct 
and unavoidable consequences of NATO expansion--are a cost to 
the United States. It is foolish to pay such a cost without 
getting a compensating benefit in return. Yet this is precisely 
what will happen if the Alliance expands as planned. NATO 
expansion thus offers the United States the worst of both 
worlds: provocation without compensation.
    The second great and unnecessary cost of expansion, as the 
Clinton administration envisions it, is the creation of a grey 
area, a no man's land--where none now exists--between what 
would be the new eastern border of NATO and Russia. Creating 
such a grey zone would increase the vulnerability and potential 
instability of the countries within it, new democracies that 
are important to the United States and the West for both 
strategic and moral reasons: the three Baltic countries and 
Ukraine. Expansion, as planned, would draw a new line of 
division in Europe. Even proponents of expansion concede this 
when they argue that NATO should be expanded because the 
current dividing line, marked by NATO's current borders, is 
obsolete and unacceptable. \40\
---------------------------------------------------------------------------
    \40\ ``If we do not enlarge NATO we will be validating the dividing 
line Stalin imposed''. Albright, Senate Armed Services Committee, April 
23, 1997, p. 12.
---------------------------------------------------------------------------
    Why moving the line of division in Europe further to the 
east is an improvement on the status quo is never explained by 
the Clinton administration. In fact, however, NATO expansion 
would not move a European line of division; it would create 
one. For the western border of the Atlantic Alliance does not 
now constitute a dividing line. During the Cold War there was 
such a line, which divided those Europeans who were free from 
those who were not. But now the Poles, Hungarians, and Czechs 
are free, and there is no external threat to their freedom. 
Moreover, the present NATO is accepted as a legitimate and 
permanent part of Europe by all parties, including Russia. With 
the Partnership for Peace, the Alliance has transformed itself 
into an organization with which every country in Europe can be 
affiliated. It is a vehicle for promoting confidence throughout 
Europe, while at the same time retaining the capacity to deter 
or fight a war if necessary. \41\ NATO expansion would, thus, 
recreate further to the east the line of division that existed 
during the Cold War but that has now disappeared.
---------------------------------------------------------------------------
    \41\ See The Dawn of Peace in Europe, p. 101.
---------------------------------------------------------------------------
    The Clinton administration suggests that this would not be 
the case: `` . . . the enlargement of NATO is a dynamic 
process'' according to Secretary Albright. ``We are beginning 
it this summer, but it is something that will go on.'' \42\ 
However, the administration has conspicuously, indeed 
energetically, avoided making any specific commitments about 
further expansion. \43\ The Baltic states, nonetheless, believe 
that they have received exactly such a commitment. After 
meeting with Secretary of State Albright in April 1997, 
Vytautas Landsbergis, the chairman of the Parliament of 
Lithuania, according to a press report ``said Lithuania has 
received an `open-ended' invitation to enter NATO. The question 
is not `if' but `when,' he was told.'' \44\ This is the formula 
that President Clinton used when he announced his decision to 
expand NATO in the first place, at the outset of 1994. The 
Ukrainian government has not formally requested NATO 
membership, but is seeking the functional equivalent: a 
separate agreement with the Alliance spelling the details of a 
special NATO relationship with Ukraine.
---------------------------------------------------------------------------
    \42\ Albright, Senate Armed Services Committee, April 23, 1997, 
p.36. Elsewhere: `` . . . when we say that the first new members will 
not be the last, we mean it''. Madeleine Albright, ``Why Bigger is 
Better'', The Economist, February 15, 1997, p. 21.
    \43\ The following exchange took place at a hearing of the Senate 
Armed Services Committee:
    Sen. [Jeff] Bingaman [D-New Mexico]: ``Let me ask about the 
Baltics. You mentioned a Baltic action plan. If the Baltic countries 
want to be part of NATO, as they obviously do, is--should we proceed to 
admit them?''
    Sec. Albright: ``Again, we are not going to name names at this 
stage. We have said that NATO is open to membership to democracies that 
fulfill the number of these criteria that both Secretary Cohen and I 
have mentioned''. (April 23, 1997, p. 59)
    \44\ Nora Boustany, ``Chretien Finds the Hill Isn't Laughing'', The 
Washington Post, April 11, 1997, p. A31.
---------------------------------------------------------------------------
    The question of Baltic membership poses enormous problems 
for which there are no obvious solutions. Bringing the Balts 
into NATO would impose large, indeed probably prohibitive, 
costs on the Alliance, which its current members might well 
refuse to pay. The Russians have made it clear that while they 
may accept, grudgingly, the addition of three Central European 
countries to the Western military alliance, they would respond 
sharply if NATO were extended all the way to their borders, as 
would be the case if the Balts joined. \45\ This would pose a 
challenge to the Russian military, whose principal duty is, 
after all, to defend the country. It is not likely to be 
persuaded by NATO's protestations of peaceful intent that it 
need do nothing in response. How it would respond is uncertain; 
but it is unlikely to do nothing at all.
---------------------------------------------------------------------------
    \45\ ``Russian Foreign Minister Yevgeni Primakov told reporters on 
a trip to Denmark that the Baltic states' entry into NATO would be 
`unacceptable' to Russia and would `undermine our relations with NATO 
entirely''. David J. Kramer, ``Who isn't invited to the NATO party?'', 
The Washington Times, March 19, 1997, p. A21. The tiny Russian enclave 
of Kaliningrad, on the Baltic, does abut Poland. It is heavily 
militarized, but could not serve as a staging area for a full-scale 
invasion of Poland.
---------------------------------------------------------------------------
    Because the Western Europeans know this full well, 
attempting to incorporate the Baltic states into NATO would 
prompt a major, perhaps even terminal, crisis within the 
Alliance, with the Europeans unwilling to run the risks Baltic 
membership would raise. \46\ Nor would the American military be 
willing to certify, as it apparently is prepared to do for the 
three Central European countries, that it could assume 
responsibility for the security of the Baltic states--as their 
inclusion in NATO would require--without stationing American 
troops or nuclear weapons there and while accepting steadily 
declining defense budgets. That, in turn, means that the cost 
of including the three Baltic states could not, in contrast to 
the Administration's claims about the cost of the expansion, be 
modest.
---------------------------------------------------------------------------
    \46\ They say this privately. See James M. Klurfeld, ``Needed: More 
Voices Against Bigger NATO'', Newsday, May 5, 1997, p. A31.
---------------------------------------------------------------------------
    Indeed, the administration is able to arrive at a modest 
estimate of the financial cost of expansion by assuming that 
only three new members will join NATO over the ten to fifteen-
year period of its forecast. \47\ Having apparently privately 
assured the Balts that they would be admitted, on the one hand, 
the administration bases its estimates of the cost of expansion 
on the assumption that these same Balts will not be admitted 
for at least ten, and perhaps fifteen, years after the initial 
planned expansion, which is set to take place in 1999.
---------------------------------------------------------------------------
    \47\ On this issue, as on others involving the Baltic states, the 
administration's official position has been vague and evasive. A 
typical example is an exchange at a press briefing on the 
administration's estimate of the cost of expansion:
    Question: ``I'm just curious. In coming up with this study--I know 
you're not prepared to say what nations might be--you don't know the 
answer to that. Did you assume three nations, or does it matter?''
    Answer: ``We assumed a small group. We're not prepared to give the 
exact number. It's a reasonable projection of those that might enter''. 
U.S. Department of State, ``Special Press Briefing on the Enlargement 
of NATO: Rationale, Benefits, Costs and Implications'', February 24, 
1997.
---------------------------------------------------------------------------
    If extending membership to the Balts would be dangerous and 
expensive, excluding them violates the promise they say they 
have received from the Clinton administration, which is the 
same promise to the Central Europeans that the administration 
asserts it must fulfill to protect America's international 
credibility. Furthermore, excluding the Balts would make a 
mockery of the idea of expansion. For the Baltic claim to 
membership is not simply as strong as that of the Central 
Europeans, it is stronger. Unlike Poland, Hungary, and the 
Czech Republic, the Balts do have borders with Russia. Unlike 
the three countries the Clinton administration has chosen for 
NATO membership, the Balts would be directly and immediately 
threatened by a resurgence of Russian imperial behavior to the 
west. It is the Baltic states, along with Ukraine, that have 
the most to lose from NATO expansion. Because of their size and 
their location, Estonia, Latvia, and Lithuania can be secure in 
one of two ways: they can be part of a military alliance that 
protects them; or they can be part of a Europe in which they do 
not need such protection. NATO expansion, as planned, risks 
giving them the worst of both worlds: denying them the second 
without giving them the first. Thus, in excluding the Baltic 
states, the planned expansion of NATO is either unnecessary or 
irresponsible.
    Proponents of the planned expansion sometimes argue that 
enlargement will enhance the security of the excluded countries 
because at least they will have NATO members in their 
neighborhoods and will be able to draw strength from their 
proximity. \48\ There appears, at first glance, to be a Cold 
War precedent for this. The European neutrals Austria, Finland, 
Switzerland, Sweden and Yugoslavia although not part of NATO, 
derived a measure of protection from the existence of the 
Alliance. \49\
---------------------------------------------------------------------------
    \48\ ``And we expect the new members to export stability eastward, 
rather than viewing enlargement as a race to escape westward at the 
expense of their neighbors''. Albright, ``Why bigger is better'', p. 
22-3.
    \49\ See Michael Mandelbaum, The Fate of Nations: The Search for 
National Security in the Nineteenth and Twentieth Centuries, New York: 
Cambridge University Press, 1988, pp. 202-3.
---------------------------------------------------------------------------
    Upon closer scrutiny, however, the precedent proves to be 
irrelevant to the status of the countries in the ``grey zone'' 
that the proposed NATO expansion would create. The Cold War 
neutrals were small, strategically insignificant countries; in 
contrast Ukraine is large and important. The neutrals were 
strategically unimportant because they were not situated on the 
main axis of confrontation--and the principal invasion routes--
between east and west. Ukraine is. The neutrals drew benefit 
from NATO, as well, because American forces were stationed in 
the NATO countries on their borders. But the Administration has 
promised that this will not be the case for the prospective new 
NATO members of Central Europe. The European neutrals 
complemented the Cold War protection that they received from 
NATO with robust military forces of their own. To follow their 
example, the Baltic states and Ukraine would have to spend far 
more on defense than they currently plan to do. Finally, the 
Baltic states and Ukraine are vulnerable to Russia in a way 
that the neutrals never were because they have large ethnic 
Russian minorities within their borders.
    The status of Russians in the Baltic states and Ukraine is 
a potentially explosive matter. In the worst case, these 
minority communities could be mobilized against their own 
governments, creating pressure within Russia to come to their 
aid. Although there are tensions between Russians and Balts in 
the Baltic states, fortunately nothing like this has occurred 
thus far. But the expansion of NATO, by triggering Russian 
resentment at the West and seeming to establish new spheres of 
influence in Europe, is hardly likely to promote communal 
harmony in the grey-zone countries. While there is no chance of 
Bosnia-style ethnic conflict in Poland, Hungary, or the Czech 
Republic, there is a chance of exactly such conflict in the 
excluded countries. At the very least, NATO expansion will not 
make such a prospect more remote than it is today.
    There is a third potential cost to NATO expansion: the 
erosion of the American commitment not just to an expanded NATO 
but to an ongoing American role in European security of any 
kind. Both Western and Central Europeans assume that because 
expansion is an American-driven project the United States will 
see it through to completion, paying the political and economic 
costs involved no matter how steep. This is a shaky assumption.
    Estimates of the economic costs of expansion vary widely, 
not to say wildly. The Administration claims that they will 
amount to between $27 and $35 billion over 13 years. The 
Congressional Budget Office, by contrast, puts the figure as 
high as $125 billion, almost five times the administration's 
estimate. \50\ Both estimates, furthermore, are based on a 
premise that the administration has elsewhere suggested is not 
true: that only three new members will be admitted over the ten 
to fifteen year period in question.
---------------------------------------------------------------------------
    \50\ William Drozdiak, ``NATO Expansion `on the Cheap' May Have 
Surcharge'', The Washington Post, March 12, 1997, pp. A1, A22. `` 
`There was a strong political imperative to low-ball the 
[administration's] figures,' said a senior U.S. official. `Everybody 
realized the main priority was to keep costs down to reassure Congress, 
as well as the Russians.'' ' Ibid.
---------------------------------------------------------------------------
    The administration's modest estimate of the American share 
of the total, moreover, is based on another questionable 
assumption: that the costs of expansion--upgrading the armed 
forces and military facilities of the new members--will be 
evenly spread among all NATO members, old and new. But the 
Central Europeans themselves are unable to spend more on 
defense. They are fiscally strapped by budget deficits, partly 
the result of social welfare obligations they inherited from 
the Communist period. The democratic governments of these 
countries can neither afford economically to fulfill these 
obligations in full nor take the political risk of repudiating 
or trimming them. \51\ Central Europe's defense budgets have 
declined steadily since 1989. \52\ Nor are the parliaments of 
the Western European members of NATO likely to contribute much, 
if anything, to the costs of NATO expansion. Most are 
indifferent, at best, to expansion; and they, too, find 
themselves under pressure to reduce spending, in order to 
qualify for inclusion in the European Monetary Union that is 
scheduled to be launched in 1999.
---------------------------------------------------------------------------
    \51\ On this issue see the essays in Ethan Kapstein and Michael 
Mandelbaum editors, The Social Safety Net in Post-Communist Europe, New 
York: The Council on Foreign Relations, 1997.
    \52\ In Poland, for example, ``the armed forces' strength has been 
cut from around 430,000 men to 230,000 over the last seven years. 
Military budgets have been cut and morale among officers facing the 
sack is understandably low. General Tadeusz Wilecki, the military chief 
of staff who won the support of President Lech Walesa in his efforts to 
limit the cuts, was sacked . . . '' Christopher Bobinski, ``Nato 
membership will ensure future security'', Financial Times, March 26, 
1997, p.III. Polling in the region shows that ``when confronted with a 
possible trade-off, most central and east Europeans oppose increasing 
the percentage of their national budget spent on the military at the 
expense of social services. Two in ten or fewer in most surveyed 
countries say they support an increase in military spending over 
education or health care''. The New European Security Architecture 
Volume II: Public Attitudes Toward European Security, Washington, D.C., 
Office of Research and Media Reaction, United States Information 
Agency, September, 1996, p.27.
---------------------------------------------------------------------------
    That leaves the United States to foot the bill for 
expansion. \53\ But how likely is it that Members of Congress, 
at a time when they may confront the prospect of reducing 
Social Security and Medicare benefits for their constituents 
who can express their displeasure in the voting booth, would 
authorize funds from American taxpayers to upgrade the Czech 
air force? It is not a foregone conclusion that they would. 
\54\ At the very least, therefore, expansion would trigger a 
transatlantic row over the familiar Cold War issue of burden-
sharing. Americans would ask why they should bear what they 
would consider an unfair share of the cost of defending Europe, 
which in any case is no longer threatened, when wealthy 
Europeans could contribute more. The resulting recriminations 
would weaken the basic consensus underlying the American 
commitment to Europe.
---------------------------------------------------------------------------
    \53\ `` `If you are serious about providing equal security, the 
basic defense needs of the new members will raise the enlargement bill 
to $70 billion,' said Walther Stuetzle, a former senior defense planner 
for the German government. `So who will pick up the tab? I think it 
will have to be the United States.' '' Drozdiak, ``NATO Expansion `on 
the Cheap' . . .'', p. A22.
    \54\ ``So there's no threat, and yet you're asking for increased 
spending in NATO. I do not see the staying power of this country behind 
that decision. I do not think America wants to foot that bill''. 
Senator John Warner, Senate Armed Services Committee, April 23, 1997, 
p.42. Moreover, the United States will be hard-pressed to pay for the 
defense program for which the Defense Department is already planning 
all apart from the cost of NATO expansion. Already personnel is being 
reduced to pay for equipment. See, for example, Bradley Graham, 
``Pentagon Outlines Cost-Saving Moves'', The Washington Post, May 7, 
1997, p. A1.
---------------------------------------------------------------------------
    Article V of the North Atlantic Treaty, the one that 
commits each signatory to come to the aid of any other 
signatory that is under attack, would also be called into 
question. Americans are unlikely to be willing to commit 
themselves to siding with Hungary in a conflict with Romania. 
\55\ But that is what Hungarian membership in NATO, by a 
literal reading of the Treaty, would mean for the United 
States. If, however, in the process of expanding NATO, Article 
V should be diluted, reinterpreted, or abandoned for the new 
members in order to accommodate these reservations, this would 
call into question the American commitment to the existing 
members, and perhaps ultimately the entire Alliance itself. 
\56\
---------------------------------------------------------------------------
    \55\ On this point see David Fromkin, ``Hidden Danger in a New 
NATO'', The New York Times, December 18, 1996, p. A27.
    \56\ Even if these countries do receive an Article V commitment, it 
is far from certain that this would mean all that it did during the 
Cold War. See Edward Luttwak, ``Add Poland and NATO is No More'', Los 
Angeles Times, April 16, 1997.
---------------------------------------------------------------------------
    Yet another feature of the present Alliance is likely to 
prove controversial if expansion proceeds as planned: the 
stipulation that all members must approve the addition of any 
new one. Turkey has already suggested that it will not approve 
the admission of the Central European countries to NATO unless 
it is, in turn, accepted as a full member of the European 
Union. \57\ Turkey will not get full EU membership and the 
Turks presumably know this. Thus they may have been signaling 
that, if excluded from the EU but called upon to approve NATO 
expansion, they will want some compensation. But if the Turks 
are compensated, it is unlikely that all other members of the 
Alliance will resist the temptation to demand similar 
treatment. If so, expansion will entail an additional cost, one 
not accounted for in the administration's estimates. Who will 
pay it?
---------------------------------------------------------------------------
    \57\ Robert Graham, ``Turkey seeks support in drive for EU 
admission'', Financial Times, January 30, 1997, p. 2.
---------------------------------------------------------------------------
    Beyond these specific considerations, NATO expansion would 
weaken American support for NATO because it would divide the 
foreign policy community and the wider public in the United 
States. If the proposal for expansion reaches the Senate, a 
divisive debate will ensue. Supporters of expansion will argue 
that rejection of the plan would cripple the Alliance. In fact, 
it is expansion itself that poses the greater danger to NATO. 
Pressing forward with it would call the Atlantic Alliance 
itself into question. There is no significant opposition to the 
American commitment to the existing NATO, \58\ but there will 
be, indeed there already is, serious opposition to NATO 
expansion. And if expansion should take place, this would risk 
a backlash in the United States against NATO itself because it 
would extend the nation's most important international 
commitment, which is meant to endure indefinitely, on false 
pretenses. Americans are being told that expansion will bring 
them important benefits. It will not. They are being led to 
believe that the project will be virtually cost-free. It will 
not be. And they are being reassured that expansion will not 
alienate Russia. But it will; indeed it already has \59\.
---------------------------------------------------------------------------
    \58\ On public attitudes toward NATO expansion see ``Public 
Indifferent About NATO Expansion'', Washington, D.C.: The Pew Research 
Center for the People and the Press, January 24, 1997, and Steven Kull, 
``Americans on Expanding NATO: A Study of US Public Attitudes, 
Washington, D.C.: Program on International Policy Attitudes'', February 
13, 1997.
    \59\ National polls show that most Americans know and care little 
about the issue of NATO expansion. When pressed, a majority of 
respondents favors including the countries of Central Europe; but 
virtually the same proportion of the public favors including Russia as 
well. ``The biggest doubt about NATO expansion was that it might 
exclude Russia''. Kull, p. 24.
---------------------------------------------------------------------------
    When the American public decides that an international 
commitment has been extended under false pretenses, or that 
such a commitment is more expensive than its government has 
promised, or that whatever the government has promised the cost 
of the commitment is too high, it tends to withdraw its 
support, which causes the commitment in question to collapse. 
In the 1970s Americans turned, gradually, against the war in 
Vietnam, and the United States left Vietnam. In the 1980s they 
turned sharply against the deployment of American marines in 
Beirut, and the United States left Beirut. In the 1990s the 
American public turned just as sharply against the mission in 
Somalia, and the United States left Somalia. To be sure, 
Vietnam, Beirut, and Somalia are not Europe, where the American 
commitment is of much longer standing and is far more 
important. But that is the point. The consequences of 
withdrawing from Vietnam, Beirut, and Somalia were manageable. 
A withdrawal from Europe would be a far more consequential 
matter. NATO expansion risks setting in motion a sequence of 
events that will culminate in the rejection by the United 
States of a central role in European security and runs this 
risk for no benefit whatsoever.
                                   V.

                               Conclusion

    If expanding NATO to Central Europe is foolish and 
dangerous, what is the alternative? What should the Alliance 
and the United States do instead? The best alternative is to do 
nothing. NATO as it now exists, particularly with the addition 
of the Partnership for Peace, is a useful part of the post-Cold 
War common security order and is politically sustainable in the 
United States.
    If NATO decided not to proceed with expansion the effects 
would be negligible. The Central Europeans would no doubt be 
disappointed, but they would be no less secure because they are 
not currently threatened. They would be no less democratic or 
internally stable because democracy and stability do not depend 
on NATO membership. The Clinton administration might well be 
embarrassed, having so publicly committed itself to expansion. 
But avoiding personal embarrassment to a small group of public 
officials hardly justifies pursuing a course that threatens 
real harm to the national interests of the United States.
    It might be politically more palatable, and would certainly 
be strategically useful, to make abandoning the plan for 
expanding NATO part of a package of measures: further 
reductions in nuclear and non-nuclear armaments, the 
demilitarization of Kaliningrad, and assurances concerning the 
continued independence of Belarus. These are desirable in their 
own right and, unlike NATO expansion, would actually contribute 
to making Europe a more secure place.
    One alternative to expanding NATO to Central Europe 
deserves special comment: the inclusion of all European 
countries to the east in the Alliance, including Russia. This 
course is less desirable than doing nothing. It would transform 
the Alliance. With Russia as a member, NATO would no longer be 
NATO. Still, no less an authority than the current American 
Secretary of State has declared that NATO has already been 
transformed. The Russians ``need to understand'', she has said, 
``that this is not the old NATO'' \60\. While including Russia 
in the Atlantic Alliance would bring enormous changes and pose 
substantial problems it would however, offer at least four 
advantages. First, it would better serve American interests 
than what the Clinton administration is proposing to do. 
Second, it would be consistent with one of the principles on 
which the post-Cold War settlement is based: inclusion. Third, 
including Russia in NATO has the potential to increase Western 
and American leverage over the one issue that matters most for 
their security: Russian nuclear weapons. Fourth and finally, if 
NATO does expand to Central Europe, the Alliance would then 
face a series of unhappy options: retreat to its original form; 
stop after the initial expansion; expand up to Russia's 
borders; or expand to include Russia. In that case, the fourth 
of these choices might come to seem, with all its attendant 
drawbacks, the least worst of them. \61\
---------------------------------------------------------------------------
    \60\ Albright, Senate Armed Services Committee, April 23, 1997, p. 
80.
    \61\ Madeleine Albright has spelled out the criteria for choosing 
new NATO members as follows: `` . . . if we were creating a new 
alliance today . . . we would not leave a democratic country out in the 
cold because it was once, against the will of its people, part of the 
Warsaw Pact. The only question we would consider is this: Which 
democratic nations in Europe are important to our security, and which 
are willing and able to contribute to our security?'' (Senate Armed 
Services Committee, April 23, 1997, p. 11) By these standards it is 
Russia, whose citizens were certainly not consulted about joining the 
Warsaw Pact and whose officials have several times expressed the wish 
to belong to the Atlantic Alliance (see, for example, Boris Berezovsky, 
``Integrate Russia, Don't Isolate It'', Los Angeles Times, March 19, 
1997) that is by far the leading candidate for NATO membership. It is a 
curious feature of the Clinton administration's case for expanding the 
Alliance that, insofar as its arguments--about democracy, stability, 
and security--have any validity at all, they do not apply to Poland, 
Hungary, and the Czech Republic, the countries the administration is 
planning to admit, but do apply to the one country it seems determined 
to keep out: Russia.
---------------------------------------------------------------------------
    If NATO does expand to Central Europe, what will be the 
consequences? In the best case, the damage to Western and 
American interests would be minimal. Russia would grumble, but 
do nothing more serious. The NATO-Russian charter would not 
become an additional source of friction. Rather, it would be 
ignored and then forgotten because none of the contentious 
issues it was intended to regulate would arise. The Russians, 
and the other Europeans, would turn their attention to other 
matters. Somehow a way would be found to cope with the problem 
of the ``grey zone'' between NATO and Russia that expansion 
would have created. The arms control accords negotiated between 
1987 and 1993 would remain in place and would ultimately be 
extended, with weapons of all kinds further reduced. That is to 
say, in the best case, the expansion of NATO would have no 
effect at all. Or, to put it differently, the best outcome of 
the expansion of NATO would be precisely the same as the 
outcome of a decision not to expand NATO.
    In the worst case, by contrast, NATO expansion would touch 
off a spiral of acrimony and mistrust that would return Europe 
to conditions not unlike the armed division of the Cold War 
era. It would restore the conditions that made the 
international relations of Europe tense, if not precarious, for 
four decades, conditions that were abolished by the ending of 
the Cold War and that the Clinton administration, perhaps under 
the mistaken assumption that they still exist, says NATO 
expansion is designed to overcome.
    To be sure, the line of division on the continent would be 
drawn further to the east than it was during the Cold War. And 
Russia would not for many years, if ever, be able to prosecute 
the conflict with the West on the same scale as the Soviet 
Union did. This, however, is not necessarily an unmixed 
blessing: with the collapse of most of its armed forces, Russia 
is likely to rely ever more heavily on the one part of its 
military establishment that remains in decent working order--
its nuclear arsenal. \62\
---------------------------------------------------------------------------
    \62\ ``Security Council Secretary Ivan Rybkin said in an interview 
with Rossiiskaya gazeta on 11 February that Russia should reserve the 
right to use nuclear weapons in response to a conventional weapons 
attack, particularly in view of the current weakness of Russia's armed 
forces''. Open Media Research Institute Daily Digest, February 12, 
1997. See also David Hoffman, ``Yeltsin Approves Doctrine of Nuclear 
First Use if Attacked'', The Washington Post, May 10, 1997, p. A21.
---------------------------------------------------------------------------
    Perhaps the likeliest result of NATO expansion falls 
between the best possible outcome the continuation of the 
unprecedented tranquillity that Europe now enjoys without it 
and the worst case, the return of some of the most dangerous 
features of the Cold War. This intermediate outcome would be 
marked by the restoration of a tradition of European 
international relations that predates the Cold War, a tradition 
featuring great power rivalry, shifting alliances, and 
continuing concern with an unregulated military balance. In 
this third case, the future would turn out to be a version of a 
more distant and now dimly remembered past. NATO expansion 
would fulfill one 1996 campaign promise that Bill Clinton did 
not make. It would be a bridge to the nineteenth century.
                                      

                                      

                                      

                            About the Author

    Michael Mandelbaum is the Christian A. Herter Professor of 
American Foreign Policy at the Paul H. Nitze School of Advanced 
International Studies of The Johns Hopkins University. He is 
also Director of the Project on East-West Relations at the 
Council on Foreign Relations and a regular foreign affairs 
columnist for Newsday. He is the author or co-author of 
numerous articles and essays and seven books, most recently The 
Dawn of Peace in Europe (New York: The Twentieth Century Fund, 
1996.)
                               Appendix 3

                      Hearing of October 22, 1997

                                                   October 16, 1997

                               MEMORANDUM

TO:
                          Members, Committee on Foreign Relations

THROUGH:
                          James W. Nance and Edwin K. Hall

FROM:
                          Steve Biegun, Beth Wilson, and Mike Haltzel

SUBJECT:
                          Hearing on the Qualifications of Poland, 
                        Hungary, and the Czech Re-
                          public for NATO Membership

    On Wednesday, October 22, 1997 at 2:00 p.m., the Committee on 
Foreign Relations will hold a hearing on the Qualifications of Poland, 
Hungary, and the Czech Republic for NATO Membership.
    Senator Smith will preside.

                                Overview

    The Foreign Relations Committee has scheduled a series of six 
hearings this fall to examine all elements of NATO enlargement. (One or 
two additional hearings will be scheduled early next year after the 
treaty is formally transmitted to the Senate). This is the third 
hearing in the series. Previous hearings have examined the strategic 
rationale and the pros and cons of NATO enlargement. Later in the 
month, the Committee will examine the costs, benefits, and 
burdensharing of NATO enlargement; the relationship between NATO and 
Russia; and public views.
    This memo, prepared with the assistance of the Congressional 
Research Service, provides an overview of the qualifications of the 
three candidate countries.
Background
    The three countries that have been invited to seek membership in 
NATO do not constitute a single or unified region. They are, rather, a 
collection of states that have each demonstrated an advanced level of 
democratic and economic development and western orientation since 1989, 
the year when the Berlin Wall fell, the Soviet East bloc disintegrated, 
and the totalitarian communist political systems in these states were 
overthrown.
    Poland, Hungary, and the Czech Republic share the legacy of 
Europe's wars and the Cold War. During the volatile inter-war period in 
Europe, these three newly-independent and relatively small states 
struggled to survive between the competing great power interests of 
Germany and Soviet Russia. The new state of Czechoslovakia's success in 
becoming a democratic and advanced industrial country did not prevent 
it from dismemberment at the hands of Germany, with western 
acquiescence, in 1938. Poland, partitioned since the 18th century, was 
ruled by a military regime from 1926 to 1939. Before World War II, 
Germany and the Soviet Union agreed to carve up Poland; Germany's 
invasion into Poland in 1939 officially launched the Second World War. 
After World War I, Hungary lost most of its former territory and was 
ruled by a regency under Admiral Miklos Horthy. Hungary first allied 
itself with Nazi Germany and fell under occupation in 1944 after it 
tried to switch sides in the war. In 1945, Soviet, not western, forces 
liberated eastern Europe from German occupation. Postwar settlements 
involved large shifts or restoration of borders and population 
resettlements. Soviet-style leaderships quickly assumed power and 
imposed totalitarian systems in each country. Within the Soviet-led 
bloc, each country's practice of and experience with communism varied 
to a certain extent, but none exercised full independence or 
sovereignty from Moscow. The three countries' militaries were 
integrated into the Soviet-led Warsaw Treaty Organization.
    Since the end of the Cold War, the former communist countries of 
east central Europe have sought to join the process of west European 
economic and political integration and to share the security guarantees 
of the western military alliance. The former Warsaw Pact countries 
first gained institutional access to NATO in late 1991 through the 
North Atlantic Cooperation Council (NACC), a forum that included all 
former Warsaw Pact members. At the January 1994 NATO summit, the 
alliance launched Partnership for Peace (PFP), a U.S. initiative 
designed to develop concrete aspects of political and military 
cooperation. Hungary, Poland, and the Czech Republic were early 
signatories to the PFP framework agreement. All have actively 
participated in PFP military exercises. All have also contributed 
troops and other forms of assistance to NATO peacekeeping operations in 
Bosnia. At the January 1994 summit, NATO also endorsed the principle of 
enlargement. NATO approved a study on the implications, or the ``how 
and why,'' of enlargement, on September 20, 1995. Going into the July 
8-9, 1997 summit meeting in Madrid, the United States expressed support 
for the candidacies of Poland, Hungary, and the Czech Republic, while 
several other NATO members preferred the inclusion of Romania and 
Slovenia as well.
    At the NATO summit in Madrid on July 8-9, 1997, Poland, Hungary, 
and the Czech Republic were invited to open accession negotiations with 
NATO. NATO members pledged to keep an ``open door'' to other 
prospective countries. Individual negotiations on accession with each 
country began in September and are expected to be completed in October. 
The focus of the talks is on the Treaty obligations associated with 
joining the alliance. NATO ministers intend to sign a Protocol to the 
North Atlantic Treaty on enlargement at its ministerial meeting in 
December 1997. The Protocol must be approved by all alliance members. 
NATO wishes to formally admit the new members in April 1999, the date 
of the 50th anniversary of NATO's founding.
    Of the three prospective members, only Poland brings a large 
military establishment. However, the Hungarian and Czech armed forces 
are equal or greater in size than those of several current NATO members 
(e.g., Denmark, the Netherlands, Norway, Portugal). In accordance with 
NATO consultations, they have put interoperability of air traffic 
control and air defense as the first modernization priority. This would 
enable NATO to extend its formidable air power capabilities over their 
countries, and would facilitate rapid reenforcement in the event of a 
crisis. Each country has made significant progress in adopting the NATO 
unit structure. In addition, ground force units deployed in accordance 
with the former Warsaw Pact's offensive doctrine are being re-located 
to reflect NATO's defensive posture.
    Each country has demonstrated the ability to meld battalion-sized 
or smaller units into NATO operations through participation in 
operations in Bosnia, training exercises under Partnership for Peace, 
or, in the case of the Czech Republic, participation in the U.S. 
coalition during the Persian Gulf War. This remains, however, only the 
first step toward the level of integration that would be required for 
any full-scale combat operations.
    None of the countries is expected to begin ``big ticket'' 
modernization programs before 2000. They are expected to look toward 
Western manufacturers, and to seek extensive co-production agreements 
to lower costs and increase public support for larger defense 
expenditures. Russia, however, may be competitive in some areas, 
particularly when upgrading existing equipment is a more attractive 
option than new purchases. Nevertheless, NATO membership is expected to 
heavily favor strong defense procurement ties to current members.
Poland
      Democracy/Governance

    Poland's democratic political institutions have operated smoothly 
since 1989. Poland has held numerous free and fair elections for 
different levels of government. The judiciary is independent. In 1997, 
Poland adopted a new constitution after it was approved in a popular 
referendum. It replaces the ``little constitution'' adopted in 1992. 
Poland has ratified numerous international conventions on human rights 
and is a member of the Council of Europe.
    Poland's last parliamentary elections were held on September 21, 
1997. The opposition Solidarity Electoral Action (AWS), a bloc of over 
thirty largely conservative groups, came in first place with about 34% 
of the vote. The Democratic Left Alliance (SLD), a coalition partner in 
the outgoing reformed communist government, came in second with about 
27%. A likely coalition partner for AWS is the pro-reform Freedom Union 
(UW - also a post-Solidarity party), which won about 13% of the vote. 
The share of the vote (about 7%) for the former coalition partner 
Peasants' Party was much reduced from its showing in the 1993 
elections. Political parties had to reach a five percent threshold in 
order to enter parliament. Other parties that passed this threshold 
include the rightist Movement for the Reconstruction of Poland, and the 
leftist Union of Labor. Election analyses have suggested that the 
Polish electorate was motivated by various social, ideological, and 
``value'' issues over strictly economic or political policies. The new 
parliament, comprised of the 460-seat lower house, the Sejm, and the 
100-seat upper house, the Senate, is to convene on October 20. 
Aleksander Kwasniewski of the Democratic Left Alliance remains 
President of Poland. Kwasniewski defeated incumbent President Lech 
Walesa in the second round of direct presidential elections in October-
November 1995. The President must nominate the Prime Minister. 
Observers anticipate that Kwasniewski's cohabitation with a Solidarity 
Electoral Action-led government might be contentious, given the AWS' 
ideologically rigid anti-communist stance.

      Economy

    Poland was the first centrally planned economy to launch drastic 
economic reforms in 1990. Early reforms focussed on price and trade 
liberalization, small-scale privatization, currency convertibility, and 
structural reforms. As a result, Poland was the first country to emerge 
from economic decline and has experienced GDP growth since 1993, with 
growth rates exceeding 5% from 1994 through 1996. The basic tenets of 
economic reform have been sustained through numerous changes of 
government. Private sector activity, especially new enterprises, grew 
rapidly and currently accounts for about two-thirds of GDP and two-
thirds of employment. Privatization of large-scale industries has 
remained slow. About one-quarter of Poland's labor force works in 
agriculture. However, the agricultural sector's share of GDP has 
declined steadily since 1989. Growth in industry, especially 
manufacturing, has fueled the country's economic recovery.

      Military Capabilities

    U.S. officials have judged Poland to have the most capable armed 
forces in Eastern Europe. Relatively large (Army-- 152,000; Air Force--
56,000; Navy--14,000), well-trained and disciplined, the major 
challenge facing them is improving interoperability with NATO and 
quality of their military equipment. Unit structure reorganization and 
redeployment from Warsaw Pact dispositions are progressing smoothly. 
Polish officers and non-commissioned officers are participating in NATO 
and U.S. military and English language training programs. Polish 
participation in the U.N. Multinational Force in Haiti, NATO's Bosnia 
operations, and in over 50 Partnership for Peace exercises has 
demonstrated the ability to carry out at least battalion-sized 
operations in conjunction with NATO forces. It should be noted, 
however, that these have been peacekeeping operations involving no 
combat, and do not reflect the demands of a large- unit high-intensity 
conflict.
    Equipment modernization is the largest challenge facing the Polish 
military. As a result of NATO requirements, the early focus has been on 
upgrading air traffic control and air defense communications. 
Additional large-scale procurement programs are not expected to begin 
prior to 2000, though negotiations are underway with Western firms 
concerning fighter aircraft purchases. Priority areas for modernization 
are:

   Ground attack aircraft
   Fighter aircraft
   Attack helicopters
   Main battle tank (T-72 upgrade)
   Armored fighting vehicles

Poland's defense budget in 1996 was $3.1 billion, approximately 2.4% of 
GDP, which is comparable to most other NATO countries. Military 
spending declined steadily through 1995, and increased slightly in 
1996. The Polish government has endorsed a principle of increasing 
defense spending by 3% per year above GDP growth. The Ministry of 
Defense estimates that defense spending after 2000 may reach 2.7% to 
3.0% of GDP.
Hungary
      Democracy/Governance
    Hungary is a stable parliamentary democracy. Hungary adopted a new 
constitution in December 1990, and is currently working on a revision 
of the constitution. Hungary has held two free and fair elections to 
the national parliament. It has stable governmental institutions and an 
independent judiciary. Hungary is a member of the Council of Europe and 
has ratified numerous international conventions on human rights.
    Hungary's last parliamentary elections were held in April 1994, and 
the next elections are scheduled to be held in Spring 1998, presumably 
in April. Prime Minister Gyula Horn leads a center-left coalition 
government comprised of the Hungarian Socialist Party and the Alliance 
of Free Democrats. The coalition commands a two-thirds majority in the 
386-seat, unicameral legislature. Horn's Socialist Party is not 
expected to undergo major changes before the next elections, although 
the party has not yet selected its next Prime Minister-designate. 
Despite periodic crises in the coalition, Free Democrat leaders predict 
that the party will remain part of the government until the next 
elections. Other parties vying for better positions in the next 
elections include the centrist Federation of Young Democrats-Hungarian 
Civic Party and the populist Independent Smallholders' Party.
    A foreign policy priority for Hungary has been relations with 
neighboring countries that have large ethnic Hungarian minorities. Both 
NATO and the European Union (EU) emphasized that regional disputes must 
be resolved prior to entry into either institution. In 1996, Hungary 
ratified basic treaties with Slovakia and Romania that included 
provisions on ethnic minority rights and the inviolability of 
frontiers.
    Of the three countries, Hungary is the only one that will hold a 
binding referendum on NATO membership. On October 7, 1997, the 
Hungarian parliament approved a set of government-endorsed questions on 
NATO membership and on land ownership. The joint referendum is 
scheduled to be held on November 16, 1997.

      Economy

    Hungary's approach to economic transformation from a command 
economy built upon its longstanding experience with gradual reforms 
under communism. After 1989, Hungary adopted price and trade 
liberalization and institutional and legal changes. Hungarian 
industries attracted the highest levels of foreign investment in the 
region. Hungary has a heavy foreign debt burden but has been 
consistently able to meet its debt service obligations. In early 1995, 
the Horn government embarked on an extensive economic stabilization 
program designed to redress Hungary's budget and current account 
deficits. The austerity program, while hugely unpopular, did much to 
reverse the imbalances and restore international confidence in the 
Hungarian economy. Hungary's economy experienced modest growth in 1994 
and 1995, but declined to 1% growth in 1996, largely as a result of the 
austerity program. Overall, the private sector produces approximately 
75% of GDP in Hungary.

      Military Capabilities

    Never large, the Hungarian armed forces now total about 60,000 
personnel (Army--45,000; Air Force--15,000). Unit restructuring in 
accordance with NATO brigade/corps organization is well underway. The 
officers and NCOs of a designated ``NATO Brigade'' are undergoing 
military and English-language training sponsored by current NATO 
members. Hungary currently has a battalion (550+ personnel) 
participating in NATO's Bosnia operation and hosts a major NATO 
logistics facility in southern Hungary in support of those operations. 
To facilitate the U.S. presence, Hungary has brought into force a 
bilateral supplement to the NATO PFP Status of Forces Agreement, 
granting additional privileges and immunities to U.S. forces and 
contractors. Hungarian armed forces have participated in over 50 
Partnership for Peace exercises with NATO.
    Very austere defense budgets have led Hungary to continue procuring 
some military equipment from Russia as part of a debt-forgiveness 
program (e.g. MiG-29 fighters, S-300 air defense missiles). Other 
recent modernization efforts have focused on meeting NATO air traffic 
control and air defense communications standards. After a six-year 
decline, defense spending increased in 1997 by 22% to 96.8 billion 
forint ($484 million), although this amount is expected to represent 
less than 1.5% of GDP. The Ministry of Defense will request a dramatic 
increase in the 1998 defense (160 billion forints/$800 million); 
however, Parliamentary Defense Committee Chairman Imre Mecs estimates 
that a 15%-20% increase to 104-115 billion florints ($520-$575 million) 
for defense spending may be more realistic. Hungary has restructured 
and downsized its military force to be NATO compatible and more readily 
attain NATO standards. Top priorities include the U.S.-sponsored 
Regional Airspace Initiative, the development of the NATO brigade, and 
building peacekeeping capability. The budget for the Ministry of 
Defense increased in real terms in 1997, and plans are to do so again 
in 1998. If, as pledged, defense spending increases over the next 
decade, priority modernization efforts will include:

   Fighter aircraft
   Main battle tanks
   Armored fighting vehicles

    It is not yet clear to what extent Hungary will begin to turn to 
Western defense firms to fulfill its modernization requirements or will 
continue to use Russia and Belarus as cheaper sources for needed 
equipment. It could be expected that NATO membership will significantly 
increase the pressure to rely upon military equipment produced in NATO 
countries.
Czech Republic
      Democracy/Governance

    The Czech Republic is a parliamentary democracy. The state's 
democratic institutions and charter of fundamental rights are 
established in the December 1992 constitution. Members of parliament 
have gained their mandates through free and fair elections. The central 
governmental institutions function smoothly, and the judiciary is 
independent. The Czech Republic is a member of the Council of Europe 
and has ratified numerous international conventions on the protection 
of human rights. Czech President Vaclav Havel, himself a former 
political prisoner of the communist regime, is a world-renowned 
advocate of human rights and social justice. The Czech Republic's Roma 
(Gypsy) minority population has been targeted with forms of 
discrimination and violence; a recent surge in the number of Czech Roma 
seeking to leave the country has heightened international scrutiny of 
the Roma situation in the Czech Republic. Some observers contend that 
the Czech citizenship law discriminates against the Roma minority.
    Since 1992, the Czech Republic has been governed by a center-right 
coalition headed by Vaclav Klaus of the Civic Democratic Party. The 
last parliamentary elections were held on May 30-June 1, 1996, for the 
Chamber of Deputies and on November 15-16/22-23, for the Senate. The 
ruling three-party coalition lost its parliamentary majority by two 
seats. The opposition Social Democratic Party gained substantially from 
the last election and won the second largest number of parliamentary 
seats. The next elections for the Chamber of Deputies are scheduled to 
be held in mid-2000; however, some observers doubt that the current 
government will complete its term if it cannot broaden its political 
support. On June 10, 1997, the Klaus government barely passed a vote of 
confidence in parliament by a vote of 101-99. In September, Klaus 
asserted that the political situation had since stabilized.

      Economy

    The Czech Republic's transformation from a centrally planned 
economy has progressed steadily since 1991. Early elements of the 
reform program included price liberalization, tight monetary and fiscal 
policies, and large-scale voucher privatization. Industry remains the 
largest productive sector, with services, including tourism, growing 
rapidly. Since mid-1996, the political stalemate between the governing 
coalition and opposition has contributed to adverse macroeconomic 
conditions after years of steadfast and successful reforms. In April 
and May 1997, the Klaus government imposed harsh austerity measures 
designed to redress economic imbalances and spur economic growth. The 
reforms included large budget cuts, a currency devaluation, stronger 
regulatory mechanisms, and swifter large privatization. In 1996, the 
Czech economy grew by about 4%. GDP growth for 1997 was estimated to 
drop to 2.7%; however, devastation of much of the country because of 
severe flooding in mid-year may take its toll on economic growth for 
1997.

      Military Capabilities

    U.S. defense officials recently warned the Czech government that 
its defense spending levels were unacceptably low, and that its efforts 
to achieve NATO-interoperability and force modernization were lagging 
behind those of the other prospective members. The Czech Republic has 
the smallest military of three, with about 56,000 personnel (Army--
38,000; Air Force--14,000; logistics corps - 4,000). As with Poland and 
Hungary, unit restructuring and redeployment is ongoing; select 
officers and NCOs are being trained in NATO schools, and modernization 
programs have focused on air traffic control and air defense 
communications. The Czechs have a battalion (600+ personnel) serving in 
Bosnia, and have contributed troops to the ongoing U.N. peacekeeping 
mission in Croatia. A Czech chemical warfare defense unit joined the 
U.S.-led coalition in the Persian Gulf War, and Czech troops have 
participated in 27 Partnership for Peace exercises.
    In 1996, the Czech parliament voted to increase defense spending by 
0.1% of GDP each year for the next four years. The 1996 defense budget 
corresponded to about 1.8% of GDP, using Czech methodology; this amount 
does not include costs of the Czech contribution to SFOR or the budget 
for civil defense. The Czech government draft budget for 1998 includes 
an increase in the military budget despite deep cuts in other spending. 
Defense officials expect that the indirect costs of membership, i.e. 
costs for modernization, will be high for the Czech Republic, but that 
costs for this purpose were necessary before the invitation to join 
NATO and had already been planned. It is expected that about 20% of the 
defense budgets will be devoted to modernization.
    Assuming that the parliament approves the government's proposed 
defense spending increases over the next several years, priority needs 
for the Czech armed forces will include:

   L-159 light attack aircraft (domestic production)
   Fighter aircraft
   Attack helicopters
   Air-to-air and air defense missiles
   Upgrade T-72 tanks to NATO standard
   Command and control communications

Czech officials emphasize the participation of Czech defense industries 
in the procurement effort as a means to maximize spending for 
procurement.
                                      

                                      

                  EXCERPTS FROM: ``NATIONS IN TRANSIT

                                  1997

                  civil society, democracy and markets

                         in east central europe

                   and the newly independent states''

      Edited by Adrian Karatnycky, Alexander Motyl and Boris Shor

  Published by Freedom House, Inc., through the suppport of the U.S. 
                 Agency for International Redevelopment

                                      

                                      

                             CZECH REPUBLIC


                                     Freedom in the World Ratings, 1988-1997                                    
                                                                                                                
                         1988-89   1989-90   1990-91   1991-92   1992-93   1993-94   1994-95   1995-96   1996-97
                                                                                                                
Political Rights              7         6         2         2         2         1         1         1         1 
Civil Liberties               6         6         2         2         2         2         2         2         2 
                                                                                                                
    Status                   NF        NF         F         F         F         F         F         F         F 
                                                                                                                


                                         Polity: Consolidated Democracy

                                           Economy: Consolidated Market

                                                 Population: 10,357,000

                                                            PPP: $7,690

                Ethnic Groups: Czechs (94 percent), Slovak (3 percent),

                                                       Roma (2 percent)

                                                        Capital: Prague

_______________________________________________________________________

Political Process  1.25/7
    1. When did national legislative elections occur? The first post-
1989 national legislative elections in Czechoslovakia in June 1990 were 
won by dissident Vaclav Havel's Civic Forum movement, which led 
peaceful demonstrations that brought down the hard-line Communist 
government. In the June 1992 national elections, two opposing parties 
each gained clear majorities in the different republics. Vaclav Klaus' 
center-right and pro-radical reform Civic Democratic Party (ODS), 
emerged victorious in the Czech lands. In the Slovak Republic, the 
Movement for a Democratic Slovakia (HZDS) headed by Vladimir Meciar was 
the clear winner. Irreconcilable differences between the parties and 
their leadership led to the breakup of the Czechoslovak federation. 
With the countries divorce on January 1, 1993, Klaus and Meciar became 
the prime ministers of their respective republics.
    The June 1996 parliamentary elections for the Chamber of Deputies 
heralded the end of the transitional phase in the Czech political 
scene, with two strong parties on the left and right in the Western 
European mold, emerging from transition. As expected, the ODS won 
nearly 30 percent of the vote (68 seats) a nearly identical result to 
1992. The big winner on the opposition side was the center-left Czech 
Social Democrats (CSSD), led by Milos Zeman, who with 26 percent (61 
seats), quadrupled their returns from 1992. Unlike the typical social 
democratic party in the region which is a ``reformed" communist party, 
the CSSD comes out of a long pre-Communist tradition of center-left 
politics.
    The other parties winning seats in the Chamber were: the 
unreconstructed Communist Party of Bohemia and Moravia (KSCM) with 10.3 
percent (22 seats), the Christian Democratic Union (KDU) with 8 percent 
(18), the extremist nationalist Republican Party with 8 percent (18), 
and the free-market Civic Democratic Alliance (ODA) with 6.3 percent 
(13). Foreign observers deemed the 1990, 1992, and 1996 elections free 
and fair.
    The CSSD victory does not, however, reflect a fundamental shift to 
the left among the populace; rather, the party has successfully 
gathered most of the votes scattered among various leftist parties. 
However, the disappointing results for the governing coalition in a 
climate of continuing economic growth give evidence to the damage 
wrought by various scandals.Unlike elsewhere in Eastern Europe, the 
Communists and Republicans remain marginal political forces unlike 
elsewhere in Eastern Europe.
    The parties of the governing coalition only managed ninety-nine of 
200 seats, down from the 105 seats before the election. As a result of 
failing to win an outright majority, the ODS-led coalition was not 
assured of forming a government. The CSSD extracted concessions from 
the ODS led coalition in return for its acquiescence in the formation 
of a minority government, which occurred in July 1996, with Klaus as 
prime minister. The CSSD received leadership positions in five 
parliamentary committees and the speakership of Parliament for Zeman in 
return. The CSSD was unable to force the dismissal of Klaus, Ruml, and 
Jindrich Vodicka (labor).
    In December 1996, two CSSD deputies (Budget Committee chairman 
Jozef Wagner and Tomas Teplik) who voted for the government's 1997 
budget were expelled from the party and now give the governing 
coalition a one-seat majority in the Chamber. This move, and the 
undemocratic means by which it was carried out, has damaged the 
reputation of the party. It also underscores the major divisions that 
are present in the CSSD between its moderate wing led by Karel Machovec 
and its strident leftist faction.
    The 1992 constitution established a Senate along with the dominant 
Chamber. However, lack of clarity in the constitutional text and 
political wrangling over electoral procedure postponed Senate elections 
for four years. Two rounds of Senate elections were held in November 
1996. Some 570 candidates registered to compete for Senate seats in 
eighty-one electoral districts, but 100 of these registrations were 
rejected by the Central Electoral Commission because of technical 
mistakes (some of which were subsequently overturned by the 
constitutional court). Only three parties, ODS, KSCM, and CSSD, 
nominated a candidate in every district. ODS won the election, but not 
overwhelmingly so, with 32 seats and a 39.6 percent share of the vote. 
The Social Democrats followed with 25 seats and 30.9 percent of the 
vote. The Christian Democrats won 13 seats, the ODA 7 and the 
Communists 2. The second round vote was viewed as a referendum on the 
ODS. Seventy-six ODS candidates made it to the second round, but only 
40 percent won. This was after all the other parties, even ODS 
coalition allies, united to back whoever was opposing the ODS candidate 
in that district. Over the objections of the ODS and with the support 
of the Social Democrats, the KDU successfully nominated its candidate, 
Petr Pithart (the Czechoslovak premier from 1990-1992), as Senate 
chairman.
    2. When did presidential elections occur? Vaclav Havel was elected 
President of the Czechoslovak federation in December of 1989 by the 
Federal Assembly. He was then elected President of the Czech Republic 
by the Czech Chamber of Deputies in January 1993. The constitution 
stipulates that presidents serve five-year terms. Since the dissolution 
of Civic Forum, Havel has had no political party affiliation.
    3. Is the electoral system multiparty-based? Are there at least two 
viable political parties functioning at all levels of government? The 
electoral system is multiparty-based. Article 5 of the constitution 
notes that ``the political system is based on free and voluntary 
formation of and free competition between political parties."
    Parties began forming in late 1989 and early 1990 for the June 1990 
legislative elections in Czechoslovakia. At least two political parties 
function at different levels of government. Candidates often run 
independently in local elections, where personal popularity can be more 
important than party membership. About 40 percent of the vote in the 
November 1994 local elections went to independents. One newly elected 
senator is an independent, and another is a member of the extra-
parliamentary Democratic Union Party.
    4. How many parties have been legalized? More than fifty parties 
have emerged since the revolution of 1989. Fewer than twenty-five 
parties registered for the local elections in November 1994, and fewer 
than ten of these are of national importance. Twenty parties registered 
for the June 1996 parliamentary elections, but only six managed to 
clear the 5 percent threshold necessary for representation.
    In the run-up to the July 1996 elections, small parties complained 
discrimination by the Central Electoral Commission, composed of 
representatives from individual parties who make decisions by a 
majority vote. The Commission ruled that the Free Democrats--Liberal 
National Social Party (FD-LNSP) was a coalition and not a single party, 
which raised its required share for Chamber representation from 5 to 7 
percent. The party complained that the Social Democrats and the other 
leftist parties were attempting to disqualify them through legalistic 
means. The Constitutional Court stepped in and ruled in favor of the 
FD-LNSP. Nevertheless, the FD-LNSP was unable to break even the 5 
percent barrier.
    In March 1996, Internal Affairs Minister Jan Ruml announced that he 
would attempt to outlaw the new Party of Czechoslovak Communists (PCC), 
led by Miroslav Stepan (the only communist imprisoned after 1989). 
Arguing that Stepan sought a ``renewal of socialism," Ruml wanted to 
use the authority of the Crimes of Communism Act; however, Vaclav Klaus 
eventually vetoed the move.
    5. What proportion of the population belongs to political parties? 
The number of party members registered is between 8-12 percent of the 
adult population, but is not a very accurate measure of support given 
the relatively high level of voter turnout.
    6. What has been the trend of voter turnout at the municipal, 
provincial and national levels in recent years? Voter turnout in the 
Czech Republic has fallen since transition. In the first post-
transition election in 1990, more than 90 percent of citizens voted. In 
the 1992 federal (Czechoslovak) elections, 85 percent of the population 
voted, although turnout was higher in the Czech republic than in the 
Slovak republic. Turnout in the November 1990 Czechoslovak local 
elections was 73 percent in the Czech lands and 63 percent in Slovakia, 
for an approximate national average of 70 percent. Excluding Prague, 
turnout in the November 1994 local elections averaged 54 percent in 
large cities and about 64 percent in towns and villages.
    Voter turnout in 1996 was split. The Chamber election turnout was 
relatively high at 76 percent. On the other hand, the voter turnout for 
the 1996 Senate election was extraordinarily low: 35 percent in the 
first round, and 30 percent in the second. The fact that the Senate is 
an unpopular institution (even more so than the Chamber), combined with 
the election-weariness of having two nationwide polls close together, 
help account for this result.
Civil Society  1.50/7
    1. How many nongovernmental organizations have come into existence 
since 1988? How many charitable/nonprofit organizations? As of mid-1995 
there were about 2,500 foundations and over 25,000 civic associations 
(compared to about 2,000 in 1988) existing in the Czech Republic, 
including approximately 50 Romany associations. Some international 
charitable organizations such as the Salvation Army, have extensive 
operations in the Czech Republic.
    The growth of the so-called Third Sector has been obstructed by 
delays in the passage of legislation on nonprofit organizations, as 
well as, economic constraints. These entities did not have a special 
legal status until the adoption of this legislation. In addition, a tax 
law passed in 1994 rescinded past favorable treatment of nonprofit 
organizations, over the objections of President Havel. In a compromise, 
the legislature empowered the Finance Ministry to enact appropriate 
regulations for nonprofits. Draft Laws on nonprofit organizations were 
long delayed until late 1995 when three bills came up for passage.
    Foreign sources of funding have supplied about half the revenue 
consumed by Czech nonprofits. Nongovernmental organizations have come 
to rely more and more on corporate and individual contributions as 
governmental, U.S., and European Union (PHARE) assistance is slowly 
being phased out.
    2. What forms of interest group participation in politics are 
legal? Such activities are not yet legally regulated, and some such 
activity exists. However, interest groups have relatively little power 
in the political process at this time. Public petitions and 
demonstrations are legal and unrestricted.
    3. Are there free trade unions? The Communist Revolutionary Trade 
Union (ROH) was abolished in March 1990. Most unionized workers belong 
to the Czech-Moravian Chamber of Trade Unions (CMKOS), which was 
established in April 1990 and is currently constituted of thirty-five 
individual unions. There are some unions outside CMKOS, but these 
remain marginal.
    About two-thirds of all workers are members of a union. Despite 
this apparent strength, the CMKOS generally remains politically 
independent. This is the result of many factors, foremost among them 
being the severe mistrust unions earned in the Communist period as 
puppets of the Communist party.
    4. What Is the numerical/proportional membership of farmers' 
groups, small business associations, etc.? There are at least three 
farmers groups. They are not very large, as farmers make up only 5 
percent of the workforce. Two small business associations merged in 
1994 to consolidate their interests. Their membership and influence 
continue to grow.
Indepdendent Media  1.25/7
    1. Are there legal protections for press freedom? The Charter of 
Basic Rights and Freedoms protects the right to a free press. While 
there is currently legislation protecting both printed media and 
broadcasting, they are out of date. The updates to much-debated laws 
were still not adopted by the end of 1996. Czech journalists have 
criticized the draft laws for not requiring that state bodies give 
information to the press and for failing to protect journalists right 
to keep the confidentiality of their sources.
    2. Are there legal penalties for libeling officials? Are there 
legal penalties for ``irresponsible'' journalism? In April 1994, the 
Constitutional Court struck down a law that allowed for the prosecution 
of those accused of defaming government officials. However, a provision 
against defamation of the president and the Republic was retained, as 
well as a provision allowing prosecution for the slander of government 
officials or departments. There are no legal penalties for 
irresponsible journalism.
    Those guilty of defaming the Republic and the President can be 
punished with prison terms of up to two years. However, the handful of 
people actually convicted under this law have only been given suspended 
sentences by the courts. What is more, Havel routinely pardons those 
who are given even this punishment. In March 1996, for example, Havel 
pardoned Pavel Karhanek, who had received a nine-month suspended 
sentence for calling Havel a former alcoholic, swindler, and Communist 
collaborator.
    3. What proportion of media is privatized? The Czech Republic has 
scores of private newspapers and magazines. Of the Czech Republic's 
four television stations, two are private, TV Nova (71 percent market 
share) and TV Prima (which emerged from the struggling Premiera TV). 
There are sixty private radio stations, in addition to Czech Public 
Radio. Some major cities can connect to cable stations. Local stations 
are allowed but are not common (probably due to financial concerns). 
One private news agency, CTA, began operations in October 1994, and 
will compete with the state CTK agency.
    4. Are the private media financially viable? From 1992 to 1995, 
press media costs increased 300 percent. This combined with the 
overcrowded nature of the market has caused major turbulence, with the 
rapid disappearance of old publications and the rapid appearance of 
new, merged, or reformed publications with a firmer financial 
situation, mostly the result of foreign investment. By March 1996, over 
half of the Czech press had foreign owners. The largest holders are the 
Swiss, French, and especially Germans. Media without foreign 
investment, government support, or party support often have only 
limited solvency. Advertising rates and revenue have increased rapidly 
and is expected to reach Kc 10.6 billion in 1996 ($393 million).
    5. Are the media editorially independent? Apparently, the largest 
threat to independent journalism stems from financial concerns. In 
January 1994, the editor of Lidove Noviny, one of the largest and most 
influential dailies, resigned, stating that the Swiss company holding 
51 percent of the paper was compromising the publication's 
independence. There is an independent journalists association.
    The case of Vladimir Stehlik, owner of the giant and bankrupt Poldi 
Steel Company, illustrates some of the problems with editorial 
independence in the Czech Republic. Both the government and TV Nova 
have been very critical of Stehlik and his business practices, which 
are under investigation. He managed to purchasePrace, a trade-union 
daily, which now regularly attacks both the government and TV Nova. Of 
course, this is nothing new; Denni Telegraf is considered to be an ODS 
mouthpiece.
    6. Is the distribution system for newspapers privately or 
governmentally controlled? There are three main printing companies in 
the Czech Republic. Typografia, a large printing company in Prague, is 
responsible for the printing of many national dailies. It is slated for 
privatization.
    7. What has been the trend in press freedom? Freedom House's 
annualSurvey of Press Freedom rated Czechoslovakia Partly Free for 
1989, and Free from 1990 through 1992. The Survey rated the Czech 
Republic Free from 1993 through 1996. The Economist calculates that the 
Czech Republic has the fourth most free press in the world, ahead of 
Germany (seventh) and Britain (ninth). However, current press law does 
not mandate the right of media to access state information, and the 
protection of confidentiality of sources is not entirely clear.
Rule of Law  1.50/7
    1. Is there a post-Communist constitution? In December 1992, the 
Czech constitution was adopted by the Czech National Council. It took 
effect in January 1993, with the dissolution of the federal state.
    2. Does the constitutional framework provide for human rights? Do 
the human rights include business and property rights? The Czechoslovak 
Federal Assembly adopted the Charter of Fundamental Rights and Freedoms 
in January 1991, which protects human rights. Although this charter is 
not in the Constitution per se, according to Article 3 of the new Czech 
Constitution, this charter is ``an integral component of the 
constitutional system." Furthermore, Article 10 commits the Czech 
Republic to abide by ratified international treaties on human rights. 
Everyone has the right to own property according to Article 11 of the 
Charter.
    3. Has there been basic reform of the criminal code/criminal law? 
While the criminal code has undergone many revisions and amendments 
since 1989 (including a fairly significant law in 1993), an entirely 
reformed penal code has still not been adopted. Former Justice Minister 
Jiri Novak announced that the much-delayed code would come up for a 
vote by October 1996.
    The civilian Internal Security Service (BIS) is independent of 
Ministry control, but reports to parliament and the Prime Minister's 
office. Police and BIS authorities generally observe constitutional--
and legal protection of individual rights in carrying out their 
responsibilities. However, there were occasional reports of abuses by 
some members of the police, disproportionately directed at Roma and 
foreigners.
    The time it took for a case to go to trial has increased from 89 
days in 1989 to 216 days in 1996. 39 percent of prisoners are awaiting 
trial. This is due to the lack of experienced judges, investigators and 
a still evolving legal environment.
    4. Do most judges rule fairly and Impartially? How many remain from 
the Communist era? Judges reportedly rule fairly and impartially. A 
great number of judges were dismissed between 1989 and 1992 for 
connections with the former Communist regime. Many resigned voluntarily 
and now have private legal practices. The 1991 law on the judiciary 
designated judges appointed after January 1990 to be life appointments. 
Those appointed before 1990 were to be dismissed as of August 1992, 
unless they were reappointed within twelve months. Once reappointed, 
they can hold their positions for life. There are now fifteen judges on 
the Constitutional Court with ten-year terms, appointed by the 
president (court established in July 1993).
    5. Are the courts free of political control and influence? Are the 
courts linked directly to the Ministry of Justice or any other 
executive body? Article 82 of the constitution notes that ``(1) Judges 
shall be independent in the performance of their office. Nobody may 
jeopardize their impartiality. (2) A judge may not be recalled or 
transferred to another court against his will; exceptions, ensuing in 
particular from disciplinary liability, shall be specified by law." 
Justices of the Constitutional Court are protected from interference by 
Article 86. Life tenure, and pay increases for judges have led to 
improved judiciary independence.
    However,judges retain administrative connections with the Ministry 
of justice, through which judges are appointed and promoted. A 1995 
Czech Helsinki Committee report notes frequent interference in ongoing 
investigations and court trials by politicians making pronouncements 
through the media.
    The earnings gap between judges and private sector attorneys is 
much bigger than in the West. Partly as a result of Czech legal 
education policy, which separates training for lawyers and judges, and 
partly because of the mistrust they earned under the Communists, 
magistrates do not yet enjoy Western nonpecuniary benefits of prestige 
and respect. Judges also do not always have adequate support resources 
in the form of law clerks, court reporters, bailiffs, and legal 
materials.
    6. What proportion of lawyers is in private practice? It is 
estimated that over half of all lawyers are employed by private groups 
(Czech and foreign groups, legal firms and other corporations). 
Salaries for lawyers in the private sector are substantially larger 
than for those in the public sector. Lawyers must belong to the Czech 
Bar Association in order to practice law.
    7. Does the state provide public defenders? The Charter of 
Fundamental Rights and Freedoms guarantees access to legal assistance 
to indigent accused, and the state does indeed provide public defenders 
in criminal and some civil cases. However, the International Helsinki 
Committee notes that many who would otherwise be eligible for such aid 
do not receive it because the process involved is complicated.
    8. Has there been a comprehensive reform of antibias/discrimination 
laws, including protection of ethnic minority rights? The Czech 
Republic has few problems regarding minorities, partly because the 
total percentage of minorities living in the country is between 2 and 6 
percent. However, skinhead attacks, particularly against Romanies 
(Gypsies) are not unusual. There were forty-two reported racially 
motivated attacks in first two months of 1996.
    There have been reports of neglect and even abuse by police who are 
often slow to respond to calls for help by Roma who find themselves the 
targets of hate crimes. Observers have noted that local courts 
sometimes mete out minor penalties for hate crimes, and deal more 
harshly with Roma than with Czechs. There are signs of pressure for 
change from the center. In January 1996, a special department was 
established to deal with extremist groups, and directives were issued 
to prosecutors to seek higher penalties in hate crime cases. In May 
1996, the Olomouc high court overruled a lower court in concluding that 
the 1995 murder of Tibor Berki, a Romany, was racially motivated, which 
led to a harsher sentence for the convicts.
    Citizenship for minorities remains an unresolved issue in the Czech 
Republic. Between 10,000 and 24,000 people, mainly the minority Roma, 
are de facto stateless. This is due to the cumbersome and overly 
bureaucratic naturalization procedures in Czech law. There are reports 
of Roma being denied citizenship when all necessary requirements have 
been met. However, fears of mass deportations have not been borne out.
    The restitution of Jewish and church property has been a slow 
process, partly due to administrative complications, but also due to 
hesitation and even opposition from the political left.
Governance and public Administratioon  2.00/7
    1. Is the legislature the effective rule-making institution? Yes, 
the Czech parliament is an effective rule-making institution. In 1995, 
the Chamber of Deputies adopted some 300 statutes. Vaclav Klaus and the 
ODS effectively ran the legislature to push forward their reform 
programs from 1992 to 1996. However, as a result of two inconclusive 
parliamentary elections in 1996, a tense political stalemate descended 
on the country which slowed legislative action on a host of pressing 
issues.
    2. Is substantial power decentralized to subnational levels of 
government? In November 1990, under the Czechoslovak administration, 
several regional reforms took place: the ten-region system (seven Czech 
regions, three Slovak) used under communism was eliminated; districts 
were placed under the administration of each republic; and municipal 
governments were made self-governing bodies. Thus, the Czech republic 
is subdivided first into seventy-six districts that are not autonomous 
and second into thousands of local municipalities that are.
    Article 8 of the constitution specifies that ``self-government of 
territorial self-governing units is guaranteed," while Article 10 1 
states that the ``State may intervene in the activities of self-
governing territorial divisions only if such intervention is required 
by protection of the law and only in a manner defined by law." Chapter 
7 of the Constitution deals specifically with local rule. It 
establishes the division of the Czech Republic first into communities 
``which shall be the basic self-governing territorial divisions" and 
which shall be ``administered by a community assembly." These include 
city councils which govern towns, villages, and small cities, as well 
as district councils which govern sections of larger cities.
    The constitution goes on to add, however, that ``the superior self-
governing territorial divisions shall be lands or regions" which shall 
be ``administered by an assembly of representatives." Thus although the 
constitution establishes the order of authority, it does not specify in 
more detail the composition and features of this middle tier of 
government.
    The continued process of regional reform has been a subject of 
intense debate in both successor republics to the Czechoslovak state. 
In the Czech Republic, the establishment of self-administrative regions 
has been complicated by fears of increased nationalist sentiment in the 
historical lands of Moravia and Silesia, as well as conflicts among 
parties. On the other hand, there is widespread feeling failure to 
establish such regions could stall entry into the EU.
    A constitutional amendment written by the ODA on the establishment 
of a medium tier of elected government between the central government 
and the community councils was debated in March and April 1996. It was 
to establish nine regional bodies. The Constitution actually calls for 
such bodies, but does not specify their composition or when they should 
be created. The bill was opposed principally by the ODS, who questioned 
whether creating these regional bodies was wise in a country as small 
as the Czech Republic. A January 1996 poll showed lukewarm support for 
such bodies: only 25 percent of Czechs considered the lack of them a 
pressing problem, but 43 percent thought they would improve state 
administration (29 percent thought the opposite).
    The coalition agreement signed after the June 1996 elections 
committed the government to establish these regions before the end of 
its term in the year 2000. Jan Kalvoda, chairman of the ODA and then-
justice minister, proposed the establishment of thirteen regions with 
fairly considerable authority, including management of roads, schools, 
cultural institutions, health facilities, and forests.
    3. Are subnational officials chosen in free and fair elections? 
Article 102 of the constitution mandates that ``Assembly members shall 
be elected by secret ballot on the basis of universal, equal and direct 
suffrage." According to the 1990 reforms, municipal or communal 
governments consist of assemblies chosen in local elections. These 
bodies then elect mayors and their deputies. District officials are 
appointed by the state, as districts are branches of the state. The 
first post communist local elections in 5,766 municipalities were held 
under these new rules in November 1990. Civic Forum won those elections 
with 35.6 percent of the vote. This victory, coming in the midst of a 
national debate about economic reform, gave a mandate to the government 
to continue on the radical reform path.
    The ODS won the largest percentage of the vote in the November 1994 
local elections, gaining 28 percent of the vote in the district 
councils and nearly 11 percent in the city councils. It was also 
victorious in Prague, with 41.2 percent of the vote. However, Josef 
Lux's Christian Democratic Union received the greatest actual number of 
seats because its strength was in the more rural city councils where 
fewer voters were apportioned per seat. Despite expectations that they 
would do well, the Communists fared quite poorly. Independent 
candidates were a significant factor in the election, winning a bit 
under half of the city council seats and 13 percent of the district 
council seats.
    The 1990 and 1994 local elections were generally deemed free and 
fair. The next local elections are scheduled for November 1998.
    4. Do legislative bodies actually function? In theory, the presence 
of the Senate should help stabilize politics in the Czech Republic. 
Article 33 of the constitution stipulates that if the Chamber is 
dissolved, the Senate would take over until new elections. Due to the 
absence of a Senate, there was no practical constitutional way to 
dissolve the Chamber before November 1996. However, the low turnout in 
the Senate elections and its low popularity as an institution could 
undermine its legitimacy.
    Local assemblies have the power to pass ordinances, call local 
referenda, and approve budgets. They have executive and legislative 
powers. Districts function as branches of the state and appear to work 
smoothly.
    5. Do the executive and legislative bodies operate openly and with 
transparency? Article 36 of the constitution guarantees that ``meetings 
of both chambers [of Parliament] shall be public. The public may be 
excluded only under conditions defined by law." Legislative sessions 
are generally open to the public in practice and new laws are 
published. The transparency of local actions depends largely upon the 
quality of local media, which varies among regions.
    6. Do municipal governments have sufficient revenues to carry out 
their duties? Do municipal governments have control of their own local 
budgets? Do they raise revenues autonomously or from the central state 
budget? Article 101 of the constitution stipulates that the self-
governing regions have their own budgets and may have their own 
property. Former ODA Chairman Kalvoda's proposed regions would have 
control of their own budgets. They would draw revenue from local taxes, 
property income, administrative fees, and state subsidies. Municipal 
governments have the power to approve budgets. It is estimated that 
municipalities received 43.5 percent of revenues from the state budget 
in 1995, versus 40.6 percent in 1994. Apart from Prague, selling and 
renting real estate is an important source of revenue.
    Municipalities are generally financially strapped and mayors of 
small communities often do not receive financial compensation. 
Municipal governments in poor, industrialized areas such as northern 
Bohemia have reported difficulty in raising funds to attend to their 
communities needs.
    7. Do the elected local leaders and local civil servants know how 
to manage municipal governments effectively? There is substantial 
inefficiency at the local level due to the presence of incompetents 
appointed by the communists because of political connections, 
inexperience, as well as uncertainty about the procedural changes 
accompanying multiple reforms. These problems should diminish with 
time. The number of municipalities increased by 50 percent without 
regulatory consent between 1989 and 1990 as some municipalities 
splintered. This situation has led to increased inefficiency. Petty 
corruption (such as small bribes to expedite matters), according to 
observers, is fairly common. For example, there have been allegations 
that civil servants request bribes in order to speed installation of 
telephone lines.
    8. When did the constitutional/legislative changes on local power 
come into effect? Has there been a reform of the civil service code/
system? Are local civil servants employees of the local or central 
government? A reformed civil service law has yet to be adopted in the 
Czech Republic. This has led to confusion about civil servants status 
and responsibilities. Debate on drafts of such laws has been extensive.
    Local reforms were enacted in November of 1990. Further reforms 
were tabled until after the division of the Czechoslovak state, and 
concrete legislation has not yet been passed. Reforms of the civil code 
have not yet been passed. Local civil servants are paid out of 
municipal budgets. District officials are state appointees.
Privatization  2.00/7
    1. What percentage of the GDP comes from private ownership? In 
1990, Czechoslovakia had the largest state sector of all the East-
Central European countries entering transition, with a negligible 
portion of national output coming from the private sector. As of the 
end of 1996, about 80 percent of GDP was produced in the private 
sector.
    2. What major privatization legislation has been passed? 
Restitution of Communist-confiscated property began in November 1990 
and lasted until September 1991. Some Kcs 75-125 billion worth of 
property was moved into private hands through restitution, including 
some 100,000 physical properties (houses, farms, shops, and the like).
    Small privatization of enterprises like shops, service 
establishments, and restaurants followed restitution and was slightly 
more controversial. Despite strong pressure for insider (manager and 
worker) preferences in the form of closed rounds of auctions restricted 
solely to employees of the firms being privatized, the parliament voted 
down any such preferences in the summer of 1990. Once assets were 
selected to be privatized, the auctions were open to all Czech 
citizens, with no special preferences. The auctions began in January 
1991 and were concluded at the end of 1993, although the majority of 
small enterprises were sold by April 1992. Over 22,000 small 
enterprises were sold, with shops constituting 58 percent of sales, 
service establishments 18 percent, restaurants 8 percent, and motor 
vehicles 7 percent. The total value transferred through the small 
privatization program amounted to a little over Kcs 30 billion (over US 
$ 1 billion).
    The foundation for large-scale privatization was laid in April 1990 
when laws establishing the legal foundation for converting state-owned 
enterprises (SOES) into joint-stock companies. In the first half of 
1990, the 100 large trusts which dominated the state sector were split 
into 330 independent enterprises, while the vast majority of communist-
appointed top directors were dismissed in favor of their deputies. With 
the need for speed and competition in mind, the large scale 
privatization law was passed in April 199s1. The initial large-scale 
privatization program was divided into two waves, the first beginning 
in February 1992 and the second in April 1994. Privatization of each 
enterprise was centered around the ``privatization project." These were 
proposals for the future of each firm, including restructuring and some 
combination of five different privatization instruments: transformation 
into a joint-stock company (so-called voucher privatization), direct 
sale to predetermined buyers, public auction, or free transfer to 
municipalities or trust funds. Management was required to submit a 
basic privatization project, but anyone was allowed to submit competing 
projects. These projects were submitted to a ``black box" decision 
making process at the Ministry of Privatization. There was, however, no 
institutional bias in favor of insiders.
    Mirroring the experience with restitution and small privatization, 
the deadlines in large privatization were extraordinarily tight, and 
were only prolonged by several months at most. For example, the 
compilation of assets to be privatized in both waves was due by July 
1991. Management's basic projects for the first wave were due by 
November 1991 to their founding ministry, and one month later to the 
Privatization Ministry. Competing projects were due by January 1992. In 
the second wave, most projects were due by July 1992. Thus, only six 
months and one year elapsed between the selection of projects due to be 
privatized in the first and second rounds, respectively.
    The requirement of speed served several major goals. The firsts 
mainly economic; to increase enterprise efficiency and resume economy-
wide growth as soon as possible. The second was ideological; the reform 
team's economic philosophy of a radical break with the past required 
this speed. Third, there was a continuing desire on the part of 
reformers to show initial successes to citizens and to maintain a 
certain pace of privatization in order to continue the momentum of 
reform in general. Fourth, rapidity coupled with the transparent and 
widely publicized privatization process limited the scope for 
``spontaneous privatization" actions by management to illegally strip 
assets for personal gain. Finally, the reform team's continuing push 
for speed minimized political opposition by creating what has been 
called a ``feeding frenzy" and a ``gold rush," which forced insiders to 
concentrate on submitting winning privatization projects rather than 
massing political opposition to the process.
    The Ministry of Privatization's project selection criteria gave 
priority to mass privatization components in competing proposals, and 
this institutional bias made the core of the large privatization 
program the so-called voucher program. Three-fourths of medium and 
large enterprises in the beginning of the reform program had mass 
privatization components. The Czech mass privatization program was 
created by Dusan Triska, who had seen the idea suggested in a 1989 
paper by Polish economists, and had heard about a similar experiment in 
British Columbia, where the province had given away shares of a power 
utility to the public in the 1970s. It had never been actually tried on 
a large scale. Most Western academics and observers predicted the 
failure of the large-scale voucher scheme.
    Beginning in 1991, all Czechoslovak citizens 18 and over were 
eligible to purchase a voucher booklet from one of 648 distribution 
centers. The purchase price was nominal at Kcs 1,000 (about $35, or one 
week's worth of average wages). Trading was disallowed until the 
secondary market began following share allocation. Participation in the 
program was only moderate by January 1992, when only 2 million booklets 
had been sold. Then, a firm called Harvard Capital and Consulting 
entered the scene. The firm promised an astounding 1,000 percent return 
to people entrusting it to manage and invest their vouchers in the mass 
privatization rounds. This was followed by the entry of similar 
organizations. These investment privatization funds (IPFS) piqued 
public interest in vouchers and the voucher privatization participation 
rate jumped enormously, to 8.5 million. Approximately 72 percent of 
voucher purchasers invested their points in IPFS.
    Eventually, 264 IPFs formed in the Czech lands for the first wave 
and another 353 formed in the second-wave. The largest IPFs were run by 
commercial and savings banks as well as insurance companies. The 
emergence of these funds actually caught the government by surprise, 
and while they may not have saved the mass privatization program, they 
certainly were one of the most important factors in its success.
    The privatization process has generally been free of major 
scandals. In October 1994, however, Jaroslav Lizner, the Director of 
the Coupon Privatization Center, was arrested and charged with 
corruption in the privatization of the Klatovy Dairy. Lizner apparently 
accepted a Kc 8 million ($300,000) bribe from a police sting operation. 
The affair created some dark clouds over the second voucher 
privatization wave, and a December 1994 poll revealed 40 percent of 
respondents felt that the scandal had undermined the voucher 
privatization program. The continuing popularity of the voucher 
privatization program suggests that this particular scandal, though 
touching one of the very highest offices in the privatization effort, 
was viewed more as an isolated incident than a systemic problem.
    The final results of large privatization show the institutional 
bias in favor of voucher privatization. By the end of December 1993, 87 
percent of the book value of enterprises were converted into joint 
stock companies for voucher privatization, 7 percent were sold by 
direct sale, less than 1 percent were made available by public auction, 
2 percent were given over to public tender, and 3 percent were 
transferred for free to other governmental units. Competition was high, 
with an average of 17 proposals were received for each state firm.
    Privatization has slowed considerably since the heady early years 
of transition. Shares worth Kc 229 billion ($8.3 billion) are still in 
state hands. Part of this is due to the fact that all the easy sell-
offs have already been made. Currently, seventy-seven percent of these 
unsold shares are in fifty-six ``strategic" enterprises and will be 
exceedingly difficult to privatize for political reasons. The 
privatization of the remaining enterprises, owned directly by the state 
or indirectly through the National Property Fund (NPF, the state body 
holding unprivatized equity), will be made on a case-by-case basis. The 
other reason for a slowdown has been the influence of the CSSD, whose 
cooperation is necessary for the weakened governing coalition to make 
major economic policy decisions. It is opposed to further privatization 
in the health care and energy sectors, as well as to restituting Church 
property.
    The other major portion of privatization is the gradual sell-off of 
residual state shares in enterprises privatized in the two waves of 
voucher privatization. By the end of 1995, these had been valued at Kc 
52 billion ($2 billion). The government sold these shares at the pace 
of Kc 2 billion per month through 1996, and intends to finish entirely 
by the end of 1997.
    3. What proportion of agriculture, housing and land, industry, and 
business and services is in private hands?
    Agriculture: Most agricultural land was privatized under 
restitution, a process that began in 1991. Other farms were put up for 
auction. As of mid-1995 it was estimated that about 90 percent of 
agriculture had been privatized, including all former cooperatives and 
most state farms.
    Housing and Land: As part of property reform, the government passed 
a law soon after the 1989 revolution giving housing and land to the 
municipality in which it was located. Those living in these units could 
then apply to buy them from the municipal government at a discounted 
price. This process may vary by municipality. In 1994, legislation was 
passed allowing for the purchase of apartment houses by cooperative 
groups at a discounted price if members reside in the building. As of 
late 1994, it is estimated that approximately 40 to 60 percent of all 
housing units were privatized.
    Industry: It is estimated that the private share of industry topped 
80 percent by early 1996. The remaining industries will be much more 
difficult to privatize. These industries are the so-called strategic 
sector: communications, energy, mining and metallurgy, and 
transportation. However, there have been some recent major 
developments. A Dutch-Swiss consortium purchased a 27 percent stake in 
the SPT telecommunications monopoly in June 1995; 26 percent of the 
enterprise was sold for vouchers while the rest is held by the NPF.
    Another important factor is the retention of ownership by the 
government through two major mechanisms. The first is the National 
Property Fund, which holds minority shares in firms sold through mass 
privatization. However, studies have shown that the NPF board members 
have been extremely passive. Thus, state ownership of enterprise shares 
has not necessarily led to a politicization of business decisions. The 
second mechanism of government ownership is the complex webs of cross-
ownership in the financial sector. The largest banks are still state-
owned, and they hold large equity stakes in investment funds, which in 
turn own newly-privatized companies. While there has not been 
significant evidence of government interference through these links in 
privatized firms, there is still some legitimate cause for caution. The 
ongoing privatization of state-owned banks is an important step to 
finding a long-term solution to this problem.
    Business and Services: Nearly all small businesses and services 
have been privatized. Out of a workforce of five million, the Czech 
Republic now has nearly 900,000 entrepreneurs, mostly involved with 
newly founded businesses rather than former state companies. By 1995, 
the privatization of family doctor, dental, and outpatient clinic 
practices was completed.
    4. Has there been reform of the state sector? (What major 
legislation has been passed? Do authorities and state managers act 
within the law? Is the state sector performing more efficiently? Does 
it require fewer subsidies than before?) Prior to 1989, Czechoslovakia 
had been spending an astonishing 25 percent of GDP on industrial 
subsidies, and it was the massive cutback of this spending that 
provided the bulk of the reduction in government expenditures from 1990 
to 1992. Subsidies fell to only 4.6 percent of GDP--average for market 
economies. Curtailing the growth in the money supply and inexpensive 
credits to SOEs drastically reduced a large indirect subsidy. Together, 
these reductions in subsidies represented a real hardening of budget 
constraints of SOES.
    Particularly large subsidies remain in the agricultural sector, 
transportation, housing, and household energy use. Efforts to balance 
the budget as well as to cut taxes will increase pressure to cut 
subsidies further. In the 1997 budget, industrial subsidies were cut 
with the exception of transportation subsidies. The latter will total 
Kc 5.8 million ($215 million). Other subsidies include agriculture, 
forestry, and water management (Kc 8 billion, or $296 million), and the 
mining industry (Kc 5.1 billion, or $189 million).
    One route the government takes to push reform through hide bound 
state-owned monopolies is to ignore unorthodox and possibly gray-market 
alternatives to their service. For example, the telecommunications 
monopolist SPT Telecom charges extravagant prices for its slow and 
inefficient services. Czech regulators have effectively ignored 
unlicensed call-back services which base operations in low-price 
markets, usually the United States. Another alternative, especially for 
data transmission, is satellite technology which bypasses SPT entirely. 
SPT has begun responding to these competitors by offering improved 
services to corporate clients and introducing radical service 
improvements like itemized billing.
Economy  1.75/7
    1. Has the taxation system been reformed? (What areas have and have 
not been overhauled? To what degree are taxpayers complying? Has the 
level of revenues increased? Is the revenue-collection body 
overburdened?) The old tax system was only slightly reformed from 1990-
1992. This tax system relied mainly on implicit taxation in the form of 
turnover taxes and confiscation of SOE profits. The Czech Republic 
introduced a major tax reform in January 1993, featuring new corporate 
and individual income taxes, and a value-added tax (VAT). There have 
been three major goals of tax reform since the transition. The first of 
these was to subject the mushrooming private sector to normal taxation, 
especially as the government was essentially giving away its tax base 
through privatization and restructuring of SOES. The second goal was to 
broaden the tax base; services were included for the first time. The 
final goal was to reduce the overall burden of taxation. This was done 
by lowering tax rates (which had been as high as 85 percent with 
further levies on profits) and increasing depreciation allowances. The 
new taxes also achieved this goal by being much less distortionary, 
which reduced taxation's excess burden on the economy.
    The following taxes are currently levied in the Czech Republic: 
corporate income tax (39 percent), investment/pension fund tax (25 
percent), value-added tax (22 percent and 5 percent for food, 
pharmaceuticals, books, and paper products), personal income tax (15-40 
percent), social insurance tax (35 percent total), dividend tax (25 
percent), interest tax (15-25 percent), royalties and fees (25 
percent), and local tax on property transfers (4 percent up to Kc 20 
million, 20 percent marginal rate above). There is no capital gains 
tax.
    The VAT was reduced 1 percent in January 1995. Another tax 
reduction took effect in January 1996, with all income taxes, corporate 
and personal, dropping several percentage points. Given the current 
governing coalition's commitments and track record, along with the 
Social Democrats' willingness to reduce the national tax burden, future 
tax reductions are likely.
    Enforcement of taxes is relatively lax, especially in small-scale 
enterprises. Underreporting profits and keeping two sets of accounting 
books (one for real, and the other for the tax collector) are fairly 
widespread practices. Some shops reportedly asked customers if they 
want to buy a product ``with Klaus or without Klaus," that is to say, 
with or without sales tax. Czech police and tax authorities complain 
that irregularities in the tax and commercial codes prevent proper 
investigation and prosecution of tax violations. In one police 
estimate, only 10 percent of tax violators are caught. This problem is 
compounded by the frequent changes in the tax code in the early 
transition years, as well as the prevalence of easily hidden cash 
transactions.
    The most spectacular decline in tax revenue in East-Central Europe 
over the 1989-1993 period was recorded by the Czech Republic. While 
this record improved in the following years, a fall off in tax revenue 
in the second half of 1996 has increased the government's keenness to 
increase tax compliance, especially in the area of the VAT.
    2. Does macroeconomic policy encourage private savings, investment 
and earnings? (Has there been any reform/alteration of revenue and 
budget policies? How have any such changes served to advance economic 
objectives?) Czech radical reformers pushed for their reform plan to be 
adopted before the June 1990 election, an outline of which was agreed 
to in May 1990. Following the elections, the new OF government accepted 
the May program and announced its commitment to radical reform. After 
vehement debate, the parliament adopted the more detailed ``Scenario on 
Economic Reform" in September 1990, and in November 1990 it passed the 
comprehensive Transformation act.
    The bulk of macroeconomic reform began in September 1990. This 
included stabilization of the economy through a restrictive fiscal and 
monetary regime, and the reduction in the size and interventionism of 
government. Czechoslovakia had inherited not only a swollen state 
enterprise sector, but also an expansive and intrusive government, even 
by the standards of Communist Central Europe. Government revenue and 
expenditure amounted to 6 2.1 percent and 64.5 percent of GDP in 1989, 
respectively, compared with 41.4 percent and 48.8 percent for Poland. 
The governing coalition has reiterated its commitment to lowering 
government expenditures as a proportion of GDP by 1 percent yearly.
    The Czech Republic has come closest to the balanced budget ideal of 
all transition economies, actually running a surplus in 1993, 1994, and 
1995. Local governments budgets are also balanced. Fiscal discipline is 
in large part responsible for the moderate inflation record of the 
Czech Republic, which is the best in post-Communist Europe. Inflation 
dropped to 10 percent in 1994, 9.1 percent in 1995 and 8.8 percent in 
1996. All of this allowed the Czech Republic to repay its $430 million 
loan to the International Monetary Fund (IMF) in 1994 a full year ahead 
of schedule.
    The economy has grown respectably since emerging from the post-
transition recession in late 1992, with a growth of 4.8 percent in 1995 
and 4.1 percent in 1996. The country also boasts one of the lowest 
unemployment rates in the region: 3.3 percent in 1996. This low rate is 
not simply a reflection of an unreformed labor market. Studies have 
shown that while Czechs face similar chances of becoming unemployed 
compared to Poles and Hungarians, although Czechs face better chances 
of becoming re-employed more quickly.
    From 1990 to 1992, the government used direct controls to constrict 
growth in the money supply, including interest rate ceilings (initially 
set at 24 percent) and credit limits on large commercial banks. Since 
1992, the government began to use familiar indirect monetary policy 
instruments: open market operations (selling and buying state bonds), 
reserve ratio requirements for banks, and modified central bank 
discount rates. Monetary policies also drastically lowered state bank 
credit to SOES. This credit declined 50 percent in real terms in 1991 
and 13.2 percent and 29.3 percent in 1992-3. The massive declines of 
this bank credit reflect the credibility of government monetary policy 
and the perception by state banks that it had shifted permanently.
    The currency has remained remarkably stable in relation to the U.S. 
dollar since transition, thanks to a determined Central Bank and plenty 
of foreign exchange reserves. This is in line with government policy to 
maintain a stable exchange rate as one of the pillars of its economic 
reform policy. The Czechoslovak koruna was devalued three times against 
convertible currencies in 1990. In January 1991 it was pegged to a 
basket of five Western currencies dominated by the German Deutchemark 
and the U.S. dollar. It was also unified and made internally 
convertible in the beginning of 1991. By the second quarter of 1991, 
the parallel market exchange rate premium had virtually disappeared. 
Since May 1993, the koruna has been tied to a two-currency basket, 
consisting 35 percent of the dollar and 65 percent of the Deutchemark. 
Still, the currency was not fully convertible on the current account 
and for capital transactions.
    The koruna was initially very undervalued. This protected firms 
from foreign competition in both the export market (since Czech exports 
became even cheaper) and the domestic market (since prices on imports 
rise). However, the Czech government has been the most successful in 
maintaining a fixed exchange rate as a nominal anchor in the economy: 
there have been no additional devaluations since 1990. In October 1995, 
the Czech koruna became fully convertible for current account 
transactions and partially convertible for capital account 
transactions. Firms are not restricted in borrowing funds from abroad. 
In February 1996, the central bank widened the band it uses to fix the 
exchange rate from 0.5 percent to 7.5 percent.
    A balanced budget, moderate monetary expansion, a stable currency, 
falling inflation, and rising currency reserves all paint a picture of 
consolidating macroeconomic stability. This has been confirmed by 
private and government credit rating agencies. Standard and Poor's, for 
example, raised the Czech Republic's credit rating from BBB to BBB+ in 
July 1994, in the same category as Chile and Israel and far ahead of 
the other Central European states. In November 1995, Standard and 
Poor's gave the Czech Republic an ``A-stable" investment grade rating, 
symbolizing capital markets regard for Czech economic reforms. It was 
inducted into the Organization for Economic Cooperation and Development 
(OECD) in December 1995, the first post-Communist nation to become a 
member. The credit rating of the country and of its firms has improved 
since December 1995. The Czech Republic along with Slovenia is rated 
the highest in the Eastern European region for credit worthiness by the 
Economist Intelligence Unit World Risk Ratings Review.
    Unexpectedly low tax revenues in the second half of 1996 caused a 
balanced-budget obsessed government to make more than Kc 9 billion 
($341 million) of budget cuts in this period. By year's end, the budget 
deficit reached Kc 1. 2 billion ($44 million)--2.3 percent of GDP.
    The adoption of the 1997 budget in December 1996 represented a 
victory for the governing coalition, and it was accomplished because of 
the defection of two CSSD deputies, both of whom were later expelled 
from the party. The budget is balanced, and includes provisions to 
lower taxes by raising the taxable income threshold and expanding 
individual tax brackets.
    Subsidies for housing will cost, 13.7 billion Kc ($507 million) in 
the 1997 budget, and heating subsidies will cost Kc 4.5 billion ($167 
million), decreased from the previous year's Kc 6.9 billion ($256 
million). The new power of the CSSD-led opposition in parliament might 
lead to an increase in social expenditures, since its cooperation in 
other areas of economic policy is needed. Nevertheless, real reform is 
needed in health insurance and pension programs, where an awkward mix 
of state and market manages to be both insecure and inefficient.
    3. Are property rights guaranteed? (Are there both formal and de 
facto protections of private real estate and Intellectual property? Is 
there a land registry with the authority and capability to ensure 
accurate recording of who owns what? What are the procedures for 
expropriation, including measures for compensation and challenge?) 
Restitution of property nationalized by the Communists was completed by 
1992. Nevertheless, because of the slow pace of courts, not all title 
has been transferred to new owners. This means that it is not always 
known who actually owns a particular property.
    The Czech Republic adopted a patent code in 1990, a trademark law 
in 1988 and 1990. Amendments to the trademark law passed in June 1995 
harmonize Czech intellectual property rights (IPR) Law on Trademarks 
and Copyrights with EU and TRIPS standards. These amendments make it 
easier to enforce, register and sell trademarks, even foreign-
registered trademarks. The latter was implemented after a small scandal 
in which the brother of a high-ranking government official registered 
names like Jaguar, Toyota, Chevrolet, and Audi as his own. The Czech 
Republic is a signatory of the following conventions on IPR: Bern, 
Paris, and the Universal Copyright Convention. In April 1996, the 
Parliament adopted laws which strengthen protection of software.
    While Czech legal protections for intellectual property are 
adequate, enforcement is rather problematic, as in all other post-
communist countries. For example, one major difficulty in 
implementation is long delays in enforcing IPR laws against violators. 
The backlog of cases in the courts is about two years--enough time for 
substantial damage to have been incurred. As of the end of 1995, for 
example, only 366 people have been convicted of IPR crimes. U.S. firms 
have estimated that more than $210 million are lost yearly to copyright 
violations. This gap between law and practice has been recognized by 
the World Intellectual Property Organization (WIPO) which has recently 
suggested placing the Czech Republic on the list of countries impeding 
trade.
    4. Is it possible to own and operate a business? (Has there been 
legislation regarding the formation, dissolution and transfer of 
businesses, and is the law respected? Do there exist overly cumbersome 
bureaucratic hurdles that effectively hinder the ability to own and 
dispose of a business? Are citizens given access to Information on 
commercial law? Is the law applied fairly?) Approximately 85 percent of 
government-controlled producer and consumer prices were liberalized in 
the beginning of 1991. After the first year of liberalization, 18 
percent of GDP was valued in regulated prices, and by the end of 1992, 
this figure fell to 5-6 percent (down from 85 percent in 1990). The 
following commodity groups prices are still regulated: energy, housing 
rents, water, transportation (especially passenger), 
telecommunications, health care, and some agricultural products.
    However, the government has made public its commitment to 
liberalizing these prices in the next several years. Even where prices 
are controlled, adjustments have been made consistently in the upward 
direction. The government has effectively suspended national wage 
bargaining between labor, employers, and the government under the 
Tripartite Council. In July 1995, wage regulation by the government was 
eliminated.
    The Czech Civil and Commercial Codes (adopted in 1992) are based 
heavily on the German and Austrian codes. The Commercial Code, adopted 
in January 1992, replaced eighty scattered regulations and codes in 
establishing the framework for inter business transactions. The 
Commercial Code was amended in early 1996 to increase protection of 
both majority and minority shareholders. Many of the provisions of the 
codes, however, remain vague.
    The courts are frequently not effective in settling disputes. This 
is due to the burden of a tremendous amount of new cases, an inadequate 
number of judges, as well as the inexperience of these judges in 
dealing with complex commercial issues. This leads to large time lags 
in rendering judgment. A large body of established precedent has also 
yet to take hold. The Czech Republic is a member of the New York 
Convention on arbitration, and as such, it is legally bound to 
recognize and enforce arbitration decisions.
    No expropriation has taken place since the end of Communist rule. 
Application of eminent domain is done under standards of international 
law: with due process and in a nondiscriminatory fashion.
    The first Czech bankruptcy law was adopted in 1991, and was 
followed by another in 1993. The revised bankruptcy law of March 1996 
streamlines and simplifies the bankruptcy process, eliminating old 
bureaucratic obstacles. It now permits forced debt restructuring and 
prevents ``looting" transactions. However, as earlier, the major Czech 
banks who are the largest creditors remain hesitant to force their 
debtors, inefficient and large ex-state owned enterprises, into 
bankruptcy. The political repercussions to these state-owned banks from 
idling thousands of workers still, for now, outweigh the financial 
costs incurred by not initiating bankruptcy proceedings. Moreover, 
bankruptcy remains an uncertain proposition for both debtor and 
creditor, given the three to four year backlog in bankruptcy courts and 
the lack of an established secondary market for seized assets. As with 
dispute resolution, courts do not have enough experience and resources. 
However, bankruptcy statistics show that, even before the recent 
amendments, firms and courts are gaining experience with the procedure 
and are disposing of cases more efficiently.
    5. Is business competition encouraged? (Are monopolistic practices 
limited in law and In practice? If so, how? To what degree is 
``insider" dealing a hindrance to open competition?) The Czech 
competition office, as elsewhere in East-Central Europe, is dominated 
by staff from the price control ministries of the old regime. These 
people and by extension, the ministry, often see their role as 
enforcing economic policy rather than establishing fair rules of the 
game. For example, competition authorities have been involved in 
investigating the justification for insurance price hikes. They also 
meddled in industrial policy-making, allowing a firm to acquire 60 
percent of the Czech coffee market in return for employment and 
investment guarantees. In addition, the problem of industry ``capture" 
of regulatory agencies seems particularly acute across post-communist 
Europe and the Czech Republic is no exception. A snug relationship 
between managers and regulators has often led to competition policy 
regulators actually deterring new competition.
    Nevertheless, the Czech Republic has been judged to have created 
one of the best institutional structures for competition policy in the 
whole of East-Central Europe. It also has created a solid foundation 
for improvement. An agreement was reached in January 1996 to coordinate 
and harmonize the Czech and the European Commission competition 
policies.
    One important area of enforcing fair competition rules is 
government procurement policy. The Czech procurement procedures are 
generally fair and open for large contracts at the central level. 
However, this is often not the case at local levels where political 
connections often count for much in awarding contracts. Another problem 
is that state-owned entities not receiving large budget transfers (such 
as utility monopolies) are not required to adhere to government 
procurement procedures. Finally, domestic firms receive a 10 percent 
price advantage over their foreign competitors. The impact of this is 
negligible, however, given the fact that most foreign investors 
establish Czech legal entities. Amendments to the procurement law, 
pushed forward by the Competition Ministry, went into effect in July 
1996. These include clarification and simplification of public tender 
procedures on both the local and federal levels. In addition, they 
institutionalize transparency-building devices, such as publishing 
winners and winning amounts, and they force government bodies to reveal 
selection criteria for tenders.
    6. Are foreign investment and international trade encouraged? (To 
what degree has there been simplification/overhaul of customs and 
tariff procedures, and are these applied fairly? To what degree is 
foreign investment encouraged or constrained? Is the country overly 
trade-dependent on one or two other countries?)

    Investment: Generally, there is no legal discrimination against 
foreign firms. Foreigners can establish any form of business 
organization permitted to citizens. As part of its OECD accession 
agreement, it promised not to give preferences to domestic firms in 
privatization sales. Profits earned on Czech investments can be 
repatriated, but with a 25 percent tax (standard for EU countries), 
which is lowered if double-taxation treaties are in effect. There are 
no land-ownership restrictions on foreigners.
    Nevertheless, in practice, there have been a few instances where 
foreign firms have been treated differently: petrochemicals, 
telecommunications, mass media, and the brewery industries. These 
sectors are highly visible as well as dominated by giant firms, and are 
thus politically sensitive. Moreover, there are certain sectors that 
are explicitly reserved for domestic firms. These so-called strategic 
sectors include defense-related industries, pure-alcohol distilleries, 
national monuments, and at least for now, telecommunications and 
banking. Finally, government procurement procedures, though liberalized 
in 1996, still give a 10 percent price advantage to domestic firms.
    The government has largely ignored calls, to offer special tax 
incentives to foreign investors, considering them less than conducive 
to efficiency. Tax incentives and a temporary protective tariff on 
automobiles was granted to Volkswagen in 1990 in return for an 
investment of what was to become $3 billion in the Skoda factory.
    Foreign direct investment (FDI) reached a record $2.5 billion in 
1995 (on the strength of several major investment deals), but fell to a 
disappointing $900 million in 1996. Cumulative FDI over the 1990-1996 
period was $6.4 billion. Germany is the top investor with a 30 percent 
share, the United States, Switzerland and the Netherlands follow, all 
with approximately 14 percent.
    Trade: Since the Czech Republic adopted the GATT/WTO tariff code, 
its average tariffs are in the 5-6 percent range. Nevertheless, some 
imported goods (such as certain foods) are charged as much as 68 
percent. The government often applies lower tariffs to European 
exporters than it does to non-Europeans. However, import protection 
levels are substantially below OECD averages.
    With the exception of controlled goods, no export controls exist. 
Exports account for a large proportion of the Czech economy: 61 percent 
of 1995 GDP. The government established the Czech Export Bank in May 
1994 to encourage exports by providing access to state-subsidized 
medium and long-term financing.
    Quantitative controls on imports were almost entirely abolished in 
1990. Nontariff restrictions are few, very liberal, and generally 
transparent where they exist. Certain imported goods require a license, 
but these are not difficult to obtain. Product and labelling standards, 
while fairly strict, are rapidly being harmonized with European and 
international standards. Product testing regulations were streamlined 
and liberalized in reforms which took effect in January 1997. In the 
early years, product testing was often a bureaucratic nightmare, 
performed at state-run testing stations. Now testing for most products 
is voluntary and performed at efficient private testing stations. One 
problem that still exists is the lack of a national products database. 
This leads to duplication as importers bringing in products tested 
elsewhere often have to resubmit for testing. Border customs stops are 
generally fairly simple for goods traveling to and from Western Europe, 
but much more onerous for Eastern Europe.
    As a member of the General Agreement on Tariffs and Trade (GATT), 
the Czech Republic acceded to the World Trade Organization (WTO) in 
January 1995. The Czech Republic is a founding member of the Central 
European Free Trade Agreement (CEFTA), which also includes Poland, 
Hungary, Slovakia, and Slovenia. All nonagricultural and food trade 
within CEFTA is scheduled to become duty-free in 1998. It is also a 
member of the European Free Trade Associate (EFTA), and has an 
association agreement with the European Union. The Czech Republic 
formally submitted its membership application to the EU in January 
1996.
    Since the downfall of the Communist CMEA trading bloc, Czech trade 
has been radically reoriented. In 1989, 44.7 percent of the Czech 
Republic's exports and 44.4 percent of its imports were to and from 
former fellow CMEA members. in the first quarter of 1996, 65-70 percent 
of Czech trade was with advanced Western industrial countries, and only 
29 percent with post communist nations in Eastern Europe. In 1995, 
exports totalled $17.1 billion, and imports were $20.9 billion. Germany 
is the Czech Republic's single largest trading partner, accounting for 
31.8 percent of exports and 25.8 percent of imports in 1995.
    7. Has there been reform of the banking sector? (is the central 
bank independent? What are its responsibilities? Is it effective in 
setting and/or implementing monetary policy? What is the actual state 
of the private banking sector? Does it conform to international 
standards? Are depositors protected?) In 1990 the state monobank was 
split between two state-owned banks, Komercni Bank (for commercial 
activities) and Investicny Banka (for long-term investment). The State 
Bank of Czechoslovakia (now known as the Czech National Bank, or CNB) 
was established as the independent central bank in charge of monetary 
policy. The CNB began operations in January 1993. It is independent by 
law--Article 98 of the Constitution notes that ``the main purpose of 
[the CNB'S] operations shall be to care for the stability of the 
currency; intercessions in its operations may be effected only on the 
basis of law." it is also autonomous in practice. It is responsible for 
money market policy, the money supply, regulating the banking sector, 
and setting interest rates.
    Headed by Josef Tosovsky, one of the architects of the Czech 
economic reforms, the CNB is moving closer to the model of the German 
Bundesbank. The CNB's supervisory authority was augmented by two 
amendments to the banking code adopted in 1994. These amendments also 
established deposit insurance, which guarantee deposits up to Kc 
100,000 (about $3,600).
    In 1996, the Czech banking system underwent a severe crisis. The 
Kreditni and Investicni Banka, the nation's six largest, collapsed in 
August. Its fall entailed the loss of 12 billion crowns ($440 million). 
In September, the CNB announced that Agrobanka, the largest private 
bank and the fifth largest overall, was suffering from extreme 
liquidity problems connected with the Kreditni collapse, and that it 
had named an administrator to temporarily take over the bank. In all, 
twelve of sixty banks have failed in the last two years. Six of these 
are in bankruptcy and the rest under forced administration.
    These collapses have shown the problems of Czech banking, including 
management and lending inexperience, cases of outright fraud, and 
inadequate supervision from above by the CNB. However, the public 
nature of the 1996 bank crisis has spurred the CNB into proposing 
needed reforms to the banking code, including the use of external 
auditors and the adoption of international accounting standards.
    In September 1996, Czech police charged five people with fraud in 
connection with the Kreditni collapse, two of whom are connected with 
Motoinvest, a financial group which has become a large shareholder in 
several important Czech companies. Motoinvest also holds 13 percent in 
Agrobanka. The government soon established a special investigative team 
to examine issues of bank fraud to follow up on the collapse of the 
several large Czech banks. A special parliamentary commission was also 
constituted by an agreement between Prime Minister Klaus and CSSD 
leader Zeman. A state company was established in October 1996 to buy 
bad loans from small banks, which have been disproportionately 
troubled, in order to help stabilize them. Another casualty of the bank 
crises has been the scheduled privatization of the state shares in 
banks.
    The banking sector is not an entire failure: the four largest 
banks, Komercni Banka, Ceska Sporitelna, Ceskoslovenska obchodnibanka, 
and Investicni a postovni banka, have a market value of 110 billion 
crowns ($4.1 billion), and constitute 70 percent of the banking sector. 
Thus far, the collapses have only affected 4 percent of all banking 
assets, a large but not devastating amount. On the other hand, the four 
largest banks are still essentially state-owned and have not undergone 
the reconstruction necessary to transform them into efficient, profit-
making banks in the Western mode.
    One problem in the banking sector is the complex web of 
interlocking ownership and credit arrangement, between the banks, the 
investment funds, the government, and the National Property Fund. For 
example, the Investicnia postovni banka (IPB) directly or indirectly 
owns many Czech companies. At the same time, these companies are owners 
of the IPB bank. This sort of confused ownership undermines shareholder 
control of banks and leaves management free from the discipline of 
profit-maximizing owners. However, the CNB proposed reforms in early 
1997 to begin addressing this problem. These include restrictions on 
ownership of nonbank firms as well as, a ban on shareholder ownership 
of more than a 10 percent stake in a bank.
    8. Is there a functioning capital market Infrastructure? (Are there 
existing or planned commodities, bond and stock markets? What are the 
mechanisms for investment and lending?) The Prague Stock Exchange (PSE) 
is the highest-capitalized equity market in the region. There are some 
1,700 companies on the exchange, the majority of which were created by 
the two waves of voucher privatization. In fact, the presence of the 
exchange is critical for the ultimate success of the Czech 
privatization program. This is because, as its creators foresaw, the 
dispersed ownership structures created by free voucher distribution to 
the entire population would not be efficient and operational along 
Western lines until a secondary market helped consolidate ownership and 
distribute it to efficient proprietors.
    Unfortunately, since its creation, the PSE has experienced numerous 
problems and has acquired the reputation of being an insiders market. 
The biggest of these problems is the lack of transparency. Many of the 
traded companies fail to give information about themselves to potential 
investors, nor do they inform current shareholders about arguably 
important events like earnings and mergers. They are not forced to do 
so because a U.S.-style securities and exchange commission does not 
exist as yet (however, with the support of Tomas Jezek, the director of 
the PSE, a regulatory commission is expected in the medium-term). 
Liquidity is low as most of the companies on the exchange are not 
regularly traded on the PSE itself. Most transactions happen privately. 
Average daily trading volume in 1995 was only $30.9 million, an 
increase from 1994's average of $14.3 million.
    Amendments to securities law took effect in July 1996. They 
increased protections for minority shareholders by requiring new 
majority owners to offer a buy out to all shareholders at a weighted 
six-month PSE share price. In addition, boards will be prevented from 
taking a company private without a 75 percent majority decision by all 
shareholders. They also increase transaction transparency by requiring 
the disclosure of major share acquisitions, mandating that listed firms 
publish their annual statements three months after the close of the 
fiscal year, and by establishing stock lending (previously unregulated) 
as a ``legally binding contractual relationship."
    The amendments also require licensing of investment funds, 
requiring the use of international accounting standards, mandating the 
segregation of investment fund assets from the assets they manage for 
their clients, and making them file quarterly reports on their 
portfolios. The enforcement of the last of these will be key, as 
investment funds in the past have ignored already--existing reporting 
rules.
    However, the administrative capacity of the Ministry of Finance may 
not be up to the task of Western-style regulation of the securities 
industry. Jan Ververka, the head of capital markets supervision in the 
Ministry, complained in November 1996 that his department is only able 
to actively regulate 20 percent of the 800 investment funds and 
brokerages. Several Western investors have noted that regulators 
already sometimes ignore clear violations of existing rules.
    Two commodity exchanges exist in the Czech Republic. The first is 
the Brno Farm Produce Exchange, which was founded in July 1993 and 
deals mainly with agricultural commodities. The more general Czech-
Moravian Commodity Exchange in Kladno was established in November 1995, 
trading a wide variety of commodities.
    As a result of a tight and well-managed fiscal policy, the Czech 
Republic's bond market is dominated by long-term private sector debt. 
However, the market is fairly small and, as a result, a mature 
secondary market in bonds has yet to emerge. The total nominal value of 
publicly traded bonds was 10.7 percent of GDP in June 1996, and bonds 
accounted for 3 5.7 percent of PSE trading in 1995. Liquidity and 
transparency in the bond market, as in the equity market, leaves much 
to be desired. The bond derivatives market is immature.
    9. Has there been reform of the energy sector? (To what degree has 
the energy sector been restructured? Is the energy sector more varied, 
and is it open to private competition? Is the country overly dependent 
on one or two other countries for energy [including whether exported 
fuels must pass through one or more countries to reach markets]?) 
Energy sector reforms in the Czech Republic date from 1992, when the 
distribution and production subsectors were separated. Shortly 
afterwards, Ceske Energeticke Zarody (CEZ), the state electricity 
monopoly, was ``privatized" (the state has yet to sell the National 
Property Fund's 67 percent share). Later, the country's ten large heat 
plants were sold to investment funds and individual shareholders. 
Furthermore, the privatizing of state-owned enterprises was in itself 
liberalizing the energy sector because these Brobdingnagian enterprises 
operate their own power plants. In November 1994, the parliament passed 
legislation establishing the legal framework for energy production and 
trade.
    Energy sector liberalization has stalled, however, since 1994. 
Whereas in 1994 private firms were producing 20 percent of the 
country's energy, by March 1996, the private sector share had only 
increased to 30 percent. The inadequate 1994 energy law has not been 
amended, the NPF stake in CEZ has not been sold, trade in electricity 
on the CEZ network has not been legalized, the nation's eight 
distribution companies have not been privatized, the creation of an 
independent regulatory commission has been delayed, and pricing is 
still not market-driven.
    Because of state regulation and subsidy policy, the price of energy 
does not cover production costs. These controls ensure that households 
receive a far lower price for electricity by being subsidized through 
high prices charged to industry. This has led to the inefficient use of 
electricity in homes for such purposes as heating. Prices are currently 
increased twice a year in 15 percent increments. The government's 
economic ministers recommended in September 1996 the total 
liberalization of energy prices over a two-year period. Of course, 
given the government's track record in the energy sector, these 
proposals have to be read with a grain of salt.
    Domestic coal supplies a little more than half of Czech energy 
requirements. The country imported 80 percent of its natural gas needs 
from Russia. Nuclear energy supplies 22 percent of Czech energy 
requirements. Oil used to be imported entirely from Russia until 1995, 
when the construction of an oil pipeline from Germany was finished. 
This new pipeline will carry 2 million tons of crude oil, as compared 
with the 5 million tons transmitted by the Russian pipeline.
    Recent developments have shown the state's willingness to allow 
foreign involvement in the energy sector. In October 1995, the Czech 
electricity transmission network was connected to UCPTE, the European 
transmission network. A consortium of Western oil companies, including 
Shell, Conoco, and Agip, finalized the purchase of a 49 percent ($138 
million) stake in Ceske Refinerska in February 1996. The consortium has 
promised $480 million in investment. Unipetrol, the state owned holding 
company, controls the other 51 percent.

                                      

                                      

                                HUNGARY


                                     Freedom in the World Ratings, 1988-1997                                    
                                                                                                                
                         1988-89   1989-90   1990-91   1991-92   1992-93   1993-94   1994-95   1995-96   1996-97
                                                                                                                
Political Rights              5         4         2         2         2         1         1         1         1 
Civil Liberties               4         3         2         2         2         2         2         2         2 
                                                                                                                
    Status                   PF        PF         F         F         F         F         F         F         F 
                                                                                                                



                                         Polity: Consolidated Democracy

                                           Economy: Consolidated Market

                                                 Population: 10,230,000

                                                            PPP: $6,451

                Ethnic Groups: Hungarian (96 percent), Romanian, Slovak

                        German, Roma, Croat and Bosnian Muslim refugees

                                                      Capital: Budapest

_______________________________________________________________________

Political Process  1.25/7
    1. When did national legislative elections occur? The first 
multiparty national legislative elections since 1945 occurred in March 
1990. The Hungarian Democratic Forum (MDF) won the elections and its 
leader, Jozsef Antall, was elected prime minister in May 1990. The most 
recent national elections occurred in May 1994, and were declared free 
and fair by a number of international organizations. Following the 1994 
elections, which led to a governing coalition of the victorious (former 
Communist) Hungarian Socialist Party (MSZP) and the liberal Alliance of 
Free Democrats (SzDSz), the distribution of seats in the National 
Assembly was as follows: MSZP, 209 seats (54.2 percent); SzDSz, 70 
(18.1 percent); MDF, 37 (9.6 percent); Independent Smallholders' Party, 
26 (6.7 percent); Christian Democratic People's Party, 22 (5.7 
percent); Federation of Young Democrats, 20 (5.2 percent); Agrarian 
Federation, 1 (.25 percent); Republican Party, 1 (.25 percent). The 
Agrarian Federation and the Republican Party joined the SzDSz 
parliamentary group.
    2. When did presidential elections occur? In May 1990, Arpad Goncz, 
a member of the SzDSz, was elected president for a five-year term by 
the Parliament. President Goncz was reelected to a second five-year 
term in June 1995. The second presidential election was controversial, 
as some political parties had pushed for direct election of the 
president. The Independent Small Holders Party presented a petition 
signed by more than 200,000 citizens favoring a referendum to determine 
the method of presidential elections, but the petition was ruled 
unconstitutional by the Constitutional Court. The Independent 
Smallholders Party boycotted the elections. Hence only 360 out of 386 
members of the Parliament voted in the second presidential elections.
    3. Is the electoral system multiparty-based? Are there at least two 
viable political parties functioning at the level of the government? 
Yes, the electoral system is multiparty-based since 1989-1990. 
Currently there are six political parties represented in the National 
Assembly, and local elections are contested by a range of political 
parties and individuals. After the 1994 elections, the ruling coalition 
reduced state support for political parties. This decision may benefit 
the ruling MSZP in the next elections. On the local level there were at 
least two viable parties competing in each electoral district.
    4. How many parties have been legalized? The Budapest City Court 
has registered close to 200 political parties since 1989, in addition 
to many movements and associations.
    5. What proportion of the population belongs to political parties? 
No official figures of party membership are available. No more than 5 
percent of the electorate are members or active supporters of political 
parties.
    6. What has been the voter turnout at the municipal, provincial and 
national levels in the recent years? In the first round of the 1990 
legislative elections the turnout was 65.1 percent. In the first round 
of the May 1994 legislative and local elections the turnout was 68.9 
percent, the turnout in the second round was 55.1 percent. The increase 
in voter turnout in the first round run counter to pessimistic views 
expressed in the media that people had lost interest in politics. The 
turnout during the 1990 municipal elections was at or below 20 percent 
in many areas.
Civil Society  1.25/7
    1. How many nongovernmental organizations have come into existence 
since 1988? How many charitable/nonprofit organizations? There has been 
an explosion in the number of NGOs registered since 1988. Charitable/
nonprofit organizations have been set up by the hundreds during the 
course of the past eight years. The number of registered NGOs 
(nonprofit charitable organizations, associations, trade unions, 
interest groups) swelled to 40,000 in 1995, and some 1.2 million 
citizens are active members of these organizations.
    There are three basic types of NGOs in Hungary. First, there are 
organizations representing professional bodies. The government gives 
them considerable authority; for example, certain lawyer associations 
allow individuals to practice law. This type of NGO is close to the 
government and may be influenced by it. Second, there are political 
lobbying or pressure groups, which are often composed of members of 
failed political parties. Third, there are service agencies, which 
include organizations involved in welfare, culture, education, health, 
and various foundations.
    The structure of civic organizations and associations also went 
through significant changes between 1990 and 1996. Organizations that 
functioned mostly on a local level developed national networks and 
centers, and they established interest representation and 
reconciliation forums and joined the general system of interest 
reconciliation. Thus, beside the trade unions, NGOs are also actively 
involved in the civil round table negotiations with the government. The 
general agreement among the representatives of NGOs is that the law on 
nonprofit organizations ensures the independence of civic 
organizations.
    2. What forms of Interest group participation in politics are 
legal? Except for specific rules disqualifying judges, MPs, armed 
forces personnel, civil servant, and so on, all forms of interest group 
participation in politics are legal if they are not prohibited by the 
penal code. Only political parties are barred from conducting their 
activities at the workplace.
    3. Are there free trade unions? Close to 30 percent of workers, 
approximately 1.2 million employees, belong to trade unions. Of these, 
about 400,000, or one-third of all union members, are members of the 
unions established since 1988. The two largest independent trade unions 
are the Democratic Confederation of Free Trade Unions (LIGA) with 
100,000 members and the Hungarian Workers Council with 150,000 members. 
Hungary's former Communist organization of trade unions, the National 
Federation of Hungarian Trade Unions (MSzOSz), survived the political 
changes of 1990 and now enjoys a considerable political and social 
influence. The MSzOSz, which represents the majority of organized 
workers in Hungary, is controlled by the MSZP, and is therefore not 
free and independent. It claims to have 1.2 million members, although 
the figure is probably closer to 800,000.
    In the Interest Reconciliation Council (ET)--a formal forum set up 
by the Horn government, where government representatives discus and 
mediate disputes between the representatives of employers and 
employees--the following six trade unions are represented: 1) the 
MSzOSz, 66.6 percent; 2) the association of autonomous Trade Unions 
(ASzSz), 20.3 percent; 3) the trade Unions' Cooperative Forum (SzEF), 
4) the Council of Interest-Representation Associations (ESzT), 5) LIGA, 
6.4 percent; and 6) the Worker's Councils (Munkastanacsok), 2.5 
percent. In general, the trade unions opposed the austerity measures 
proposed by the government and the employers, and defended the 
interests of their members. The forty major strikes organized by trade 
unions in 1995 and 1996 suggest that these organizations--including the 
majority MSzOSz--are free and independent from the government.
    4. What Is the numerical/proportional membership of farmers groups, 
small business associations, etc.? Many small holders associations 
exist and are active. Similarly, a plethora of independent 
entrepreneurial associations operate currently in Hungary, although the 
majority are localized and concentrated in Budapest. According to the 
National Statistical Bureau (KSH) the membership in farmer's 
associations is approximately 8,000, and the membership of small 
business associations, including regional chambers of commerce, is 
27,000. In addition, it is important to note that some registered NGOs 
are actually businesses which sought legal classification as 
foundations because of the enormous tax advantages involved. These 
advantages include the ability to pay tax-free ``scholarships" to 
employees rather than wages. A Budapest pizzeria, for instance, has 
been designated a foundation.
    Civic NGOs are numerically much larger than the ones representing 
commercial interests (with the exception of the trade unions). The most 
significant civic associations are organized in the Union of Civic 
Associations (TESz), with 464 NGOS, and the Council of Interest-
reconciliation Associations (TET), with seventy-four NGOS. The largest 
NGOs (outside the trade unions) are the National Association of Large 
Families (NOE), with registered 120,000 members, the National Chamber 
of Retired People (ONK), and the Association of Hungarian Women (MNSz). 
This suggests that among the 40,000 registered NGOs many are marginal.
Independent Media  1.50/7
    1. Are there legal protections for press freedom? Yes. Although no 
media law had been passed until December 1995, legal protections for 
press freedom are explicitly guaranteed by the constitution. Though 
freedom of the press was nominally guaranteed even before 1989, it has 
been respected only since the sweeping political transformation of 
1989-1990.
    The Parliament passed a law regulating television and radio 
broadcasting in December 1995. The law has three basic sections. The 
first concentrates on broadcasting for general audiences. Local 
broadcasts have to be at least 20 percent of total by January 1999, 
while commercial programs should not exceed 20 percent of the total. 
The second section sets the rules for public and commercial 
broadcasting, and stipulates that the commercials should not exceed six 
minutes per hour. The third section deals with the regulations of 
public programing: 51 percent has to be made in Hungary, and 70 percent 
of all programs should be made in Europe. Most media experts agree that 
the new media law is one of the most comprehensive ones in the post-
Communist states of East Central Europe, yet they suggest that the law 
dictates an untenable pace of change in the state-owned Antena 
Hungaria.
    2. Are there legal penalties for libeling officials? Are there 
legal penalties for ``irresponsible'' journalism? The law stipulates 
penalties for the unfounded libeling or defamation of any individual, 
including officials. The Criminal Code specifies a number of offenses 
which might be committed via the press, such as defamation or 
incitement to hatred against the community. In those cases it is the 
individual writer who is primarily responsible for the criminal offense 
and who is sentenced, but under the general rules of the criminal law 
the editor may also be held responsible. Apart from liability under 
criminal law, there is also liability under civil law. The defendant 
maybe sued for damages in the case of a violation of personal rights. 
However, punishment for libel is extremely light and has little if any 
deterrent impact, particularly for the large publications.
    In March 1996, the Parliament passed an amendment to the penal code 
that stipulates that ``anyone who incites hatred or acts in any other 
way that is capable of inciting against the Hungarian nation or any 
other national, ethnic, or religious minority or race, must be punished 
by up to three years of imprisonment." The law was passed after several 
well-publicized incidents of racial hatred in recent years ended with 
the acquittal of the defendants based on their constitutional right to 
free speech. Some contemporary developments suggest, however, that the 
controversy between what should qualify as an incitement to hatred and 
what as an example of free speech, is far from being resolved. The 
state prosecutor, for instance, has banned not only the Magyar 
translation of Mein Kampf, but also the English version, although the 
work is being routinely used at Western universities.
    3. What proportion of media are privatized? Some small local radio 
stations exist in limited markets. No national radio stations are 
privately owned; however, several regional stations such as Radio 
Juventus and Radio Bridge can be heard throughout the nation by using 
transmitting stations. Local cable companies are owned privately, and 
cable dominates the Hungarian media. Several local television stations 
broadcast on AM micro-channels, and there are some small private 
channels servicing single districts of large cities. No national 
television station is owned privately. Today there is a wide variety of 
generally high-quality, uncensored national and local papers, 80 
percent of which are in private hands. There is no government-owned 
daily newspaper. The largest daily is a former Communist party paper 
that is now owned by the Bertelsmann company (BMG) based in Germany. 
The Communists privatized the paper before the change in the political 
system. The Hungarian government owns no stock in the paper. 
Nevertheless, what is decided by the ruling Socialist Party is 
reflected in the paper, since the daily is close to the governing 
party. There is one government agency that is responsible for sending 
out news received from official sources. Besides the state-owned MTI 
wire services there is also a private Ferenczi wire service owned by 
MTM Communications.
    In November 1996, the draft for ten-year concessions for two 
national television channels was published in a bid to privatize a 
large part of the state-dominated television market by May 1997. The 
plan for privatization includes three national public service channels 
and two commercial channels for television viewers in Hungary. The two 
largest companies interested in the concessions are Compagnie 
Luxembourgeoise de Telediffusion (CTL), which recently merged with 
Germany's Bertelsmann, the Central European Development Corporation, 
the Westdeutsche Allgemeine Zeitung group and France's TF1. In 
addition, today there are around twenty-six private commercial 
television stations in Hungary, and thirty-one radio stations.
    4. Are the media financially viable? Yes, in most cases. Given the 
transitional character of the Hungarian media market, there has been a 
relatively high turnover of new publications and many of them proved 
not to be viable. Generally speaking, however, private media, 
especially organizations with a high percentage of foreign ownership, 
perform successfully.
    The state owned Hungarian Radio and Television are reportedly in 
deep financial trouble and have requested 18 billion forints from the 
government. Due to budgetary constraints, the government granted only 
2.5 billion forints as a loan, with real estate being used as 
collateral. Most media experts agree that both state owned media 
organizations, the Hungarian TV and Radio, are chronically overstaffed 
by thousands of in-house employees, and that both organizations will 
have to make significant cuts in staff and broadcasting time to remain 
competitive.
    5. Are media editorially independent? Legally, the media are 
editorially independent. Some newspapers, however, are owned by banks 
and trusts that are in government hands, and some local papers are in 
the hands of local self-governing bodies (administrations). For 
example, the majority state-owned Posta Bank owns at least four papers 
and a large private radio station, Radio Bridge. In addition, since 
many major publications were privatized before 1989, the leaders of the 
opposition argue that many editors have remained loyal to the Communist 
successor MSZP. State-owned radio and television, according to 
opposition leaders, are not editorially independent, because their 
heads were fired by the government in the spring of 1994. The 
government also announced plans to dismiss 1,000 state radio and TV 
employees, citing financial constraints. Critics of this move charge 
that it is politically motivated.
    The opposition has been unable to substantiate its charges of 
political pressure on the media. The state radio and TV continue to 
suffer from significant over-manning and inefficiency; yet no employees 
have been fired. Reports of major corruption scandals involving members 
of the government suggest that the media have been able to maintain 
their independence. There is not a single daily newspaper that shows a 
clear pro-government bias. On the contrary, in May 1995, for instance, 
information was leaked relating to a secret transfer of state funds to 
the majority state-owned Budapest Bank, the president of which was the 
Finance Minister, Lajos Bokros. The Bank was found to have violated the 
law by keeping the $10 million transfer secret from shareholders and 
Bokros was forced to resign.
    6. Is the distribution system for newspapers privately or 
governmentally controlled? The major newspaper distributor in Hungary 
is a government entity, the Hungarian Distributor's Office, not 
necessarily because the government wants to control or influence 
distribution, but rather because the distribution process is 
prohibitively expensive when done privately. Nevertheless, a new 
distribution service was created in 1995 by foreign-owned publications 
in response to the reported inefficiency and high cost of the state 
system. The new organization operates as a limited partnership.
    7. What has been the trend in press freedom? Freedom House's Annual 
Survey of Press Freedom rated Hungary Not Free for 1988, Partly Free 
for 1989, Free from 1990 through 1992, Partly Free for 1993, Free for 
1994, and Partly Free again for 1995, due mainly to mass-firings from 
the state owned media, and the increased pressure to reflect pro-
government views. In sum, the absence of a single daily newspaper, 
radio or TV station that shows a clear pro-government bias, the 
reporting of corruption scandals involving MPs and ministers of the 
Horn cabinet, as well as the positive international reaction to the new 
media law, all suggest that the media is editorially independent from 
the government and its reporting is objective. There were, however, 
several cases of corruption in print media, where commercial 
organizations bribed newspaper editors in order to get favorable 
reports on their products and business ventures.
Rule of Law  1.75/7
    1. Is there a post-Communist constitution? The present Hungarian 
constitution is a patchwork of amendments introduced in 1989 and 1990, 
when the parliament changed practically the entire wording of the 
Communist constitution dating from 1949. While most legal experts agree 
that the amended constitution conforms with the requirements of a 
parliamentary democracy, they point out that its wording is often 
vague. This has led to jurisdictional conflicts among various 
government institutions and offices. After the 1994 legislative 
elections the six parliamentary parties agreed to draft a new 
constitution.
    The six parliamentary parties selected the members of the 
constitutional committee, and agreed on the procedural rules that would 
guide the drafting and approval of the new constitution. The coalition 
parties agreed that the opposition will have a substantial say in the 
preparation of the new constitution, as well as in any changes to the 
Standing Order in Parliament. In addition the ruling coalition agreed 
that the constitutional committee will have twenty-four members instead 
of the proposed twenty-seven, four from each party represented in the 
parliament, reflecting the current proportional representation in the 
legislative body. Finally, Parliament amended the Constitution by 
saying that the new rules in the Standing Order that describe the 
constitutionalization process, can only be enforced by a four-fifths 
majority. The draft of the new constitution had not yet been approved 
in 1996, and it does not seem likely that the draft will be ready 
before the 1998 elections.
    2. Does the constitutional framework provide for human rights? Do 
the human rights include business and property rights? The present 
constitution declares that Hungary recognizes the inalienable and 
inviolable basic rights of man and it is the foremost responsibility of 
the state to ensure the observance of these rights. Individual and 
human rights, freedom of speech and assembly, social and property 
rights are extensively covered in the constitution. Accordingly, 
parliament passed a number of amendments to the penal code, including 
laws regulating freedom of the press and defamation, and laws on 
defense of minorities in 1996. According to the experts, laws governing 
business and property rights in Hungary are fair and meet western 
standards. Yet, it has to be acknowledged that the courts and the legal 
bureaucracy are overburdened and rulings even on relatively simple 
cases can take years.
    3. Has there been basic reform of the criminal code/criminal law? 
Since 1989 there has been substantial reform in the Hungarian criminal 
code. The death penalty for political crimes, aggravated detention, 
penal idleness, as well as reformative-educative labor have all been 
abolished. A new article supplementing the criminal code states that a 
person who violates the freedom of conscience and religion of another 
individual by force shall be punished with imprisonment for up to three 
years. The crime of ``incitement against the community" was inserted 
into the penal code to ensure that national, religious and linguistic 
minorities are protected under criminal law. Finally, drug traffickers 
are liable to receive much more severe punishments than before, while 
individuals using drugs in small quantities receive offers to undergo 
treatment. If they agree to be treated, no criminal proceedings are 
initiated, or proceedings already under way are discontinued.
    Between 1994 and 1996, four significant criminal laws were passed 
by the parliament. Amendment IX/1994 to the penal code regulates the 
sale and use of fire arms; amendment XLI/1995 changed the age limit for 
the prosecution of juvenile delinquents in cases of serious crimes; 
amendment XVII/ 1996 to section IV/1978 of the penal code prescribes 
harsh punishment for offenses against minorities; and amendment LII/
1996 deals explicitly with crimes related to the smuggling of nuclear 
materials and acts causing environmental destruction.
    4. Do most judges rule fairly and impartially? How many remain from 
the Communist era? The decisive majority of judges is respected for 
being impartial and fair. The percentage of the judges appointed before 
1989 is approximately 55 percent.
    5. Are courts free of political control and influence? Are the 
courts linked directly to the Ministry of Justice or any other 
executive body? As established by the constitution, the judiciary is 
independent from the other branches of government and subordinate only 
to the law. To shield the judiciary from political influence, the 
constitution stipulates that judges cannot be members of any political 
party, nor can they engage in any political activities.
    The independence judges in Hungary is guaranteed in several ways. 
First, the judiciary is financially independent from the executive 
branch of the government. Legislation in Hungary stipulates that the 
courts budget is also separate from the Ministry justice. Second, the 
system for the promotion and remuneration judges is determined 
exclusively by law, with no derogations allowed. Third, with the 
exception of the president of the constitutional court who is elected 
by Parliament,judges are appointed by the president of the republic on 
the recommendation of the Minister justice, but with the consent of the 
judicial Council. Fourth, a judge ceases to perform his duties either 
at his own request, because he is declared incapable by his peers, or 
because of professional misconduct when the disciplinary council 
recommends to the president of the Republic that the judge should be 
removed from his function. Finally,judges enjoy immunity from 
prosecution and therefore cannot be arrested and detained, or be the 
subject of criminal proceedings except by authorization of the 
president of the republic.
    In 1995, the constitutional court overturned portions of law, 
passed by the legislature, related to economic austerity measures 
introduced by the Finance Minister. This was the first constitutional 
court ruling against the current government, and it signaled that the 
court will continue to function independently. Together, the 
constitutional court ruled on 169 cases. On average, the constitutional 
court rules on approximately 150 cases every year. Of these, some 35 
percent are found to be unconstitutional. Experts agree that the 
constitutional court in Hungary is one of the most active and 
independent among the post-Communist states.
    6. What proportion of lawyers is in private practice? Currently, 
about 6,000 lawyers are employed by private law firms. Companies, 
firms, trade unions, and associations, as well as various other 
organizations, employ close to 25,000 counsels, solicitors, and 
advisors. Together, there are close to 30,000 lawyers in private 
practice, which is more than 80 percent of the total. The rest are 
employed in the judiciary and governmental organizations. According to 
Istvan Soltesz, the secretary general of the Hungarian Parliament, 
close to 60 percent of the MPs are lawyers (including himself).
    7. Does the state provide public defenders? According to the 
constitution and to the penal code the state is liable to provide 
public defenders if the accused have no means to obtain, and/or to pay 
for a private defense lawyer.
    8. Has there been a comprehensive reform of ant-bias/discrimination 
laws, including the protection of ethnic minority rights? In July 1993, 
Parliament passed a Law on National and Ethnic Minority Rights. Two 
years of preparatory work and several draft texts went into it. The law 
bans discrimination against minorities and regards their rights to 
national and ethnic self-identity as part of universal human rights and 
basic freedoms. The law recognizes all ethnic groups that have lived in 
Hungary for at least a century, and whose members are Hungarian 
citizens but have their own language, culture and traditions. These 
groups include Armenians, Bulgarians, Croats, Germans, Greeks, Poles, 
Roma, Romanians, Ruthenians, Serbs, Slovaks, Slovenes and Ukrainians. 
Nevertheless, Hungary's estimated 500,000 Roma (Gypsies) continue to 
suffer de facto discrimination in employment and housing, and have been 
hit especially hard by the effects of economic restructuring. They have 
also been the victims of skinhead attacks and vigilante justice.
    Parliament passed an amendment to the penal code that stipulates 
that anyone who incites hatred or acts in a way likely to incite hatred 
against the Hungarian nation or any other national, ethnic, or 
religious minority, will be punished by up to three years of 
imprisonment. The law was passed after several well-publicized 
incidents of racial hatred in recent years ended with the acquittal of 
the defendants based on their constitutional right to free speech. In 
addition, the 1994 election results suggest that the 3 percent minority 
candidates elected into local representative organs corresponds to the 
proportion of minorities living in Hungary. Yet only 1 percent of 
minority mayors were elected. Proportionally, the strongest 
representation was gained by the German minority, while weakest are the 
gypsies.
Governance and Public Administration  1.75/7
    1. Is the legislature the effective rule-making institution? There 
is consensus among legal experts that the Hungarian Parliament is 
fulfilling its function as the country's supreme legislative body. 
Between its first session in May 1990 and March 1992, the Parliament 
passed over 180 laws, compared with an average of four or five per year 
under Communism. Beginning in the early 1990s, the substantive nature 
of the legislation passed indicated that a true democratic lawmaking 
body was emerging. Also in contrast to lawmaking during the Communist 
period, government decrees are now subordinate to legislative 
enactments.
    During its 1993 session, Parliament voted on 117 Acts, 103 
Resolutions, and it issued two Statements; one was the proposition of a 
principle ``On the Interpretation of the Limitation of Culpability," 
and the other was a declaration ``Against Hate Provoking Extreme 
Manifestations." In 1994, 105 laws were passed, in 1995, 126 laws, and 
until November of 1996 some 70, including the Media Law.
    2. Is substantial power decentralized to subnational levels of 
government? According to Chapter IX of the constitution on local self-
government, there is substantial decentralization of political power to 
the subnational level. Administratively, the territory of Hungary is 
divided into a capital city, counties, towns and communities, with 
their own, subnational governments. These governments have equal 
rights, but their obligations may differ. The rights of subnational 
governments are protected by the courts, and they often turn to the 
constitutional court to protect their rights. Local representatives are 
elected through local plebiscites for a four-year term. They may 
develop their own framework of laws and ordinances (if not contrary to 
higher statutes), and may affiliate with other local bodies of 
representatives. A legal framework is in place which provides for the 
right to autonomous policy making at this level. However, some local 
and regional governments are in a weak financial position. Thus, the 
limits on their power are not necessarily politically motivated but 
largely the result of economic and financial constraints.
    3. Are subnational offices chosen in free and fair elections? Yes, 
local, regional and other subnational officers are chosen in free and 
fair elections. An exception is at the subregional level, where 
Commissioners of the Republic are appointed by the government to 
supervise more than one county. These commissioners ensure that all 
local decrees correspond to national laws, and they can suspend the 
application of local decrees that run counter to national laws. The 
most recent subnational elections were held in December 1994. The 1994 
Law LXII on subnational elections states that 1) the electoral system 
shall have one round relative majority elections at the local level, 
and 2) all communities (together 3,147) shall elect mayors locally. 
Before the 1994 law was enacted, only communities with more than 10,000 
inhabitants held such elections. The turnout in the 1994 local 
elections was 43.4 percent (3.4 percent higher than in the 1990 
elections). Together 95,000 candidates ran for office and 21,495 were 
elected.
    4. Do legislative bodies actually function? Yes, national, regional 
and local legislative bodies do function. The National Assembly 
(Parliament) has been especially active in debating and passing laws. 
Local legislative bodies have enacted a large number of rules and 
regulations within their respective jurisdictions. According to Istvan 
Kukorelli, a Hungarian political scientist, the activity of local 
legislative bodies seems to correspond to the size of the electoral 
district, where larger districts are more active than the smaller ones. 
Hence, Budapest has the most active, as well as the most influential, 
subnational legislation. Most of the legislative activity on the 
subnational level is directed toward raising revenues at the local 
level, and the regulation of commercial activities.
    5. Do the executive and legislative bodies operate openly and with 
transparency? Yes, they operate, openly and with transparency under the 
scrutiny of the public, and the press, as well as the State Audit 
Board, the Central Audit Office, and the Government Control Bureau. 
During first two years of the Horn government eleven ministers either 
resigned or were dismissed, the latest ones in the wake of a corruption 
scandal involving payments of millions of dollars by the State 
Privatization Agency (APV) to a consultant. Lajos Bokros, the Finance 
Minister Involved in the $10 million transfer to the Budapest Bank, was 
the first among ministers who resigned in 1996.
    The State Audit Board was created in 1990, and the Central Audit 
Office in 1993, to control the economy and manage the publicly financed 
central institutions. By the end of 1994, the Central Audit Office was 
replaced by the Government Control Bureau, an independent national 
organ of state administration. The bureau has the right to control the 
two subsystems of public finance; the central budget and the separate 
national funds. It can also explore how cabinet decisions are 
implemented. Finally, the president can veto bills passed by the 
legislature. In December 1996, for instance, President Arpad Goncz 
vetoed two bills backed by the government. Political scientist Attila 
Ledenyi pointed out that Gonzc, a former Free Democrat (SzDSz), vetoed 
the bills backed by the SzDSz to show his nonpartisanship; others 
pointed to corruption scandals involving members of the Horn 
government.
    6. Do municipal governments have sufficient revenue to carry out 
their duties? Do municipal governments have control of their own local 
budgets? Do they raise revenue autonomously or from the central state 
budget? Generally speaking, municipal governments do have revenues to 
carry out their duties, although the country's difficult economic 
situation places a significant burden on them. A part of municipal 
revenues is provided directly by the central state budget, and the 
other part raised locally, from real estate and business taxes. Local 
governments raise this portion of revenues autonomously, while the 
portion provided from the central state budget is often earmarked for 
specific projects. The XLVI Law of 1996, for instance, ear-marked funds 
for Budapest for the construction of hospitals, the reconstruction and 
maintenance of national historical sites and monuments, and for the 
modernization of infrastructure. In addition to municipal revenues tied 
to administrative districts, the central state budget earmarks funds 
for the self-government of minorities living in Hungary These funds are 
proportional to the size of the respective minorities. The National 
Roma Minority Self-Government, for instance, received most of its 
revenue from this source (90 million forint) for 1997, while the 
Bulgarian, Greek, Polish and Armenian minority self-governments 
received the least (7 million forint).
    7. Do the elected local leaders and local civil servants know how 
to manage municipal governments effectively? Yes, most of the local 
leaders elected during or after 1990 have proved to be competent and 
able to manage municipal government. To keep up with the complexities 
created by the transitional processes, large-scale programs to deepen 
the professional knowledge of those managing local government are 
currently under way. These programs are financed by the central state 
budget.
    8. Has there been constitutional/legislative reform regarding local 
power? Has there been a reform regarding the civil service code/system? 
Are civil servants employees of the local or central government? In 
1991, law reforming the Local Administration of Self-Governing Bodies 
was passed. The current socialist government modified and simplified 
the law in 1994, providing for single-round local elections and direct 
elections of mayors in every community. The civil service code/system 
was reformed in 1991. Unified requirements and standards were 
established for an exam in public administration for all those in, or 
wishing to enter, the civil service. This reform applies to those 
public officials working at both the local and the national levels. 
Local civil servants are the employees of local governments, although 
their official status as civil servants is identical with those 
employed by the central government. No significant changes were made in 
the civil service code in 1995 and 1996.
Privatization  150/7
    1. What percentage of GDP comes from private ownership? As of late 
1994 about 58 percent of GDP came from private ownership. The World 
Bank estimated in mid-1995 that the private share of GDP had reached 60 
percent. According to the Economic Intelligence Unit (EIU) Country 
Report, Hungary's privatization continues to be a success story. The 
private sector generates some 75 percent of Hungary's GDP, and the 
government considers that its privatization program will be virtually 
completed by the end of 1997.
    2.What major privatization legislation has been passed? 
privatization started with the passage of Act No. 13 in 1989 that 
governs the transformation of state companies into joint-stock and 
limited liability firms. According to the legislation, privatization in 
Hungary has to take place through sale, or open or closed tender. The 
national (state-owned) property is privatized under the supervision of 
the Property-managing Organization of the National Treasury (KVS), the 
State Property Agency (AVU) and the State Property Management Holding 
Co. (AVRt), which was changed into the State Privatization and Property 
Management Holding Co. (APVRT) in 1995. Act No. 74 of 1990 also known 
as ``Pre-Privatization"--set the rules for the privatization of small 
businesses through auctions. Act No. 7 of 1990 outlined the practical 
steps to be taken in cases of various types of privatization suggested 
in Act No. 13. Act No. 10 of 1992 declared that the goals of 
privatization were: 1) the modernization of technology, 2) increase of 
working capital, 3) import of know-how and marketing experience, 4) 
support for domestic and foreign entrepreneurs, 5) the development of 
the domestic capital market, and 6) creation of work opportunities.
    A New Privatization Law was drafted in November 1994 by the Horn 
government, and it passed in January 1995 with ninty-nine changes. The 
law focuses on the privatization or liquidation of state owned, 
strategic industries--primarily mining, communications, transportation, 
banking, and energy. Instead of the three entities that ran 
privatization from 1990 to 1995, the APVRT was put in sole charge. The 
privatization process consists of two rounds. in the first round, the 
APVRT announces publicly the terms of a concourse for a list of state 
owned companies and private (domestic and foreign) entities make their 
bids. In the second round, the agency develops new terms for those 
companies which were not sold in the first round. In the first round, 
held on September 29, 1995, 73 companies were listed; 104 bids were 
made on 71 companies, and 42 were sold. In the second round, held on 
January 10, 37 companies were listed and only 4 were sold. The 
remaining 33 companies are to be liquidated.
    3. What proportion of agriculture, housing and land, industry, and 
business and services is In private hands?

    Agriculture: The Agriculture Ministry estimates that approximately 
90 percent of agricultural land is in private hands, but adds the 
caveat that up to half of this number is made up of limited 
cooperatives. The state's share in forestry remains still at 94 percent 
according to the 1995 data.
    Housing and Land: The Agriculture Ministry estimates that 
approximately 97 percent of housing and land is either in private or 
municipal hands. Foreigners could not purchase housing or land until 
the law was changed in 1994. These figures did not change in 1995.
    Industry: Up to 65 percent of industry was in private hands by the 
end of 1994. In 1995 and 1996, the proportion of industry in private 
hands increased to approximately 70 percent, mainly through the 
privatization of strategic and financial industries, as well as the 
sale of state utilities to foreign and domestic investors. 
Manufacturing, mining, utilities, transport, communications and 
financial services account for approximately 43.8 percent of Hungary's 
GDP. The ratio of domestic to foreign ownership in the private sector 
in industry is approximately 2 to 1.
    Business and Services: From 1991 through June 1994, the number of 
small businesses which had been privatized was as follows: 4,066 in 
1991; 3,571 in 1992; 1,428 in 1993; and 416 in 1994. Added to the 
relatively large number of companies privatized prior to 1989 and the 
plethora of newly-founded companies, over 70 percent of business and 
services were in private hands by the end of 1994. However, there is 
only one private bank, and no known health or transportation services 
are provided by the private sector.
    By the end of 1995 only the legally approved minimum 25 percent 
share of the National Saving and Trade Bank (OTP) remained under state 
control. The share of the state in transportation, postal services, and 
communications remains 72 percent, but by the end of 1997 this is 
estimated to decline to the desired 25 percent minimum. The private 
sector share in health, education and agriculture reached 45 percent in 
the first quarter of 1996. It is debatable, however, whether banks and 
health services should be included in the small business and services 
category, because they are classified as strategic industries.
    4. Has there been reform of the state sector? (What major 
legislation has been passed? Do authorities and state managers act 
within the law? Is the state sector performing more efficiently? Does 
it require fewer subsidies than before?) By the end of 1994 only so-
called strategic industries remained in the state sector: 1) the 
Hungarian Electric Energy Industry (MVM); 2) the natural gas 
distribution; 3) the Hungarian Oil Industry (MOL); 4) state radio and 
TV (Antenna Hungaria); 5) the Hungarian Long Distance Telephone and 
Telegraph (MATAV); and 6) banking, including the National Saving Bank 
(OTP), Budapest Bank (BB), MH Bank and K&H Bank. In June 1995, 
parliament passed a law that established The Joint-Stock Company for 
State Privatization and Property Handling (APV). Some eight state firms 
and 737 industrial companies created the initial portfolio of the APV. 
The law also stipulated that state-owned strategic industries have to 
be made available on condition that they allow private investors to 
turn a fair profit, and that by the end of 1997 the state's share would 
be no more than 25 percent.
    The new law for privatization of the strategic industries created a 
number of controversies, where, for instance, the Antenna Hungaria was 
placed on the market in 1995, but no interested investors were found. 
The insolvent media company requested 18 billion forints from the 
government for restructuring, but received only 2.5 billion. The APV 
hopes that it will find investors in 1997, under the terms of the new 
Media Law. The privatization of utilities also ran into difficulties 
when the government was forced by foreign investors to raise energy 
prices, but had to retreat in the face of massive public protest. 
Recently a Belgian investor threatened to sue the APV because he could 
not turn a ``fair profit.''
Economy  1.75/7
    1. Has the taxation system been reformed? (What areas have and have 
not been overhauled? To what degree are the taxpayers complying? Has 
the level of revenues Increased? Is the revenue collecting body 
overburdened?) The taxation system has undergone a number of reforms 
and changes. Between 1990 and 1996, parliament passed thirty-four laws 
and amendments that regulate taxation. The most significant is Law XCI/
1990 on the Regulation of Taxation. It offers a draft of laws 
regulating taxation and tariffs; determines the state agencies which 
will monitor and enforce; and outlines what objects and real estate are 
subject to what taxation and tariffs. Taxes on sales, income, and 
social security make up most of the revenues.
    Mainly because of problems with the budget deficit financing, 
several changes in taxation were proposed by the Horn government. In 
1996, for instance, it suggested an increase in social insurance taxes 
for small businesses from the current 10 percent to 45 percent of net 
income. The government argues that the increase is necessary because of 
the generous social rights guaranteed by the Constitution. The Chairman 
of the National Business Association (IOSZ) claimed that tens of 
thousands of small business owners would return their licenses because 
of the increase.
    Revenues from taxation posted the most significant increase in the 
1994 fiscal year, but in 1995 they remained virtually the same in spite 
of the hike in social security insurance. This could be attributed to 
taxpayer noncompliance. In 1995, tax and social insurance fraud cases 
numbered 480, and the amount of taxes owed in 50 of the most 
significant cases--committed mostly in the small business sector--
surpassed the 20 billion forint mark. The scale of tax fraud suggested 
that the National Customs and Revenue Office (VPOP) and the Tax and 
Finance Control Office (APEH) were overburdened. In response, the 
government established a separate Department for Major Taxpayers OAFH) 
in February 1996 to deal with the largest taxpayers.
    2. Does macroeconomic policy encourage private savings, investment 
and earnings? (Has there been any reform/alteration of revenue and 
budget policies? How have any such changes served to advance economic 
objectives?) The Socialist-led coalition government has made massive 
efforts to enact tougher macroeconomic policies. In 1995 the 
legislators passed a budget that would restrict social entitlements; 
enacted laws on supplementary budget; abolished the tax on interest 
from savings; and established the Committee for Coordination of 
Economic Protection to deal more effectively with economic criminality, 
estimated to be responsible for losses amounting to 30 percent of GDP. 
However, the constitutional court ruled that the austerity measures 
were not in accord with the constitutional guarantees on social 
entitlements. Moreover, the Interests Reconciliation Council has been 
unable to stifle public protest against unpopular economic measures. 
This suggests that the success of economic reform hinges to a 
considerable degree on the passage of the new constitution, in which 
the Socialist government intends to scale back the ``social rights" 
that hinder the economic transition. The public is increasingly 
unwilling to accept the dismantling of Hungary's ambitious social-
welfare system, and in 1995 and 1996 the trade unions organized strikes 
in education, public transport, and the nuclear and electricity 
sectors. Public support for the MSZP dropped from 33 percent in 1994 to 
20 percent in 1995.
    Analysts estimate that the 1997 budget deficit is going to be 
between 310 and 380 billion forint ($2.39 billion) by the expected GDP 
growth rate of 2.39 percent, or 4.9 percent of the total GDP. Yet, 
second quarter 1996 economic indicators show a massive 8.9 percent 
growth of the industrial output (4.9 percent for the year), a steady 
inflation of approximately 22 percent for the year, steady unemployment 
of 10.6 percent, and a decline in interest rates from 35 percent to 27 
percent. This may lead to higher than expected economic growth and 
hence, a lower deficit. Experts believe that a reform of the social 
security sector, which has a deficit of 13 billion forint, is going to 
be instrumental for sound budgetary and fiscal politics in Hungary. The 
IMF announced on December 18, 1996 that Hungary met the qualifications 
for a $381 million stand-by loan.
    3. Are property rights guaranteed? (Are there both formal and de 
facto protections of private, real estate and intellectual property? Is 
there a land registry with the authority and capability to ensure 
accurate recording of who owns what? What are the procedures for 
expropriation, including measures for compensation and challenge?) The 
property rights are formally guaranteed by the constitution, and are de 
facto upheld by contract and property laws. Article 9/Chapter I of the 
constitution states that 1) public and private property is to be 
equally respected and granted equal protection, and 2) that the 
Republic of Hungary acknowledges and promotes the right to free 
enterprise and the freedom of economic competition. Moreover Article 
14/Chapter I guarantees the right to inheritance. The land registry 
accurately records the ownership and transfer of real estate, and 
according to Balazs Pastory, the head of a U.S. law firm in Budapest, 
the Central Land Registry Office does not seem to be overburdened with 
the increased number of claims brought by privatization. Restitutions 
are less common as a direct form of property transfer. Former owners 
and their heirs are usually granted vouchers according to the size of 
their claims. The vouchers can be applied toward the purchase of other 
state-owned property.
    4. Is It possible to own and operate a business? (Has there been 
legislation regarding the formation, dissolution and transfer of 
businesses, and is the law respected? Do there exist overly cumbersome 
bureaucratic hurdles that effectively hinder the ability to own and 
dispose of a business? Are citizens given access to information on 
commerce law? Is the law applied fairly?) Besides the protection of 
private enterprises guaranteed by the constitution, there are numerous 
laws designed to regulate the formation of private enterprises. The 
Commerce Law consists of approximately 350 pieces of legislation, and, 
according to Dr. Pasztory, is up to Western standards, being 
transparent, and is applied fairly to all subjects. The Commerce Court 
(Ceg Birosag) is inefficient. Many complaints have been filed against 
it on account of its slowness.
    5. Is business competition encouraged? (Are monopolistic practices 
limited in law and in practice? If so, how? To what degree is 
``insider" dealing a hindrance to open competition?) Fair competition 
is guaranteed by the Commerce Law and by the elimination of state 
monopolies. The pace of privatization in Hungary suggests that the 
government made substantial efforts to relinquish state monopolies in 
all spheres of production, and encourage competition. But the process 
was stained by several corruption scandals that led to the dismissal of 
the entire APV board and the minister in charge.
    As far as competition in strategic industries is concerned, 
domestic investors complained that they are disadvantaged by large 
Western corporations. They urged a more protectionist policy in the 
privatization of these industries. Neither the scandals nor the 
complaints of domestic investors seemed to hamper the performance of 
the Hungarian economy in 1996. The government continued with the 
privatization of strategic industries and the GDP posted a robust 8.6 
percent growth in the first two quarters of 1996.
    6. Are foreign investment and international trade encouraged? (To 
what degree has there been simplification/overhaul of customs and 
tariff procedures, and are these applied freely? To what degree is 
foreign investment encouraged or constrained? Is the country overly 
trade dependent on one or two other countries?) Hungary leads by far 
the post-Soviet countries of Central and Eastern Europe (including 
Russia, Ukraine, Belarus and the Baltic states) in the proportion of 
direct foreign investment. Hungary is currently holding 32 percent of 
direct foreign investment ($8,506 million), compared to only 22.5 
percent or $6,000 million provided to the former Soviet Union. Hungary 
is attractive to foreign investors because its legislation provides 
more safeguards than in many other countries in the region. The 
legislation on the privatization of strategic industries, for instance, 
guarantees that an investor can obtain solvent companies and their 
market share for a fair price through a transparent privatization 
process, and at a fair profit for the investor. This led to several 
lawsuits against the APVRT, the latest from a Belgian investor who 
purchased a share of the state-owned utility company, but, contrary to 
the legislation, the government failed to deregulate the energy prices. 
Moreover, the labor force in Hungary is relatively cheap and highly 
skilled, the country is centrally located, and enjoys a relatively high 
degree of political stability.
    Finally, Hungary is trade-dependent. The first three quarters of 
1996 show an international trade deficit of 314.4 billion forint ($2.6 
billion), or 9.2 percent of total international trade. The largest 
trade deficit has been shown in energy ($1.26 billion), finished goods 
($1.28 billion), and machinery ($1.26 billion). This is also one reason 
why advanced industrial countries find Hungary attractive for 
investment. On the whole, more that thirty of the world's top fifty 
multinational corporations invested in Hungary, and the average per 
capita foreign investment is $5 28, compared to the regional average of 
$41. In 1993 there were 4,286 new businesses in foreign ownership and 
the number of joint ventures totaled more than 20,000 in 1995.
    7. Has there been reform of the banking sector? (Is the central 
bank independent? What are its responsibilities? Is it effective in 
setting and/or implementing monetary policy? What is the actual state 
of the private banking sector? Does it conform to international 
standards?) The banking sector was reformed after 1989, and according 
to the vice president of the National Bank, Dr. Szapari, the central 
bank operates independently of the government. Yet, he also suggested 
that a three year term is insufficient. Five years would ensure more 
independence and stability within the central bank.
    By the end of 1995, the first year of the privatization of the 
state-owned banking sector, 58 percent of banks were privately owned. 
By the end of 1997, the government hopes to increase the private share 
to 75 percent. In addition to domestic banks, a number of foreign banks 
operate in Hungary, including Citibank, Deutsche Bank, Hipo Bank and 
Bank of America, proof that banking candidates conform to international 
standards.
    In the first two quarters of 1996, the banking sector showed a 
staggering 30 percent growth in net income. In some cases, however, the 
government was forced to repurchase insolvent banks from foreign 
investors because of their poor performance. The latest such case was 
the repurchase of the Polgari Bank from GE Capital in December 1996, 
after the bank posted a huge loss.
    8. Is there a functioning capital market infrastructure? (Are there 
existing or planned commodities, bond and stock markets? What are the 
mechanisms for investment and lending?) The Budapest Stock Exchange 
(BUX), established in 1990, was one of the first such in the region. 
The BUX index contains seventeen stocks. To qualify for the index, a 
stock has to comply with three out of five criteria, including a 
minimum face value, defined minimum price, a minimum number of 
transactions, and a cumulative minimum turnover of 10 percent of the 
registered capital during the six months preceding the revision of the 
index. If more than twenty-five stocks met at least three of the five 
qualifications, they are selected according to their weighed average 
calculated across the five criteria.
    The Dutch DAX index served as a blue-print for the construction of 
BUX. The base value of the BUX was set for 1,000 points on January 2, 
1991. Through most of 1996, the BUX index operated in the range of 
3,500-3,600 points, and remained mostly flat. During the end of the 
year rally, however, the BUX for the first time crossed the 4,000 point 
barrier, and on January 8,1997 it reached 4,562.83.
    Total turnover on the BUX reached 1.67 2 billion forint (over $10 
billion) in 1996, or over 25 percent of Hungary's GDP. Close to 75 
percent of the share value was owned by foreign investors, 10 percent 
by domestic private investors, and 15 percent by the state. Analysts 
attribute the surge in BUX to the fact that the Central Bank held the 
interest rates steady throughout the last quarter of the year, and that 
the market enjoys enormous investor confidence. Morgan Stanley rated 
the BUX the third best exchange in the world in 1996, after the Russian 
and Venezuelan exchanges.
    9. Has there been reform of the energy sector? (To what degree has 
the energy sector been restructured? Is the energy sector more varied, 
and is it open to private competition? Is the country overly dependent 
on one or two other countries for energy [including whether exported 
fuel must pass through one or more countries to reach markets]?) The 
privatization of the energy sector started in 1995, and presently 70 
percent is held in private hands. An independent oversight body, the 
Hungarian Energy Office, was set up in July 1994 to regulate energy 
sales and price levels and to ensure a minimum distance between the 
government and the privatized entities in the energy sector. The first 
round of energy sector sales was held on September 18, 1995, and a 51 
percent stake was sold for $460 million to eighteen investors. Six 
distributors and two generating plants of the electric energy sector 
were sold in early December 1995, and the following foreign investors 
acquired between a 47 percent and 49 percent share in the individual 
electricity-distribution companies: Electricite de France; the Belgian 
Powerfin; the German Bayernwerke; and the German Isaar Amperwerke. The 
revenues from sales totaled $1.3 billion. Domestic energy production is 
distributed among coal (23 percent), oil (30 percent), gas (29 
percent), and nuclear and hydroelectric energies (17 percent). 
Approximately 50 percent of oil and gas is imported from Russia.

                                       

                                       

                                 POLAND


                                     Freedom in the World Ratings, 1988-1997                                    
                                                                                                                
                         1988-89   1989-90   1990-91   1991-92   1992-93   1993-94   1994-95   1995-96   1996-97
                                                                                                                
Political Rights              5         4         2         2         2         2         2         1         1 
Civil Liberties               5         3         2         2         2         2         2         2         2 
                                                                                                                
    Status                   PF        PF         F         F         F         F         F         F         F 
                                                                                                                



                                         Polity: Consolidated Democracy

                                           Economy: Consolidated Market

                                                 Population: 38,613,000

                                                            PPP: $4,380

                              Ethnic Groups: polish (98 percent) German

                                                  Ukrainian, Belarusian

                                                        Capital: Warsaw

_______________________________________________________________________

Political Proces  1.50.7
    1. When did national legislative elections take place? Elections 
for the 100-seat Senate and the 460-member Sejm were held in September 
1993. The Sejm is dominated by two ``post-Communist" forces, the 
Democratic Left Alliance (SLD) and the Polish Peasant Party (PSL) 
which, as a result of the election law, were able to translate 36 
percent of the popular vote into a ``constitutional" majority of 66 
percent of the seats in the Seim and 73 percent in the Senate. In the 
Sejm, the SLD held 171 seats; the PSL, 132; the Democratic Union (UD), 
74; the Social Democratic Union of Labor (UP), 41; the nationalist 
Confederation for an Independent Poland (KPN), 22; President Walesa's 
Non-Party Bloc to Support Reform (BBWR), 16; and the German Minority, 
4. In the Senate, the SLD captured 37 seats; the PSL, 36; and 
Solidarity, 9. The rest were split among 10 parties. The elections were 
free and fair. Prime Minister Jozef Oleksyof the SLD--who replaced PSL 
Prime Minister Waldemar Pawlak in March 1995--resigned in January 1996 
amid allegations that he collaborated with Soviet and Russian 
intelligence. He was replaced by Sejm Speaker Wlodzimierz Cimoszewicz 
in February.
    2. When did presidential elections occur? In November 1995, 
Alexander Kwasniewski, leader of the SLD, defeated incumbent Lech 
Walesa, who had led Poland's independence movement as head of the 
Solidarity trade union in the 1980s. After the first round, Kwasniewski 
led Walesa, 35.1 to 33.1, winning the runoff with 51.7 percent.
    3. Is the electoral system multiparty-based? Are there at least two 
viable political parties functioning at all levels of government? Yes, 
Poland is a multiparty democracy. The Communist Party monopoly ended 
following round table negotiations between the non-Communist opposition 
and the military regime in 1989, which led to the legalization of 
Solidarity and other political reforms. The Interim Constitution 
adopted in 1993 enshrines political pluralism. Parties function at all 
levels of government.
    4. How many political parties have been legalized? Most of Poland's 
estimated 100 political parties and associations are small. A new 
electoral law, adopted in April 1993, aimed at reducing the number of 
parties in Parliament (twenty-nine political groupings were represented 
in Parliament after the 1991 vote, none with more than 13 percent of 
the vote). Parties that failed to get 5 percent (8 percent for parties 
campaigning in coalition) of the national vote would not be 
represented. Only seven groups secured parliamentary representation 
after the 1993 vote.
    5. What proportion of the population belongs to political parties? 
Despite the large number of parties, less than 2 percent of the 
population claims membership in any political party.
    6. What has been the trend of voter turnout at the municipal, 
provincial, and national levels in recent years? Since 1989, overall 
voter turnout has decreased slightly in local elections. The turnout 
for elections since 1989 is as follows: June 1989 (parliamentary): 62 
percent; May 1990 (local and regional): 42 percent; November 1990 
(presidential): 60 percent; December 1990 (presidential run off: 53.4 
percent; October 1991 (parliamentary): 43.2 percent; September 1993 
(parliamentary): 52 percent; June 1994 (local and regional): 34 
percent; 1995 (presidential, second round): 68.23 percent.
Civil Society  1.25/7
    1. How many nongovernmental organizations have come into existence 
since 1988? How many charitable/nonprofit organizations? International 
organizations have estimated that there are over 25,000 nongovernmental 
organizations in Poland. These include professional, cultural, youth, 
sports, political, ecological, religious, women's and single-issue 
organizations. Voluntary charities, many associated with the Catholic 
Church, are active, as are international groups such as the Red Cross. 
NGOs and voluntary organizations have received broad support and 
technical assistance from the UN Development Program and the Open 
Society Network.
    2. What form of interest group participation in politics are legal? 
The existing constitution does not include the right to petition the 
Constitutional Court and the public does not have the right of 
initiative for law- or rule-making. Article 8 of the Consultation and 
Referendum Act of 1987 states that authorities can carry out public 
consultations either at their own initiative or upon the request of 
trade unions, farmers' unions, or other associations and NGOS. If the 
request is refused, reasons must be given, but the petitioner does not 
have the right to appeal in court. Most lobbying activities are legal 
and political endorsements are permitted, Citizens use petitions, 
public demonstrations, letters to newspapers, and media access (radio 
call-ins) to air their views publicly.
    3. Are there free trade unions? There are four national inter 
branch industrial unions registered, along with seventeen other major 
independent industrial branch unions and three agricultural unions. The 
Independent Self-Governing Trade Union Solidarity (NSZZ) claims a 
membership of 1.4 million as of 1996. Offshoots of mainstream 
Solidarity include the Christian Trade Union Solidarity and Solidarity 
'80. There are no reliable estimates of their membership. The National 
Alliance of Trade Unions (OPZZ)--the successor of its Communist-era 
namesake--claims 4.5 million members, but polls in early 1996 suggest 
that its dues-paying membership may be less than Solidarity's. Over 100 
SLD deputies are, or have been, members of the OPZZ, which sponsored 63 
``trade union deputies" in the 1993 elections. Other unions include the 
Free Miners' Union, which claims more than 300,000 members, and the 
National Teachers' Union. There were several strikes in 1996, including 
ones by coal miners and doctors. Estimates of union participation range 
from 30 to 40 percent of Poland's roughly 20 million workers, and the 
rate of unionization is low within the growing private sector.
    4. What is the numerical/proportional membership of farmers' 
groups, small business associations, etc.? Farmers and agricultural 
workers are organized in local and regional associations, unions and 
cooperatives, although exact membership figures are unavailable. They 
are a potent political force, and their interests are represented 
politically by the Polish Peasant Party, Rural Solidarity, the 
Christian Peasant Alliance, and other smaller parties. There are 
numerous business and professional associations and groups in Poland, 
though membership and statistics vary widely or are incomplete. Among 
them are the Polish Chamber of Commerce (in most major cities), the 
Business Center Club, etc. There are over 400 NGOs concerned with the 
economy, finance, insurance and the labor market.
Independent Media  1.50.7
    1. Are there legal protections for press freedom? The Bill on the 
Annulation of the Law on Control of Publications and Performances, the 
Abolition of its Control Organs and the Change in the Press Law, 
adopted in April 1990, declared censorship to be abolished and 
confirmed agreements reached during 1989 round table discussions 
between the opposition and the military regime. Since then, laws and 
amendments have sought, in some cases, to inhibit press freedom, 
particularly through statutes dealing with defamation of officials and 
the state.
    2. Are there legal penalties for libeling officials? Are there 
legal penalties for ``irresponsible" journalism? Article 270 of the 
Penal Code states that anyone who ``publicly insults, ridicules and 
derides the Polish Nation, Polish People's Republic, its political 
system, or its principal organs is punishable by between six months and 
eight years' imprisonment." Article 273 imposes a prison term of up to 
ten years for anyone who violates Article 270 in print or through the 
mass media. The law has been enforced on several occasions, bringing 
protests from international human rights group. The 1994 Law on State 
Secrets was also considered overly broad. In January 1995, the Supreme 
Court ruled that journalists could be forced to reveal sources whenever 
it was requested by prosecutors or judges. But in April 1995, the Sejm 
rejected a measure that would have forced journalists to reveal their 
sources only in the most serious of crimes. In February 1996, the 
editor-in-chief of the satirical weekly, Nie, was convicted of 
publishing secret documents, given a one year suspended sentence and 
fined $4,000. Amendments to the press and penal codes in December 1996 
held journalists responsible not only for deliberate, but also 
unintentional, infringements on personal property. The regulation 
provided that no materials concerning a person's private life may be 
published, unless they are strictly connected with his or her public 
activities.
    3. What proportion of the media is privatized? Since a 1992 law 
abolished media monopoly by the government, private media have 
mushroomed in Poland, accounting for 85 percent. There are some 3,300 
newspapers and magazines (100 dailies out of 380 papers), 119 
commercial radio stations (six national stations, four of which are 
state-owned), as well as ten commercial TV stations. The four most 
popular national dailies are independent: Gazeta Wyborcza (formerly 
linked to Solidarity), Sugar Express, Express Wieczorny, and 
Rzeczpospolita. State-run television stations, TVP-1 and TVP-2, 
dominate the market. Foreign ownership of newspapers and magazines is 
limited to no more than 45 percent. Polsat remains the most popular 
commercial television network. A license for central Poland was granted 
to TVN, which is owned by the Polish company ITI and the Central 
European Media Enterprises Group. There are several cable stations.
    4. Are the private media financially viable? Yes, though 
competition among media is stiff. Annually, some 1,500 print titles 
appear or disappear. Market saturation, lack of advertising revenues, 
and printing costs are key factors in the failure of many newspapers or 
magazines.
    5. Are the media editorially Independent? Newspapers and magazines 
reflect political diversity, and run the gamut from the far-left to the 
far-right. Party papers reflect the views of their publishers. The 
National TV and Radio Council (KRRT) is ostensibly independent of the 
government, but since its nine members are nominated by Parliament, the 
Senate and the president's office, politics plays a role in the 
Council's makeup. Personnel changes at TVP-1 led to the cancellation of 
programs too critical of the Communist era. Tomasz Siemoniak, director 
of the most popular television station, Channel 1, was fired by a TVP 
board of directors dominated by the ruling coalition. In March 1996, 
Wieslaw Walendziak resigned as TVP president after his decisions were 
overruled.
    6. Is the distribution system for newspapers privately or 
governmentally controlled? Private distributors, and transport and 
dissemination by publications themselves are the chief means of 
distribution.
    7. What has been the trend in press freedom? Freedom House's annual 
Survey of Press Freedom rated Poland Not Free for 1988, Partly Free for 
1989, and Free from 1990 through 1996.
Rule of Law  1.50/7
    1. Is there a post-Communist constitution? Poland is technically 
governed by a 1952, Stalin-era document, frequently amended since the 
fall of Communism. In November 1992, President Lech Walesa signed into 
law the so-called Little Constitution which mandated a strong 
presidency. The constitutional balance of power between the presidency, 
the government and the legislature remains amorphous, pending the 
adoption of a formal constitution. In 1996, Solidarity and other 
opposition groups wanted the constitution to be adopted after the 1997 
elections. The new draft diminished presidential powers, widened the 
prerogatives of the Constitutional tribunal and allowed citizens a 
greater say in legislative matters. While a preamble was adopted in 
November, the PSL and the Union of Labor Party held up parliamentary 
ratification by opposing the three tier territorial administration, 
arguing that the constitution did not guarantee basic social rights 
such as free medical care and public schooling.
    2. Does the constitutional framework provide for human rights? Do 
the human rights include business and property rights? The Little 
Constitution guarantees basic human rights. Two governmental 
organizations monitor human rights in Poland: the Office of the 
Commissioner for Civil Rights Protection (the Ombudsman), established 
in 1987, and an independent internal body with broad authority to 
investigate alleged violations of civil rights and liberties. Poland 
signed the European Convention on Human Rights and Fundamental 
Freedoms, which came into effect in January 1993, providing recourse to 
the Council of Europe's legally binding machinery in the event of 
alleged violations of civil or political rights. Property and business 
rights are safeguarded. President Walesa's attempts to implement a 
Human Rights Charter and an Economic Principles Charter after the 
passage of the Little Constitution were stalled by the Sejm.
    3. Has there been reform of the criminal code/criminal law? Reform 
of the Penal Code and the Penal Procedure Code began in 1989-90. Most 
of the offensive provisions dealing with political crimes were removed 
or changed. Subsequent draft laws introduced new offenses in the area 
of economic crime. There are new procedural guarantees for defendants, 
and limits on the use of phone tapping and house searches. Some changes 
have been controversial, such as measures on libel and defamation of 
public officials by the press, the definition of state secrets, and 
other infringements on freedom of the press and expression. Reform is 
an organic, ongoing process; in March 1996, the government submitted a 
draft penal code that provided for more lenient treatment of prisoners, 
allowing anyone sentenced to life imprisonment to petition to be 
released after twenty-five years. At the end of 1996, the Sejm sent 
several bills back to committee dealing with provision of the penal and 
penal procedures codes, and amended an article easing an appeal for 
presidential clemency.
    4. Do most judges rule fairly and impartially? How many remain from 
the Communist era? Most judges reportedly rule fairly, and many, though 
not all, of the pre-Solidarity judges have stepped down or been 
removed. The Ministry of justice can remove judges for ``betraying the 
principle of court independence." Trials are generally open, though the 
courts reserve the right to close a trial to the public in some 
circumstances such as divorce cases, trials in which state secrets 
maybe disclosed, or cases whose content can offend ``public morality." 
This prerogative is rarely invoked.
    5. Are courts free of political control and influence? Are the 
courts linked directly to the Ministry of Justice or any other 
executive body? Poland's three-tiered court system consists of regional 
and provincial courts and a Supreme Court. A Constitutional Tribunal 
may offer opinions on legislation, but its authority is limited. judges 
are nominated by the National Judicial Council and appointed by the 
president. Judges are appointed for life and can be reassigned but not 
dismissed except by a decision of the National Judicial Council. In 
July 1993, a law dealing only with appeals based on procedural issues 
introduced appellate courts into the Polish Judicial system for the 
first time since World War II. The justice Ministry faces such problems 
as differences of opinion about the role and position of the 
prosecutor's offices--in particular, whether they should return to 
being free from government supervision. There exists a hazy 
relationship between prosecutor's offices and the State Security Office 
(which is under the jurisdiction of the minister of internal affairs). 
Political parties, parliamentary commissions, the State Security 
Office, the government and the president's office continue to exert 
political pressure on the justice minister and his prosecutors.
    6. What proportion of lawyers is in private practice? Privatization 
and the proliferation of Western companies and law firms in Poland has 
provided opportunities for thousands of lawyers to work full- or part-
time in the private sector, but a sizable majority remain employed by 
the state.
    7. Does the state provide public defenders? Yes. Once formal 
charges are filed, the defendant is allowed to study the charges and 
consult with an attorney provided at public expense if necessary
    8. Has there been comprehensive reform of antibias/discrimination 
laws, including protection of ethnic minorities? The constitution and 
laws provide for equal rights regardless of sex or ethnic origin. 
Poland's population is 98 percent ethnically homogenous, with small 
Ukrainian, Belarussian, Slovak, Lithuanian and German minorities. The 
electoral law exempts ethnic minority parties from the requirement to 
win five percent of the vote nationwide for parliamentary 
representation. Minority groups enjoy cultural autonomy, and many have 
established institutions and native-language publications. In the 1996-
97 school year, Lithuanian was taught to pupils of Lithuanian descent 
in twelve schools in northeastern Poland. Bilateral treaties with 
Belarus and Poland contained provisions relating to the rights of those 
national minorities. In Przemysl, a cupola was torn down in the spring 
of 1996 from a Ukrainian Catholic Church, reportedly for safety 
reasons, without the consent of the Ukrainian minority in the city, an 
event that further fueled ongoing tensions between the Roman Catholic 
majority and the Ukrainian minority there. There have been sporadic 
incidents of anti-Semitism and anti-Gypsy violence.
Governance and Public Administration  1.75/7
    1. Is the legislature the effective rule-making institution? The 
legislature, consisting of a Senate and a lower house, the Sejm, is the 
effective rule-making institution. Before the election of President 
Kwasniewski, Parliament and then-President Lech Walesa often clashed 
over the extensive power granted to the president by the interim 
constitution. The 1995 and 1996 constitutional drafts--which were never 
ratified because of political disagreements--would have reduced 
presidential powers. With the SLD and its allies controlling almost 
two-thirds of seats in both houses of Parliament, the president and 
Parliament have worked closely together.
    2. Is substantial power decentralized to subnational levels of 
government? Yes, in 1990 the first Solidarity-led government introduced 
a local self-government law that laid the foundation for a completely 
new and decentralized system of local government. The gmina, or 
community of local residents, became the basic administrative unit, 
acquiring legal status, ownership of local assets, and responsibility 
for its own budget. The gmina elected a council, which appointed 
executive officials to run it in accordance with the councilors' 
resolutions. There are 2,465 gminas. In December 1996, the government 
coalition proposed the introduction of a third level of government, a 
district-county (Powiat ), to the provincial and municipal levels.
    3. Are subnational officials chosen in free and fair elections? 
Poland has had two elections (1990 and 1994) for over 52,000 
councillors to 2,383 local councils. The elections were free and fair. 
The results confirmed the popularity of the two partners in the ruling 
``post-Communist" coalition-the Democratic Left Alliance (SLD) and the 
Polish Peasant Party (PSL).
    4. Do legislative bodies actually function? On the national level, 
Parliament drafts, debates and passes laws. There has been considerable 
devolution of power, with local and regional councils now exercising 
extensive powers.
    5. Do the executive and legislative bodies operate openly and with 
transparency? The lack of a new constitution has not helped the cause 
of transparency. While texts of most decrees and laws are published and 
available to the mass media (which enjoy free access to government 
officials), the Consultation and Referendum Law of 1987 does not 
require that all draft laws, rules, government programs and plans be 
publicly available.
    6. Do municipal governments have sufficient revenues to carry out 
their duties? Do municipal governments have control over their local 
budgets? Do they raise revenues autonomously or from the central state 
budget? Municipal and provincial governments have sufficient means to 
carry out their duties and have control of local budgets. Municipal 
governments raise revenues autonomously through taxes, which are 
supplemented by state funds.
    7. Do elected local leaders and civil servants know how to manage 
municipal government effectively? In many instances, local authorities 
tend to have a better idea of funding priorities and spend a reported 
20 to 40 percent less than the central administration on the same 
tasks. Poland now has an increasingly competent cadre of local 
officials and civil servants who manage effectively.
    8. Has there been constitutional/legislative reform regarding local 
power? Has there been a reform of the civil service code/system? Are 
local civil servants employees of the local or central government? The 
first Solidarity-led government introduced and implemented self-
government legislation in 1989-90. Reforms of the civil service code 
and system are ongoing, and an elite school of public administration 
has been established to train qualified candidates to serve in 
government. In October 1996, under a new Civil Service Law, the prime 
minister appointed twenty-four politicians, civil servants and 
academics to a new Civil Service Council. The Council will pronounce on 
civil servants' professional ethics and also advise on the criteria for 
evaluation and promotion.
Privatization  2.25/7
    1. What percentage of the GDP comes from private ownership? In 
1989, the private sector accounted for 18 percent of GDP. Today, an 
estimated 55 percent of GDP is produced by the private sector. It also 
accounts for 60 percent of total employment. The expansion of the 
private sector in Poland has been largely driven by the spontaneous and 
vigorous emergence of new enterprises, rather than privatization. 
Nevertheless, a relatively large state sector remains, and 
privatization has been rather slow.
    The informal economy is estimated to account for about 15 percent 
of GDP.
    2. What major privatization legislation has been passed? The first 
phase of privatization occurred during the final months of Communist 
rule with the introduction of legislation in 1987-88 that allowed 
state-owned firms to issue stock and transform themselves into joint-
stock companies. In August 1990, the Ministry of Ownership 
Transformation was created by two separate laws: The Office of the 
Ministry of Ownership Act and the Privatization of State-Owned 
Enterprises (SOES) Act.
    Early Polish law defined several principal privatization 
strategies: sales to foreign investors; mass privatization, initial 
offerings on the newly organized stock exchange; and the ``insider" 
(management and/or worker) takeover of firms through leasing or 
outright ownership. Due to a number of political factors such as the 
powerful political connections of managerial elites and strong trade 
union influence, Polish privatization has generally followed the 
``inside" path. In addition, privatization projects have mostly been 
handled by regional voivodship (county) offices (and not the central 
Privatization Ministry), making the process more spontaneous and 
decentralized. For these reasons, the pace of privatization has been 
haltingly slow and intensely controversial. As of mid-1996, Poland had 
still not adopted restitution (reprivatization) legislation returning 
properties expropriated by Germans during World War II and the 
Communists afterwards.
    In 1990-1991, the government announced a ``mass privatization" 
program that envisaged the commercialization of 450 of the largest 
state-owned industrial firms. After considerable delay, an amended 
version of the plan, the Law on National Investment Funds and Their 
Privatization, took effect in June 1993. Due to start in the summer of 
1994, mass privatization was stalled by the ``post-Communist" 
government until June 1995. These delays were the result of the PSL's 
and the ROP's hostility to giving foreigners property rights to Polish 
companies.
    Mass privatization in Poland was based on giving citizens vouchers 
which represented an ownership stake in all fifteen National Investment 
Funds (NIFs), which are run by state-selected foreign and local 
management groups. These vouchers went on sale in November 1995 for 20 
zloty (approximately $7), with 15 million of 27 million eligible Poles 
becoming purchasers. The distribution ended in November 1996.
    These NIFs in turn took a controlling (33 percent) stake in each of 
514 large and medium scale enterprises, while a 27 percent share was 
distributed to the other fourteen NIFS, 10 percent to the firm's 
workers, and 30 percent left to the state. In the next phase of mass 
privatization, vouchers will be exchanged for stock in individual NIFs 
by early 1997. With some exceptions, the process has been relatively 
smooth. There are early signs that individual NIF management teams have 
sought to become active in restructuring the firms they now control.
    In February 1996, a referendum called by Lech Walesa and supported 
by Solidarity sought to replace the government's piecemeal asset 
disposal with faster privatization, but low turnout nullified the poll.
    Apart from the NIFS, the pace of privatization slowed significantly 
in 1995 and 1996. The privatization of several major SOES, including 
the LOT national airline, did not take place as scheduled in 1996, and 
has been postponed until mid-1998--as has that of the copper giant KGHM 
Polska Miedz (the world's eighth largest producer).
    The PSL bears a large portion of the blame. It continues to oppose 
further sales of property and companies to foreigners. The PSL will 
continue to be a factor in privatization through at least 1997. 
Following the October 1996 government reorganization and after much 
political infighting in the ruling coalition, the PSL's Miroslaw 
Pietrewicz was appointed the head of the Treasury Ministry which is now 
responsible for privatization. However, the liberal Wieslaw Kaczmarek 
will continue to run the program.
    3. What proportion of agriculture, housing and land, industry, and 
business and services is in private hands?
    Agriculture: In 1989, a fifth of the land was state-owned with the 
rest in private hands. Today, 2.1 million private farmers work on 14.3 
million privately-farmed hectares. The Agricultural Ownership Agency 
was set up four years ago to take over and sell 1,495 state farms and 
3.1 million hectares of land. By March 1993, new Polish owners were 
found for a mere 24,000 hectares of former state land and another 
204,000 had been leased to individual owners or employee-owned 
companies. In the first quarter of 1994, the government took over 177 
state farms.
    The large private sector has not necessarily translated into a free 
market in agriculture, however. Protection for the agricultural sector 
in Poland is very significant. According to the National Bank of Poland 
(NBP), this policy fuels price increases that continue to account for a 
major portion of consumer inflation.
    Housing and Land: Poles are allowed to own private housing and 
land. In July 1994, the Polish Senate rejected legislation meant to 
enact a market-oriented ``rent revolution." The bill would have 
affected 3.5 million apartments owned by the state and municipalities, 
or one-third of all units. There is a severe shortage of affordable 
housing. To buy land or buildings, foreigners are still required to 
obtain clearance from the Interior Ministry. Real estate may either be 
owned or leased by way of a perpetual lease. High interest rates make 
mortgage financing of property rare.
    Industry: The private sector holds a 38 percent share of industry. 
``Strategic" (that is, politically significant) industries such as oil, 
telecommunications, metallurgy, shipbuilding, banking, insurance, 
mining, airlines, armaments, and portions of the chemical and tobacco 
industries are unlikely to be privatized for the foreseeable future. 
The IMF and World Bank declared that Poland needed to accelerate the 
pace of privatization in these sectors. The current trend, however, is 
to form industry-wide holding companies (such as Nafta Polska in the 
oil sector) and to ``commercialize'' rather than privatize.
    Business: 89 percent of retail businesses are now private. Some 
4,500 medium and large-scale firms have undergone privatization since 
1990, and some 3,500 remain to be privatized.
    ``Small'' privatization--the sale or lease of state-owned stores, 
shops and small firms to individuals or groups of private investors--
has been relatively successful. In 1990 alone, 35,000 state owned and 
cooperative stores were transferred to the private sector. By September 
1991, 75 percent of the retail trade was back in private hands. By 
1996, over 90 percent of small business and service sector 
establishments were in private hands.
    4. Has there been reform of the state sector? (What major 
legislation has been passed? Do authorities and state managers act 
within the law? Is the state sector performing more efficiently? Does 
it require fewer subsidies than before?) State-owned enterprises (SOES) 
continue to be subsidized directly through budget and executive agency 
remissions, and indirectly through tax amnesties, state guarantees of 
credit, and political pressure on state-owned banks to extend credit to 
favored enterprises. This discrimination in favor of SOEs continues 
despite Poland's supposed commitment to its elimination. Direct 
subsidies account for only 2.1 percent of budget expenditures in the 
new 1997 budget, but critics charge that political--not economic--
considerations govern which industry receives them.
    A government reorganization in October 1996 transferred 
responsibility for the 1,300 SOEs from the various ministries to the 
wojewodas (governors).
Economy  1.75/7
    1. Has the taxation system been reformed? (What areas have and have 
not been overhauled? To what degree are taxpayers complying? Has the 
level of revenues increased? Is the revenue-collection body 
overburdened?) The following taxes are levied in Poland: income 
(ranging from 21 to 45 percent), social security (aggregate rate of 
48.5 percent on income), VAT (22 percent generally and 7 percent on 
specific goods such as food and medicines), and corporate income (40 
percent). There are also taxes on property, agriculture and forestry, 
inheritance (between 5 percent and 45 percent), and stamp duties on 
certain transactions, such as property transfers (2-5 percent).
    The current level of income tax rates was introduced in 1994 as a 
``temporary'' measure. Following internal debate between the coalition 
parties, the government announced in May 1996 that income tax rates 
would be cut to a range of 20-43 percent beginning in 1997 (with a 2 
percent reduction in the corporate income tax) at the same time that 
tax breaks would be reduced. This set off a political battle to define 
a new income tax rate structure. In September, the Sejm budget and 
finance committees decided to scrap this reduction, while the Sejm as a 
whole decided only to lower the minimum level for income tax rates to 
17 percent in October. This was virulently opposed by the SDL-dominated 
government and Finance Minister Grzegorz Kolodko, whose position was 
supported by a November Senate decision to support a four-rate 20-44 
percent income tax structure. The new taxes were signed into law in 
late November by President Kwasniewski. Corporate income taxes were 
also reduced by two points to 38 percent.
    These high tax rates encourage private sector activity in the 
informal economy. According to an Institute for Private Enterprise and 
Democracy in Poland (IPED) survey, 15 to 22 percent of the labor force 
is employed informally and 22 to 25 percent of salaries are paid 
informally. Sixty percent of those working informally receive social 
security system benefits. High tax rates on wage income also have the 
unfortunate side effect of making the labor market more rigid. This 
leads to high unemployment in spite of Poland's impressive growth rate. 
While it has fallen recently, Polish unemployment remains high: 13.5 
percent in September 1996. The character of the unemployed pool is also 
problematic. Long-term unemployment represents 40 percent of total 
unemployment. Many of those unemployed actually work in the informal 
sector.
    The introduction of the VAT has considerably improved revenue 
collection. The biggest laggards in tax payments are large loss-making 
SOEs in such sectors as mining, steel and shipbuilding.
    2. Does macroeconomic policy encourage private savings, investment 
and earnings? (Has there been any reform/alteration of revenue and 
budget policies? How have any such changes served to advance economic 
objectives?) Poland was the first post-Communist nation to embark on 
macroeconomic reform. The ``Balcerowicz program,'' begun on January 1, 
1990 in the face of hyperinflation (600 percent in 1990), made the 
zloty internally convertible and pegged its value (on a downward 
``crawling'' basis) to a basket of Western currencies. 
Hyperinflationary pressures were extinguished by 1992, and Poland was 
the first nation to emerge from the post-transition recession with real 
growth in 1993.
    The Finance Ministry controls the state budget. Real GDP grew by 6 
percent in 1996, slightly below 1995's 7 percent. The dynamism of the 
private sector accounts for the majority of this growth in output. In 
1995, the deficit was 2.7 percent of GDP, and it has been under 3 
percent of GDP since 1993. The public debt fell to 58 percent of GDP as 
a result of low budget deficits and the London club debt reduction 
plan. Government consumption grew by 2.6 percent in 1996. Foreign 
reserves rose from $6 billion at the end of 1994 to over $18 billion in 
mid-1996.
    Retail prices increased by 18.5 percent in 1996, down from 1995's 
21.6 percent. Wages rose 5.5 percent in real terms, and were 923 zloty 
($330)per month after payroll taxes at the end of 1996. The 1997 
budget, passed at the end of 1996, projects a deficit of 2.8 percent of 
GDP.
    Its macroeconomic progress was recognized by the West when Poland 
acceded to the OECD in July 1996. Poland's debt rating was raised in 
April 1996 by Standard & Poor's from BB to BBB. In general, Polish 
credit ratings are now investment grade. Poland also repaid all of its 
IMF drawings in 1995.
    One of the most important issues facing Poland is the social 
insurance system, particularly the national pension. Currently, Poland 
has the youngest retirement age in Europe. It has more pensioners below 
the age of sixty-five than above and 10.5 million contributors support 
9 million pensioners. There is no relationship between contributions 
and the benefits paid in retirement. The system represents 39 percent 
of government expenditures and crowds out productive infrastructure 
investment. Demographic trends indicate that this situation will 
continue to deteriorate further unless reform takes place.
    A 1995 move by Finance Minister Grzegorz Kolodko to index benefits 
to wages rather than prices failed when the Labor Ministry and its 
head, Leszek Miller, opposed the plan. In October 1996, union and 
employer representatives on the Tripartite Commission for wage and 
Social Issues rejected a government proposal to raise the retirement 
age for men from sixty to sixty-five and for women from fifty-five to 
sixty. Unions argued that the proposal was premature, while employers 
maintained the necessity of a wholesale reform of the system. Observers 
note that real reform of the pension system is unlikely before the 1997 
parliamentary elections, given the political sensitivity of the issue.
    According to a November 1996 survey, 49 percent of Poles have zero 
savings, a decline from 58 percent in November 1995. Reflecting 
increasing confidence in the currency, the number of Poles keeping 
their savings in zloty-denominated accounts rose from 50 percent in 
1995 to 56 percent in 1996.
    3. Are property rights guaranteed? (Are there both formal and de 
facto protections of private real estate and intellectual property? Is 
there a land registry with the authority and capability to ensure 
accurate recording of who owns what? What are the procedures for 
expropriation, including measures for compensation and challenge?) 
Article 7 of the amended 1952 constitution notes that ``The Republic of 
Poland shall protect ownership and the right of succession and shall 
guarantee comprehensive protection of personal property. Expropriation 
may be allowed exclusively for public purposes and for just 
compensation.'' Article 15.2 of the June 1996 draft of the new 
constitution states that ``Expropriation is admissible only for public 
purposes and upon fair compensation,'' while Article 38 adds that 
``forfeiture of property may occur solely in cases specified by law, 
pursuant to a legal court ruling.'' Article 216.4 states that ``Laws 
may define the guidelines, scope, and procedure for the compensation of 
property losses due to the suspension or abridgment of the rights and 
liberties of man and citizen for the duration of a state of 
emergency.''
    Poland recently liberalized regulations on foreign property 
holdings. Before, purchasing land by foreigners or foreign companies 
necessitated a permit from the Ministry of Internal Affairs. This 
procedure sometimes added months to a property transaction. Now, the 
following transactions can be performed without a permit: individual 
purchase of a residential apartment; ownership of land after a five-
year residency period; and the purchase by foreign companies of up to 
0.4 hectares of land in cities and up to one hectare of land in the 
countryside.
    Regulations and applications remain difficult and confusing. 
Moreover, permits are not necessarily approved: between 1990 and 1995, 
only 16.6 percent of permit applications by foreigners were granted. 
Indeed, a new law requires all companies with majority foreign 
ownership to obtain real estate permits by May 1997. The continuing 
restrictiveness of these laws reflects the fears of the PSL, among 
others, that foreigners will come to own Poland.
    A Patent Law Act was passed in 1993, followed by a Copyright Law in 
1994. Three executive ordinances have been enacted by the Minister of 
Culture and Arts. A December 1994 ordinance establishes a Copyright 
Commission. The Commission, composed of Culture and Arts Ministry 
appointees, is charged with two tasks: approving tables of royalties 
proposed by ``collective administration societies'' for the use of 
works and performances; and to arbitrate disputes concerning royalties. 
Poland also acceded to the Berne Convention in 1994. Together, these 
changes in Polish legislation on the protection of intellectual 
property represent a considerable advance.
    Enforcement has also improved. In late 1994, the Polish government 
closed major television broadcasters of pirated material. The 
government has been less effective in curtailing software piracy. The 
Business Software Alliance, a U.S. anti-piracy trade organization, 
estimates that 91 percent of software in Poland is pirated. It also 
estimates that U.S. software vendors lost $201 million as a result of 
such piracy in 1994.
    Registries in land, companies, and property liens are not fully 
developed. For instance, if there is more than one lien on a property, 
the most recent has priority--the opposite of what happens in the West.
    One problem created by the lack of legislation on restitution of 
German- and Communist Expropriated property is that land sales are 
hampered--and development projects slowed--by confusion over the 
progress of the legislation. A substantial amount of property, 
especially in urban areas, has very unclear titles of ownership. When 
such legislation is enacted, former owners will have first rights of 
sale or disposal, according to a mid-1996 ruling of the highest 
administrative court. This will create problems for the current 
``owners'' of restituted property.
    4. Is It possible to own and operate a business? (Has there been 
legislation regarding the formation, dissolution and transfer of 
businesses, and is the law respected? Do there exist overly cumbersome 
bureaucratic hurdles that effectively hinder the ability to own and 
dispose of a business? Are citizens given access to Information on 
commercial law? Is the law applied fairly?) In general, Polish laws 
regarding the creation of new businesses are fairly liberal and 
transparent. There was an explosion of businesses created following the 
transition, especially of small service firms. Thus, despite the 
relatively slow speed of Polish privatization, the share of the GDP 
produced by the private sector is in the top tier of the East-Central 
European countries.
    Nevertheless, there is some degree of complexity and lack of 
transparency involved in starting and running a business. This is 
related to the speed with which laws related to business activity are 
amended. Over 220 laws, amended over 500 times, regulate business 
activity. This often means that even small firms must employ 
professional assistance to comply with the law.
    Polish regulation remains a barrier to business formation and 
management. Arbitrary enforcement of labor, health and safety 
regulations is one facet of this problem. Another is access to 
differential levels of protection from imports. Price controls still 
exist on certain products such as fuel, transportation and rent.
    Corruption, while present, is not seen as a significant obstacle to 
doing business in Poland. In July 1996, the former mayor of Gdansk was 
arrested for having accepted a 50,000 deutsche mark bribe from a German 
company for a Gdansk insulation contract.
    The Polish legal system is based on French and German models. 
Polish accounting practice, regulated by the Ministry of Finance, is 
moving slowly toward meeting international standards. Poland is a 
signatory of four international agreements on dispute resolution: the 
1923 Geneva Protocol on Arbitration Clauses, the 1958 New York 
Convention on the Recognition and Enforcement of International 
Arbitration Awards, the 1961 Geneva European Convention on 
International Trade Arbitration, and the 1972 Moscow Convention on 
Arbitration Resolution of Civil Law Disputes in economic and scientific 
cooperation. The threat of expropriation is minimal.
    Trade unions are unusually strong in Poland compared with the rest 
of East-Central Europe, and they have sometimes strongly protested 
restructuring and management changes in enterprises, especially in 
those that are newly-privatized. However, they have not seriously 
disrupted Polish business activity.
    5. Is business competition encouraged? (Are monopolistic practices 
limited in law and in practice? If so, how? To what degree is 
``insider'' dealing a hindrance to open competition?) Poland's anti-
monopoly commission has attempted to attack monopolies (defined as 
market share by a single enterprise which exceeds 40 percent), although 
these efforts are not always successful. In August 1996, the Anti 
Monopoly Office threatened to charge Polish Telecommunications with 
anti competitive actions it took with regard to Centertel, a wireless 
phone service provider.
    However, the creation of industry-wide holding companies (such as 
Nafta Polska in fuels) of SOEs serves to increase monopolization.
    6. Are foreign investment and international trade encouraged? (To 
what degree has there been simplification/overhaul of customs and 
tariff procedures, and are these applied fairly? To what degree is 
foreign investment encouraged or constrained? Is the country overly 
trade-dependent on one or two other countries?)

    Investment: The Foreign Investment Act of 1991 and later amendments 
to it secured the opening of Poland to foreign investment. With the 
exception of ``strategic'' sectors mentioned earlier, Poland does not 
require any local participation, ownership, or management in companies. 
Foreigners can generally enjoy complete ownership of new or existing 
Polish firms. Profits and dividends can be fully repatriated with no 
permit requirement.
    Generally, domestic and foreign firms are treated equally under 
Polish investment law. One exception is bidding for public procurement 
contracts. Polish firms enjoy a mandated 20 percent price advantage, 
and 50 percent of materials and labor in all contracts are required to 
be Polish.
    However, foreign investors enjoy special tax privileges, provided 
that the investment is at least ECU 2 million, exports total over 50 
percent of production, or that the investment is made in areas with 
high unemployment. Foreign partners are allowed to import inputs duty 
free. Final restrictions on foreign investment in joint ventures were 
removed by the March 1996jointVentures Law. In April 1996, Poland 
eliminated controls on flows of capital.
    Inflow of foreign direct investment (FDI) from 1990-1994 has been 
quite slow relative to the size of the Polish economy. This changed in 
1995 when FDI grew by 60 percent to reach $2.5 billion ($6.8 billion 
cumulative) in 20,000 Polish firms. The U.S. is Poland's major 
investor, with a 25 percent share of total FDI in 1995.
    One perplexing problem is that large foreign investors sometimes 
demand protection from imports. GM made higher tariffs on auto imports 
a precondition of its investment in the auto industry.
    Trade: Poland's average trade-weighted tariff was 9.3 percent in 
January 1995. The January 1996 revision of the customs tariffs 
established an average 7.7 percent tariff on industrial products and a 
19.5 percent tariff on agriculture goods. On top of these duties, 
Poland charges a general import tax rate of 3 percent (down from 5 
percent in 1995). The latter was removed on January 1, 1997. Finally, 
certain ``strategic'' goods such as alcohol, cosmetics, cigarettes, 
confectionary items, automobiles, and fuel are charged an additional 
excise tax.
    Poland acceded to the Uruguay round of the General Agreement on 
Tariffs and Trade (GATT) in July 1995, and as such is a member of the 
World Trade Organization (WTO). As part of its agreement with the EU, 
Poland has agreed to lower tariffs on European manufactured goods by 20 
percent a year over five years beginning in 1996. Poland is also a 
member of the European Free Trade Association (EFTA) and the Central 
European Free Trade Agreement (CEFTA),both of which obligate a 
substantial reduction in import duties.
    The optimistic and probably unattainable goal is to have a 
completely free trade regime by 1999 as Poland gears up to join the 
European Union. However, Poland is still plagued by a proliferating 
number of barriers to imports (affecting some 4,000 product groups and 
25 percent of imports). Political, not economic considerations, dictate 
which sector will enjoy protection.
    Nontariff barriers such as certification requirements (for 
cosmetics, among others) and quotas (especially in agriculture, fuels, 
alcohol and tobacco products) are growing in number. Safety Testing is 
yet another kind of barrier because of its nontransparent nature. 
Overworked officials, antiquated methodology, and slow communication 
between Warsaw and the borders do little to facilitate trade.
    The level of import protection in some sectors, such as 
agriculture, automobiles and steel, is enormous. The PSL, which 
controls the Agricultural Market Agency (ARR), has attempted to fight 
agricultural imports through a series of fragmented legal regulations. 
This tactic has been called ``creeping protectionism.''
    Polish trade has shifted radically since transition. CMEA business 
with the USSR and its satellites dominated foreign transactions through 
the late 1980s. Since then it has become highly diversified. OECD 
countries account for 70 percent of trade, with Germany alone 
accounting for 30 percent. Russia is Poland's third-largest partner 
(with 8 percent of the total trade).
    An October 1996 government reorganization created a new Ministry of 
the Economy which subsumed the former trade and foreign trade ministry 
functions.
    7. Has there been reform of the banking sector? (Is the central 
bank independent? What are its responsibilities? Is it effective in 
setting and/or implementing monetary policy? What is the actual state 
of the private banking sector? Does it conform to international 
standards? Are depositors protected?) Poland is unique in that the 
National Bank of Poland (NBP), was strongly independent early on. Not 
surprisingly, it has implemented significant monetary restraint. This 
is especially so under the strong stewardship of NBP President Hanna 
Gronkiewicz-Waltz.
    The NBP is responsible for defending the value of the national 
currency, the zloty, and sets exchange and interest rates. Since 1994, 
zloty devaluation has slowed in response to massive inflows of short-
term capital. In June 1995, the IMF confirmed the zloty's full current 
account convertibility. The NBP revalued the zloty in December 1995 to 
control inflationary pressures.
    The Foreign Exchange Law of October 1995 liberalized currency 
exchange rules. First, it allowed Polish exporters to establish their 
own payment deadlines (rather than the across-the-board three-month 
deadline). Second, the law no longer forces Polish firms to immediately 
resell foreign currency received from abroad. This means that it is now 
possible to establish foreign currency bank accounts. However, Polish 
firms are still required to obtain foreign exchange permits for 
transactions involving foreign exchange credits and loans.
    By October 1996 there were eighty-eight banks in Poland, twenty-
four of which were state owned. However, these state-owned banks have a 
57 percent market share. The financial sector is dominated by nine 
banking conglomerates, five of which have been privatized. A bad debt 
crisis plaguing the Polish banking industry began in 1990. By 1995, 
nonperforming assets had been significantly reduced system-wide. By the 
end of the year, 16.1 percent of credit portfolios were estimated to be 
nonperforming. Moreover, one-quarter of this amount was actually held 
by one troubled bank, BGZ SA (40 percent nonperforming loans). Thirty-
two of Poland's leading fifty banks have 5 percent or less of their 
portfolios nonperforming. The total assets of the banking system by the 
end of 1995 was 136.7 billion zloty ($54.7 billion). Despite 
significant de facto restrictions on the operation of foreign banks in 
Poland, they increased their capital stakes in 1995.
    Bank privatization has been beset by problems since the 
controversial 1993 privatization of Bank Slaski. By the end of 1996, 
however, the NBP planned to hold tenders for Polski Bank Inwestycyjny 
and Prosper Bank. The tender for Powszechny Bank Kredytowy will be held 
by March 1997.
    8. Is there a functioning capital market infrastructure? (Are there 
existing or planned commodities, bond and stock markets? What are the 
mechanisms for investment and lending?) Polish capital markets have 
been maturing slowly but steadily since 1990. The Warsaw Stock Exchange 
(WSE) was established in April 1991 with five traded companies. By the 
end of 1996, eighty-three firms were regularly traded. There are fifty-
one brokerage houses providing underwriting, auditing, marketing, and 
consulting services. There are also 843,000 open investment accounts. 
The WSE is comparable to the Greek and Portuguese stock exchanges in 
terms of trading volume and quantity of transactions, but lags far 
behind in capitalization ($9 billion as of November 1996, 7 percent of 
GDP). In order to promote stability, the WSE limits daily price 
movements to about 10 percent. Ninety-nine percent of the Exchange's 
capital is held by the Ministry of Privatization.
    The Polish bourse is still underdeveloped in that it lacks large 
institutional investor-like pension funds, and intermediaries like 
investment banks. Nonetheless, it is developing steadily. Further 
liberalizing amendments to the Securities Law will probably be enacted 
in early 1997.
    By September 1996, trading in mass privatization ownership 
certificates in Poland's fifteen national investment funds made up 
about 10-15 percent of the daily trade volume on the Warsaw Stock 
Exchange. The vouchers began trading on July 15, 1996. The stock 
prospectus for the Eugeniusz Kwiatkowski Fund, one of the NIFS, was 
submitted for review to the Polish Securities and Exchange Commission 
in November, while the rest were submitted in December. Public trading 
in individual NIFs will begin in the first quarter of 1997.
    Other exchanges have been late in developing. The Warsaw Grain and 
Feed Commodity Exchange, Poland's first commodity futures exchange, was 
created in late 1995. In May 1996, the Council of Ministers Economic 
Committee decided to establish eight national commodity exchanges and 
twenty-five regional exchanges. Poland's over-the-counter securities 
market, the Central Table of Offers, became operational in early 
December 1996. It was organized by fifteen brokerage houses.
    Another important development in the evolution of Polish capital 
markets occurred in November 1996 when seventeen Polish financial 
institutions created Poland's first credit rating agency, the Central 
European Center for Ratings and Analysis. It will rate bond issues of 
firms, banks and municipalities.
    Short-term treasury bills used to finance the budget deficit have 
been the major feature of Polish capital markets. This has been 
changing, however. In 1995, Poland returned to international capital 
markets with a very successful $250 million issue of Eurobonds.
    The private capital markets reflect Poland's evolution. While in 
1991, bank loans were the only source of capital for expanding 
companies, today short-term commercial paper, bonds (including 
convertible bonds) and share issues are now accepted methods of raising 
short- and medium-term capital. Currency futures and stock market 
options are also now available. Long-term financing is still difficult 
to raise because of high inflation and general uncertainty.
    By the beginning of January 1997, capital outflows were to be fully 
liberalized.
    9. Has there been reform of the energy sector? (To what degree has 
the energy sector been restructured? Is the energy sector more varied, 
and is it open to private competition? Is the country overly dependent 
on one or two other countries for energy [including whether exported 
fuels must pass through one or more countries to reach markets]?) The 
1990 Law on the Liquidation of the Amalgamated Power Supply and Lignite 
Authority and the 1993 Law on the Transformation of Strategic 
Enterprises have shaped the reform of the electricity sector.
    Polskie Sieci Energetyczne SA, a state-owned firm, has run the 
Polish electricity grid since 1990. While there are plans to admit 
private shareholders, the state plans to keep a controlling interest in 
the company.
    In May 1996, Poland merged seven state-owned oil refineries and the 
main gasoline distribution network into Nafta Polska (an industry-wide 
holding company) in order to increase efficiency. It was hoped that 
this would attract foreign investment into the industry and the private 
sector. Individual refineries will be able to offer 30 percent of their 
shares to foreign investors within a year. The Central Petroleum 
Product (CPN) distribution network, while no longer a monopoly, still 
dominates energy distribution. It was to be incorporated into Nafta 
Polska by the end of 1996.
    The dissolution of state ownership in the energy sector has 
consisted mostly of ``minor privatization'' or the contracting out of 
support services such as repair, transport, storage, and administration 
to private companies. The privatization of a large power plant, Zespol 
Elektrowni Patnow-Adamow-Konin (PAK), set for 1996, has been subject to 
continual delays.
    The energy market is protected from imports by a number of barriers 
such as tariffs and quotas. As a result, imports only account for a 
fifth of total supply. The EU has recently agreed to allow Poland to 
extend this protection to the year 2000. In 1996, oil import duties and 
price caps were reduced so as to alleviate fuel shortages. Moreover, 
Poland is to have a power plant built, owned, and operated by 
foreigners.
    The new 1996 Energy Law creates an Electricity Regulation Board, 
which is responsible for licensing, supervising and approving rates, 
levying fines, and arbitrating disputes between users and producers. 
The Law downgrades the powers of the National Electricity Authority 
which decides the fate of individual power plants.
    Energy prices on the whole are controlled, but the state has pegged 
any increases to inflation. Electricity prices are set by the minister 
of finance for consumers and by the minister of industry for intra-
sector trade. A price increase from the current $0.053 per kWh, to a 
break-even rate of $0.075 is scheduled to take place in the year 2000. 
However, the attainability of this goal is in question because of 
government-induced delays in scheduled price increases.
    Electricity prices under the law will be set on a national 
electricity exchange. At the beginning of May 1996, regional prices 
were introduced for electricity. These prices will be adjusted based on 
a number of factors, including reliability and continuity of supply as 
well as distance.
    The EU agreed in late 1996 to extend protection of the Polish fuel 
market until the year 2000. Under the agreement, customs duties would 
be gradually reduced beginning in 1997. In return, Poland is obligated 
to continue fuel price deregulation, accelerate refinery privatization, 
remove nontariff barriers such as quotas on fuels, and give equal 
treatment to all firms dealing with Polish refineries.
                               Appendix 4

                      Hearing of October 28, 1997

                                                   October 24, 1997

                               MEMORANDUM

TO:
                          Members, Committee on Foreign Relations

THROUGH:
                          James W. Nance and Edwin K. Hall

FROM:
                          Steve Biegun, Beth Wilson, and Mike Haltzel

SUBJECT:
                          Hearing on the Costs, Benefits, 
                        Burdensharing, and Military Implica-
                          tions of NATO Enlargement

    On Tuesday, October 28, 1997, at 10:00 a.m., the Committee on 
Foreign Relations will hold a hearing on the Costs, Benefits, 
Burdensharing, and Military Implications of NATO Enlargement
    Senator Helms will preside.

                                Overview

    The Foreign Relations Committee has scheduled a series of six 
hearings this fall to examine all elements of NATO enlargement. (One or 
two additional hearings will be scheduled early next year after the 
treaty is formally transmitted to the Senate). Previous hearings have 
examined the strategic rationale, the pros and cons of NATO 
enlargement, and the qualifications of the three candidate countries. 
Later in the week the Committee will examine the relationship between 
NATO and Russia, and on November 5 public views on NATO enlargement 
will be heard.
    This memo, prepared with the assistance of the Congressional 
Research Service, provides an overview of the structure of NATO and the 
costs--to the U.S., allies, and candidate members of NATO--associated 
with NATO expansion.

                     Mission and Structure of NATO

Military Mission
    The core of NATO's military mission is the North Atlantic Treaty's 
Article V, in which it is agreed that an attack on one member shall be 
considered an attack against all; and it is further agreed that each 
member will individually and in concert take ``such action as it deems 
necessary, including the use of armed force, to restore and maintain 
the security of the North Atlantic area.'' From this basis, and the 
assumption that the Warsaw Pact was the most likely adversary, NATO 
focused it military efforts for 40 years on 1) deterring and 2) 
preparing for a high intensity conflict in Central Europe.
    At their 1990 London summit, NATO heads of state reaffirmed the 
basic aims of the alliance, but directed a comprehensive strategic 
review in light of the collapse of the USSR and the Warsaw Pact. The 
resultant new ``Strategic Concept'' was adopted at the 1991 Rome NATO 
summit. The Strategic Concept provides a much more detailed set of 
objectives, functions, and guidelines for NATO's military 
establishment, of which the most salient are:

   Maintain military capability sufficient to prevent war and 
        provide an effective defense.
   Deter and defend against any threat of aggression against 
        the territory of any member.
   Maintain the capability to manage successfully crises 
        affecting the security of members by reinforcing political 
        actions.
   Be capable of participating in United Nations missions
   Maintain an up-to-date appropriate mix of nuclear and 
        conventional forces in Europe to provide a broad range of 
        response options.
   Provide enhanced flexibility and mobility, and assured 
        capability for reinforcement when necessary.

    The Strategic Concept also urges priority attention to the 
following military capabilities:

   Surveillance and intelligence collection/processing.
   Flexible command and control
   Mobility within and between regions
   Appropriate logistics capabilities, including transport and 
        war materiel reserves
   Ability to reinforce quickly any area at risk within the 
        alliance's territory

    To provide a framework for achieving or improving specified 
military capabilities, so-called ``Force Goals'' and associated time-
lines are negotiated for each NATO member. The negotiations are closed, 
and the resultant Force Goals remain classified. Consequently, detailed 
public assessment of Force Goal achievement is not possible. In 
general, however, it is widely believed that Force Goals are frequently 
not accomplished on time, and their time-lines renegotiated. It is the 
failure of some allies to meet Force Goals (that have been met by the 
United States) that drives much of the burden sharing debate in NATO.
NATO Organizational Structure
    NATO does not maintain a standing army of its own. The alliance 
defense is maintained through an agreed allocation of national military 
capabilities and is led by a permanent representation of its sixteen 
member states called the North Atlantic Council (NAC). The NAC (NATO 
headquarters) is located in Brussels, Belgium. The NAC consists of 
permanent representatives of each member state at the ambassadorial 
level, and meets twice a year at the level of foreign minister and 
defense minister. Occasional summits at the head of state level are 
held for major decisions such as the invitation of Poland, Hungary and 
the Czech Republic to join the alliance, which was accomplished at a 
July 1997, summit in Madrid, Spain.
    The NATO civilian structure remains essentially unchanged from the 
Cold War period. Below the North Atlantic Council is a Secretary 
General (the senior civilian official at NATO), and the Defense 
Planning Committee, the Nuclear Planning Group, and the Military 
Committee. These latter, three organizations are the decision making 
bodies for NATO's core functions. The Secretary-General, selected by 
the NAC to manage the day-to-day operations of the NATO staff, oversees 
the International Secretariat and chairs all but the Military 
Committee. The Military Committee oversees NATO's Integrated Military 
Command Structure (IMCS).
    In addition to decision-making bodies, NATO has two consultative 
and cooperative fora. The first is the newly formed Euro-Atlantic 
Partnership Council (EAPC), which melds the former North Atlantic 
Cooperation Council and the on-going Partnership for Peace program. The 
EAPC comprises most of the nations of Europe and the newly independent 
nations of the former Soviet Union. The EAPC is consultative only, and 
has no authority in NATO's decision-making or command structure. The 
second consultative body, the NATO-Russia Permanent Joint Council 
(PJC), was established under the May 1997, NATO-Russian Founding Act. 
The PJC has been described by NATO as a forum intended to promote trust 
and the ``habit of consultation'' with Russia. The PJC has no role in 
NATO's administrative structure or decision-making process, and is 
specifically barred from discussion of NATO's or Russia's ``internal 
matters.''
    Since the end of the Cold War, NATO's Integrated Military Command 
Structure (IMCS) has undergone substantial alteration. The number of 
major and subordinate commands has been reduced. The two remaining 
major commands are the Allied Command Europe (ACE), which comprises all 
land, air, and naval forces in Europe and the Mediterranean, and the 
Atlantic Command which oversees naval and amphibious forces in the 
Atlantic. Both of these commands are headed by U.S. officers; the 
Supreme Allied Commander Europe and the Supreme Allied Commander 
Atlantic (SACEUR and SACLANT). Neither France nor Spain, though members 
of NATO, are currently part of the IMCS, however, negotiations over 
Spain's participation in the IMCS are in their final stages.
    The subordinate commands have few, if any, active duty units under 
their operational control in peacetime, but serve as coordinating 
headquarters which will assume control of designated forces in time of 
war or crisis. The exception to this are the Immediate Reaction Forces 
discussed below, which are under SACEUR's control at all times. 
Otherwise, each member nation is fully responsible for the maintenance 
and deployment of its own armed forces whether in peacetime, crisis, or 
war.
    The new command structure reflects the significant reduction in 
NATO's active duty forces over the last several years, and an 
increasing reliance on mobilized reserves to deal with any major 
conflict. According to statistics on force reductions (provided by NATO 
Headquarters) the following reductions have taken place in NATO using 
force levels in 1990 as the base line.

   25% reduction in total peacetime force levels;
   25% reduction of total ground force units including a 45% 
        reduction in ground forces in the Central Region (i.e. 
        Germany);
   10% reduction in naval units deployed in the NATO region;
   25% reduction in total combat aircraft assigned to NATO 
        including a 45% reduction in the Central and Northern Regions; 
        and
   25% reduction in combat aircraft designated for 
        reinforcement from North America.

    The ACE Mobile Forces Land/Air (a reinforced brigade-sized force) 
along with the Standing Naval Force Mediterranean and the NATO Airborne 
Early Warning System are generally the only units under SACEUR's 
operational control in peacetime. The second readiness tier is the ACE 
Rapid Reaction Corps (approximately 5 full divisions, and 5 
``framework'' divisions) which comes under SACEUR control in times of 
crises or war. It was elements of this Rapid Reaction Corps that 
initiated the IFOR mission in Bosnia. Though other units have 
subsequently rotated in for the SFOR operation, SACEUR retains overall 
command.

                        Costs of NATO Membership

Common Costs
    All sixteen members of NATO make annual contributions to the so-
called ``Common Costs'' of the alliance, which comprise three accounts: 
1) Civil Budget; 2) Military Budget; and the Security Investment 
Program. The Civil Budget provides for, among other things, the 
operating expenses of NATO's civilian headquarters, the International 
Secretariat (staff), NATO science and defense research activities, and 
some Partnership for Peace programs. The Military Budget funds the 
international military headquarters, the airborne early warning 
aircraft operations, the NATO petroleum pipeline, and the NATO 
Maintenance and Supply Agency.
    The Security Investment Program (formerly called the Infrastructure 
Fund) supports a broad range of projects recommended by the SACEUR and 
SACLANT, in accordance with a specified planning cycle that generally 
requires about two years to execute. Typical project areas include the 
mobility and deployability of NATO forces, NATO command and control, 
allied reconnaissance and intelligence, and maintaining logistics and 
training facilities.
    The total and individual contributions for the NATO Common Costs 
are determined through alliance-wide negotiation. New cost projections, 
taking into account the accession of the new members, are expected by 
mid-December. At least slight increases are expected for the Civil and 
Military Budgets to accommodate additional headquarters personnel from 
the new members. It is, however, the Security Investment Program that 
holds the greatest potential for significant increases because it 
traditionally funds precisely the types of projects most needed by the 
new members. NATO's European members have generally insisted that 
dramatic increases should not occur, recommending instead that some 
currently planned projects should be put aside in favor of more urgent 
needs among the new East European members. It is also generally 
accepted that a slight reduction in each member's percentage share of 
contributions will result when the new members are included in the 
calculation. The exact distribution of costs will be negotiated upon 
the new members admission to the alliance.
    The inclination to keep the Common Costs roughly in line with 
current levels is rooted in the assumption that the threat of a major 
conflict will remain very low, and that the current Bosnia peacekeeping 
operation is representative of the most demanding scenario NATO forces 
will be called upon to face in the foreseeable future. Some have voiced 
concern, however, that without a firm commitment to a robust alliance-
wide defense capability from the outset, complacency and domestic 
political pressures could erode NATO's ability to perform its core 
mission of collective defense.
    NATO headquarters and the Department of Defense have provided a 
series of statistical breakdowns of U.S. and allied contributions to 
the Common Costs and of comparative national defense spending. (See 
Annex 2) The U.S. share for each element of the Common Costs is: Civil 
Budget--24.3%; Military Budget--24.1%; Strategic Improvement Program--
23.8%. It should be noted, however, that funds actually appropriated 
may be less than the United States' allocated share. The U.S. total 
contribution to NATO Common Costs over the last several years, and 
projected for 1998 are: 1993--$318 million; 1994--$342 million; 1995 - 
$407 million; 1996 - $453 million; 1997 - $489 million; 1998 (est.) - 
$493 million. This shows a steady increase, though the rate of increase 
drops sharply in 1998.
    In addition to funding the Common Costs, the United States has 
provided bilateral security assistance to the prospective new members 
in order to facilitate their qualification for NATO membership. The 
U.S. assistance has been channeled primarily through International 
Military Education and Training (IMET) and Foreign Military Financing 
(FMF) grants. IMET provides training in Department of Defense schools 
for Central and East European officers and civilian defense managers. 
The training focuses on the role and functions of the military in a 
democratic society, and on civilian defense management. FMF grants have 
been used to fund the prospective members' participation in Partnership 
for Peace training exercises and to upgrade air traffic control and 
communication facilities. The amounts appropriated from FY1996-FY1998 
for these programs are: Poland-- $44.2 million; Hungary--$24.5 million; 
Czech Republic--$28.6 million.
Current and Prospective NATO Allies' Defense Spending
    Defense spending by the United States and the NATO allies has 
decreased both in absolute terms and as a percentage of gross national 
product for the last ten years (see Annex 2). Though this could be 
expected with the collapse of the Soviet Union and the Warsaw Pact, 
there is a growing concern that declining allied defense budgets will 
not allow accomplishment of even the more modest military commitments 
of the NATO's basic mission as outlined in the 1991 alliance Strategic 
Concept.
    The disparities between the U.S. and its NATO allies in transport, 
logistics, communications, and intelligence capabilities (made apparent 
in the Persian Gulf War and in the on-going Bosnia operations) have led 
some to suggest NATO could devolve into a so-called ``three-tiered'' 
alliance, with the United States, current NATO allies, and the new 
members having vast differences in capabilities. In order to prevent 
these disparities the U.S. estimates that the current allies will have 
to spend some $8-10 billion for force modernization (almost as much as 
the new members) over the next ten years to modernize their forces. 
Related concerns include the decline of allied government funding for 
defense research and development, the lack of cooperation or 
consolidation among European defense industries, and, despite pledges 
to the contrary, continued European domestic political pressures to 
reduce defense expenditures.
    Most recently expressed by Secretary Cohen at the NATO ministers 
conference on October 2, 1997, this U.S. position on required 
modernization by the allies encountered predictable European 
resistance. Some allies argued that their foreign aid programs to 
Russia, Ukraine, and Bosnia are significantly greater than the United 
States', and that these funds should also be counted as security 
investments. In addition, there is some feeling that the United States 
is pushing for more rapid modernization not because of immediate 
security requirements, but rather to create additional markets for its 
domestic defense industries. While acknowledging obvious disparities in 
capabilities and their intent to address the problems, the NATO allies 
nevertheless believe that modernization need not be carried out at the 
pace or price indicated by U.S. NATO enlargement cost estimates.
    With regard to the prospective NATO members, Poland, Hungary, and 
the Czech Republic, the cost analysis must consider whether candidate 
states have sufficient domestic support for raising defense spending, 
and whether their developing economies can bear such spending 
increases. Complicating this latter consideration, the International 
Monetary Fund recently recommended that all three countries avoid 
excessive defense spending increases. At a recent of NATO defense 
ministers, Secretary Cohen strongly emphasized that the new members 
will be expected to pay their full share of enlargement costs, 
including the adequate modernization of their armed forces. The 
positions of the IMF and NATO are not irreconcilable, but obviously a 
proper balance must be found. Currently, defense spending in the three 
countries represents the following percentage of their gross domestic 
product (GDP): Poland--2.2%; Hungary--1.7%, and the Czech Republic--
1.5%. The overall NATO average in 1996 was 2.9%, while the European 
members of NATO averaged 2.3%, and U.S. defense spending stood at 3.7%
    Of the three prospective members, Poland has received the highest 
marks for its qualifications from U.S. officials. There is very strong 
public support for NATO membership, and though still not on par with 
the more developed of the Western allies, Poland's economy is improving 
rapidly. In addition, Polish armed forces are generally considered to 
be in better condition than others in Eastern Europe. Though Hungarian 
armed forces are relatively small and in serious need of modernization, 
there is strong public support for NATO membership which could make 
increased defense spending more politically palatable. For U.S. Defense 
officials, it is the Czech Republic's low defense spending, and polls 
indicating around 50% public support (up recently from 35%) for NATO 
membership, that present the greatest concern. The Czech government has 
pledged a defense spending increase of .1% of GDP each year for the 
next five years, though this spending plan has not yet received 
parliamentary approval.

                           NATO Cost/Benefits

    Since the collapse of the Soviet empire, the question of the cost/
benefit analysis of NATO for the United States has received increased 
attention. It does not, however, appear to be a question answerable 
solely in terms of dollars and cents. Even to determine NATO's costs to 
the United States is very problematic. The amount the United States 
appropriated for NATO Common Costs in 1995, for example, represented 
less than two-tenths of one percent of the U.S. defense budget. The 
costs of forward-deployed forces in Europe and the Mediterranean could 
be ascribed to NATO membership, but their most significant operation 
(and their only one involving combat) was in the Persian Gulf War. 
Consequently, many argue that the United States would be spending as 
much, if not more, to maintain its defense posture without the 
alliance. They argue that U.S. global security challenges, not NATO 
requirements, drive U.S. defense spending.
    NATO membership provides the United States a very strong voice in 
European security affairs, institutionalized with U.S. officers in key 
command positions. NATO's contribution to a politically stable Europe 
can be argued to provide substantial economic benefit to the United 
States. The Administration has argued that the desire to join NATO has 
led the newly independent East European states to abandon long-standing 
ethnic and/or territorial rivalries that could have recreated the 
tensions of the 1930s in the region. The cohesion of the alliance in 
the conduct of the Persian Gulf War and the on-going enforcement 
activities in the region lend some credence to NATO's also having an 
out-of-theater deterrent capability.
                                ANNEX 1

        Summary of NATO Enlargement Cost Estimates 1
---------------------------------------------------------------------------

    \1\ From: U.S. Library of Congress. Congressional Research Service. 
NATO Expansion: Cost Issues. By Carl Ek. CRS Rpt. No. 97-668 F. July 2, 
1997.
---------------------------------------------------------------------------
The Clinton Administration
    On February 24, 1997, the Clinton Administration sent to Congress a 
report detailing its rationale and cost estimates for NATO expansion. 
2 The document, which may be viewed as the President's 
statement of U.S. policy, outlines the defense posture the 
Administration believes is necessary, presents the likely costs for its 
scenario, and estimates the share of costs that would be assumed by the 
United States, its allies, and new members.
---------------------------------------------------------------------------
    \2\ U.S. Department of State. Bureau of European and Canadian 
Affairs. Report to the Congress on the Enlargement of the North 
Atlantic Treaty Organization: Rationale, Benefits, Costs and 
Implications. Washington, D.C. February 24, 1997.
---------------------------------------------------------------------------
    In developing its cost estimates, the Administration assumes that 
``enlargement will take place in a European security environment in 
which there is no current threat of large-scale conventional aggression 
and where any such threat would take years to develop.'' With no 
significant threat on the horizon, NATO will extend Article 5 
assurances to new members through improving its ability to send 
reinforcements if necessary, rather than through stationing substantial 
forces in the new territories.
    The Administration lists several priorities for attaining 
interoperability--new members will need to train and exercise with 
alliance forces to become familiar with NATO procedures; they also will 
need to integrate with NATO's command, control, communications and 
intelligence (C3I) network, be able to receive and support NATO troops, 
operate with the alliance's air defense system, and field combat and 
logistical support. The goal will be not only to ensure that these 
countries can help NATO defend their borders, but also to enable them 
to deploy their own forces to assist NATO in both mutual defense and 
non-Article 5 missions.
    The Administration notes some further assumptions for its estimate: 
1) it applies to ``[a] small group of nonspecified Central European 
countries;'' 2) it will be unnecessary for NATO permanently to station 
a large number of forces in the new countries; 3) standard burden 
sharing rules would apply (members pay for their own forces and share 
the costs of infrastructure improvements); and 4) some of the 
activities (e.g., language training and air traffic control upgrades) 
are already underway.
    The Administration states that its estimates are based not on total 
defense spending, but on two types of measures that are associated with 
enlargement: the first, those that would take place whether new members 
are added or not, and the second, those that are tied directly to 
expansion. It breaks these measures down into three categories: 1) new 
members' military restructuring; 2) NATO regional reinforcement 
capabilities; and 3) direct enlargement measures.
    To restructure and modernize new members' armed forces, the 
Administration estimates that, from 1997-2009, it would cost between 
$800 million and $1 billion annually, or a total of $10- 13 billion. 
This will include such measures as modernization of ground forces, 
including artillery, armor and ammunition; procurement by each country 
of surface-to-air missiles and one squadron of combat aircraft; and 
training. The cost of these steps would be borne by the new countries.
    For NATO regional reinforcement capabilities, the Administration 
estimates alliance costs of $600-800 million per year, or $8-10 billion 
total. This estimate is based on being able to deploy and sustain four 
divisions and six NATO fighter wings to reinforce new members in the 
event of a threat. Because the United States is already fully prepared 
to deploy forces, these costs would fall largely on current NATO 
allies, according to the Administration. Like restructuring and 
modernization, most of these steps, it is reasoned, would take place 
regardless of expansion plans as they are applicable to NATO's evolving 
strategy regarding non-Article 5 missions.
    Direct enlargement costs, according to U.S. calculations, would 
average $700-900 million per year, or a total of $9-12 billion to 
attain ``mature capability.'' These costs consist of upgrading and/or 
ensuring interoperability of: command, control, communications and 
intelligence (C3I); air defense systems; logistics support; 
reinforcement reception; infrastructure; and exercise facilities and 
staging. The report estimates that about 40% of the costs for direct 
enlargement activities would be paid for by individual member 
countries--both current and new--to improve their own forces, and the 
remaining 60% would be financed by NATO common funds for 
infrastructure. Divided in this manner, the new countries would pay 
about 35% ($230-350 million per year, or $3-4.5 billion total); current 
allies--other than the United States--would contribute 50% ($350-425 
million per year, or $4.5-5.5 billion total); and the United States' 
share would be 15% ($150-200 million annually, or $1.5-2.0 billion 
total). Because common funding of NATO activities would commence only 
after accession in 1999, the U.S. contribution is reckoned over the 10-
year period 2000-2009.
    Total costs for the Administration's scenario consequently range 
from $27 billion to $35 billion, of which new members would pay $13-
17.5 billion, current allies $12.5-15.5 billion, and the United States 
$1.5-2.0 billion. The Administration notes that its estimates exclude 
programs in support of relations with Eastern and Central European 
countries, as well as U.S. funding for NATO's Partnership for Peace 
program, since neither is directly related to NATO enlargement.
Congressional Budget Office
    In March 1996, the Congressional Budget Office (CBO) published The 
Costs of Expanding the NATO Alliance, 3 a study that 
estimates the amounts that would be necessary to fund several possible 
expansion scenarios. The cost analyses focus on expanding the alliance 
to include the four countries considered most likely at the time the 
analysis was written: Poland, Hungary, the Czech Republic and Slovakia.
---------------------------------------------------------------------------
    \3\ U.S. Congressional Budget Office. CBO Papers. The Costs of 
Expanding the NATO Alliance. March, 1996. Washington, D.C.
---------------------------------------------------------------------------
    CBO assumes two levels of threat: regional dangers, which are more 
likely, and a much less likely threat from Russia--the only power with 
the potential to mount a significant threat to the alliance. The CBO 
study presents five scenarios, with cumulative costs; that is, the cost 
of each is added to the previous ones. Costs are for the period 1996-
2010.
    Option 1--Strengthen Visegrad Defense Forces and Provide for NATO 
Reinforcement ($60.6 billion). The most fundamental and least costly 
single scenario, option 1 envisions current NATO members assisting the 
four above-named countries in defending themselves against ``a border 
skirmish with a neighbor or a limited war with a regional power.''
    CBO assumes that three steps are key to enabling western NATO 
allies to assist the new members. The first involves instruction in 
NATO military doctrine and procedures, as well as large-scale exercises 
with the alliance. The second consists of improvements in and 
interoperability of new members' C3I systems. Finally, the new 
countries would need to upgrade their air defenses. CBO estimates total 
costs for such steps at $21.2 billion.
    Various improvements in military capability are presumed necessary 
under option 1. Nearly one-third ($19.2 billion) of the cost of this 
option is dedicated to upgrading equipment (of new members and current 
allies) and acquiring new stocks, including such items as fighter 
aircraft and anti-tank weaponry. In addition, CBO also includes $5 
billion for tanker aircraft, and nearly $7 billion for improving 
Poland's army and navy. In order for the new members to receive 
supplies and reinforcements from NATO, the alliance would also likely 
need to upgrade infrastructure in the new member states, which would 
consist of making improvements in transportation and fueling systems. 
CBO budgets $3 billion for such work. CBO also factors in $4.7 billion 
for the construction of training facilities, and $0.6 billion for 
purchase of fuel and ammunition stocks.
    CBO estimates the total cost of option 1 at $60.6 billion over 15 
years, of which the United States would contribute $4.8 billion, the 
new members $42.0 billion, and current members $13.8 billion. However, 
the study adds that, if NATO chose simply to provide for a minimum 
defense capability by employing the first three initiatives (C3I, air 
defense, and training), the estimated cost of expansion would fall to 
$21.2 billion, of which the U.S. share would be $1.9 billion.
    Option 2--Project NATO Air Power East to Defend the Visegrad States 
($79.2 billion). According to CBO, options 2-5 ``would attempt to 
provide an Article 5 defense against an aggressive and militarily 
potent Russia.'' Under CBO's second scenario, NATO would project air 
power eastward by creating prepared or co-located operating bases and 
would add $18.6 billion to the cost of the first option.
    Option 3--Project Power Eastward With Ground Forces Based in 
Germany ($109.3 billion). Option 3 adds ground forces to air power by 
enabling nearly all of NATO's 11 divisions to move from Germany to the 
Visegrad states in the event of an attack. Choosing this option would 
add about $30 billion to the above two options, with the U.S. share 
being $3.6 billion.
    Option 4--Move Stocks of Prepositioned Equipment East ($110.5 
billion). This option envisions storing equipment sufficient for five 
brigades of U.S. troops, who would fly in directly from the United 
States in the event of an emergency. Existing stocks of equipment would 
be moved from their current west European locations to newly built 
storage facilities in the Visegrad countries at an additional cost of 
$1.2 billion, $290 million of it funded by the United States.
    Option 5--Station a Limited Number of Forces Forward ($124.7 
billion).  The last option entails moving nearly three divisions of 
U.S. and allied ground forces and two air wings from Germany to 
renovated bases in the new member states, where they would be 
permanently stationed. This option by itself would cost approximately 
$14 billion, with $5.5 billion paid by the United States.
RAND
    In the Autumn 1996 issue of Survival, three analysts at RAND 
published another study of the possible costs of NATO expansion. 
4 Like CBO, the RAND authors posit a series of enlargement 
options. Rather than assigning a single cost estimate to each option, 
however, RAND provides funding ranges for each, based on different 
policy choices. RAND also assumes the Visegrad four to be the most 
likely new members, though acknowledging that Slovakia's chances had 
``clearly diminished.'' RAND posits four alternative defense postures, 
somewhat similar to those constructed by CBO. RAND also develops 
increasingly ambitious scenarios, but provides additional flexibility 
within each option.
---------------------------------------------------------------------------
    \4\ What Will NATO Enlargement Cost? By Ronald D. Asmus, Richard L. 
Kugler, and F. Stephen Larrabee. Survival. Vol. 38, No. 3. Autumn, 
1996. pp. 5-26.
---------------------------------------------------------------------------
    Option 1. The ``self-defense support'' option assumes that new 
member states will be responsible for defending their own borders, and 
that western NATO member assistance might be limited to aiding in such 
key areas as C3I and logistics; however, the alliance might provide 
other forms of aid, such as assisting new members develop better air 
defenses, infrastructure, munitions reserves, and helping them improve 
their readiness. Option 1 costs range from $10-20 billion.
    Option 2. RAND's second option adds air power, through such steps 
as the upgrading of European air wings and the construction of co-
located operating bases with munitions storage facilities in the new 
member territories. Once more, the cost of this option would depend on 
the extent of the forces used. If five fighter wings were readied for 
eastward deployment in the event of a crisis, costs would go up to $20 
billion; if 10 fighter wings were equipped, costs would rise to $30 
billion.
    Option 3. The third option combines land forces with air power. 
Current NATO member forces would remain where they are presently based, 
but would be prepared to ``commit armored and mechanized forces to 
perform a broad spectrum of missions in Eastern Europe, ranging from 
border defense to peacekeeping and crisis management.'' RAND estimated 
that costs for this option would range from $30-52 billion; the higher 
estimate would combine 10 NATO divisions with 10 fighter wings. A 
middle option with a $42 billion price tag is discussed in detail.
    Option 4. Under the fourth option, set up to address a ``worst case 
scenario,'' NATO would move significant forces--both land and air--
eastward. Estimated costs for this option range from $55 billion to 
$110 billion; the latter estimate arises from forward deployment of the 
10 divisions and air wings of option 3. RAND points out, however, that 
because there is no imminent threat, ``[s]uch a posture is clearly not 
needed today.''
    On the topic of burden sharing, the authors note that member states 
currently are responsible for funding their own forces, and pay a share 
of the NATO common infrastructure costs. The amount that any given 
country will contribute to expansion will depend upon how large its 
share is of the common infrastructure budget and upon how extensively 
its forces will be used. Thus, under the first option (self-defense 
support), a larger share of the burden would be borne by the new 
members, while projecting air and/or ground forces would entail greater 
expenses by current members. Under RAND's above-mentioned $42 billion 
``middle'' scenario, for example, current members would contribute 
approximately $25.6 billion (61%), new members would pay $8.0 billion 
(19%), and the remaining $8.4 billion would come from the NATO 
infrastructure funds. Of this amount, the U.S. share of the total 
package could range from $420 million to $1.4 billion--an estimate that 
appears to assume a redistribution of contributions.
                                ANNEX 2

              Comparative NATO Defense-spending Statistics

      Table 1.--NATO ``Common Cost'' Budget Cost Sharing Formula in     
               Percentages of the total NATO Common Budget              
                                                                        
                                       Military    Security      Civil  
                                        Budget    Investment    Budget  
                                                                        
United States.......................    24.12       23.2708     23.35   
Belgium.............................     2.85        4.1260      2.76   
Canada..............................     5.6         2.75        5.6    
Denmark.............................     1.68        3.33        1.59   
France..............................    16.50       12.9044     16.50   
Germany.............................    15.54       22.3974     15.54   
Greece..............................     0.38        1.00        0.38   
Iceland.............................     0.04        0.00        0.05   
Italy...............................     5.91        7.745       5.75   
Luxembourg..........................     0.08        0.1973      0.08   
Netherlands.........................     2.84        4.58        2.75   
Norway..............................     1.16        2.83        1.11   
Portugal............................     0.63        0.345       0.63   
Spain...............................     3.5         3.2816      3.5    
Turkey..............................     1.59        1.04        1.59   
United Kingdom......................    17.58       10.1925     18.82   
                                                                        



                              Table 2.--U.S. Contributions to NATO ``Common Costs''                             
                                                 (in $millions)                                                 
----------------------------------------------------------------------------------------------------------------
                                                                                                         FY1998 
                                                       FY1993    FY1994    FY1995    FY1996    FY1997    (est.) 
----------------------------------------------------------------------------------------------------------------
Strategic Investment................................       60       140       119       161       172       176 
Military Budget.....................................      216       161       248       249       273       273 
Civilian Budget.....................................       42        41        40        43        44        44 
                                                                                                                
    Total...........................................      318       342       407       453       489       493 
----------------------------------------------------------------------------------------------------------------


                                        Table 3.--NATO Member Defense Expenditures as % of Gross Domestic Product                                       
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                 Average   Average   Average   Average                                                  
                            Country                              1975-79   1980-84   1985-89   1990-94    1992      1993      1994      1995      1996e 
--------------------------------------------------------------------------------------------------------------------------------------------------------
Based on current prices                                                                                                                                 
                                                                                                                                                        
  Belgium.....................................................      3.2       3.3       2.9       2.0       1.9       1.8       1.7       1.7       1.6 
  Denmark.....................................................      2.4       2.4       2.1       2.0       2.0       2.0       1.9       1.8       1.8 
  France......................................................      3.8       4.1       3.8       3.5       3.4       3.4       3.3       3.1       3.0 
  Germany.....................................................      3.4       3.4       3.0       2.2       2.1       2.0       1.8       1.7       1.7 
  Greece......................................................      5.6       5.5       5.2       4.5       4.5       4.4       4.4       4.4       4.6 
  Italy.......................................................      2.0       2.1       2.3       2.1       2.1       2.1       2.0       1.8       2.0 
  Luxembourg..................................................      0.9       1.1       1.0       0.9       1.0       0.9       0.9       0.8       0.8 
  Netherlands.................................................      3.1       3.1       2.9       2.4       2.5       2.3       2.1       2.0       2.0 
  Norway......................................................      2.9       2.7       2.9       2.8       3.0       2.7       2.8       2.4       2.5 
  Portugal....................................................      3.4       3.0       2.8       2.7       2.7       2.6       2.5       2.6       2.7 
  Spain.......................................................                2.4       2.2       1.7       1.6       1.7       1.5       1.5       1.5 
  Turkey......................................................      4.4       4.0       3.3       3.8       3.9       3.9       4.1       4.0       4.4 
  United Kingdom..............................................      4.9       5.2       4.5       3.8       3.8       3.6       3.4       3.0       2.9 
  NATO Europe.................................................                3.6       3.2       2.7       2.6       2.6       2.4       2.3       2.3 
  Canada......................................................      1.9       2.1       2.1       1.9       1.9       1.9       1.8       1.6       1.5 
  United States...............................................      5.0       5.8       6.3       4.9       5.1       4.8       4.3       4.0       3.7 
  North America...............................................      4.7       5.4       5.9       4.7       4.9       4.5       4.1       3.8       3.6 
  Nato total..................................................                4.6       4.7       3.7       3.7       3.6       3.3       3.0       2.9 
--------------------------------------------------------------------------------------------------------------------------------------------------------
Source: NATO.                                                                                                                                           



                                                         Table 4.--U.S. and NATO Europe: Comparative Data on Military Spending, 1985-95                                                         
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                    Military Expenditures (Constant        Gross National Product (Constant     Military Expenditures (Percentage of       Population             Military      
                                            1995$, Billions)                       1995$, Billions)                             GNP)                       (Millions)         Expenditures Per  
                                -------------------------------------------------------------------------------------------------------------------------------------------    Capita (1995$)   
                                                                                                                                                                           ---------------------
                                   United         NATO     Europe         United         NATO     Europe         United         NATO     Europe         United      NATO      United      NATO  
                                   States                                 States                                 States                                 States     Europe     States     Europe 
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1985...........................     353.8               213.4              5,758               6,159               6.1%                3.5%              238.5      372.9      1,483        572 
1986...........................     374.9               213.7              5,920               6,347               6.3%                3.4%              240.7      374.7      1,558        570 
1987...........................     373.0               217.6              6,085               6,526               6.1%                3.3%              242.8      376.6      1,536        578 
1988...........................     365.9               213.5              6,321               6,786               5.8%                3.1%              245.0      378.7      1,493        564 
1989...........................     364.3               215.2              6,533               7,026               5.6%                3.1%              247.3      381.5      1,473        564 
1990...........................     351.9               216.7              6,625               7,237               5.3%                3.0%              249.9      400.8      1,408        541 
1991...........................     309.7               213.6              6,555               7,373               4.7%                2.9%              252.6      403.8      1,226        529 
1992...........................     328.2               204.0              6,729               7,446               4.9%                2.7%              255.4      405.7      1,285        503 
1993...........................     312.0               197.5              6,881               7,416               4.5%                2.7%              258.1      408.4      1,209        484 
1994...........................     295.3               192.2              7,106               7,614               4.2%                2.5%              260.7      410.9      1,133        468 
1995...........................     277.8               183.9              7,247               7,784               3.8%                2.4%              263.0      413.4      1,056        445 
                                                                                                                                                                                                
  Total........................                                                                                                                                                                 
  (Avg)                           3,706.8             2,281.3             71,760              77,714               5.2%                2.9%              250.4      393.4      1,351        529 
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Source: U.S. Arms Control & Disarmament Agency, World Military Expenditures and Arms Transfers, 1996, August, 1997.                                                                             


                                                       Table 5.--U.S. and Selected Allies: Comparative Data on Military Spending, 1985-95                                                       
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                      Military Expenditures (Percentage of GNP)                                       Military ExpendituresPer Capita (1995$)                   
                                   -------------------------------------------------------------------------------------------------------------------------------------------------------------
                                      United                                                              United     United                                                              United 
                                      States     France     Italy     Germany   Netherlands    Norway    Kingdom     States     France     Italy     Germany   Netherlands    Norway    Kingdom 
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1985..............................      6.1%       4.0%       2.2%       3.2%        3.0%        3.1%       5.1%      1,483        892        341        885         642         766        810 
1986..............................      6.3%       3.9%       2.2%       3.1%        3.0%        3.2%       4.8%      1,558        892        356        879         648         804        797 
1987..............................      6.1%       3.9%       2.4%       3.1%        3.0%        3.4%       4.6%      1,536        917        397        879         655         865        783 
1988..............................      5.8%       3.8%       2.4%       2.9%        2.9%        3.3%       4.1%      1,493        912        399        866         645         839        737 
1989..............................      5.6%       3.7%       2.3%       2.8%        2.8%        3.4%       4.1%      1,473        918        402        857         646         849        742 
1990..............................      5.3%       3.6%       2.2%       2.8%        2.6%        3.3%       4.1%      1,408        911        382        703         625         849        742 
1991..............................      4.7%       3.6%       2.1%       2.5%        2.5%        3.2%       4.3%      1,226        914        381        643         605         828        757 
1992..............................      4.9%       3.4%       2.1%       2.3%        2.5%        3.5%       3.8%      1,285        881        377        610         601         924        679 
1993..............................      4.5%       3.4%       2.1%       2.2%        2.3%        3.2%       3.6%      1,209        865        379        550         554         867        650 
1994..............................      4.2%       3.4%       2.0%       2.0%        2.2%        3.2%       3.4%      1,133        870        370        511         535         901        624 
1995..............................      3.8%       3.1%       1.8%       1.9%        2.1%        2.7%       3.0%      1,056        826        338        496         518         804        572 
                                                                                                                                                                                                
  Average.........................      5.2%       3.6%       2.2%       2.6%        2.6%        3.2%       4.1%      1,351        891        375        716         607         845        718 
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Source: U.S. Arms Control & Disarmament Agency, ``World Military Expenditures and Arms Transfers, 1996,'' August, 1997.                                                                         

           Prepared Statement of Senator Russell D. Feingold
    Thank you, Mr. Chairman.
    As you know, this is one of a series of hearings on the question of 
the proposed expansion of the North Atlantic Treaty Organization to 
include Poland, Hungary and the Czech Republic. This Committee, and 
then the Senate at large, will soon be faced with a decision to ratify 
an amendment to the NATO treaty of 1949, representing the fourth such 
enlargement since the alliance was formed.
    This will clearly be an historic decision, for, as we all know, 
NATO arguably has been the most critical force in maintaining peace and 
security in Europe over the past half century.
    For the past several years, the peoples of east and central Europe 
have enjoyed freedoms that were unavailable to them during the Cold 
War. These countries have made substantial progress toward democracy 
and free market economics. They are our partners and our friends.
    Expansion of the alliance will help assure that the people of 
Eastern Europe will never again be subjected to the kind of tyranny 
they endured under the Soviet regime, by offering a critical firewall 
against any new threat to peace and democracy. Curtailment of such 
threats are goals we all share.
    I am therefore supportive of the fundamental goals of NATO 
enlargement. However, I do have some concerns, that I know are shared 
by many other Members of Congress, about the commitment -- financial 
and otherwise -- the United States will undertake as it pursues 
enlargement of the alliance.
    There have been at least three major studies conducted to assess 
the potential costs of NATO expansion by highly respected governmental 
and nongovernmental entities. Yet each of these analyses makes 
different assumptions about what types of costs actually can be 
attributed to expansion, per se, and different assumptions about the 
potential threats that NATO will face over the next decade. Depending 
on which study you read, the U.S. share of the costs of NATO expansion 
could be anywhere form $2 billion to $7 billion. What that means is we 
could be up or down $5 billion depending on whose assumptions you 
believe.
    Now I know it is extremely difficult to develop a truly accurate 
assessment of costs when there are probably hundreds of variables that 
we can not control. But we are talking about a substantial commitment 
on the part of the U.S. taxpayer.
    I recognize that the higher figures reflected in some reports 
assume a resurgent Russian threat, an assumption that I hope is 
unlikely. But even if you remove this assumption, we are still dealing 
with numbers that differ by hundreds of millions of dollars.
    Mr. Chairman, this year, we have finally passed legislation that 
will help us arrive at a balanced budget. So I have to ask myself, what 
are the implications of assuming a new commitment where our cost 
estimates may vary by hundreds of millions of dollars?
    As I have indicated, I clearly support the Administration's goals 
with respect to NATO expansion. But I am somewhat disturbed that we do 
not seem to have a good handle on expected costs here.
    Even though this analogy may not hold up to heavy scrutiny, I can 
not ignore the fact that the current estimate for the cost of U.S. 
troop deployment in Bosnia is now up to about $7 billion, representing 
a more-than-three-fold increase over the Administration's initial 
estimate of some $2 billion. Undersecretary Slocum might respond to 
that comment by explaining to me how there was little means to 
anticipate some of the conditions our troops faced in Bosnia back in 
late 1995 when the first estimates were developed. Well, that may be 
true. But this was a very expensive lesson for us to learn. What the 
United States is likely to spend in Bosnia over two and one-half years 
is equal to just over half of the entire foreign operations budget for 
fiscal 1997!
    My point here is that -- in the midst of implementing what will be 
the most significant shift in our collective defense strategy 
represented by the enlargement of NATO -- I do not think the United 
States can afford to get this wrong. We must have a clear understanding 
of where this plan is taking us and what it is going to cost.
    So that is why, Mr. Chairman, I welcome the zeal with which you are 
pursuing this issue with this series of hearings. Clearly, NATO 
expansion is enormously important for the President, for the Congress, 
for the American public, and for the people who suffered under the 
Soviet yolk for so long.
    I am honored to be able to participate in this historic debate as a 
member of this Committee.

                               __________

                    THE HIGH COST OF NATO EXPANSION

               Clearing the Administration's Smoke Screen

                             by ivan eland*

                           Executive Summary

    The Clinton administration's estimate of the costs of NATO 
expansion is fatally flawed. Even if the dubious major assumptions--
that the current benign threat environment will continue and that no 
NATO forces will need to be permanently stationed in new member states-
-are accepted, the administration's estimate that the total cost of 
expansion will be only $27 billion to $35 billion is much too low. Its 
paltry estimate of $1.5 to $2 billion for U.S. costs is even more 
incredible.
    The U.S. Department of Defense, which made the cost estimate for 
the administration, did not develop a detailed list of military 
enhancements needed for expansion, estimate the cost of each 
enhancement, and add those costs up for a total. Instead, in many cases 
DoD analysts used a ``macro'' approach to select a level of spending 
(what they termed ``level of effort'') for a particular category of 
military improvement, with little or no military rationale or analysis 
to back it up. In other cases, where DoD made microassumptions, they 
were very questionable and designed to hold costs down. In addition, 
DoD analysts felt constrained in how much military infrastructure they 
could assume would be built on the territories of new member nations. 
All of those dubious methods were needed because the DoD's estimate 
resulted from negotiations within the administration; it was not a 
valid estimate of costs based on military requirements.
    In this study, a detailed critique is offered of the 
administration's assumptions and method of estimating the costs; and an 
alternative cost estimate, which uses the DoD's major assumptions but 
is based on more realistic micro assumptions and better methodology, is 
presented. That estimate projects the total costs of expansion at about 
$70 billion (although they could reach $167 billion), of which at least 
$7 billion would accrue to the United States.

                              Introduction

    On July 8, 1997, at U.S. initiative, the North Atlantic Treaty 
Organization decided to admit Poland, Hungary, and the Czech Republic 
as members. The U.S. Senate--as will the legislative bodies of the 
other 15 members of the alliance--will be required to approve an 
amendment to the North Atlantic Treaty ratifying the plans for 
expansion. To make that ratification decision, those bodies will need 
good estimates of what NATO expansion is likely to cost.
    When admitting new members, the alliance--under article 5 of the 
treaty--agrees to assist them if they come under attack. Thus, 
enlarging the alliance will cost new members and existing members money 
because armed forces will need to be improved and military 
infrastructure in the substantially expanded territory will need to be 
augmented to receive and support them. Although some observers argue 
that collective defense is cheaper than unilateral defense, the real 
question is, for whom? The new members are located near unstable areas 
of Eastern Europe and would benefit greatly from admission to the 
alliance. Even so, they expect that joining the alliance will lead to 
increases in their defense budgets.\1\ Those nations, however, may not 
be able to afford even the expenses required for collective defense, 
because their economies are in transition from communism to capitalism 
and polls show that their populations do not support increases in the 
proportion of government spending devoted to defense.\2\ Thus, upon 
entering the alliance, they may require subsidies from existing members 
to help them finance improvements to their dilapidated infrastructure 
and obsolescent armed forces. As a result, it is important to estimate 
not only the costs of expansion for the United States and its existing 
NATO allies but for new members as well. If the costs that new members 
will face are too large for them to afford, those costs could very 
easily become the responsibility of the alliance and its current 
members--most notably, the United States.

    *Ivan Eland is director of defense policy studies at the Cato 
Institute.
    Despite the Senate's need for good cost information on which to 
make its ratification decision, the Clinton administration had to be 
dragged into a discussion of the expenses of expansion. Although 
expansion became an official goal of NATO in January 1994, it was only 
in February 1997 that the administration issued its woefully inadequate 
estimate of the costs of expansion. The administration did so then only 
because it was required to by Congress and because estimates by the 
Congressional Budget office and RAND were putting pressure on it to 
develop an estimate of its own. The administration's attitude seemed to 
be that any discussion of costs would harm prospects for ratification.
    Yet members of Congress and the public, when passing judgment on 
any public policy initiative, have a right to cost estimates that are 
methodologically rigorous and reasonably accurate. In the case of NATO 
expansion, the administration has failed on both counts. The 
administration's cost figure resulted from a negotiation between the 
White House and several offices in the Pentagon; it is not a valid 
estimate based on the military requirements of expansion.\3\

                   The Administration's Cost Estimate

    The administration's estimate, developed by the U.S. Department of 
Defense, was that total costs of expansion during the period from 1997 
to 2007 would be from $27 billion to $35 billion, with U.S. costs 
amounting to a scant $1.5 billion to $2 billion. The estimate was based 
on the following assumptions:

   A direct conventional military threat to new members is 
        unlikely for the foreseeable future; such a threat, if it 
        appeared at all, would take many years to develop.
   As long as the current benign threat environment continues, 
        the alliance will provide an article 5 defense of the 
        territories of new member states by reinforcing the militaries 
        of those nations with the forces of existing members (four of 
        the divisions and six of the air wings stationed in Western 
        Europe) rather than permanently stationing existing members, 
        forces in the new member states in peacetime.
   The forces of new members must be able to operate with those 
        of existing members.
   The forces of current NATO members must be able to reinforce 
        those of new members.\4\

    As shown in Table 1, the administration's cost estimate was divided 
into three categories: military restructuring by new members, 
enhancements to regional reinforcement capabilities of current members, 
and direct enlargement.
    Curiously, the administration listed all three categories of costs 
in its estimate but then stated that the

                                 Table 1.--The Administration's Cost Estimate\1\                                
                                              (billions of dollars)                                             
----------------------------------------------------------------------------------------------------------------
                                                                    United       NATO         New               
                        Category of Costs                           States      Allies      Members      Total  
----------------------------------------------------------------------------------------------------------------
Military restructuring by new members...........................                               10-13       10-13
Enhancements to regional reinforcement capabilities of current                                                  
 members........................................................                    8-10                    8-10
Direct enlargement..............................................     1.5-2.0     4.5-5.5     3.0-4.5        9-12
    Total.......................................................     1.5-2.0   12.5-15.5     13-17.5       27-35
----------------------------------------------------------------------------------------------------------------
\1\ Source: U.S. Department of Defense, ``The Military Implications and Costs of NATO Enlargement,'' undated    
  briefing, p. 9.                                                                                               

``measures in the first two categories would, for the most part, need 
to be pursued independent of enlargement.''\5\ Military restructuring 
by new members included the modernization of their air and ground 
forces and training. Enhancements to regional reinforcement 
capabilities of current members included giving ground and air units 
mobile logistics so they can project power east onto the territory of 
new members to reinforce them if they come under the threat of attack. 
Direct enlargement included ''costs directly and exclusively tied to 
enlargement.\6\ Those direct costs included the following general 
subcategories of improvements in the new member states: communication, 
exercises, and reception facilities for reinforcements.
    A breakout of costs was provided only for those three main 
categories and subcategories. In the direct enlargement category, a few 
more details were provided on what the subcategories of communication, 
exercises, and reception facilities included, but no costs were 
attached to them. The listed improvements in the new member states 
under the subcategories included the following: educating officers, 
renovating command centers, improving the communications of military 
forces, enhancing air defense and air offense, increasing the amount of 
equipment that can operate with the equipment of existing NATO nations, 
and providing procedures and facilities to receive and fuel incoming 
NATO reinforcements.

          Problems with the Administration's Major Assumptions

    The lack of detailed cost projections in the administration's 
estimate is only the first indicator that something is awry. The first 
two of the major assumptions in the estimate--no current threat and no 
stationing of NATO forces in the new member nations--may prove 
problematic.
    Although the threat environment is benign at the moment, three 
potential flashpoints exist that could drag a new member--and thus 
NATO--into a regional conflagration. The first is Hungary's tension 
with the belligerent Serbia over the Hungarian minority in the Serbian 
province of Vojvodina. Serbia actually bombed a town inside Hungary 
during the Yugoslav civil war. The second possible flashpoint is 
Poland's border with Belarus, governed by the repressive and erratic 
regime of Alexander Lukashenko. if unstable Belarus erupts, Poland will 
expect NATO's help.\7\ The third flashpoint is Poland's border with the 
isolated Russian enclave of Kaliningrad. Russian military and security 
officials, concerned about the strengthening of Polish forces near the 
enclave, have publicly announced that Russia intends to build up its 
forces.\8\ The second and third flashpoints could involve a 
confrontation between NATO and Russia. Furthermore, although Hungary's 
disputes with Romania and Slovakia over the rights of the Hungarian 
minorities living in those countries have subsided for the moment, they 
could flair up again in the future.
    Any one of those potential flashpoints could increase pressure for 
NATO to permanently station forces on the territories of new members. 
As Ted Galen Carpenter has written about that possibility,

        On the surface that might appear to be an extremely remote 
        possibility. But it is worthwhile to recall that the prospect 
        of a permanent U.S. military garrison in Western Europe seemed 
        equally unlikely when NATO was created in 1949. In fact, 
        Secretary of State Acheson, Chairman of the Joint Chiefs of 
        Staff Gen. Omar Bradley, and other officials of the Truman 
        administration explicitly assured Congress and the American 
        people that the United States would not station troops on the 
        Continent. Less than two years after the North Atlantic Treaty 
        was safely ratified, however, some four U.S. divisions were on 
        their way to Europe.\9\

    As Carpenter notes, one of the reasons that increased commitment 
was deemed necessary was the slow pace of Western Europe's rearmament 
after World War II. He also notes the gradually escalating nature of 
the rhetoric justifying the increased obligations.

        Administration leaders stressed that the assumption of 
        additional responsibilities was not intended to be permanent, 
        that the United States would bear them only until the West 
        Europeans could complete their rearmament efforts. The allies 
        had different ideas, however, and thus began the process by 
        which the United States would come to have primary 
        responsibility for Western Europe's defense instead of merely 
        backstopping Western European efforts.\10\

Those U.S. troops remain in Europe today long after the disintegration 
of the Soviet Union.
    NATO is an example of international commitments that mushroom out 
of control as circumstances change. Another example is the entangling 
alliances that led to World War I. Although a rough balance of power 
existed in Europe before the war, there had sprung up on the Continent 
a series of alliances--beginning in the 1870s and continuing through 
the first decade of the 20th century--that had become outdated by 1914 
as the international situation changed. Those entanglements dragged the 
reluctant major powers--including Germany--into what turned into a 
global war.\11\
    Similarly, during a time of uncertainty and change in post-Cold War 
Europe, admitting new members to an outdated NATO alliance may further 
inhibit the flexibility of U.S. foreign policy to respond to unexpected 
circumstances in the future. U.S. flexibility would be further 
compromised if pressure built to permanently station forces in the new 
member states. That scenario could easily happen--as it did in the NATO 
alliance after World War II--if new allies are unwilling or unable to 
bear the expenses of drastically transforming their marginal militaries 
into effective fighting forces. As the Congressional Budget office 
notes, Central European nations, in transition from communist to 
capitalist economies, may be both unwilling and unable to afford such 
expenses. According to public opinion polls in all of those states, 
their populations do not support increases in government spending 
devoted to defense.\12\ Jonathan Landay of the Christian Science 
Monitor concludes, ``Even as talks on their admission gather speed, 
doubts persist over whether they can rebuild armies equipped with 
outdated Soviet technologies into assets that can contribute to NATO's 
strength.''\13\
    Thus, although the administration is currently selling the 
expansion of the alliance by promising to eschew permanently stationing 
NATO forces in new member states, the existence of potential regional 
flashpoints combined with insufficient defense efforts by new member 
states could require an abrupt change after ratification is secure. The 
U.S. military establishment is now minimizing military threats in 
Europe to ensure ratification of NATO expansion. It is curious that in 
every case except NATO expansion, the Pentagon routinely plans for and 
buys weapons for the worst case war scenario. After all, when was the 
last time the United States fought two regional wars nearly 
simultaneously, as the military currently plans to do? After 
ratification is ensured, the Pentagon might have an incentive to return 
to business as usual, maximizing military threats in the region to 
support the argument that the forward stationing of troops is needed. 
The U.S. military presence in Europe might be perceived as less 
vulnerable to congressional pressures for reduction or withdrawal if it 
were ``closer to the action'' instead of sitting awkwardly in Germany, 
a nation that is no longer threatened. The Congressional Budget Office 
also noted that permanently stationing military units in new member 
states could raise the cost of NATO expansion to as much as $167 
billion.\14\ But Congress might feel it had little choice but to fund 
such costs if the actual or perceived threat seemed great enough. Thus, 
the camels nose under the tent could lead costs to increase 
dramatically.

                           Categories of Cost

    Despite the problems with the administration's assumptions of a 
continuing benign threat environment and a defense based on 
reinforcement rather than the permanent stationing of forces, for the 
purposes of analysis let us assume that both assumptions are valid. 
Even with that generous concession, the administration's estimate of 
the costs of expansion is questionable. Let us start with the way the 
estimate is structured.
Three Categories and a Curious Assertion
    The administration's inclusion of three major categories of costs 
with the disclaimer that two of the categories--military restructuring 
by new members and enhancements to reinforcement capabilities of 
current members--were promised by those nations whether or not NATO 
expanded allows the administration to have it both ways. Had the 
administration omitted those two categories--which account for $18 
billion to $23 billion of the $27 billion to $35 billion total 
estimate--the remaining $9 billion to $12 billion covering only direct 
enlargement costs would have been ridiculed in Congress as obviously 
too low. By using the $27 billion to $35 billion figure but including 
the caveat that most of the expenses would have been incurred anyway, 
the administration gives the appearance of being comprehensive in its 
methodology for costing while at the same time it touts lower costs.
    Such accounting distinctions are helpful when selling the expansion 
of the alliance, but they are not very helpful in determining the total 
costs that NATO nations will probably incur or whether they can afford 
them. Richard Kugler, a coauthor of the RAND study on the costs of NATO 
enlargement and a proponent of expansion, termed the distinction 
between direct costs and the other two categories ``gibberish.''\15\ 
The Congressional Budget Office's study included all three categories 
of costs, and a study by the Potomac Foundation implicitly endorsed 
that comprehensive analysis of costs.\16\
    The argument that both new member nations and existing NATO members 
would need to transform and improve their militaries whether NATO 
expanded or not is suspect. There is a contradiction between the DoD's 
assumption of a continuing benign threat environment and its assumption 
that the new NATO nations would transform and improve their militaries 
even without expansion. Why would they do so unless they perceived a 
threat? Moreover, although all three new member nations may have 
promised to increase spending and modernize their militaries, actions 
speak louder than words. The post-Cold War track records of both 
existing allies and new members are not good. The defense spending of 
the Central European nations between the end of the Cold War and the 
period of serious talk about NATO expansion should give some indication 
of what their defense efforts would have been without expansion. From 
the end of the Cold War in 1989 until very recently, when they were 
being examined for admission to NATO, the prospective new members spent 
declining real amounts on defense. During the same period, most of the 
European allies also had declining defense budgets.
    In fact, both the DoD and the new members argue that the new 
members will restructure and modernize their armed forces whether or 
not NATO expands, at the same time that the new members claim that 
joining the alliance will increase their defense budgets. Hungary 
claims that joining the alliance will require an increase in its 
defense budget of 35 percent, Poland expects a 20 percent rise, and the 
Czech Republic has pledged to double defense spending in the next two 
years.\17\ An increase of nearly 60 percent in the collective defense 
budgets of all three new members is a better estimate.
The Scope of Needed Military Improvements
    Despite the decline in resources for defense, providing a credible 
article 5 defense for an expanded NATO will require substantial 
enhancements to the militaries of new member states, as well as 
significant improvements in the forces of existing allies. In its 
response to a General Accounting Office report, even the DoD admits 
that the failure to make such improvements could ``seriously impair an 
enlarged alliance's military effectiveness.''\18\

        In our analysis, we set out some basic tasks connected with 
        enlargement, that an enlarged NATO will need to be prepared to 
        carry out if it is to be able to provide an effective Article V 
        collective defense of the new members. First, current members 
        must make additional progress in upgrading their regional 
        reinforcement capabilities to be able to more effectively 
        implement NATO's 1991 Strategic Concept. Second, new members 
        must continue restructuring and selectively modernizing so that 
        they can enhance their self-defense capabilities. Third, new 
        members must increase their forces' interoperability with 
        current members' forces and they, with the Alliance as a whole, 
        must establish the levels of command and control, air 
        surveillance, logistics, and the like necessary for collective 
        defense. only the last category is a direct result of 
        enlargement, and in that sense only that category is an 
        incremental cost of enlargement. However, without the other two 
        types of enhancements, an enlarged Alliance would not be as 
        militarily credible or effective as it should be, nor as 
        equitable in its sharing of defense burdens.\19\

    That passage indicates that new members--in addition to enhancing 
their forces so that they can better operate with those of NATO--would 
need to restructure and modernize their forces to enhance their self-
defense capabilities. Another passage in the GAO report indicates that 
the DoD assumed that NATO would continue relying on its post-Cold War 
strategy that requires that every member have a ``basic self defense 
capability.''\20\ Currently, the militaries of the new members are 
excessively large and in a sorry state. They have obsolescent equipment 
and an overly centralized command structure left over from their days 
in the Warsaw Pact. Those forces would need to be reduced in size and 
reorganized along western lines. The equipment, particularly command, 
control, and communication devices, would need to be compatible with 
that of NATO. The officers and senior enlisted personnel would need to 
be trained in NATO procedures and English, the day-to-day working 
language of the alliance. The infrastructure of new member nations--
both military and civilian--is dilapidated. Ports, rails, and roads are 
in poor shape because of heavy use and little maintenance during the 
years of the Warsaw Pact. Military bases are run down and in some cases 
unusable because of environmental contamination. Substantial 
improvements to the military infrastructure will be needed if it is to 
adequately receive NATO reinforcements.
    One French military officer is quoted as saying, ``There is a big 
gap between [Eastern European] militaries and the European allies in 
NATO.''\21\ That admission should give proponents of expansion pause 
because even some of the militaries of existing allies are of 
questionable quality-for example, those of Turkey, Spain, and Portugal. 
The Clinton administration acknowledges the severe problems with the 
armed forces of new members: ``These states emerged from the Warsaw 
Pact with military forces that were poorly structured and inadequately 
equipped for modern warfare.''\22\
    Yet the administration keeps insisting that the new members were 
planning substantial military improvements even in the absence of 
expansion. The new members have an incentive to play along with that 
line of reasoning, exaggerating what was planned. The more improvements 
they say were already in their plans, the smaller the costs of 
expansion. only a comprehensive accounting of all costs related to 
expansion will end that game.
    Furthermore, to make their armed forces compatible with those of 
NATO, they will need to buy Western systems, which tend to be the most 
expensive. That gives rise to a worrisome potential for hidden costs to 
U.S. taxpayers. When new NATO members buy new equipment to replace 
their aging inventories, there will be political pressure from U.S. 
arms exporters on the U.S. government to provide financing for those 
sales. Other Western governments will be providing such assistance, and 
the argument will be made that U.S. sellers will lose out in the 
already fierce competition for arms sales to the new members. Expenses 
for U.S. government financing of such sales will accrue to the U.S. 
taxpayer. That is one important reason why new members, expenses for 
upgrading old equipment and purchasing new equipment should be included 
when the total costs of expansion are considered, and U.S. financing of 
those purchases should be included when U.S. costs are considered. Such 
U.S. assistance, which could be substantial, was excluded from the 
administration's estimate.
    Also, U.S. allies would need to make significant improvements in 
their forces in order to reinforce new member states in time of crisis. 
Unlike U.S. forces, the armed forces of the West European allies still 
have only a very limited ability to project power, even within the 
European theater, according to U.S., European, and NATO officials.\23\ 
During the Cold War, the alliance strategy was to use an ``in-place 
linear defense'' in Germany against any Soviet attack. That changed in 
1991, when NATO adopted a post-Cold War Strategic Concept that 
emphasized that alliance forces should enhance their flexibility and 
mobility.\24\ Yet, since then, the European allies have had little 
enthusiasm for making such enhancements. Declining real defense budgets 
since the end of the Cold War in most allied nations indicate those 
nations are reluctant to make such costly improvements to their forces 
in the absence of NATO expansion. In fact, two proponents of expansion 
even advocate using NATO expansion to prod the slumbering allies to 
enhance the mobility of their forces so that they also can be used in 
operations other than defending the treaty area.\25\ Those operations, 
such as the NATO mission in Bosnia, are called ``out-of-area'' 
operations. The operation in Bosnia has highlighted the gap between 
U.S. forces and those of existing NATO allies, especially in logistics 
and communications.\26\
Contradictory Requirements
    Implicit in that argument, and explicit in the arguments of other 
proponents of expansion, is the assumption that the military 
improvements heeded to make allied forces more mobile to reinforce new 
members in any article 5 defense will also make them more mobile for 
out-of-area missions called for in the 1991 Strategic Concept.\27\ To 
some extent, the two missions would benefit from the same improvements 
to forces. To improve the tactical mobility of rapid reinforcements on 
the ground for article 5 defense, the allied ground forces would need 
additional combat support (reinforcing artillery, air defense, and 
helicopters) and combat service support (combat engineers, military 
police, communications, medical units, maintenance and mobile repair 
units, ammunition handling and storage, and trucks and heavy equipment 
transporters). Allied tactical air forces would need mobile engineers, 
maintenance units, medical units, and other support assets. Such 
enhanced tactical mobility would also help allied forces conduct out-
of-area missions, especially those--such as the one in Bosnia--that 
require overland movements from bases in Central Europe.
    For some out-of-area missions, however, the allies would need to 
buy expensive aircraft for airlift and ships for sealift to improve 
strategic mobility. In addition, one NATO general has said that such 
missions would require the alliance to lighten its maneuver units.\28\ 
Lightening the units will make them easier to transport by strategic 
lift.
    But buying assets for strategic mobility will cut into the 
resources needed to make the aforementioned improvements in tactical 
mobility. In addition, making units lighter for transport by strategic 
lift might reduce their capability to fight in certain tactical 
situations--for example, reinforcing Polish forces. Poland is the most 
important of the three new members, if insulating Germany's eastern 
border from attack is the primary goal of expansion (the primary goal 
thus far has been hard to discern). Poland is large and flat and is 
best defended by heavily armored forces. Lightening such heavy forces 
so that they are more easily transported to out-of-area operations by 
strategic lift will impair their ability to conduct an article 5 
defense of Poland.
    To a certain extent, the competing requirements for strategically 
mobile forces and tactically mobile forces may cause funding dilemmas 
in allied nations already unenthusiastic about spending money on 
defense. Because any threat to new members that would require an 
article 5 defense is perceived as low, any money spent by the allies 
will probably be directed to improvements in strategic lift for more 
immediate out-of-area peacekeeping missions. If that is the case, the 
allies may have inadequate tactical mobility to reinforce new NATO 
members in a crisis. Thus, the alliance might be stretched too thin if 
it attempted to expand its mission and its territory at the same time.
    In sum, to avoid impairing the effectiveness of an enlarged NATO, 
existing allies must have an adequate capability to tactically 
reinforce new members in time of crisis or war, and new members must 
substantially improve their obsolescent forces and infrastructure so 
that they can provide themselves with a basic defense. Those are 
inherently costly requirements.
Reasons for Flaws in the Administration's Analysis
    Despite the administration's perception of a mild threat to new 
members, its cost estimate is supposed to be based on achieving a 
``mature capability'' for article 5 defense of NATO states. To achieve 
that capability, the administration states,

        New members will continue to improve interoperability and 
        undertake other enlargement enhancements during this phase, 
        using a combination of national and common NATO funding. During 
        this phase, new members will replace aging equipment stocks and 
        it is expected that they will continue to downsize, 
        restructure, and modernize their forces, while increasing their 
        capacity to operate with other NATO forces in their own 
        countries and elsewhere. During the same period, current member 
        states will continue to modernize their forces and make them 
        more deployable and sustainable for both collective defense and 
        non-Article 5 operations.\29\

    ``Mature capability'' has been deliberately defined in a vague 
manner, but it is supposed to be made possible by the three categories 
of military improvements cited in Table 1 and the subcategories under 
them. In reality, when the details of the subcategories are examined, 
they fail to form a convincing case that sufficient improvements would 
be made to the forces and military infrastructures of new member states 
to enable them to provide an adequate article 5 defense capability 
against even regional (non-Russian threats. (The administration's 
projected improvements are woefully inadequate if a resurgent Russian 
threat is posited.) Sometimes the details of the assumed military 
improvements on which the cost estimates are based are simply 
nonexistent, and other times the improvements are inadequate for the 
task.
The ``Level-of-Effort'' Evasion
    In short, the administration's estimate is not a cost estimate at 
all but an ``affordability'' estimate. The administration did not 
determine a list of detailed military improvements required for NATO 
expansion, estimate the cost of each of the improvements individually, 
and add up the total. Instead, for many broad categories of military 
improvements, the DoD took what it called a ``macro,'' approach by 
embracing the concept of ``levels of effort.'' The levels of effort 
were based on DoD analysts' perceptions of how much new members could 
afford to spend on particular categories, not on what was needed. 
Moreover, no explanation was given of the genesis of those perceptions.
    For example, DoD analysts simply chose a level of spending for 
logistics improvements--$777 million to $1.076 billion--and decided 
that logistics improvements would include a wide variety of items: 
NATO-compatible fuel nozzles, fuel standards, radios, computer systems, 
safety standards, host-nation support arrangements for equipment 
warehouses, and personnel to support NATO deploying forces. Yet when 
asked how many radios or how many fuel nozzles they assumed would be 
purchased, DoD analysts replied that they could not specify the number 
because the estimate was a ``level of effort.'' They made no attempt to 
find out how many of those and other items new member nations would 
need or how many their projected level of effort would purchase. In 
other cases, such as improvements to road and rail systems of the new 
member states to allow them to transport military cargo, DoD analysts 
could not even specify how they arrived at their estimate or provide a 
detailed list of enhancements, let alone their costs. They simply 
decided, without any analysis, how much would be spent on that general 
category. In short, DoD analysts came up with seemingly precise numbers 
for each category, but they usually have little or no detailed cost 
analysis to back them up.
    An evaluation of the DoD's cost estimate by the General Accounting 
office confirms that point:

        Many of DOD's estimates for specific cost elements could not be 
        verified. DOD officials did not consistently document their 
        analyses. As a result, we were unable to audit or validate 
        estimates for most specific cost elements. DOD developed other 
        cost element estimates on a highly aggregated basis.\30\
Implicit Political Constraints
    Another important general observation is that DoD analysts admitted 
that they felt constrained in the amount of military infrastructure 
they could assume would be placed in new member states. Therefore, they 
tried not to leave a ``big footprint.'' They did not say why they felt 
constrained. Was it the DoD's sensitivity to Russian opposition to 
large amounts of new infrastructure in those nations? Or, more likely, 
was it the DoD's sensitivity to Congress's mounting concern about the 
cost of expansion? Does that caution make the new members suspicious 
about how effective a defense based on reinforcement can be? Perhaps it 
should.
    Although skimping on military preparedness in new member nations 
might dodge some Russian and congressional sensitivities, it will 
probably not provide the new members with an adequate defense under 
article 5. Thus, NATO will have expanded into a volatile region, 
promising to defend new members, but be unable to do so effectively 
because of political and budgetary constraints. The United States 
should have learned its lesson in Vietnam about the perils of half-
hearted security guarantees to regions of little strategic value.

 A Category-by-Category Critique of the Administration's Cost Estimate

    To expose the shaky foundations of the administration's estimate, 
it is necessary to explore certain very specific and meaningful 
categories of costs. At this point, it is best to throw out the DoD's 
three general categories of costs, because, as Kugler argued, they are 
gibberish. They obscure rather than illuminate the true cost of 
expansion. Instead of amorphous and undefined categories, such as 
``direct enlargement,'' more specific categories of improvements that 
have some military meaning should be used. In each specific category of 
military enhancements, the administration's faulty assumptions, or lack 
of specific assumptions, will be explored.
Training and Exercises
    Total expenditures for this category were $2.5 billion to $4.2 
billion. The administration estimates that the cost of ``increased 
proficiency in individual and unit training'' for the armed forces of 
new members would be $1 billion to $2 billion. Another $1.3 billion to 
$2 billion would be spent for those militaries to train with NATO 
units. About $200 million was added to expand International Military 
Education and Training, a program created to expose foreign military 
personnel to the methods of the U.S. military and help them to gain 
technical, nation-building, and English language skills. Informally, 
the DoD analysts who made the estimate admitted that they did not base 
it on what those nations would require (that is, types and numbers of 
exercises); they based their estimate on what they believed new members 
could afford.\31\ They estimated expenditures for training and 
exercises of new members, forces by using 80 percent of the per capita 
costs of training and exercises for existing members' forces. That 
equated to about 10 percent of the military operations and maintenance 
budgets of the new member states.
    The GAO report accurately describes the DoD approach:

        DOD's estimated cost for training is notional and actual costs 
        may vary substantially from estimates. DOD analysts did not 
        project training tempos and specific exercise costs. Instead, 
        they extrapolated U.S. and NATO training and exercise costs and 
        evaluated the results from the point of view of 
        affordability.\32\

    Specifying the types, numbers, and resulting cost of exercises 
would have been preferable to choosing an arbitrary percentage of NATO 
per capita training costs. Furthermore, because the forces of new 
members were formerly part of the Warsaw Pact that was vastly different 
in command structure and culture from NATO, they would probably need 
more per capita training than NATO militaries. They also might need 
fairly frequent exercises to learn how to operate with NATO forces. In 
short, according to many military planners, before purchasing expensive 
weapon systems, new members should spend their scarce defense resources 
exercising with NATO forces and buying communications equipment to 
facilitate such training. The $2.5 billion to $4.2 billion estimate for 
training and exercises is based on artificially postulated 
considerations of affordability. An estimate based on requirements for 
specific exercises at a given frequency would yield a more realistic 
cost estimate at the top of the range ($4.2 billion).
Command, Control, Communications, and Intelligence
    The DoD's estimated total costs for improving command, control, 
communications, and intelligence (C\3\I) were $2 billion to $3 billion. 
The DoD assumed that the military headquarters of new member states 
would be refurbished to take NATO equipment and estimated that cost at 
between $1.1 billion and $1.8 billion. For communications gear, the DoD 
added from $870 million to $1.2 billion, of which $390 million to $540 
million was for a minimal number of tactical radios and $480 million to 
$690 million was for interface boxes. (Interface boxes connect 
otherwise incompatible national communication systems but only at the 
headquarters level.)
    The DoD relied on interface boxes because they are much less 
expensive than providing more radios so that lower level military units 
of varying nationalities can talk directly to each other in the heat of 
battle. If interface boxes were used, two lower level units next to 
each other on the battlefield would need to communicate through a 
higher level headquarters. That could require too much time, especially 
if one friendly unit was in danger of being hit by another. According 
to the Hungarian defense attache in Washington, interface boxes are 
inadequate for peacekeeping missions, let alone an article 5 
defense.\33\ He noted that Hungary is buying tactical radios so that 
lower level units can communicate with NATO militaries instead of 
relying only on communications among headquarters.
    The DoD analysts acknowledged that some people in the department 
argued for a more ambitious effort to provide communications equipment 
but failed to prevail in the debate. military planners believe that 
modern command centers and compatible communications equipment are 
vital to making an expanded alliance militarily effective. Thus, the 
DoD's $2 billion to $3 billion estimate for C\3\I is too low. More 
tactical radios would need to be purchased to give critical flexibility 
on the battlefield. Doing so, however, would double the cost to $6.2 
billion.
Air Defense
    Air defense enhancement is the last of the three most critical 
improvements for new members. The Central European nations are no 
longer part of the integrated air defense system of the Warsaw Pact and 
are vulnerable to attack from modern aircraft. The gap in air defense 
coverage is particularly pronounced at medium to high altitudes. 
Filling that gap accounts for the bulk of the expenses for air defense 
improvements.
    The DoD estimated that the cost of air defense improvements would 
total $2.1 billion to $2.9 billion. That sum includes $20 million to 
$23 million for identification friend-or-foe systems (those systems 
identify friendly aircraft so air defenses do not kill friendly 
forces), $185 million to $293 million for air sovereignty centers 
(command centers for air defense operations) and air defense 
surveillance, and $1.9 billion to $2.6 billion for ground-based 
surface-to-air missiles (SAMs).
    Because air defense is so critical, the DoD's estimate should have 
assumed that new members would buy Patriot PAC-2 systems to fill the 
requirement for medium-to high-altitude SAMS. Instead, the DoD, to 
reduce its estimate, assumed that the three nations would buy the much 
older Improved Hawk system, which was originally introduced in the 
1960s. It is reasonable to assume that, because of financial 
constraints, new members would probably not buy such systems until late 
in the next decade. In 2020, when any system would still have to be 
viable, the I-Hawk will be more than 50 years old. The life expectancy 
of the I-Hawk system was 30 years. In air defense--where technology is 
leaping ahead quickly--the value of such an old system would be nil. 
Equally important, ground-based air defense systems are now being used 
to attack the threat being posed by tactical ballistic missiles. If a 
capability against that threat is desired, Patriot will provide some 
capability, but the I-Hawk will provide little.
    Although the DoD analysts acknowledged that air defense is a 
critical area for improvement, they still assumed the purchase of I-
Hawks. Obviously, assuming that an obsolescent system is purchased cuts 
the cost of NATO expansion. Although it is questionable whether the new 
members can afford all of the military improvements needed to give them 
a basic article 5 defense capability, air defense is so critical to 
modern warfare that they should not skimp on it. The Patriot PAC-2 
system is more expensive than the I-Hawk, but not prohibitive for new 
members. Several nonindustrialized nations--Israel, Kuwait, Taiwan, and 
Saudi Arabia, which have gross domestic products similar to Poland's--
have already purchased the system. In addition, South Korea and the 
United Arab Emirates are actively exploring the purchase of the system. 
If the assumption is changed from purchase of the I-Hawk to purchase of 
a Patriot-like system, the costs for air defense improvements rise to 
$8 billion. If the new members want a system that will be capable 
against modern air threats into the future, however, they--or someone 
else--have little choice but to spend the money.
Modernizing the Ground Forces of New Members and Making Them More 
        Mobile
    The armored forces of the new members consist mainly of T-55 and T-
72 tanks. Although the T-72 could be effective if it were upgraded with 
Western fire control systems and other new electronics, the T-55 is 
obsolete and would need to be replaced. According to one press report, 
``More than half of Poland's 1,700 tanks are Soviet T-55 designs from 
1955 and are unusable.''\34\
    In addition, as is the case for the forces of existing European 
allies, added combat support and combat service support may be needed 
to enhance mobility. That is particularly true in the case of Polish 
forces. Poland is large and flat, making it an excellent venue for 
mobile warfare. Yet about half of the Polish divisions (six) were 
stationed in the western part of the country during the Cold War and 
remain there today, away from the current threats to Poland's security 
on the other side of the country. It is prohibitively expensive to 
create new bases for six divisions in eastern Poland, so making them 
more mobile is a cheaper alternative. (Although half of all Polish 
divisions need to be made more mobile, Czech and Hungarian forces may 
not need added mobility. Those forces have much smaller territories to 
defend than do Poland's forces and can probably get by without too many 
modifications.)
    The administration assumed that ``deployable logistics 
sustainment'' was to be added to 25 percent of the divisions (4.9 
divisions) of all new member states. The military rationale for that 
assumption is unclear. It looks as if the administration was outfitting 
a limited number of units in each country for out-of-area peacekeeping 
operations. Yet the administration's cost estimate was based on giving 
new members a ``mature'' article 5 defense capability. The added cost 
to make each division mobile was $925 million to $1.1 billion plus 
costs for operations and maintenance.
    In addition, DoD analysts assumed a level of effort for the 
modernization of the ground forces of new members. The analysts said 
that they assumed unspecified upgrades of armor but no new tank 
purchases, even though the period of the estimate stretches through 
2009 and many of the obsolete T-55s are already unusable. Also, DoD 
analysts stated that they assumed artillery would be upgraded and 
standardized. Otherwise, the analysts provided few specific details to 
support the level of effort chosen. The GAO report was concerned about 
the DoD estimate's lack of specifics. ``DOD's estimate for 
modernization and restructuring of new members' ground forces was also 
notional and was based on improving 25 percent of the new members 
forces. However, it did not include specifics as to what would be done 
to upgrade the equipment and how much it would Cost.''\35\
    According to U.S. military planners, standardizing new members, 
artillery to make it compatible with that of present NATO members is 
very expensive (it requires the new members to buy new tubes, new 
ammunition, and new logistics systems) and was not a high priority 
militarily. Although guns from various nations that fire standardized 
ammunition are a plus, guns that fire incompatible ammunition, using 
compatible communications devices, can coordinate their fires well, the 
analyst contended. The planners thought that it was more important for 
new members to spend limited funds to train with NATO and improve air 
defense and command, control, and communications. Yet, when asked how 
many tubes they could standardize with a subset of the small amount of 
money they allocated for the modernization of ground forces, DoD 
analysts again replied that they could not specify the number because 
their estimate merely assumed a level of effort.
    When the level of effort for the modernization of ground forces was 
added to the funds needed to provide deployable logistics for about 
five divisions, the administration's total cost for this category was 
$5.4 billion to $6.4 billion. A more realistic and specific program for 
modernizing the ground forces of new member nations and making them 
more mobile would add combat support and combat service support to one 
more division (bringing the total to six divisions), rewire T-72 tanks 
with Western electronics, replace a small number of T-55 tanks with new 
tanks over the long term, and exclude artillery standardization because 
of its limited military usefulness. Such a program would cost $7 
billion.
Upgrading the Weapons of New Members or Buying New Ones
    The administration included this category in its estimate so that 
the analysis would appear comprehensive but then did not include all 
the items needed to equip the armed forces of new members for modern 
warfare. Recall that the administration admitted that ``these states-
emerged from the Warsaw Pact with military forces that were poorly 
structured and inadequately equipped for modern warfare.'' \36\ The 
administration's assumptions about weapons purchases by new members for 
the 1997-2009 period are paltry and do not coincide with the more 
ambitious defense plans of those nations.
    Defense analysts project that by the end of 1998 one third of 
military aircraft in Eastern Europe will be unable to fly. By 2005, if 
no new aircraft are purchased, no East European country will have an 
air force.\37\ Yet the DoD did not assume that existing Soviet-built or 
new indigenously built aircraft would be wired with new electronics 
(including electronic warfare equipment) until new aircraft could be 
purchased. Even worse, the DoD assumed that each nation would buy only 
one squadron (18 aircraft) of worn-out U.S. F-16 aircraft from the bone 
yard. All of the bone yard aircraft combined were assumed to cost a 
measly $725 million to $823 million. To add insult to injury, the DoD 
underestimated the cost of even the bone yard aircraft. The GAO's 
analysis showed that ``the cost of purchasing refurbished F-16 aircraft 
would be at least 11 percent higher than the high end of DOD's 
estimate.''\38\ (That example casts doubt on the accuracy of the DoD's 
estimates in the other rare cases in which the costs of specific 
military improvements were provided.)
    In any case, instead of a limited number of bone yard aircraft that 
do not provide much capability, the three new members say they are 
planning to buy up to about 300 new (Western and indigenously produced) 
aircraft.\39\ Although some of the new members may delay the purchase 
of such aircraft, their obsolescent air forces will compel them to buy 
aircraft within the period of the estimate.\40\ In fact, the DoD is 
encouraging the sale of new U.S. aircraft by offering the new members 
grants, discount loans, and free leases.\41\ The least the DoD could do 
would be to reflect in its cost estimate the prospect of some new 
weapon sales and concomitant security assistance to finance them.
    DoD analysts assumed that air-to-air and air-to-ground weapons 
would be purchased for 500 total aircraft in the three nations combined 
but did not calculate the number of each kind of weapon needed per 
aircraft. Instead, the analysts chose a level of effort of from 
$700,000 to $800,000 per aircraft, leading to a total cost of from $350 
million to $400 million. Of course, they could not specify how many 
air-to-air and air-to-ground munitions they assumed would be purchased 
with the estimated amount of money. They also specified $525 million to 
$600 million as a level of effort for anti-tank weapons but again could 
not cite the number of weapons that could be purchased for that amount. 
In both cases, the amount to be spent was arbitrarily chosen, not based 
on military requirements.
    During the 1997 to 2009 period, the DoD estimated the costs for 
only those meager weapons purchases. The total was an embarrassingly 
low $1.6 billion to $1.8 billion. In contrast, weapons purchases to 
give new members a ``mature'' article 5 defense capability against 
lesser regional threats (assuming the absence of a resurgent Russia) 
would cost about $11.5 billion over a 15-year period.
    That figure does not ``gold plate'' the Central European militaries 
by replacing one-for-one their obsolescent equipment with new Western 
hardware. Instead, it often reflects the less expensive expedient of 
upgrading or modernizing weapons only in areas deemed critical by 
military planners. The figure includes improvements such as inserting 
Western electronics (including electronic warfare equipment) into 
existing Soviet-built and new indigenously produced aircraft until 
about 200 new Western aircraft have been purchased gradually, according 
the plans of the new member nations. The figure also assumes that 
standard combat loads of less expensive air-to-air (Sidewinder) and 
air-to-ground (Maverick) munitions would be purchased for those 
aircraft. Specific numbers of relatively inexpensive anti-tank weapons 
would be purchased to reduce the number of new tanks needed. The number 
of anti-tank missiles purchased was based on how many standard-sized 
divisions the new member armies would require. Adequate Soviet-built T-
72 tanks would be rewired with Western fire control devices and other 
electronic devises. Gradually, one-third of the obsolete T-55 tanks 
would be replaced with either indigenously produced or Western-built 
tanks.\42\
Naval Improvements
    The administration did not include any funds for improving the 
Polish navy, even though it might need to help clear mines from Polish 
ports to facilitate NATO reinforcement in a regional war--for example, 
one between Poland and Belarus. Belarus might profit greatly from 
sending aircraft to drop mines near Polish ports, thus preventing or 
slowing resupply by NATO. If Russia were helping its ally, the Polish 
navy might also need improved anti-submarine warfare sonars to help 
NATO watch or even destroy Russian subs trying to interdict supplies 
moving into Polish ports. In any reasonable cost estimate, Poland 
should be responsible for helping to keep its ports and sea-lanes open. 
Some new electronics for Polish ships and new coastal radars are also 
needed. Even such modest improvements would cost $1.1 billion.
Port, Road, and Rail Improvements
    Improvements to ports and dilapidated road and rail systems would 
also be needed to facilitate NATO reinforcement and resupply during a 
crisis. DoD analysts assumed that most port, road, and rail 
improvements would be undertaken for commercial reasons. For militarily 
critical road and rail improvements that the commercial sector would 
fail to undertake, the analysts simply used an aggregate number ($258 
million to $462 million). When asked from what data it was aggregated, 
they could not provide an answer. They provided no better answer for 
their cost estimate for port improvements ($172 million to $201 
million). It is quite curious that they can provide no details because 
their numbers--including the total for the entire category of $430 
million to $663 million--seem very precise.
    DoD analysts were right to assume that most of the improvements to 
infrastructure would be undertaken by the commercial sector. But they 
appeared to have just picked a number for militarily critical 
improvements.
    In reality, only modest militarily critical improvements need to be 
made to Poland's ports. However, Szczecin, the westernmost port that 
would be the farthest away from any potential front, is obsolete, has 
poor rail access, and has a shortage of facilities for unloading roll-
on, roll-off ships that haul military vehicles. Like Poland's other two 
ports of Gdansk and Gydnia, Szczecin would need to be dredged to 
accommodate fully loaded military sea lift ships.
    The road and rail systems in the new member nations are another 
story. During the Warsaw Pact years, the road and rail systems were 
used heavily but received little maintenance. Detailed data from the 
U.S. Transportation Command, the World Bank, and the European Bank for 
Reconstruction and Development indicate specific improvements that are 
needed or planned. For a crude estimate of the militarily critical 
improvements, 10 percent of the total cost of this list of enhancements 
can be used. If this alternative assumption is used, a better estimate 
of port, road, and rail costs is $3 billion.
Exercise Facilities
    DoD analysts assumed that five brigade-sized and one battalion-
sized exercise facilities would be upgraded. Their estimate failed to 
specify, however, what upgrades would be made. Nevertheless, the 
specificity of the DoD's assumptions for this category of improvements 
was greater than for most other categories of costs, which contained 
levels of effort based on affordability. Yet the DoD's cost estimate--
$325 million to $490 million--is still probably too low.
    It is widely accepted that military bases and infrastructure in the 
former Warsaw Pact nations are in very poor condition and some 
installations may be unsafe because of environmental contamination. It 
would be prudent to assume that new large-scale exercise facilities 
would need to be built, or at least that the cost of needed extensive 
repairs and modifications to existing facilities would approach the 
cost of new ones. If those assumptions are used, the expenses in this 
category rise to $4.7 billion.
Stockpiling Fuel and Ammunition for the Forces of New Members
    DoD analysts assumed that hardened bunkers would be refurbished to 
store ammunition for only 10 days at a cost of $100 million to $200 
million. However, they assumed that no ammunition would be purchased to 
go in the bunkers. In addition, they did not assume that hardened fuel 
facilities would be built or that stocks of fuel would be purchased. 
They assumed that fuel would be available on the commercial market even 
during a crisis.
    In wartime, it is questionable whether adequate fuel supplies would 
be available from commercial distribution systems, which might be 
damaged or in disarray. It seems possible that competition for limited 
supplies might arise between the forces of new members and incoming 
NATO forces. In addition, the DoD assumed that a war would last only 10 
days. Some wars might last only that long, but many might not.
    Furthermore, NATO, instead of permanently stationing troops in new 
member states, has opted for a cheaper reinforcement strategy. New 
member forces would have to hold out until NATO reinforcements arrived. 
Therefore, a better assumption to hedge against a delay in the arrival 
of reinforcements is that new members would need facilities for storing 
30 days' worth of ammunition and fuel and the stocks of such supplies 
to go in those facilities. The total cost of the facilities and stocks 
would be $600 million.
Upgrading Airfields in New Member Nations
    In time of crisis or war, the administration proposes a defense 
concept that flies six wings of NATO aircraft from bases in Western 
Europe to operate from airfields that are close to the front in new 
member states. To make that possible, the airfields would be improved 
at a cost of $2.9 billion to $3.3 billion. DoD analysts stated that 
those improvements include maintenance facilities, added ramp space, 
and base support. Runways were assumed to be adequate, and no upgrades 
were included; no hardened shelters for aircraft were provided. Despite 
listing specific upgrades, it appears that the DoD analysts did not add 
up the cost of each to get the total cost of airfield improvements. DoD 
analysts mentioned that the total cost was obtained by multiplying a 
standard $70 million to $80 million per aircraft squadron (plus 
operations and maintenance costs) times 19 or 20 squadrons (six wings) 
of aircraft. Thus, it seems that the cost estimate per squadron is a 
level of effort rather than the sum of the costs of individual 
improvements.
    In addition, the administration assumed that the six air wings 
would be distributed among airfields in the three new member countries, 
with two air wings in each. Thus, only enough airfields to house two 
air wings were upgraded in each of the countries. A new member might be 
disappointed to learn that NATO was planning to send only two wings of 
aircraft--not six--to its defense if it were attacked. of course, if 
one new member were attacked, NATO aircraft might fly missions from 
airfields in the other two new members, provided neighboring countries 
(Slovakia and possibly Austria) allowed overflights of their territory. 
The main purpose, however, is to fly aircraft to operating bases close 
to the front so that they can drop more weapons in less time using less 
fuel.
    Instead of using a level of effort per wing as a proxy to compute 
the improvements needed to airfields, the DoD should have obtained cost 
figures on a detailed list of enhancements for a standard NATO 
Colocated Operating Base (COB) already created in a country whose 
economic development, and thus cost of refurbishment, is similar to 
that of the new member nations. The list of enhancements to existing 
airfields includes adding air traffic control and communications 
equipment, building hardened shelters for aircraft, upgrading barracks 
and mess halls, and building maintenance shops. Given the very poor 
state of infrastructure on military bases in former Warsaw Pact 
nations, one should assume that runways would need to be repaired and 
reinforced. Hardened shelters are a must for any airfield near the 
front, otherwise aircraft might be destroyed by the enemy while they 
were still on the ground. In addition, the assumption should be made 
that sufficient COBs would be created in each of the three nations so 
that all six wings of reinforcing NATO air power could be housed in any 
of those nations in case of a threat. If those necessary measures were 
implemented, the cost would be $4.3 billion.
Creatinq Reception Facilities in the New Member States to Receive NATO 
        Ground Forces
    According to the administration's concept for defending new members 
under threat of attack, four NATO divisions would move east from their 
bases in Western Europe to ``reception facilities'' in new member 
states. Yet DoD analysts assumed that reception facilities would be 
created for only six brigades (two divisions), three of which would be 
in Poland. Each facility costs only $15 million to $20 million plus 
operations and maintenance costs. DoD analysts provided no description 
of what that money would buy. They did not include the purchase of 
short-range air defenses to protect the facilities, because they argued 
that those defenses would be brought with the incoming forces. In 
total, the reception facilities for two divisions were estimated to 
cost a paltry $115 million to $144 million. Although it is unclear what 
the DoD is buying for that small amount, it cannot be much.
    Several problems exist with the DOD's assumptions. Creating 
reception facilities for only two divisions would require four 
divisions to go through them sequentially rather than simultaneously. 
The DoD seems to think such phased deployment is acceptable. But such a 
bottleneck could allow enemy forces to destroy the incoming divisions 
sequentially before they could mass for an attack. In addition, 
reception facilities are divided up among the new member countries, 
creating an even worse problem than exists with COBs because there are 
even fewer facilities per number of incoming units. For example, if 
Hungary is threatened and has a reception facility for only two 
brigades, four NATO divisions descending on it might allow the enemy to 
have a field day attacking that bottleneck. The problem is further 
exacerbated by the fact that ground forces, unlike aircraft, cannot 
simply deploy to facilities in Poland and the Czech Republic and then 
fly missions (albeit suboptimal ones) into Hungary. Ground forces must 
deploy to reception facilities in Hungary or they are out of position 
to defend against any attack on that nation.
    Furthermore, reception facilities would need to consist of more 
than NATO-compatible fuel facilities and host-nation support for 
arranging logistics support. Money could be saved by building reception 
facilities at abandoned Soviet bases in new member nations, but the 
facilities would still need to include rail sidings and facilities for 
unloading train cars, vehicle parking lots to rearrange equipment from 
its configuration for transportation to its configuration for battle, 
hangars for helicopters, upgraded barracks and mess halls, and 
facilities for maintaining equipment. Reception facilities for ground 
forces at air bases would require extra hangars for aircraft and 
warehouses to store incoming airlifted equipment and supplies. Costs 
for short range air defenses also need to be included in the price of a 
reception facility, because forces being unloaded from trains will be 
very vulnerable to attack until they get their air defenses set up. If 
reception facilities are provided for four divisions in each of the 
three countries, the cost will be $1.2 billion--nearly eight times the 
Pentagon's maximum estimate.
Improving the Air Wings and Ground Forces of European Allies to Project 
        Power
    Although NATO plans to move four ground divisions and six wings 
from bases in Western Europe to reception facilities and airfields, 
respectively, in new member nations, only three divisions and five air 
wings need extensive modifications. One U.S. ground division and one 
air wing already have most of the needed mobile support assets to 
project power. In contrast, the forces of the European allies were 
designed for an in-place linear defense of Germany during the Cold War 
and, therefore, need significant enhancements to be able to move into 
the territories of new member states during a crisis or war.
    The administration's estimate provides ``deployable logistics 
sustainment'' for three non-U.S. ground divisions and five non-U.S. air 
wings.\43\ No specific definition of that term is provided. DoD 
analysts said that providing deployable logistics for each ground 
division would cost between $1.2 billion and $1.5 billion plus 
operations and maintenance costs. No per unit cost to outfit each air 
wing was cited. The estimate cites a total cost of $4 billion to $5 
billion to outfit the ground divisions and the same amount to outfit 
the air wings. Thus, the DoD projected the total cost of augmenting 
allied ground and air forces at $8 billion to $10 billion.
    The DoD's per unit and total cost figures to augment European 
ground forces for power projection seem accurate. Although the DoD did 
not list the specific items needed to make the ground forces of the 
European allies more mobile, this paper earlier provided a list of 
items for the ground forces of new members. The list is the same for 
the forces of the European allies, but the higher cost per division can 
be attributed to the larger size of allied divisions.
    In contrast, the administration's estimate for augmenting the air 
wings is too low. The cost of providing an itemized list of 
enhancements--mobile engineers, maintenance units, medical units, and 
other support assets--for five air wings should be about $6.9 billion. 
Because the DoD provided no details on deployable logistics 
sustainment, it is difficult to discern why the DoD's costs were lower. 
With $4.5 billion needed to augment allied ground forces and $6.9 
billion needed to augment allied air forces, a more realistic estimate 
of the total cost of improved allied power projection is $11.4 billion, 
not $8 billion to $10 billion.
Making U.S. Forces More Mobile
    Although U.S. forces are able to project power much more 
effectively than are those of the European allies, a deficiency still 
exists in U.S. capabilities. During the Persian Gulf War, U.S. forces 
had a shortage of heavy equipment transporters for transporting tanks. 
While Germany's excellent rail system mitigated the effects of that 
shortage during the Cold War, the poor rail systems of the new members 
will not help much. The cost of adding heavy transporters for one U.S. 
division is $400 million. The administration's estimate did not seek to 
remedy the shortage and thus avoided accounting for those costs.
Systems for Storage and Transport of Fuel and Ammunition
    The previous discussion of storage and transportation of fuel and 
ammunition pertained to new member nations. There is also the matter of 
fuel and ammunition for arriving NATO reinforcements.
    DoD analysts admitted that they did not assume the stockpiling of 
fuel and ammunition for NATO forces in new member states because 
prepositioning is a sensitive issue. They felt constrained to minimize 
the infrastructure or ``footprint'' they assumed would be placed on the 
territory of new member states. In addition, they did not extend the 
NATO fuel pipeline to reception facilities and COBs in new member 
states. DoD analysts felt that incoming NATO forces could get fuel from 
the commercial market or from the new member governments. They did add 
$1.6 billion to $1.9 billion for NATO-compatible fuel systems. That sum 
included $900 million for enhancing the fuel storage and distribution 
system for air and ground forces, but the analysts never explained what 
improvements that sum would finance. The estimate also included $389 
million to $538 million for NATO-compatible fuel nozzles and standards 
and $274 million to $438 million for NATO-compatible fuel facilities 
and other support equipment at reception facilities.
    As noted earlier, it seems questionable to assume that the 
commercial market--which could be easily damaged or disrupted--could 
provide fuel needs during a war. During wartime, where will the new 
member governments get the fuel if it is not stockpiled (DoD added no 
money for either buying or storing fuel) or transported by the NATO 
pipeline? The forces of NATO and the new members might find themselves 
competing for dwindling supplies. Notably, the DoD does not assume that 
fuel will be readily available in its regional warfare scenarios in 
Korea or the Persian Gulf.
    Therefore, a 30-day supply of both fuel and ammunition for NATO 
forces would need to be bought and stockpiled in the new member states. 
Hardened bunkers and fuel facilities would be needed to store those 
supplies. In addition, as a backup, the NATO pipeline would need to be 
extended to supply bases on the territory of new members. If such 
improvements were made, the cost would be $5 billion rather than $1.6 
billion to $1.9 billion.

                         Distribution of Costs

    Important details of how the administration distributed its 
estimated costs among the United States, existing European NATO allies, 
and new members are also sketchy. In its estimate, the administration 
properly assigned to existing allies the entire costs of enhancing 
their forces to project power. (The severe constraints on their defense 
spending leave open to doubt whether they will actually make those 
enhancements.) The estimate also assigned to new members all of the 
costs of restructuring and modernizing their own forces. It failed to 
assume that at least some of the cost of those efforts would accrue to 
the United States. According to the Department of State study, ``Some 
of the efforts have been modestly supported by U.S. assistance 
programs. . . . Whether any such costs would be borne by the United 
States in the future would depend on decisions by the U.S. Congress and 
Executive Branch.''\44\
    Saying that the U.S. government has not yet decided what future 
assistance will be provided allows the DoD to avoid adding in what 
could be substantial costs. Western arms manufacturers--including those 
in the United States-will pressure their governments to provide 
security assistance for sales in a competitive arms market. The small 
amount of assistance already provided to the prospective new members 
has come under the auspices of the Partnership for Peace program, 
designed to make very modest improvements in the militaries of the 
prospective members to prepare them for international peacekeeping 
missions. The financial assistance provided for NATO expansion has the 
potential to be much larger. The GAO reports that a Polish official 
estimated that Poland would need $2 billion in credits just to buy 
multipurpose aircraft.\45\ The total bill for security assistance for 
the entire list of weapons purchases by new members could be much 
higher. RAND estimated that arms purchases by new members could reach 
$30 billion to $40 billion, which would require $1 billion to $3 
billion annually in security assistance.\46\
    The details on distributing expenses for direct enlargement are 
murkier than they are on the administration's other cost categories. 
The administration assumed that new members would pay 35 percent of 
direct enlargement costs, the European allies would pay 50 percent, and 
the United States would pay 15 percent. (That assumption is based on 
another assumption: that 40 percent of direct enlargement costs would 
be funded by member nations and 60 percent would be funded by the NATO 
common budgets, to which nations usually contribute on the basis of 
their gross domestic products.)\47\
    The president's report to Congress implies, and DoD analysts 
confirmed, that those percentages had been derived by separating out 
the detailed expenses of expansion into U.S. costs, allied costs, and 
costs to new members and then adding them up. Yet, in the DoD's macro 
approach to costing, levels of effort were assigned to broad areas of 
improvements, with no detailed costs to back.them up. How did a 
nondetailed DoD estimate result in detailed costs to separate out and 
add up into the three percentages that measure the relative sharing of 
burden?
    For example, the DoD estimated that $777 million to $1.076 billion 
would be spent on logistics. That category included, among many other 
items, NATO-compatible fueling systems and standards, as well as host-
nation support arrangements for equipment warehouses. The number and 
cost of the individual items did not exist because it was a level of 
effort estimate. Yet, presumably, NATO-compatible fueling systems and 
standards would be financed with common NATO funds, while host-nation 
support arrangements are the responsibility of the new member nations 
that would host NATO reinforcements in time of crisis. Since there are 
not enough detailed costs provided to indicate how much of the $777 
million to $1.076 billion for logistics was funded commonly and how 
much nationally, how could overall percentages be calculated? Other 
broad areas of improvements that would probably have components funded 
both commonly and nationally, which would be difficult or impossible to 
sort out, would be enhancements to infrastructure; air defense; and 
command, control, and communications. Those subcategories make up the 
bulk of the direct enlargement category.
    In short, the DoD's nondetailed estimate does not lend itself to 
the segregation and addition of individual expenses so that such global 
percentages could be calculated. Did the DoD just arbitrarily assign 
percentages of direct enlargement expenses to be borne by the United 
States (15 percent), existing allies (50 percent), and new members (35 
percent)?

                    The Real Costs of NATO Expansion

    In this study, for each category of expenses, a more realistic cost 
estimate was developed and compared with the administration's estimate. 
The alternative estimates were developed by accepting, only for the 
purposes of analysis, the administration's assumption of a continuing 
benign threat environment and the strategy of reinforcing new members 
during a crisis with four NATO ground divisions and six air wings. 
Adding the alternative figures gives a total cost for expansion of 
about $70 billion. That number is twice the upper end of the 
administration's $27 billion to $35 billion range (see Table 2).

           Table 2--Comparison of DOD'S Estimate with an Estimate Based on More Realistic Assumptions           
                                              (billions of dollars)                                             
----------------------------------------------------------------------------------------------------------------
                                                                    Alternative                                 
                     Category of Improvement                          Estimate              DoD Estimate        
----------------------------------------------------------------------------------------------------------------
Training and exercises..........................................             4.2                        2.5-4.2 
Command, Control, Communications, and Intelligence..............             6.2                            2-3 
Air defense.....................................................             8.0                        2.1-2.9 
Modernization of ground forces of new members to make them more                                                 
 mobile.........................................................             7.0                        5.4-6.4 
Upgrading the weapons of new members or buying new ones.........            11.5                        1.6-1.8 
Naval improvements for Poland...................................             1.1                              0 
Port, road, and rail improvements...............................             3.0                          .4-.7 
Exercise facilities.............................................             4.7                          .3-.5 
Stockpiling fuel and armnunition for the forces of new members..              .6                            1.2 
Upgrading airfields in new member states........................             4.3                        2.9-3.3 
Creating reception facilities for NATO ground forces............             1.2                             .1 
Improving allied ground forces' and air wings' capability to                                                    
 project power..................................................            11.4                           8-10 
Making U.S. forces more mobile..................................              .4                              0 
Systems for fuel and ammunition storage and transport...........             5.0                        1.6-1.9 
    Total.......................................................        69 (U.S.                                
                                                                     share=7)\1\    27-35 (U.S. share=1.5-2)\1\ 
----------------------------------------------------------------------------------------------------------------
\1\ both of these figures may increase. The $7 billion in U.S. costs will increase if the new members cannot pay-
  -as is likely--the estimated $34 billion in projected costs that will accrue to them. The almost $70 billion  
  in total costs could increase to between $125 billion and $167 billion if the administration's dubious        
  assumptions fail to hold. Those assumptions are that the current benign threat environment will continue and  
  that no pressure will come from new members for the permanent stationing of NATO forces on their territories. 
  The cost of relaxing those assumptions is discussed in Congressional Budget Office, The Costs of Expanding the
  NATO Alliance (Washington: CBO, March 1996), pp. xiv, 51-55.                                                  

    U.S. costs are estimated to be at least $7 billion, 
compared with $1.5 billion to $2 billion in the 
administration's estimate. Even $7 billion could grow if, as is 
likely, the new member states were unwilling or unable to pay a 
more realistic estimate of the expenses that would accrue to 
them ($34 billion). In that case, the European allies would 
probably expect the United States to pay more of the new 
members' bill because expansion was a U.S. initiative and 
because European defense spending is under severe constraints 
induced by the fiscal austerity needed to join the European 
Monetary Union.\48\
    The $34 billion in costs would require the three new 
members to increase their combined annual defense budgets-
currently only $4.6 billion--by almost 60 percent. More 
important, such expenses would require the new members to 
increase their meager military investment (research, 
development, and procurement) by about 10 times that 
percentage. Such spending increases would be difficult, given 
the transition of their economies from communism to capitalism 
and polls showing that their populations do not support 
increases in government spending for defense. In addition, 
while the U.S. administration is encouraging the new members to 
pay the bulk of the costs for expansion, the International 
Monetary Fund--in which the United States is a driving force--
has become alarmed by that prospect and is pressuring them to 
hold down such large defense spending increases to avoid 
damaging their fragile economies.\49\
    According to the Congressional Budget office, if the 
administration's assumption of a continued benign threat 
environment is abandoned and if permanent stationing of a 
limited number of NATO forces in new member states and larger 
reinforcing forces are required, the total costs of expansion 
would increase to $125 billion. About $19 billion of that cost 
would accrue to the United States.\50\
    Again according to the Congressional Budget Office, if 
large numbers of NATO forces needed to be stationed in new 
member states, the total costs would escalate to about $167 
billion.\51\ A large permanent presence might be needed if NATO 
guaranteed the security of the new members and a militarily 
resurgent Russia emerged, either independently or as a response 
to a perceived threat from NATO expansion.
    In sum, even if the DoD's dubious assumptions about a 
continuing benign threat environment and the ability to avoid 
pressure for the permanent forward stationing of troops hold, 
the total costs of NATO expansion are likely to be much greater 
than the administration's estimate would indicate. To guard 
Congress's constitutionally mandated powers of the purse and 
the Senate's informed advice and consent on treaties, Congress 
has a right to a reasonably accurate and methodologically 
rigorous analysis of how much expanding the alliance is likely 
to cost. The administration's cost estimate is woefully 
inadequate in both regards.
                                 Notes

    \1\ Jeff Gerth and Tim Weiner, ``Arms Makers See a Bonanza in 
Selling NATO Expansion,'' New York Times, June 29, 1997, pp. 1, 8.
    \2\ Congressional Budget Office, The Costs of Expanding the NATO 
Alliance (Washington: CBO, 1996), p. 40. Ivan Eland and Jeannette 
Deshong were the principal authors of the report.
    \3\ Steven Erlanger, ``A War of Numbers Emerges over Cost of 
Enlarging NATO,'' New York Times, October 13, 1997, pp. Al, A10.
    \4\ U.S. Department of State, Report to the Congress on the 
Enlargement of NATO: Rationale, Benefits, Costs, and Implications, 
February 1997, pp. 10, 15.
    \5\ Ibid., p. 16.
    \6\ Ibid., p. 18.
    \7\ Ted Galen Carpenter and Andrew Stone, ``NATO Expansion 
Flashpoint No. 1: The Border between Poland and Belarus,'' Cato 
Institute Foreign Policy Briefing no. 44, September 16, 1997, p 1.
    \8\ Ibid., pp. 11-12.
    \9\ Ted Galen Carpenter, Beyond NATO: Staying Out of Europe's Wars 
(Washington: Cato Institute, 1994), p. 21.
    \10\ Ibid., p. 32.
    \11\ James Joll, The Origins of the First World War, 2d ed. 
(London: Longman, 1992), pp. 42, 45-46, 47, 50-52, 54-55, 60, 62, 200, 
201.
    \12\ Congressional Budget Office, p. 40; and Jonathan Landay 
``U.S.: No Free Lunch,'' Christian Science Monitor, October 7, 1997, p. 
1.
    \13\ Jonathan Landay, ``U.S. Military Outpaces Its NATO Peers,'' 
Christian Science Monitor, September 29, 1997, p. 1.
    \14\ Congressional Budget office, p. 52. Page 35
    \15\ Richard Kugler, now with the National Defense University, 
Comments at a forum on Capitol Hill entitled ``NATO Enlargement--
Matching Requirements and Costs: A Transatlantic Forum Roundtable 
Discussion,'' sponsored by the Potomac Foundation, 'September 8, 1997.
    \16\ Congressional Budget office, pp. 26-40, 44-45, 47-48; and 
Reiner Huber and Gernot Friedrich, A Zero-Cost Option for NATO 
Enlargement: Arguments for a Comprehensive Approach (McLean, Va.: 
Potomac Foundation, August 1997), pp. 10-11.
    \17\ Gerth and Weiner, p. 8; and William Drozdiak, ``NATO Nations 
Balk at Paying Large Share of Expansion,'' Washington Post, October 3, 
1997.
    \18\ DoD response, in General Accounting Office, NATO Enlargement: 
Cost Estimates Developed to Date Are Notional (Washington: General 
Accounting Office, August 1997), p. 11.
    \19\ Ibid., pp. 23-24.
    \20\ Ibid., p. 4.
    \21\ Quoted in Landay, ``U.S. Military Outpaces Its NATO Peers,'' 
p. 1.
    \22\ Bill Clinton, response to questions on NATO enlargement from 
Sen. Kay Bailey Hutchison, September 10, 1997, response to question 8, 
p. 11 (copy in author's files).
    \23\ Douglas Berenson, ``Officials Say NATO Must Step Up Rapid 
Reinforcement, Lift Abilities,'' Inside the Pentagon, July 31, 1997, p. 
3; and Landay, ``U.S. Military Outpaces Its NATO Peers,'' p. 1.
    \24\ North Atlantic Treaty Organization, NATO Handbook (Brussels: 
NATO Information and Press, 1995), pp. 244-45, 246-47.
    \25\ Huber and Friedrich, Foreword and pp. 1-2.
    \26\ Landay, ``U.S. Military Outpaces Its NATO Peers,'' p. 1.
    \27\ Ronald Asmus, Richard Kugler, and Stephen Larrabee, ``What 
Will NATO Enlargement Cost?'' Survival 38, no. 3 (Autumn 1996): 9-10.
    \28\ Quoted in Berenson, p. 4. Page 36
    \29\ U.S. Department of State, p. 12.
    \30\ General Accounting Office, p. 9.
    \31\ The DoD's assumptions for specific categories of costs were 
discussed at a meeting with the author on April 2, 1997. DoD personnel 
present were Ron Moore, an analyst in the DoD's office of Program 
Analysis and Evaluation, and Barry Pavel and Lt. Col. Reginald Gillis 
in the office of the Assistant Secretary of Defense for Strategy and 
Resources. Subsequently, the Pentagon's assumptions were confirmed in 
writing.
    \32\ General Accounting Office, p. 10.
    \33\ Phone conversation with Col. Tamas Toth, Hungarian defense 
attache in the United States.
    \34\ Christine Spolar, ``Applicants Offer Lots of Heart but Few 
Arms,'' Washington Post, June 17, 1997, p. A12.
    \35\ General Accounting Office, p. 10.
    \36\ Clinton, response to question 8, p. 11.
    \37\ Christine Spolar, ``Aging Armies Grapple with Costly Overhaul: 
E. European Nations Take Aggressive Steps to Amass Price of Admission 
to NATO,'' Washington Post, June 19, 1997, p. A23.
    \38\ General Accounting Office, p. 10.
    \39\ Jeff Erlich and Brooks Tigner, ``Czechs, Poles Seek Fighter 
Bids by Year-End,'' Defense News, September 22-28, 1997, p. 26; and 
Spolar, ``Aging Armies Grapple with Costly Overhaul,'' p. A23.
    \40\ Jeff Erlich, ``Central European Nations May Delay Fighter 
Purchases,'' Defense News, October 6-12, 1997, p. 10.
    \41\ Gerth and Weiner, pp. 1, 8.
    \42\ Unlike the DoD's estimate, the $11.5 billion figure does not 
include any funds for standardizing artillery tubes, ammunition, and 
ammunition-handling equipment. Military planners believe that doing so 
costs a great deal of money for only a modest gain in military 
capability. Standardizing only a few guns, as the DoD assumed, would 
have almost no military value. Nations facing severe constraints on the 
resources they can spend on defense would best spend those Page 37 
funds on higher priority items.
    \43\ U.S. Department of Defense, ``The Military Implications and 
Costs of NATO Enlargement,'' undated briefing, p. 8.
    \44\ U.S. Department of State, p. 18.
    \45\ General Accounting Office, p. 12.
    \46\ Asmus, Kugler, and Larrabee, p. 10; and RAND, ``The Costs of 
NATO Expansion: Preparing NATO and ECE Forces to Carry Out New Treaty 
Commitments,'' Santa Monica, May 1995, p. 10.
    \47\ Ibid., p. 19.
    \48\ Brooks Tigner, ``NATO Rift Widens over Expansion Costs,'' 
Defense News, October 6-12, 1997, p. 6.
    \49\ U.S. Department of Defense; Landay, ``U.S.: No Free Lunch,'' 
p. 1; and William Drozdiak, ``NATO Nations Balk at Paying Large Share 
of Expansion,'' Washington Post, October 3, 1997.
    \50\ Congressional Budget Office, pp. xiv, 51-55. The CBO developed 
several options for implementing expansion that ranged from a defense 
that relied heavily on improved self defense capabilities under a 
benign threat environment to the limited stationing of NATO troops in 
new member states under a resurgent Russian threat. The $125 billion 
represents the high-end cost.
    \51\ Ibid.

                              ----------                              


              Other Studies in the Policy Analysis Series

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284. Fighting Back: Crime, Self-Defense, and the Right to Carry a 
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283. Ten Myths about Financial Derivatives by Thomas F. Siems 
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282. Campaign Finance ``Reform'' Proposals: A First Amendment Analysis 
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281. How the Budget Revolution Was Lost by Stephen Moore (September 2, 
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280. Renewable Energy: Not Cheap, Not ``Green'' by Robert L. Bradley 
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279. The End of Representation: How Congress Stifles Electoral 
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278. The Threat to Independent Education: Public Subsidies and Private 
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277. With Friends Like These: Why Community Radio Does Not Need the 
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276. Should Congress Transfer Federal Lands to the States? by Randal 
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275. Tobacco Medicaid Litigation: Snuffing Out the Rule of Law by 
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274. How Rent Control Drives out Affordable Housing by William Tucker 
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273. Help or Hindrance: Can Foreign Aid Prevent International Crises? 
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272. Emancipating America from the Income Tax: How a National Sales Tax 
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271. Dereliction of Duty: The Constitutional Record of President 
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     Responses of Mr. Slocombe to Questions Asked by Senator Helms
(questions 8 and 11 have classified supplements stored by the committee 
                         on foreign relations.)
    Question 1. NATO is currently engaged in a review of the 1991 
Strategic Concept. I am concerned that this review will de-emphasize 
the role of collective, territorial defense of the alliance in favor of 
operations other than war (e.g., the promotion of democracy, nation-
building, crisis management, and peacekeeping). Will the United States 
government insist that any new strategic concept continue to emphasize 
collective, territorial defense as the centerpiece of military strategy 
in the NATO Alliance?
    Answer. Yes. We have already made the point that the U.S. believes 
that ``Article V'' defense of the territories of allies remains the 
core NATO mission. The Strategic Concept was adopted by NATO in 1991. 
At the July 1997 Madrid Summit, NATO allies agreed to examine the 
Strategic Concept ``to ensure that it is fully consistent with Europe's 
new security situation and challenges''. Since then, NATO has developed 
an agreed Terms of Reference (TOR) document for the conduct of the 
review, which was endorsed by Foreign and Defense Ministers during 
their December 1997 meetings. The TOR confirms NATO's commitment to the 
core function of Article 5 collective defense and the transatlantic 
link.
    Question 2. What are the key differences in force structure for the 
new NATO members (Poland, Hungary and the Czech Republic) that would be 
implied by a Strategic Concept based on territorial defense, versus one 
which is based on planning for operations other than war (OOTW)? Using 
the five categories of equipment limited by the Treaty on Conventional 
Forces in Europe (CFE) as a basis, please provide the Committee with an 
illustrative, side-by-side comparison of the force structures that 
would be possessed by each new NATO member depending upon whether 
emphasis is placed on territorial defense or on OOTW.
    Answer. The current force structure of the three invitees (as per 
CFE limited categories of equipment) is as follows:

                                                                        
------------------------------------------------------------------------
                                                        CZECH           
                                             POLAND   REPUBLIC   HUNGARY
------------------------------------------------------------------------
Tanks:....................................     1,729       952       797
Artillery:................................     1,581       767       840
ACV:......................................     1,442     1,367     1,300
Helicopters:..............................        94        36        59
Aircraft:.................................       384       144       141
------------------------------------------------------------------------
(Figures were reported at annual information exchange, as of 1 January  
  1997.)                                                                

    Poland, Hungary and the Czech Republic are working on improving 
their ability to operate within NATO's integrated military command 
structure. We do not expect that NATO will require the invitees to 
significantly alter their existing force structure for operations other 
than war in particular. As with current allies, NATO military planning 
is centered on collective defense under Article Five, not on operations 
other than war. It therefore would be speculative to try to determine 
for, or compare force structures between, the two types of operations.
    The term Operations Other Than War (OOTW) is defined in Joint 
Publication 1-02, Department of Defense Dictionary of Military and 
Associated Terms, as ``Operations that encompass the use of military 
capabilities across the range of military operations short of war. 
These military actions can be applied to complement any combination of 
the instruments of national power and occur before, during and after 
war. Also called MOOTW.'' Because the scope of MOOTW is so wide and can 
encompass anything from a large-scale humanitarian mission to a small 
contingent contribution to a peace enforcement operation, specific 
information would be required to provide a detailed comparison 
assessment between a territorial defense posture and one based on MOOTW 
criteria. However, we believe that both current and new members' forces 
will remain capable of unilateral defense, while also capable of 
conducting a variety of other operations, including MOOTW.
    Question 3. It has been suggested by some that the Administration 
is urging new NATO members to adopt a rapidly-deployable force 
structure, perhaps at the expense of the force configuration necessary 
for the country's territorial defense. Can you assure the Committee 
that this is not the case?
    Answer. Yes. We have been urging the new NATO members to adopt more 
deployable forces, but this does not come at the expense of territorial 
defense. To the contrary, the keystone units that new NATO members have 
been developing as their elite, most ready and deployable forces, would 
also be critical for contributing to their initial self-defense in the 
case of cross-border aggression. In order to participate in NATO 
contingencies that increasingly require deployable forces, the new 
members must continue their transformation from static defense forces. 
These countries are in the process of determining what portion of their 
forces will need to be deployable, and, in consultation with NATO, how 
rapidly their forces should be available.
    Question 4. I am concerned that NATO's proposal for a stabilized 
area in Central Europe places the indigenous military capabilities of 
the three new NATO members in direct conflict with NATO's capability to 
station forces. The only way a country could make room for stationed 
forces would be to reduce its own national holdings to create 
``headroom'' under the territorial ceilings established in the adapted 
CFE Treaty. While there may be no need for stationing at this time, 
certainly one could envision scenarios where it would become necessary. 
Please explain to the Committee NATO's strategy for defending the three 
new NATO members while at the same time adhering to the constraints 
that would be imposed under a stabilized zone in an adapted CFE Treaty?
    Answer. We recognize the importance of assuring that the CFE Treaty 
is not a constraint to fulfilling US or NATO obligations under the 
Washington Treaty. The proposed NATO stabilized region does indeed 
prevent upward revision of the territorial ceilings from their current 
maximum national level of holdings for the Czech Republic, the Republic 
of Hungary, and the Republic of Poland. Reciprocally, it also imposes 
the same constraint upon the Republic of Belarus, the territory of the 
Ukraine outside the Flank Zone, and the Kaliningrad Oblast of the 
Russian Federation.
    In a 14 March 1997 statement, the North Atlantic Council asserted 
that ``... the Alliance will carry out its collective defense and other 
missions by ensuring the necessary interoperability, integration, and 
capability for reinforcement rather than by additional permanent 
stationing of substantial combat forces.'' This statement succinctly 
describes the strategy of both NATO and the United States for defending 
the three new NATO members.
    A critical objective of the United States in the on-going CFE 
Treaty negotiations is to protect the capability to carry out U.S. and 
NATO responsibilities with regard to defending Alliance members. We 
will also ensure that the provisions for temporary deployment allow 
needed scope for reinforcements and emergencies.
    Question 5. The Joint Chiefs of Staff have determined -- and have 
circulated at NATO -- the minimum amount of equipment deemed necessary 
for deployment, on a temporary basis, of equipment to the new NATO 
members. Please provide the Committee with a detailed analysis of the 
process by which these numbers were reached, including all threat and 
response assessments and contingency planning conducted in connection 
with this determination.
    Answer. No answer was received.
    Question 6. Has the United States and NATO developed contingency 
plans for the defense of new NATO members under various scenarios? What 
forces and operational capabilities would be needed to satisfy the most 
demanding of these scenarios, such as a resurgent Russia or a nuclear 
scenario? We will appreciate your providing to the Committee a 
detailed, classified assessment which identifies possible threats to 
the three new NATO members, from best to worst-case scenarios. Please 
attach to this threat assessment an identification, using CFE Treaty 
equipment categories as a guide, of each force package necessary to 
respond to the given threat.
    Answer. At this time, no contingency plans have been developed by 
the US or NATO to defend the new NATO members. Prior to accession NATO 
will initiate contingency planning for the Article V defense of the 
Invited Countries. Prior to any contingency planning, the NATO Military 
Committee will evaluate the spectrum of threat scenarios and provide 
guidance to planners for contingency planning.
    Question 7. It would appear that NATO intends to fulfill its 
territorial defense commitments to the new NATO members using a 
strategy of rapid deployment, rather than through pre-deployment of 
substantial force enhancements in-country. What prompted this shift in 
policy? What are the advantages and disadvantages of this approach?
    Answer. There has been no ``shift'' in policy. NATO's adoption in 
November 1991 of a new Strategic Concept signaled the Alliance's shift 
away from a forward positional defense to a regional reinforcement 
strategy. NATO took this important step in response to the vast changes 
in the European security environment as a result of the end of the Cold 
War. Most importantly, there was, and currently is, no significant 
threat of large-scale, cross-border aggression, and any such threat 
would take years to develop.
    Question 8. Will the United States' ``nuclear umbrella'' be 
extended to the three new NATO members? Given the Administration's 
pledge not to deploy tactical nuclear weapons on the territories of 
these new members, does this mean that the US intends to satisfy its 
new nuclear guarantees with strategic nuclear weapons? Will other NATO 
members provide an extended deterrence guarantee to the three new NATO 
members? Has there been any discussion within the Administration or 
NATO of withdrawing tactical nuclear weapons from the European theater 
as a means of accommodating Russian concerns? If so, please describe.
    Answer. The guarantees under Article 5 of the North Atlantic Treaty 
pertaining to assistance to any member state which is attacked will be 
extended to the new NATO members upon their accession. With respect to 
the United States' ``nuclear umbrella'', the Administration's 1994 
Nuclear Posture Review reaffirmed that nuclear weapons continue to play 
a critical role in deterring aggression against the United States, its 
overseas forces, its allies, and friends. That review also reaffirmed 
the role of U.S. dual-capable aircraft (DCA) in Europe.
    The NATO Strategic Concept states that the supreme guarantee of the 
security of the Allies is provided by the strategic nuclear forces of 
the Alliance, particularly those of the United States. It also states 
that the Alliance will maintain sub-strategic forces, based in Europe, 
which will provide an essential link with strategic nuclear forces, 
reinforcing the trans-Atlantic link. The U.S. DCA meet that 
requirement.
    The number of US tactical nuclear weapons in Europe has declined 
significantly since the end of the Cold War. However, there has been no 
consideration of withdrawal of the remaining forces, for any reason, 
including ``as a means of accommodating Russian concerns about 
enlargement.'' The Nuclear Posture Review reaffirmed that the United 
States will maintain its current commitment of dual-capable aircraft 
and nuclear weapons dedicated to NATO.
    Question 9. Because Hungary is not territorially contiguous to any 
other NATO member, some are concerned that - in some circumstances - 
Hungary could be denied essential NATO reinforcements during a crisis. 
What specific steps has the Administration taken to conclude a legally-
binding agreement with Austria to allow NATO forces to transit Austrian 
territory in time of crisis? What steps have been taken to conclude 
such an agreement with Slovenia?
    Answer. In the current security environment, NATO should have no 
difficulty in reinforcing Hungary. Both Austria and Slovenia are NATO 
aspirants. Our policy has been and continues to be that the door to 
NATO membership remains open. In the interim, as active participants in 
the Partnership for Peace program, both are fully supportive of NATO 
and could be expected to allow free passage in the event it became 
necessary to send reinforcements to or through Hungary. In the worst-
case scenario that access to NATO was denied, NATO forces could 
reinforce via airlift as we once did in Berlin. In its assessment of 
the military requirements associated with enlargement, SHAPE has 
assumed the presence of a political agreement to permit access to 
Hungary. However, SHAPE has also identified a requirement for an Air 
Port of Debarkation (APOD) to assure access if the worst-case scenario 
were to occur. Any negotiations for NATO access would be undertaken by 
NATO and would not be pursued bilaterally.
    Question 10. Will NATO revise the Strategic Concept in order to 
harmonize the mission of NATO with the level of commitment that members 
are willing to provide in support of the 1991 Strategic Concept? For 
all NATO members, please provide the Committee the Force Goals and 
implementation timelines devised at NATO in support of the 1991 
Strategic Concept (in unclassified form if possible).
    Answer. The Strategic Concept is an over-arching policy statement 
that establishes Alliance missions and requirements, and from which (in 
its force planning process), NATO has derived its new force posture. 
That new force posture has evolved from the Cold War-era's fixed 
border-static defense to one emphasizing strategic mobility and the 
sustainment of deployed forces; deployable C3I (Command and Control, 
Communication and Intelligence) systems for joint operations and air 
warfare; theater missile defense; capabilities to address the risks 
posed by NBC weapons and their means of delivery; and provision of 
combat support and combat service support for multinational reaction 
forces.
    These force goals represent a commitment of military forces and 
capabilities to the Alliance in the future. As such, force goals are 
targets for nations to achieve and do not reflect nation's actual 
contributions in forces and capability. The planning cycle is biennial, 
with force goals projected for a six year planning period into the 
future. Implementation timelines are flexible and are driven by the 
availability of resources of each committed ally. Each fall, NATO 
verifies and reinforces individual Allied force goal commitments and 
assesses the Alliance's overall capability to meet all aspects of its 
Treaty responsibilities. The documents requested are classified by NATO 
and are available to the Committee in that form.
    Question 11. The report on costs of NATO enlargement provided to 
the Congress in February 1997 indicates that existing NATO allies must 
spend $8-10 billion to bring their forces in line with obligations from 
the 1991 Strategic Concept. What countries specifically are failing to 
meet their Force Goal commitments? Please break down this dollar 
requirement by NATO member in approximate distribution.
    Answer. Force goals reflect (and are reflected in) the guidance 
documents, defense requirements, and national defense postures the 
Alliance uses to meet its Article 5 responsibilities. Force goals are 
biennially developed and projected for a six year planning period into 
the future. They represent national commitments of military forces and 
capabilities to NATO in the future. As a result, force goals are 
targets for nations to achieve and do not reflect nations' actual 
contributions in forces and capability. From that standpoint, Alliance 
force goal shortfalls are defined in terms of capability shortfalls, 
not by specific national shortfalls. In addition, force goals can be 
addressed in a variety of ways: ``accepted,'' ``partially accepted,'' 
``under consideration,'' ``not accepted,'' or accepted/partially 
accepted but under an extended timeline. The reasons for not accepting 
a goal include national requirements, financial, political, and even, 
in some instances, a national belief that the goal is not valid. In 
addition, there are instances of a nation not meeting a specific goal 
due to national requirements but offering the capability in some other 
manner.
    Annually, using the Defense Review Process, NATO assesses its 
capability to meet agreed mission requirements in light of a number of 
factors, including the prevailing security situation. The process 
culminates in ``country chapters'' that review each nation's 
contribution to the Alliance. This year, NATO determined that main 
defense forces are generally capable of meeting current mission 
requirements. Concurrently, NATO believes that capability shortfalls 
exist in some combat support and combat service supports areas. These 
shortfalls are identified, and the Alliance is taking steps to rectify 
them through its normal force planning process. But, shortfalls should 
always be taken in the context of overall contribution to the Alliance. 
The attached classified annex is a compendium of the country chapter 
sections addressing national responses to force goals. As such, it 
presents only a part of NATO's exhaustive evaluation of each nation's 
contribution, both positive and negative.

                               __________

        Response of Mr. Eland to Question asked by Senator Biden
    Thank you for your follow-up question, which I am pleased to 
answer. However, I must first state the following: If your question 
asks if my analysis of the costs of NATO enlargement was in any way 
influenced by my views on the continued membership of the United States 
in NATO, the answer is an emphatic ``no.'' Let me explain.
    In my mind, the issue discussed at the October 28, 1997 Foreign 
Relations Committee hearing--my estimates of the cost of NATO 
enlargement--is a separate issue from my policy views on NATO 
enlargement or U.S. membership in NATO. As the principal author of the 
Congressional Budget Office report on the costs of NATO enlargement, I 
could not and did not take a position on NATO enlargement nor on 
continued U.S. membership in the alliance. Both assistance (in costing) 
and supervision were provided by other CBO employees, who were also 
committed to CBO's policies of neutrality and of not making policy 
recommendations. All involved CBO analysts agreed with the resulting 
analysis in the report.
    In fulfilling my role as a CBO analyst, I developed a cost estimate 
that is, if anything, conservative in its projections of the cost of 
enlargement. I talked to military planners--both active and retired--
and developed a detailed list of only the most critical improvements to 
armed forces and infrastructure that were needed for enlargement. The 
Joint Staff told me that my detailed list was a good one. CBO then 
simply estimated the cost of each detailed improvement--usually from 
data provided by the armed services or international organizations and 
added up the total. An example of this conservatism is in weapons 
purchases for new members. The RAND study assumed that, over time, new 
members would replace 50% of their obsolescent Soviet-built equipment 
with new Western equipment, with expenses totaling as much as $30 to 
$40 billion. CBO was more modest in its assumptions, upgrading existing 
Soviet-built systems in the short-term and buying a limited number of 
new Western systems in the long-term. CBO's estimate for such purchases 
was only S19.2 billion.
    The CBO study postulated five options for NATO enlargement ranging 
from more modest security preparations in a lesser threat environment 
to more ambitious defense measures in more severe threat scenarios. In 
contrast, DoD's later cost estimate listed a very specific scenario, 
which did not correspond exactly with any of CBO's options. Thus, the 
two studies were not directly comparable, The Cato analysis merely 
adjusts the CBO estimate to make it comparable to DoD's estimate, It 
uses the same costing factors and methodology in the original CBO 
report. Therefore, my policy views on whether NATO should be enlarged 
or whether the United States should remain in NATO had no impact either 
the CBO estimate or Cato analysis.
    Reasonable people differ about whether NATO is the optimal 
institution for securing and promoting U.S. interests in Europe. It 
should be noted that many prominent defenders of NATO in its current 
form nevertheless vehemently oppose enlargement. I personally believe 
that we should at least consider options other than a ``NATO forever'' 
policy, but that is a separate issue from the Wisdom of proposals to 
enlarge the alliance. It is even more distinct from the issue of how 
much such enlargement will cost.

                               __________

Prepared Statement of Dr. Stephen A. Cambone, Senior Fellow, Political-
    Military Studies Program Center for Strategic and International 
                        Studies, Washington, DC

                           Executive Summary

    The CATO Institute has just released a new study on the cost of 
NATO enlargement. ``The High Cost of NATO Expansion: Clearing the 
Administration's Smokescreen'' is written by CATO's director of defense 
policy studies, Ivan Eland, author of a earlier CBO study on 
enlargement. That CBO study estimated enlargement costs to be as high 
as $125 B.
    The new CATO study sets the cost at $70 billion using what it says 
is a more ``methodologically rigorous and reasonably accurate'' 
estimating process than the one used by the Office of the Secretary of 
Defense (OSD).
    CATO declares the cost of enlargement to be at least twice OSD's 
high estimate of $35 B. CATO's $70 B figure is based on assigning new 
members nearly $34 B in additional costs related specifically to 
enlargement. But these additional charges are not justified by a 
clearly articulated and validated set of requirements based on threat 
analyses, force capabilities and operational plans. It is based on the 
author's view-rejected by current and prospective allies--that NATO 
should have a robust, forward deployed capability to defend the new 
members and that new members themselves should be more robustly armed 
to conduct intense operations for 30 days on the old Cold War model.
    It is not surprising that this study is marred by the same 
assumptions that guided the CBO study since it is done by the same 
author.

                              Introduction

    For more than a year the cost of NATO enlargement has been growing 
as an issue. It began with an estimate provided by the CBO that put the 
cost at anywhere from $60-125 B. This estimate followed one prepared by 
the RAND Corporation that put the total at anywhere between $10-110 B 
though a subsequent article in Survival by the report's authors 
suggested $42 B as a reasonable estimate of costs. Both these estimates 
were followed by a report from the DOD that put the costs at $27-35 B.
    Most observers found the CBO numbers too high. The estimate was 
rooted in an assumption that defense planning should be based more on 
Cold War requirements than those likely to obtain in the coming 
decades. The RAND estimates were not nearly as wide as they appeared at 
first. Taking reasonable assumptions about the effort made by new 
members to improve their national capabilities, the force package NATO 
would need to provide to reinforce those national capabilities and the 
cost of preparing the glue to hold it all together--C3I, 
infrastructure, road, airfields, etc., RAND suggested a price of about 
$42 B. OSD's estimate was greeted initially as being too low. But the 
difference between it and the RAND estimate (apart from a few 
differences in priorities internal to the estimates) can be accounted 
for by the additional cost assumed by RAND in assigning one more ground 
division to the NATO reinforcement package.
    There the matter has sat for about a year. In the interim the GAO 
issued a report suggesting that costs could be higher than OSD (and by 
implication RAND) estimated due to a number of factors that have 
historically, but not universally, affected cost estimates. But the GAO 
also said that the CBO and RAND estimates were ``more reliable'' than 
OSD'S.
    A new round of debate is now likely to be touched off by a report 
released in late October, 1997 by the CATO Institute of Washington, DC. 
Prepared by one of the two analysts responsible for the CBO report, 
Ivan Eland, the CATO report declares that the costs of enlargement will 
be about $70 B and could rise to $167 B. The US share of the cost, 
estimated by OSD at 1.5-2.0 billion over 10 years is estimated by CATO 
to be $7 B over the same time frame.
    The report appears at a time the US Senate is attempting to come to 
grips with costs. This, by itself, would assure attention was given 
CATO's effort. Additional attention is likely to be generated by allied 
countries already worried that the approach to costing by the US--CBO, 
RAND, OSD, GAO and CATO alike--are all to high and likely to reduce 
support for enlargement among their publics. And in Poland, Hungary and 
the Czech Republic CATO's numbers are likely to elicit both concern and 
disdain. The concern is for the affect on public opinion which, while 
it has finally come to accept the additional costs enlargement will 
impose, is hardly ready to absorb the bill CATO would assign to it, 
some $34 B. Governments are likely to be disdainful because they have 
already begun to plan and calculate their own programs on the roughly 
$10-13 B cost estimated by OSD.
    But attention is likely to be focused on CATO's estimates for 
another reason. The libertarian think-tank is noted for its opposition 
to enlargement and, among some of its scholars, the view that the US 
ought to withdraw from the alliance altogether. CATO's attitude toward 
the alliance is evident in its characterization of NATO as ``outmoded'' 
and its worry that it is akin to the pre-WW I alliance system that 
plunged the ``reluctant major powers... into a global war.'' In light 
of the introduction one is put on notice by the author himself to look 
for inflated military requirements and costs as the leading edge of a 
broader argument that the US should reduce, and maybe even end, its 
NATO commitments--whatever they may be. Being apprised of CATO's 
attitude at the beginning of the report--no one can say they do not 
know where it stands on the issues--the reader expects that the author 
has taken pains not only to criticize what has been done by OSD, but to 
be more accurate in his own estimates. In short, despite the provenance 
of the report, indeed precisely because of it, and its potential 
political effect, the reader is led to expect that CATO has held itself 
to a higher standard and for that reason the report should be read with 
care.

                           Categories of Cost

    Three basic categories of cost are being used by all analysts.
    The first relates to the expenditures by the new members to make of 
themselves competent allies. These expenditures fall broadly in two 
subcategories. The first is national expenditures, i.e., those 
associated with providing national defense forces by downsizing and 
modernizing forces acquired during the days of Warsaw Pact. The second 
is expenditures specifically incurred to make those national forces 
``interoperable'' and ``compatible'' with NATO forces. These two 
subcategories can be very difficult to distinguish. What fraction of 
the ground-force improvements made by Poland go in the first, and which 
in the second, category? For some allies, like Germany, the difference 
in the past has been non-existent in practical terms; all of its forces 
were assigned to NATO. Nonetheless, Germany's defense costs were all 
counted as national, and not NATO costs. Judgment is needed in 
apportioning costs among the subcategories. This judgment is 
particularly open to question because it will drive estimates of 
enlargement costs dramatically up or down.
    The second relates to the expenditures made by the current allies 
to assure that they can meet their collective obligation to support the 
new members in case any of them is subject to aggression. This 
reinforcement capability is currently estimated at four ground 
divisions and six air wings. But here again two categories of cost can 
be identified. The first is the changes or additions being made to 
force structures and postures among the current non-US allies (the US 
is exempt on the belief that its forces are structured and postured 
adequately) to enhance their role in strictly national policies. The 
second category is that being done specifically to meet the needs of 
reinforcing the new members. The distinctions here are even less 
obvious than in the case of the new members. Most allies would argue it 
is a distinction with no difference. The French effort to restructure 
its forces, downsize them and develop a rapid reaction corps of 40,000 
professional soldiers is not driven by NATO enlargement. The German 
effort to develop the KRK, its crisis reaction corps, is not animated 
by enlargement but a national decision that Germany should play a 
larger role in NATO and EU security affairs in Europe and around its 
periphery. The UK's restructuring and reposturing was begun long before 
enlargement was mooted and its major procurement programs--C-13OJs, 
APACHE helicopters and new amphibious shipping--set in place before 
enlargement was agreed. The multinational and integrated Eurocorps, 
German/Dutch brigade, Franco-Spanish-Italian naval units, etc., are 
being animated by EU concerns, not NATO enlargement.
    That said, all of the changes in hand will make the forces of NATO 
allies far more compatible and far more capable of meeting NATO's new 
``force projection'' doctrine for both collective defense and ``out of 
area'' operations. Assigning these essentially national commitments to 
NATO enlargement is an American habit strongly resisted by allied 
governments. In their view it inflates the cost of enlargement in ways 
that are both misleading and unnecessary. They might accept the 
penchant of American's to mislead themselves into thinking that they 
can so easily leverage and direct European national programs if it 
weren't the case that the inflated costs unnecessarily drive down 
public support for enlargement among allied publics. Thus, in making an 
estimate it is important Americans distinguish what is integral to 
enlargement and what is tangential. If we are not to count the costs of 
procuring and operating our own military over the last ten years, an 
effort costing hundreds of billions of dollars, then why should we 
count what the allies will spend in the next ten years on their own 
national programs?
    The American answer, of course, is that the Europeans haven't spent 
the money yet and the capability they promise to buy is essential to 
fulfilling the collective defense commitments of the alliance. That is 
fair enough; but both France and German are already embarked on the 
modernizations outlined above. The KRK will begin standing up in 2000. 
The French FAR is about two years behind the KRK. It would seem that 
unlike the 1970s and early 1980s when its was to the advantage of the 
allies to place the costs of European security on the US, today that is 
no longer the case. The nascent EU is being nurtured in part on the 
milk of defense industry spending and the honey of military 
modernization and integration aimed at a common security policy. 
Neither Germany nor France can falter in these efforts lest they cede 
the leadership of the EU's security policy to the other. In this case 
the interests of the US and its allies for a modem, force projection 
capability among the European allies is quite similar, albeit generated 
by very different motives.
    The third category of costs is direct costs, i.e., those imposed on 
all concerned to assure that forces are interoperable and compatible. 
The first refers to different equipment operating effectively together. 
The latter refers to employing equipment that meets the same standards. 
For our purpose it is easier to refer to the two as rendering the 
forces complementary. This latter term introduces the notion that a 
certain amount of ``making do'' is both to be expected and acceptable. 
The US is not buying nor will it operate the forces of new or old NATO 
allies. It, and they, must settle for the friction imposed on 
operations by equipment and procedures generated by the national 
requirements of 16, soon to be 19, countries. That said, there are 
agreed items and actions that need to be procured and funded. These 
direct costs are distributed among the allies themselves as well as a 
common NATO-funded account, the latter itself funded by assessments on 
the members.
    This brief review of cost categories makes it plain that 
considerable discretion is permitted to an analyst in which category a 
given cost is listed and then, within the category, where it 
apportioned. What makes precision in such costing difficult--apart from 
being certain that the requirements for capability are firm, that the 
system-level costs are well known, that economic factors are agreed, 
etc.--is that money is fungible. A zloty, forint or koruna spent on 
radios can be assigned to at least two categories and charged against 
at least four accounts. But the critical point is that the radios are 
bought, distributed, deployed, and employed in exercises and training.
    A second factor making precision difficult is the always vexing 
questions, ``how much is enough?'' Up to a limit more radios are a good 
thing; below a certain limit too few radios is a bad thing. The 
question we are facing in costing NATO enlargement is how many are 
needed between too few and too many when the same money used to buy 
those radios can be used to upgrade artillery systems or to fund 
airfield improvements? Again, one analyst is likely to differ from 
another. In the end it comes to a judgment about priorities in 
capability over time.

                           Comparing Analyses

    Analytic outcomes depend in large measure on the methodologies used 
to chose data inputs and to assess outputs. The CATO study promises ``a 
detailed critique of the administration's assumptions and method of 
estimating the costs...'' and promises a cost estimate that is 
``methodologically rigorous and reasonably accurate.'' With these words 
CATO implies the OSD study was neither rigorous nor accurate. To 
underscore the point, CATO dismisses the OSD estimates by charging the 
result it offered ``resulted from a negotiation between the White House 
and several offices in the Pentagon; it is not a valid estimate based 
on the military requirements of expansion.''
    Evidence for this serious charge is drawn from a Washington Post 
story, not from CATO's own knowledge. But this is beside the point. The 
document produced by OSD was subject to interagency discussion and 
coordination. That is how the work of government is done, irrespective 
of administration, on matters of major policy importance. To charge 
that ``negotiations'' took place as the final document was prepared is 
of significance if, and only if, the charge is that the figures were 
``cooked'' in this process--a charge implied but for which CATO 
provides no evidence.
    That brings us to methodology. CATO charges the OSD analysts used a 
``level-of-effort'' methodology--given what the new members had to 
spend, how much could be bought in the categories of capabilities 
deemed appropriate. The OSD analysts have ``little or no detailed cost 
analysis to back them up,'' charges CATO. In support of this position 
they cite the GAO and statements by three OSD analysts. In place of 
this level of effort analysis CATO implies that we will receive from it 
an estimate that determines ``a list of detailed military improvements 
required for NATO expansion, estimates of the cost of each of the 
improvements individually, that add[s] up [to] the total.''
    On the level-of-effort analysis, this criticism may have some truth 
to it. However, the RAND analysis from which OSD drew the framework of 
its own report was based on actual requirements. OSD's analysis, 
drawing on RAND's work, was based on requirements; the costs were not 
presented on a year-by-year basis but rather as a ``level of effort'' 
or average over the 1997-2009 period. Such an approach is not 
illegitimate. The alliance as a whole and the individual allies are in 
the midst, as suggested earlier, of recasting requirements and 
restructuring forces. The candidate states are in the same position. 
OSD analysts do have a good idea of what it takes for the US, and by 
experience for a number of allies, to make a ground division more 
mobile, to provide an air wing with a bare-base capability for a 
forward deployment, etc. Treating this spending in aggregate--based on 
expectations of allied resources and those of the new members--may not 
yield the fine distinctions that ``counting of eaches,'' a term used by 
the military for exaggerated and often misleading bean-counting, but it 
certainly provides a good ``level-of-effort'' estimate.
    It is doubtful CATO analysts went to the level of ``counting 
eaches,'' either. The accounting systems and methods needed for such an 
approach do not now exist. But the evidence that their approach was not 
so fine is in the sections of the report that deal with estimates of 
cost category by category. In the category of ``training and 
exercises'' for example, we are told OSD analysts admitted to basing 
the estimate on what new members could afford and setting costs at 80% 
of that current members. CATO's conclusion: ``[t]he 2.5 billion to $4.2 
billion estimate... is based on artificially postulated considerations 
of affordability.'' This critique leads us to expect a more rigorous 
treatment of the subject. Instead, CATO leaves us with the following: 
``An estimate based on requirements for specific exercises at a given 
frequency would yield a more realistic cost estimate at the top of the 
range [provided by OSD] ($4.2 billion).'' No more than this is offered.
    The same lack of rigor is evident in the discussion of C3I: ``Thus, 
the DOD's $2 billion to $3 billion estimate for C3I is too low. More 
tactical radios would need to be purchased to give critical flexibility 
on the battlefield. Doing so, however, would double the cost to $6.2 
billion'' No evidence is offered for the conclusion or the price.
    The analysis improves in the discussion of air defense. Here CATO 
makes a substantive argument that the I-HAWK systems OSD proposes for 
the new members ought to be replaced by PATRIOT PAC-2. The reason 
offered, primarily, is that HAWK had a life expectancy of 30 years; in 
2020 it will be 50 and new technology will have passed it by rendering 
``the value of such an old system ... nil.'' Perhaps; but in reaching 
this conclusion (one shared by the RAND analysis) one might have 
expected a discussion of the significance of the I-HAWK upgrades funded 
by BMDO to enhance both their air defense capability and provide.a 
measure of capability against short range ballistic missiles--a 
deficiency CATO calls out as affecting I-HAWK. In addition, one might 
have expected an analysis of the contribution of allied counter-air 
operations to the missions of the alliance. But again, a lack of the 
promised rigor leaves the reader without a basis for deciding whether 
OSD's assumptions or those of CATO are more appropriate--assumptions 
because no requirements are offered by CATO.
    The section on modernizing ground forces returns to high-level 
estimates, but this time coupled to a confused discussion of new 
members' mobility needs. On this latter point we are treated to a long 
discussion of bases, whether 5 or six divisions should be enhanced, 
artillery compatibility, etc. OSD is criticized for assuming that five 
divisions among the new members in aggregate need to be made more 
mobile and that updating of T-55 tanks was not necessary and new tank 
purchases not costed. But we know that the T-55s are being retired as 
the candidates draw down their forces and that upgrades to the T-72s 
are not prohibitively expensive (especially if the Israelis do them) 
and that new tank fleets are not the first order of business in any 
allied army. To be critical of OSD for not costing new tank purchases 
would seem to miss the point of requirements on which CATO's analysis 
is said to be based--that upgraded T-72s are equal to the threats they 
will face. The discussion of artillery compatibility leads no where 
productive and ignores the program the US has underway to buy kits to 
allow its forces to fire ammunition of different caliber. After nearly 
two pages of discussion, CATO concludes that its analysis, with neither 
requirements nor specific programs provided, costs $600 million more 
than OSD's top-end ``level-of-effort'' estimate!
    CATO's discussion of the candidate's need for aircraft upgrades or 
replacement seems more compelling than OSD'S. But the reason is not 
increased rigor of analysis by CATO but the fact that OSD did not treat 
this issue in detail. OSD proposed that only one squadron of 
replacement aircraft would be provided to each new member, an approach 
consistent with OSD's preference that new members not focus on 
rebuilding their air forces. However, given the sorry state of air 
forces in the three countries, and the likelihood that governments will 
want to make a start on refurbishing their fleets, funds are likely to 
be spent on aircraft.
    But even if this is so, in the end CATO cannot account for the 
$11.5 billion price tag it provides in this section. Industry estimates 
for ``fly-away'' costs for early model F-16 A/B aircraft in US storage 
is $1-2 million. An F-16 A/B with a mid-life upgrade of the kind 
currently being done around the world would result in a fly away cost 
of $12 million. A new F-16 C/D would cost $24 million to fly away. The 
mix of possibilities here for replacing about 300 aircraft among the 
candidate is quite broad. But even if we suppose all purchased at $12 
million per aircraft, the total is still only $3.6 billion--$2 billion 
higher than OSD estimated but well short of the CATO estimate. Even if 
we add weapons for the 300 aircraft (and the other weapons CATO 
includes as part of this discussion) it is difficult to understand how 
the remaining $8.0 billion in their estimate is to be made up. CATO 
provides no clue. Moreover, is not obvious that the costs, whatever 
they might be, should be charged exclusively to the enlargement 
account. Aircraft purchases are likely to be pursued on a national 
rather than a NATO basis.
    CATO adds a category of capability OSD did not estimate, i.e., 
naval improvements. After worrying a bit about Russia providing 
landlocked Belarus (!) with submarine support (!), CATO adds $1.1 
billion in cost.
    Port, road and rail improvements are estimated to cost some $2 
billion more than OSD estimated. After asserting that these facilities 
received little maintenance during the Cold War and citing detailed 
reports from the US TRANSCOM and from the World Bank and EBRD for civil 
improvements, CATO then asserts that ``for a crude estimate of the 
military improvements, 10% of the total cost of this list (presumably 
compiled from the above organizations) of enhancements can be used.'' 
What relevance this ``list'' and the costs associated by CATO have to 
the reports coming into OSD from its survey teams now in the field, who 
are reporting that the facilities are not as bad as assumed, is hard to 
know.
    Exercise facilities are another category in which CATO does not 
provide the rigor it promised. After dismissing the OSD estimate--which 
had greater specificity than others according to CATO--CATO's report 
reaches this conclusion: ``It would be prudent to assume that new 
large-scale exercise facilities would need to be built, or at least 
that the cost of needed extensive repairs and modifications to existing 
facilities would approach the cost of new ones. If those assumptions 
are used, the expenses in this category rise to $4.7 billion.'' This is 
at least $4.2 billion more than OSD estimated. This could be a serious 
problem. But we have no idea whether CATO's ``assumptions'' are any 
better than OSD'S. CATO does not review the state of current 
facilities, the improvements being made as a result of PFP training, 
the use by the UK, Belgium and others of facilities in Poland, etc. One 
longs for the rigor promised and in its absence is left to wonder why 
it is not provided?
    Stockpiles of fuel and ammunition is another category where the 
issue of whether to charge costs to nations or enlargement is 
appropriate. CATO faults OSD for costing only the refurbishment of 
existing bunkers adequate to store only 10 days supply. Here CATO 
offers differing assumptions about local fuel supplies and then worries 
a war might last more than 10 days. On the basis of this worry it turns 
to NATO's new doctrine of force projection and implies NATO could not 
put its forces forward fast enough and the new members would have to 
hold out--presumably with only modest help--not for 10 days but for 30. 
This is certainly possible. But more likely is that NATO, currently 
working to a standard that would allow it to project its ARRC 
headquarters for nonarticle 5 operations in 10-14 days, could do better 
under war time conditions--especially if it had any tactical warning, 
leave aside strategic warning, at all. Moreover, NATO air forces are 
the most modern in the world. The Polish plains are a ready-made 
killing ground for all-weather aircraft. But these issues do not enter 
CATO's analysis even though it adds $4-500 million to OSD's estimate.
    The upgrade of airfields comes in next for treatment by CATO. In 
this category we can see most clearly CATO's own concept of what an 
Article 5 operation in the time frame of interest might be in terms of 
threat and response. Both are substantially more robust than allied 
governments foresee. While this does not make the allies right and CATO 
wrong, there remains still the question of whether in a more stressful 
environment CATO's recommendations--and the associated costs--make 
sense.
    After criticizing OSD for a level of effort estimate for forward 
basing of only two of the six air wings designated by NATO to reinforce 
the new members in the event of article 5 operations, CATO argues 
estimates should be used derived from cost data for creating collocated 
operating bases in countries of similar economic development and then 
using the funds to assure that bases for all six reinforcement wings 
are available in each new candidate country. In considering this 
recommendation one looks for evidence that the improvements already in 
hand are accounted for. Take for example the Regional Air Initiative 
(RAI). The RAI will have already created a new air traffic control 
system in the region in the next year or so and gone a long way to 
assuring mutually recognizable IFF systems. Also, preliminary reports 
suggest the airbases are not so bad as some supposed. Other 
recommendations may not be appropriate. For example, the insistence 
that hardened shelters for aircraft ``are a must'' is surely open to 
question.
    Most questionable, however, is the assertion--based on CATO's own 
notion of what an Article 5 contingency would be and how to meet it--
that facilities must be prepared in all three countries to receive all 
six reinforcement wings. It is hard to see where the Czech Republic 
would put them and why it is not acceptable to distribute them among 
Germany, Poland and the Czech Republic when defending Poland. But these 
are smaller points. The main point is that one looks in vain for the 
military logic (other than being close to the front so aircraft ``can 
drop more weapons in less time using less fuel'') and requirements 
about threat characteristics, axes and rates of advance, range of 
adversary air and missile threats, rotational schedules for allied 
aircraft, etc., went into CATO's decision that the ``necessary 
measures'' it says are needed for a cost of $4.3 billion, or at least 
$1 billion more than OSD estimated.
    CATO's Article 5 assumptions are also at the root of its 
differences with OSD on ground reception facilities in new member 
countries. Rather than prepare facilities sufficient for a phased 
deployment of reinforcing units, CATO asserts that facilities for all 
four reinforcing divisions are needed in each country. Otherwise, 
bottlenecks would be created allowing an enemy--who and how they might 
do so unsaid--to destroy incoming forces ``sequentially before they 
could mass for an attack.'' The role of air power (and the additional 
PAC-2 units CATO would purchase) in defending the facilities and 
conducting offensive operations to disrupt and prevent such attacks, 
the availability of aircraft to transport forces, the locus of a 
battle, NATO campaign plans, etc., are all elements of analysis that 
would help the reader to agree with CATO's preference for moving all 
four divisions simultaneously to any country and to accept the 
additional $1 billion cost.
    CATO turns next to improvements to allied forces needed to make 
them more capable of projecting forces to the east. They accept OSD 
``level of effort'' estimate for ground forces, but reject them for the 
air forces. It adds $2-3 billion in cost to provide mobility logistics 
to allied air forces--with no evidence provided either of allied 
estimates of equipment needed or how CATO arrived at its estimates.
    The need to enhance US capabilities does not go without comment, 
with an additional $400 million cited as needed to buy tank 
transporters.
    The last category of interest reviewed is systems for storage and 
transport of fuel and ammunition. Here CATO criticizes OSD--fairly it 
would seem--for not being more realistic in planning for the needs of 
arriving allied forces. But the final estimate of $5 billion is driven 
by the same 30 day war requirement as used earlier. If this is the 
proper number, then evidence should be offered for it. Otherwise, we 
have only CATO's preference.

                        Looking for Bottom Lines

    The CATO analysis presents itself as a detailed cost analysis of 
NATO enlargement. A closer looks leaves the reader uncertain on two 
points: the source and veracity of the costs it purports to add up and 
whether those costs are properly assigned to enlargement.
    With respect to the costs themselves, the reader is rarely 
presented with the cost analysis on which CATO's alternative estimate 
is based. To take the last category, for example, the reader does not 
know what mix of weapons CATO would stockpile and against what 
requirement, by weapon type, drove the mix and the total. Nor is the 
reader given a justification for the 30 day stockpile requirement 
beyond CATO's own assumptions about Article 5 threats and operations. 
To criticize OSD for over-reliance on commercial sources of fuel may be 
reasonable; but that does not validate the conclusion.
    The discussion of upgraded airfields again shows a lack of 
thoughtfulness on CATO's part. The idea that all three new members need 
bases for all of the reinforcing air wings seems false on its face, at 
least as it applies to the Czech Republic. And, while it is true that 
the presence of Slovakia between Hungary and Poland could render 
assistance from one to the other difficult, the reader is curious to 
know what contingency would require all four reinforcement wings and in 
the context of which Slovakia's status would not be clarified? None 
that CATO suggests would seem to require each new member to have a full 
complement of air wings on its territory.
    There are two categories of cost to which this critique of CATO's 
costing does not apply: air defense and aircraft modernization. But in 
each case the alternative CATO cost is derived not from a close 
analysis of military requirements, but broad--dare one say ``level-of-
effort''--analyses. In the case of air defense the I-HAWK is declared 
obsolescent and PATRIOT PAC-2 the preferred alternative. No effort is 
made to examine I-HAWK's BMDO-sponsored upgrades nor the real value of 
PAC-2, which by 2009 will be inferior to the PAC-3 model. No effort is 
to made to evaluate the impact of offensive counter-air operations or 
strategic warning in moving allies' PAC-2 systems forward and the need 
to do so against the technically inferior (vis a vis NATO as a whole) 
air and missile threats that would be present in the contingencies that 
CATO postulates.
    The discussion of aircraft modernization strikes the reader as a 
reasonable concern. But even here the estimate of cost--$10 billion 
more than postulated by OSD--is hard to understand. First, it is mixed 
in with the purchase of anti-tank missiles, which does not help. 
Second, fly-away and life cycle costs are not separated or identified. 
Third, type of aircraft, the character of the modernization, etc., are 
not detailed. But even assuming all of these can be reasonably 
accounted for, we come to the issue with which this review of cost 
estimates began--what fraction of cost is to be charged to 
``enlargement'' and what to ``national'' costs. CATO has decided to 
charge all of the aircraft modernization to NATO enlargement. This 
would seem mistaken if no other reason than that the aircraft CATO 
rightly points out need to be replaced would need replacing without 
NATO enlargement.

                            Coming to Grips

    CATO's analysis does not deliver on its promise. It charges OSD 
with ``level-of-effort'' and ``macro'' analyses and promises to deliver 
``rigorous and reasonably accurate'' estimate based on actual costs. 
The reader is left to trust the authors with respect to the accuracy of 
their estimates; no sources are offered. It is the rigor of the 
analysis, however, that is hard to credit. The much higher costs 
postulated by CATO derive from its own belief about the military 
requirements to dampen the flashpoints it identifies--Hungary in 
conflict with Serbia; Poland affected by Belarus or by Kaliningrad. 
While one can agree that all three may be flashpoints, it is not 
obvious that they are the source of ``regional conflagration'' 
approaching WW I standards that CATO implies. But even if we accept 
that they can be dangerous and vexing, it is not obvious that the force 
structure or posture that CATO recommends is necessary to meet these 
contingencies. If CATO is to be persuasive in its recommendations, the 
reader is going to need a discussion of adversary force capabilities, 
NATO force capabilities, NATO strategy and operational plans, etc.
    CATO is obliged to provide this information as part of its analysis 
for one compelling reason: of the additional $35 billion it estimates 
NATO enlargement will cost, nearly $34 B--for C3I, air defense, air 
force upgrades, port, road, rail facilities, exercise facilities, 
stockpiles of weapons and fuel, airfield upgrades and reception 
facilities--is directly attributable to CATO's unstated assumptions 
about threat, force capabilities, strategy and plans. The CATO report 
carries over many of the same assumptions that marred the original CBO 
report, undoubtedly because the two have the same author. In addition 
to these assumptions, all of it is attributed solely to NATO 
enlargement; none of the additional cost is seen as being home by 
national budgets for national purposes. This does not seem, on its 
face, to be a common sense allocation of cost. So large an increase in 
estimated cost and so stringent an assumption about who pays has to be 
explained and justified. CATO does neither. That there is room for 
improvement in OSD's $27-35 B estimate is undoubtedly true; that those 
improvements will result in the doubling of costs as asserted by CATO 
remains to be proven.
    It is equally true that OSD did not provide adversary force 
capabilities, NATO force capabilities, NATO strategy and operational 
plans, etc. But the burden of proof in this case is on CATO. It is CATO 
that imposes military requirements drawn from its own analyses. It is 
CATO that has based its additional costs on those requirements. It is 
CATO that declared categorically that OSD's costs are ``not a valid 
estimate based on the military requirement of expansion.'' On balance, 
however, CATO does not measure up to the standard it has set for itself 
and its readers. Until CATO can justify the more stressing technical 
threat environment it implies, and then actually puts military 
requirements on the table, presents an evaluation of existing and 
planned allied capability and those of potential adversaries, and 
provides the detailed costs for developing the capabilities they assert 
as necessary for the defense of NATO, its charge against OSD rings 
hollow. One is left to wonder if CATO is not guilty of the charge it 
levels at OSD--that its interest in NATO enlargement (in CATO's case 
its long-standing opposition to NATO and its enlargement) of the 
alliance has colored its judgment.
                               Appendix 5

                      Hearing of October 30, 1997

                                                   October 29, 1997

                               MEMORANDUM

TO:
                          Members, Committee on Foreign Relations

THROUGH:
                          James W. Nance and Edwin K. Hall

FROM:
                          Steve Biegun, Beth Wilson, and Mike Haltzel

SUBJECT:
                          Hearings on NATO-Russia Relations

    On Thursday, October 30, 1997, at 9:30 a.m. and at 2:00 p.m., the 
Committee on Foreign Relations will hold a two-part hearing on the 
NATO-Russia relationship.
    Senator Helms will preside in the morning session and Senator Hagel 
in the afternoon.

                                Overview

    The Foreign Relations Committee has scheduled a series of six 
hearings this fall to examine all elements of NATO enlargement. (One or 
two additional hearings will be scheduled early next year after the 
treaty is formally transmitted to the Senate). Previous hearings have 
examined the strategic rationale for NATO enlargement; the pros and 
cons of NATO enlargement; and the cost, burdensharing, benefits and 
military implications of NATO enlargement. Thursday's hearings will 
examine the NATO-Russia relationship, and next week the Committee will 
hold a final hearing to solicit public views on NATO enlargement.
    This memo, prepared with the assistance of the Congressional 
Research Service, provides an overview of the evolving NATO- Russia 
relationship.

          The Origins of NATO Strategy Toward the Soviet Union

    In 1949, after such events as the Soviet blockade of Berlin, a 
Soviet-backed coup in Czechoslovakia, and Soviet support for Greek 
Communists in the Greek civil war, NATO was formed to provide for the 
collective defense of Western European democracies against the Soviet 
Union. However, the North Atlantic Treaty, under which NATO was 
created, makes no specific reference to the Soviet Union. Article 5 of 
the Treaty states only that if an ``armed attack'' is made against a 
party to the Treaty, each of the other parties will take ``such action 
as it deems necessary, including the use of armed force to restore and 
maintain the security of the North Atlantic area.''
    Throughout the Cold War, the United States deployed significant 
conventional forces in Europe to back up its commitment to defend 
Western Europe from the Soviet threat. However, the Soviet Union had 
even more conventional forces in Europe, and U.S. nuclear superiority 
remained the linchpin of NATO's deterrent. The growth of Soviet nuclear 
capabilities in the 1950s and 1960s led the alliance to adopt the 
doctrine of ``flexible response'' under which NATO would respond to a 
Soviet conventional attack: first with conventional weapons and, if 
necessary, with tactical and theater nuclear weapons and, ultimately, 
with the U.S. strategic nuclear arsenal. Acknowledging the beginnings 
of detente, NATO adopted the ``Harmel doctrine'' in 1967, which called 
for a dual-track policy of continued commitment to collective defense, 
while working to ease tensions with the Soviet Union.

               NATO-Russian Relations after the Cold War

    The collapse of Communist regimes in Central and Eastern Europe in 
1989-1990, and of the Soviet Union in 1991, led NATO to revise its 
fundamental strategic concept to de-emphasize the Soviet threat. NATO 
forces and the U.S. military presence in Europe were dramatically 
reduced and restructured. While collective defense remains NATO's core 
function, NATO has agreed to take on new roles, such as crisis 
management and peacekeeping. NATO also engaged in efforts to promote 
cooperation and partnership with the countries of Central and Eastern 
Europe and the former Soviet Union. The North Atlantic Cooperation 
Council (NACC) was set up in December 1991 to provide a forum for 
consultation and cooperation on a wide range of political and security-
related issues among member states of the Conference (later 
Organization) for Security and Cooperation in Europe. Russia joined the 
NACC after the formal dissolution of the Soviet Union at the end of 
December 1991.
    In January 1994, NATO set up the Partnership for Peace (PfP) 
program. The program was designed to build on the efforts of the NACC 
to establish partnerships between NATO and NACC countries. Russian 
officials initially hailed the PfP concept, mainly because they viewed 
it as an alternative to NATO enlargement. However, Russia put off 
joining the PfP program until June 1994, partly in anger over NATO air 
strikes in Bosnia and partly because some in Russia felt PfP did not 
sufficiently single Russia out as a ``great power.'' The signature of 
Russia's Individual Partnership Program, which sets out specific 
cooperation projects, was delayed until May 1995, due to Russia's 
objections to NATO's enlargement plans. NATO-Russian relations finally 
entered a new stage of semi-cooperation in December 1995, when Russia 
agreed that its troops would serve under U.S. command as part of a 
NATO-led Bosnia implementation force. Russia participates in the Euro-
Atlantic Partnership Council (which has replaced the NACC) and has 
indicated that it will participate more fully in the enhanced PfP 
program.

           Russian Attitudes Toward NATO and NATO Enlargement

     At the end of an August 1993 visit to Warsaw, President Yeltsin 
signed a joint declaration with President Lech Walesa which said that 
Poland's desire to join NATO did ``not run counter to the interests of 
any state, including Russia.'' Soon afterwards, Russian officials 
backtracked on this statement saying that although Poland as a 
sovereign country had a right to join NATO, Russia was concerned that 
NATO enlargement would isolate Russia.
    In September 1993, Yeltsin sent a letter to the leaders of the 
United States, France, Britain and Germany that reportedly stressed 
that any enlargement of NATO must take into consideration Russian 
security concerns. The Russia-NATO relationship was subsequently 
strained for three years by strident Russian opposition to NATO 
enlargement. The tone of the hardening Russian line was set at a time 
when President Yeltsin dismissed most reformers from his government and 
relied increasingly on hardline officials to shape Russian foreign 
policy. In conjunction with this hardline shift were the Russian 
refusal to observe elements of the CFE Treaty, Russian political 
defense of the Bosnian Serbs against NATO efforts to end the war in 
Bosnia, the brutal Russian invasion of Chechnya with tens of thousands 
of civilian casualties, and Russian backed efforts to undermine the 
sovereignty of neighboring states that once constituted the Soviet 
Union.
    Since the shift in 1993, most Russian political leaders have been 
opposed to NATO enlargement. This anti-enlargement consensus permeates 
all government institutions, from President Yeltsin's staff to the 
foreign and defense ministries, to virtually all factions of the 
Russian parliament. Only a handful of democrats, such as former Foreign 
Minister Andrei Kozyrev, criticizes the anti-NATO enlargement consensus 
that has developed in Russia. (The leaders of most countries formerly 
in the Soviet Union openly support NATO enlargement, including Ukraine, 
Georgia, Azerbaijan, as well as the non-Soviet states Lithuania, Latvia 
and Estonia.)
     Opinion polls have shown that many ordinary Russians instinctively 
oppose NATO enlargement, but that the importance of the issue pales in 
significance when compared to the very real challenges of their own 
economic situations. For example, in an April 1997 USIA poll, 69% said 
that they had heard or read ``not very much'' or ``nothing at all'' 
about NATO. (This despite a steady drumbeat of official criticism of 
enlargement in the Russian media). Of the minority who claimed to be 
fairly well- informed about NATO, 62% expressed opposition to 
enlargement, 18% supported enlargement and 20% were unsure.
    Most Russian leaders, with their views shaped largely by Soviet-era 
propaganda, see NATO as a Cold War anachronism whose purpose is to 
defend against a competing bloc (the Warsaw Pact) that no longer 
exists. Many are skeptical that NATO can be reformed to take on new 
functions more relevant to the demands of post-Cold War Europe (such as 
peacekeeping and resolution of ethnic conflicts), let alone serve as 
the centerpiece of European security. Most will admit that an expanded 
NATO is not a military threat to Russia, although those that do think 
so--especially some communists and extreme nationalists--make wild 
statements about NATO's aggressive intentions without any challenge by 
Russian officials who know better. NATO can do very little to assuage 
such baseless, nationalistic concerns aside from the continued 
dissemination of accurate information about the defensive nature of the 
alliance and the stabilizing benefit of enlargement (NATO will operate 
an information office in Moscow for this purpose), and a willingness to 
invite Russia to participate in a dialogue with NATO.
    The broadest concern among the Russian elite is that Russia will be 
isolated by NATO enlargement and that key questions of European 
security will be decided without its participation. Some observers 
believe that NATO enlargement will give a political boost to anti-
Western forces in Russia, because the views of most ordinary Russians 
of NATO remain colored by over 40 years of anti-NATO Soviet propaganda.
    Some Russian leaders have claimed that NATO's commitment to enlarge 
the alliance is a betrayal of an oral commitment by the United States 
during German unification talks in 1990 that NATO would not expand to 
the east of Germany. Those present at the talks in Germany, including 
then-Secretary of State James Baker, then-Soviet Foreign Minister 
Eduard Shevardnadze, and German government officials, deny that such a 
commitment was ever given, although former U.S. Ambassador to Soviet 
Union Russia Jack Matlock has said the United States did give Russia 
such an assurance.
    Although a few pro-Western Russian, non-governmental analysts have 
advocated Russian NATO membership as a way of easing possible Russian 
isolation, Russian government officials and most Russian analysts 
sharply reject such an idea. They would be reluctant to tie themselves 
into an alliance which puts Russian forces under U.S. command in NATO, 
and they believe such a move would ease the way for NATO to admit an 
avalanche of new members, including the Baltic States and Ukraine.

                        NATO-Russia Founding Act

    The failure of Russian efforts from 1994 to 1996 to stop 
enlargement by expressing unyielding opposition and threatening 
countermeasures led Russian officials to alter their tactics. While 
still opposing enlargement, Russia began to seek concessions from NATO 
to ameliorate the potentially negative impact that it believed 
enlargement would cause to Russian interests. In March 1996, Russian 
Foreign Minister Yevgenii Primakov asked for legally-binding guarantees 
that no nuclear weapons, foreign forces, or any NATO military 
infrastructure would be moved onto the territory of new members.
    NATO has resisted any permanent constraints on the military 
capabilities that would lead new members in Central and Eastern Europe 
to be less secure than other members of the alliance (``second class 
membership''). Nonetheless, NATO formally declared on March 14, 1997, 
that ``in the current and foreseeable security environment the alliance 
will carry out its collective defense and other missions by ensuring 
the necessary interoperability, integration, and capability for 
reinforcement rather than by additional permanent stationing of 
substantial combat forces.'' In specific regard to the deployment of 
nuclear weapons, NATO stated on December 10, 1996 that its members have 
``no intention, no plan, and no reason'' to deploy nuclear weapons in 
new member states.
    In September 1996, in order to bridge differences with Russia on 
NATO enlargement, Secretary of State Warren Christopher endorsed the 
concept of a negotiated agreement to create the foundation for 
cooperation between an enlarged NATO and Russia. NATO approved the idea 
in December 1996, and NATO-Russia talks on the proposed document began 
in January 1997. At the Helsinki summit between Presidents Clinton and 
Yeltsin on March 20-21, 1997, President Yeltsin reiterated Russia's 
opposition to enlargement, but dropped Russia's demand for a legally-
binding treaty, settling for a political document signed by the heads 
of state of the NATO countries and Russia.
    NATO and Russia formalized consultative procedures in a document 
called the ``Founding Act on Mutual Relations, Cooperation and Security 
between NATO and the Russian Federation'', which was signed by 
President Yeltsin, President Clinton and the leaders of other NATO 
member states in Paris on May 27, 1997. The Founding Act established a 
``NATO-Russia Permanent Joint Council'' (PJC) to ``provide a mechanism 
for consultations, coordination, and to the maximum extent possible, 
where appropriate, for joint decisions and joint action with respect to 
security issues of common concern.''
    In testimony before the Senate Armed Services Committee, Secretary 
of State Albright said that the PJC is a ``forum for consultation, 
cooperation, and--where possible--joint action. It will not have the 
power to dilute, delay, or block NATO decisions, nor will it supplant 
NATO's North Atlantic Council.'' The document says consultations will 
not extend to internal matters of either NATO, NATO member States or 
Russia. It adds that the Founding Act does not ``provide NATO or 
Russia, in any way, with a right of veto over the actions of the 
other...''. The Permanent Joint Council will meet at the level of 
foreign ministers and defense ministers twice a year and at the level 
of ambassadors monthly. The Council will be chaired jointly by 
representatives of Russia, NATO and a rotating representative of NATO 
member governments. Council working groups and committees may be set up 
to deal with specific issues.
    The Founding Act outlines many areas for possible NATO-Russia 
cooperation. These include conflict prevention; peacekeeping 
operations; Russian participation in the Euro-Atlantic Partnership 
Council and the Partnership for Peace; exchange of information on 
strategy, defense policy, military doctrine and military budgets; arms 
control; nuclear safety; non-proliferation of weapons of mass 
destruction; ``possible cooperation in Theater Missile Defense''; air 
traffic safety; ``possible armaments-related cooperation''; defense 
conversion; civil emergency preparedness and disaster relief; terrorism 
and drug trafficking; and other areas.
    A particularly important section of the Founding Act deals with 
nuclear weapons and conventional weapons deployments in new NATO member 
states. The Founding Act says that NATO member states ``reiterate that 
they have no intention, no plan and no reason to deploy nuclear weapons 
on the territory of new members...and do not foresee any future need to 
do so.'' The document adds that NATO ``has no intention, no plan and no 
reason to establish nuclear weapon storage sites on the territory'' of 
new members or to refurbish old Soviet ones left over from the Warsaw 
Pact.
    On the issue of conventional forces, the Act calls for the 
adaptation of the Conventional Forces in Europe (CFE) Treaty, including 
``a significant lowering'' of treaty limited equipment levels for all 
parties to the Treaty. The Act says that CFE adaptation should also 
``enhance military transparency by extended information exchange and 
verification...'' The Act also says that ``NATO reiterates that in the 
current and foreseeable security environment, the Alliance will carry 
out its collective defense and other missions by ensuring the necessary 
interoperability, integration, and capability for reinforcement rather 
than by additional permanent stationing of substantial combat forces. 
Accordingly it will have to rely on adequate infrastructure 
commensurate with the above tasks. In this context, reinforcement may 
take place, when necessary, in defense against a threat of 
aggression...'', peacekeeping missions, or military exercises. Russia 
pledged to engage in similar restraint in the deployment of its armed 
forces.

                      The Permanent Joint Council

    The first meeting of the Permanent Joint Council was delayed by 
procedural disputes over who should chair Council meetings. After a 
compromise was reached under which the Russian representative, the NATO 
Secretary General and a representative of a NATO member state will 
rotate chairing individual agenda items during each meeting, the first 
meeting of the Permanent Joint Council took place on July 18, 1997. A 
second meeting on September 11 focused on Bosnia. In a performance that 
dashed the hopes of those who hoped that the PJC would usher in an era 
of NATO-Russia cooperation, the Russian ambassador to NATO, Vitaly 
Churkin, used the meeting to criticize NATO for putting pressure on 
hard-line Bosnian Serbs and allegedly exceeding the mandate of the 
NATO-led peacekeeping force.
    The Council held its first ministerial-level meeting in New York on 
September 26, 1997. Russian Foreign Minister Primakov, Secretary of 
State Albright, and the other NATO foreign ministers discussed the 
situation in Bosnia, the PJC work program for the rest of 1997, and had 
an exchange of views on the issue of peacekeeping. The work program 
will include discussions on proliferation of weapons of mass 
destruction, terrorism, defense and military cooperation and 
transparency on military strategy and doctrine. Practical cooperation 
activities will include civil emergency planning, scientific and 
environmental projects and retraining of retired military officers. 
Secretary of State Albright praised the results of the meeting, and 
urged that by the end of the year a Russian military representative to 
NATO be established, as well as liaison missions between Russian and 
NATO military commands, and that NATO should open an information center 
in Moscow. On October 20, Russia named Lieutenant-General Viktor 
Zavarzin as Russia's military representative to NATO.
    Implementation of the Founding Act may ease Russia-NATO tensions 
over enlargement in the short term, but there are several potential 
problems that could impair the effectiveness of the Founding Act in the 
longer term. One is that Russian officials now appear to be trying to 
draw another line against further enlargement to the east. President 
Yeltsin and Foreign Minister Primakov have warned that if the Baltic 
states, or any states of the former Soviet Union are invited to join 
NATO, Russia would re-evaluate its policy of cooperation with the 
alliance. NATO has refused to rule out membership for these or other 
European countries.
    A second potential problem is differing views over the nature of 
the new Russia-NATO relationship as outlined in the Founding Act. In 
the short term, the Founding Act may be useful to Russian leaders 
because it gives them political cover for having been unable to stop 
NATO enlargement. Nonetheless, U.S. and NATO officials have repeatedly 
stressed that Russia will have no veto power over NATO decisions, a 
position that has been publicly contradicted by some Russian government 
officials.

      Adaptation of the Conventional Forces in Europe (CFE) Treaty

    The Founding Act calls for adapting the CFE Treaty to the new 
situation in Europe, including ``a significant lowering'' of treaty 
limited equipment (TLE) levels for all parties to the Treaty. The Act 
also calls for enhanced information exchange and verification 
provisions in the adapted Treaty.
    CFE adaption talks got under way in Vienna in January 1997. In 
February 1997, NATO put forward its adaptation proposal. NATO proposed 
that the outmoded bloc-to-bloc and zonal limits in the Treaty be 
replaced by national limits for each country's forces, as well as 
territorial limits that would include national TLE, plus TLE deployed 
by foreign forces on that country's soil. NATO proposed the 
establishment of a new stabilizing zone, which would include Poland, 
Hungary, the Czech Republic, Slovakia, Russia's Kaliningrad region, 
Belarus and western Ukraine.
    In this stabilizing zone, territorial limits would be set no higher 
than the current entitlement levels for these countries or areas. This 
means that if foreign forces were stationed on the territories of these 
countries, they would have to reduce their own forces to remain under 
the territorial limit. Additional information would be exchanged on the 
stationing of foreign troops in the zone and on foreign troops 
temporarily deployed there for military exercises. There would also be 
special inspection quotas for certain sites in the zone.
    In a March 1997 Russian CFE adaptation proposal, Moscow agreed to 
move to national limits, but also sought limits that would have 
prevented NATO from stationing any foreign TLE on the territory of new 
member states. Russia also proposed overall TLE limits for alliances 
(i.e. NATO).
    On July 23, 1997, the United States, Russia and the other 28 
signatories to the Treaty reached agreement on ``basic elements'' for 
CFE Treaty adaption. These elements included an acknowledgment that the 
bloc-to-bloc structure of the Treaty should be replaced by individual 
TLE limits for each country's forces, and that these country limits 
should not exceed current country allocations. Another element was that 
each country would also have a territorial ceiling that would include 
both its own national limits plus foreign troops stationed on its soil.
    Although the ``Basic Elements Document'' represents significant 
progress, difficult negotiations on the details lie ahead. Many 
observers are nevertheless optimistic about a successful outcome to the 
talks, given that NATO proposals do not significantly constrain 
Russia's already weak conventional forces, while the proposals could 
assuage Russian fears of an aggressive NATO buildup in Central Europe.

                Competing Views on NATO-Russia Relations

    The Clinton Administration hailed the Founding Act as a step toward 
a Russia-NATO partnership. On July 3, 1997, President Clinton said that 
the Founding Act ``would make it crystal-clear that NATO is no longer 
an organization designed to contain Russia; NATO is an organization 
designed to work with all free countries to respect the territorial 
integrity of its members, to protect the security of its members, and 
to work with its members and their allies--Russia, soon to be Ukraine, 
and those in the Partnership for Peace--on common security problems 
like the problem in Bosnia.'' President Clinton has also said that the 
new consultative ties with Russia will give Moscow ``a voice, but not a 
veto'' in NATO decisions.
    Other Administration officials have stressed that the Founding Act 
does not alter NATO's core mission of collective defense. They say the 
Founding Act is an attempt by NATO to engage Russia in a cooperative 
relationship but that NATO will still provide insurance in case of 
negative developments in Russia.
    Administration officials stress that the Act merely restates 
current NATO policy on the deployment of foreign forces on the 
territory of new members, the adaptation of the CFE Treaty to new 
realities in Europe, and on the non-deployment of nuclear weapons on 
the territory of new member states. They assert that the Founding Act 
in no way limits the rights and responsibilities of the new member 
states and that the door to NATO membership remains open for the Baltic 
States and other countries not invited in this round of enlargement.
    During an October 7, 1997 Senate Foreign Relations Committee 
hearing, Secretary of State Albright stressed that NATO will not 
negotiate with Moscow in the PJC over NATO's strategic doctrine, 
strategy, readiness or any other NATO internal matter. She said all 
NATO polices will be established by consensus within the alliance 
before any discussions with Russia in the PJC. She added that, since 
the agenda for the PJC is set by consensus, the United States will 
always be able to prevent the PJC from discussing any issue that it 
does not want to discuss for any reason.
    Several NATO allies, particularly Germany, France, and Italy, were 
initially concerned that enlargement would jeopardize improved 
relations with Russia and inspire a nationalist backlash injurious to 
Western interests. In this view, an angry Russia would cause 
instability and tension in Central Europe. NATO endorsed the Founding 
Act to avoid such a development. In fact, the Founding Act had its 
origins in a French idea for a Russia-NATO charter. European officials 
have stressed (perhaps as much if not more than U.S. officials) the 
need to engage Russia in a cooperative relationship while moving 
forward with enlargement.
    Proponents of the Founding Act see this measure as a definitive 
symbol of NATO's desire to work with, not against Russia. It addresses 
a widely held view--including among potential members of NATO in 
Central Europe--that isolating Russia would undermine European 
security. It establishes a forum for Russia to have a voice in European 
security, and it has allowed Russian leaders who have employed heated 
rhetoric against NATO enlargement to save face as NATO proceeds toward 
that goal.
    Critics of the Founding Act contend that it will allow Russia to 
obstruct NATO decision making. They point out that because difficult 
decisions at NATO are not made by casting votes or using vetoes, but 
rather through a careful process of building consensus, the ``voice but 
not a veto'' construct actually gives the Russian government equal 
footing with members of the alliance on virtually any subject 
considered in the Permanent Joint Council.
    On a separate matter, critics contend that the PJC provides Russia 
with an official status inside NATO in advance of the Central and 
Eastern European states seeking membership. Furthermore, Russia's 
status has been achieved through a political agreement among NATO 
members, while Central European states are required to gain the 
approval of member states through ratification.
    Finally, skeptics assert that while a NATO-Russia dialogue has some 
appeal in the abstract, when held up against the concrete, contemporary 
challenges of European security, the ability to reach a common approach 
between NATO and Russia on issues such as Bosnia will be problematic if 
not impossible.
     In a June 8, 1997 op-ed article in the Washington Post, Henry 
Kissinger said he was ``gravely concerned'' that the Founding Act will 
dilute NATO into a ``U.N.-style system of collective security'' by 
``grafting an elaborate and convoluted machinery for consultations with 
Russia at every level of the alliance.'' Kissinger conceded that the 
Founding Act gives Russia no formal veto over NATO decisions, since if 
the Permanent Joint Council is deadlocked on an issue, the North 
Atlantic Council (NATO's chief policymaking body), in which Russia does 
not sit, could still act.
    Finally, Kissinger warned that the NAC and the Permanent Joint 
Council will tend to merge in practice, because countries will hesitate 
to meet without Russia for fear of damaging ties with Moscow. Kissinger 
urged the Senate in giving its advice and consent to enlargement to 
make clear that nothing should detract from the NAC as NATO's chief 
policymaking body. He added that Congress should adopt a joint 
resolution calling for the countries invited to become new NATO members 
to be admitted to the Permanent Joint Council while the ratification 
process is underway.
                               Appendix 6

                      Hearing of November 5, 1997

                                                   October 21, 1997
The Hon. Jesse Helms
Chairman,
Committee on Foreign Relations,
U.S. Senate

Dear Mr. Chairman,
    We, the Ambassadors of the Czech Republic, Hungary and Poland to 
the US, warmly welcome the initiative of the Committee on Foreign 
Relations of the Senate to hold a series of hearings on the enlargement 
of NATO.
    We view the enlargement of the Alliance as a historic step that 
will extend the zone of stability and security eastward. This is a 
unique opportunity for our countries to rejoin the community of 
democratic nations with whom we share the same values, interests and 
goals. We are convinced that our accession to the Alliance will 
contribute to further projecting stability, freedom and democracy in 
our region.
    As our Foreign Ministers jointly pledged at their meeting with you 
and your fellow Senators on Capitol Hill in September, the Czech 
Republic, Hungary and Poland intend to become full-fledged members of 
the Alliance and are ready and able to assume all obligations, tasks 
and responsibilities, as well as costs resulting from membership. Our 
countries not only want to enjoy the benefits of security guarantees 
provided by the Alliance but are also willing and able to contribute to 
common security. We have all embarked on a comprehensive reform of the 
armed forces with the ultimate objective of achieving the required 
level of compatibility and interoperability. This will enhance our 
capabilities to fully participate in all Alliance missions. To this 
end, our countries have shown firm determination to allocate the 
necessary financial and other resources to both individual and 
collective defense.
    As prospective members of the North Atlantic Alliance, our 
countries are equally committed to good faith efforts to build 
consensus on all issues, and in general to strengthen the cohesion of 
the Alliance.
    Mr. Chairman,
    We, the Ambassadors of the Czech Republic, Hungary and Poland 
firmly believe that under your able leadership the Committee on Foreign 
Relations of the US Senate will play an instrumental role in bringing 
the historic process of NATO enlargement to a successful outcome.
        
        
Alexandr Vondra,

    Ambassador,

  Czech Republic.

                            Gyorgy Banlaki,

                              Ambassador,

                          Republic of Hungary.

                                                  Jerzy Kozminski, 

                                                     Ambassador,   

                                                Republic of Poland.

                               __________

   Supplemental material submitted by Paula Stern, U.S. Committee to 
                      Expand NATO, Washington, DC

                            NATO ENLARGEMENT

                     Security, Prosperity & Freedom

    NATO enlargement has been called ``the most far reaching U.S. 
foreign policy initiative since the end of the Cold War'' for good 
reason. It represents an historic opportunity to expand security, 
peace, prosperity and freedom across Europe in a way that increases 
American security, expands American prosperity, and reinforces American 
freedom.
    Nearly 50 years ago, twelve nations came together with a commitment 
stated clearly in the preamble of the North Atlantic Treaty, to 
``safeguard the freedom, common heritage, and civilization of their 
peoples, founded on the principles of democracy, Robert B. Zoellick 
individual liberty, and the rule of law.'' Those twelve nations grew to 
16 and today, NATO enlargement offers this commitment and its promise 
of security, prosperity and freedom to the nations of Central and 
Eastern Europe.
    NATO membership remains the best guarantee of European peace. NATO 
no longer draws its strength from a common enemy but from a shared 
vision of a secure, prosperous and peaceful future. It is a military 
alliance, but it is and always has been much more, as Vaclav Havel, 
President of the Czech Republic, wrote in the New York Times (May 13, 
1997): ``It must see itself as a guarantor of Euro-American 
civilization and thus as a pillar of global security.''

                                Security

    NATO is a military alliance offering a collective defense against 
military threats. There is a continuing need for this most effective 
military alliance in history. The threats to U.S. security are as real 
as war in the former Yugoslavia, rampant terrorism, and the spread of 
nuclear weapons. In 1989, we were told the Cold War was over. Two years 
later, America was in the Persian Gulf with the largest deployment of 
U.S. troops since 1945.
    NATO enlargement will strengthen NATO's collective defense 
capability by expanding the number of countries willing to work 
together and defend each other for a more stable Europe.
    We are already seeing the contributions that nations such as 
Poland, Hungary, and the Czech Republic can make. They were with us in 
the Gulf War. Their soldiers joined NATO forces in Bosnia. Hungary even 
provided military bases. They are working to expand democratic 
principles and respect for human rights. They are contributing to the 
security and stability of Europe.
    History shows that, when uncertainty and instability prevail, 
conflict follows. NATO enlargement offers increased stability and 
security. And a stronger, broader alliance in NATO makes the threat of 
force more compelling while making it less likely NATO will need to 
actually use that force.

                               Prosperity

    History also has shown that security and prosperity are 
inseparable. American leadership brought the Marshall Plan to help 
rebuild a postwar Europe. NATO, since its founding, has helped secure 
the peace that made prosperity possible. Enlarging NATO can help the 
new democracies in Central and Eastern Europe work toward both security 
and prosperity, expanded trade, increased investment, and economic 
growth.
    The prospect of NATO membership already is giving rise to new 
regional agreements contributing to increased, long term security in 
the region. That security is essential to growing businesses and jobs 
and to sustaining the practices of a market economy. Already, Central 
and Eastern Europe are growing faster than much of the rest of Europe 
as nations move from the economic constraints of communism toward free 
markets.
    Increased stability, increased security and political democracy, 
and free markets will make Central and Eastern Europe an increasingly 
important trading and business partner for American exporters and 
investors. These nations are growing at 4 to 5 percent annually in real 
terms and our exports to the region are increasing by double digit 
rates. State industries are being privatized. Infrastructure is 
improving. Well-educated workers are eager for jobs. Demand is 
increasing from everything from computer chips to home furnishings, 
creating valuable opportunities for American businesses.
    NATO enlargement will help preserve the security central to bring 
prosperity and growth for Europe and the United States. Half a century 
ago, NATO helped bring stability, security and economic growth to 
Western Europe. Today, an enlarged NATO can do the same for Central and 
Eastern Europe, ensuring that the region's strong economic growth is 
sustained and free market democracies are fostered.

                                Freedom

    Twice in this century Americans have crossed an ocean and given 
their lives to defend freedom. Twice in this century, Europe has been 
devastated by world war and then divided by Cold War. America has 
invested heavily: more than a half million lives; more than $13 
trillion. We have received much in return; security, prosperity, peace. 
It is time once again to invest in freedom to preserve that security, 
prosperity and peace.
    NATO enlargement will bring into the alliance nations that share 
our values and our dreams. Their struggle against totalitarianism 
offers an impressive historical example of commitment to independence 
and freedom. Hungarian freedom fighters died heroically in 1956. The 
Prague Ppring in 1968 offered the hope of freedom only to be crushed by 
Soviet tanks. Solidarity in Poland waged a decade-long campaign for 
freedom that found success in the events of 1989. Few countries on 
earth have bled more for their freedom.
    The countries of Central and Eastern Europe should not be punished 
because history left them on the wrong side of the Cold War line 
between freedom and tyranny.

                               __________

                            NATO ENLARGEMENT

                         Key Questions Answered

Q: With the Cold War over, hasn't NATO outlived its purpose? Shouldn't 
        it be disbanded instead of expanded? Why does America still 
        need NATO?
    America still needs NATO because America still needs a Europe that 
is free and democratic, safe and secure. This is not a question of 
idealism or charity. It is a question of self interest. Despite all the 
recent attention given to the Asian market, Europe is still a critical 
economic partner to an American economy increasingly dependent on trade 
and investment abroad. But more than economics are involved here. It is 
the nations of Europe that most share our basic values. It is the 
nations of Europe who have been our most reliable allies in meeting 
challenges to our interest and advancing our common values in the 
world.
    For Europe to play this critical role, it must be secure from 
external attack and at peace within itself. Three times in this 
century--two hot wars and one cold one--America has come to the defense 
of Europe whether threatened by war, racism. or Communism. History has 
taught us that only if the United States stays engaged in the security 
of Europe can the safety and security of the continent be assured.
    NATO is the vehicle for America's continued engagement in the 
security of Europe. But it is also the vehicle by which the Western 
Europeans have organized their own security and have learned to put 
aside the historical rivalries and conflicts among themselves. For half 
a century, NATO has in this way helped to ensure the stability, 
security and economic growth of Western Europe. Today, by expanding 
NATO, it can do the same thing for Central and Eastern Europe, and move 
us closer to the goal of an undivided Europe, democratic, free, safe 
and secure.
Q: Does NATO advance the national interests of the United States? How?
    Since its inception, America has stood for freedom and democracy, 
human rights and the rule of law, individual initiative and market 
economy. It has believed that a world in which these principles are 
broadly accepted is a better world not only for the people of--other 
nations, but also for the people of the United States. No peacetime 
alliance in history has been as successful as NATO in advancing these 
principles. It protected Western Europe as it rebuilt its war-torn 
political and economic systems based on these principles. It can 
provide similar reassurance to Central and Eastern Europe as they 
engage in the same task after the ravages of Communism. By enhancing 
our values in the world, it advances our interests.
    Just the prospect of NATO membership has given Central and Eastern 
Europe greater stability than at any other time in this century. 
Hungary has resolved border disputes and minority issues with both 
Slovakia and Romania. Poland has resolved similar issues with Ukraine 
and Lithuania. Romania has followed a similar course. An expanded NATO 
can contribute to a more stable and secure Europe. In this way, an 
expanded NATO will reduce, not increase, the risk that future American 
men and women in uniform might have to give their lives once again in a 
European conflict.
Q: If we enlarge NATO, don't we risk diluting the military 
        effectiveness and political cohesion of the most effective 
        military alliance in history?
    No. A judiciously-expanded NATO would gain in military 
effectiveness and political cohesion. At present, several NATO members 
have considerable less military capacity than Poland, and a number have 
less combat power than Hungary. The new states from Central and Eastern 
Europe will increase the military capacity of the Alliance. Several of 
them made significant military contributions, in terms of forces, 
support and bases during the Gulf War and again during the Bosnia 
crisis.
    Perhaps as important, however, the infusion of fresh energies and 
commitment from these enthusiastically democratic states will help 
revitalize NATO. These states showed their commitment to freedom 
particularly during the waning days of the Cold War. They understand 
from their history the cost of inadequate national defense. They are 
likely to be among the more sturdy members and contribute to a 
stronger, not weaker, Alliance.
Q: Even if we wanted to enlarge NATO, isn't the cost prohibitive? Who 
        is going to pay the bill?
    The costs directly attributed to expansion are those required to 
make it possible for the forces of the new members to operate with 
those of the Alliance. This requires such things as adopting NATO 
procedures, assuring the forces can communicate with each other, and 
training with NATO forces. These costs are estimated by the Pentagon to 
run about $700 million to $900 million per year, of which the U.S. 
share would be $100 million to $150 million per year. The remaining 
costs attributed to NATO expansion are either costs associated with 
steps that current members should take whether or not NATO expands, or 
costs the new members must assume to upgrade their own forces.
    Some of us forget the ``ground zero'' level of many European 
militaries in the early days of NATO. Germany needed to start from 
scratch in building the Budeswehr, which soon became central to NATO's 
defense. That was at a time of much greater peril to the peace of 
Europe. By contrast, the current security situation is much less 
threatening. This allows the new member states to spread over a decade 
or more the costs of improving their defense forces. These costs are 
much less than the costs the new members would have to incur if they 
were to try to provide for their security outside of the NATO alliance.
    Even if all of these costs were attributed to NATO expansion, the 
total would be modest compared to the benefits. And the potential costs 
of not expanding would be vastly greater. For failing to pay now the 
cost of assuring the stability of Europe may require the United 
States--as it has twice before in this century--to bear again the much 
more painful cost of instability and conflict in Europe.
Q: What countries are we inviting to join NATO? Why?
    Poland, Hungary, and the Czech Republic will almost certainly be 
among the first nations invited to join an enlarged NATO. These nations 
played a critical role in the fight for freedom in Europe and the fall 
of Communism. They have made great progress over the last seven or 
eight years in developing democratic political systems, reformed market 
economies, and the rule of law. They have worked hard to prepare 
themselves through the Partnership for Peace program to become members 
of the Alliance and assume the responsibilities that go with it. They 
have resolved outstanding territorial and ethnic disputes.
    Many of America's European allies and many Americans believe that 
Romania and Slovenia are also ready to join the first round of NATO 
expansion. Others believe that the extraordinary sacrifices of Estonia, 
Latvia, and Lithuania argue for early consideration. How many countries 
are invited in the first round and the timing of the following 
invitations is a question for NATO authorities and the governments of 
the member countries. President Clinton has said that the first 
countries to be invited to join NATO will not be the last. This will 
reassure those not included in the first round that the door to NATO 
has not been closed on them.
Q: Aren't we really buying into a lot of border disputes and ethnic 
        conflicts that ultimately will cost American lives? Are we 
        really going to send U.S. troops to defend Warsaw?
    Poland and the Czech Republic have no internal ethnic conflicts. 
Only Hungary has an ethnic minority outside its immediate neighbors 
(largely in Romania and Slovakia). Just the possibility of NATO 
membership has become a catalyst for new regional agreements designed 
to resolve these and other longstanding ethnic and border tensions. For 
example, the Polish Lithuanian Treaty of 1994, the Hungarian Slovakian 
Treaty of 1996, the 1996 agreements between Poland and Ukraine, the 
1996 treaty between Hungary and Romania, and the 1996 agreement between 
the Czech Republic and Germany.
    By agreeing to the entry of Poland into NATO, the United States 
will be committing itself to send U.S. troops to defend Warsaw--just as 
it has committed itself to send troops to defend Oslo, Athens, or 
Ankara. But the commitment is designed precisely to reduce the risk to 
American lives. For it is the paradox at the heart of deterrence that 
by committing to defend Warsaw--and unambiguously maintaining the 
military capability to do so effectively--NATO in fact reduces the risk 
of the kind of crisis that might require it to make good on that 
commitment.
Q: The Founding Act was negotiated to answer Russian complaints about 
        NATO enlargement. Haven't we simply caved in to the Russians 
        and, in essence, allowed the ``fox'' into the ``chicken coop''?
    The Founding Act, signed May 27, 1997 in Paris, gives Russia an 
important voice and an important role in European security and 
stability. It recognizes that Russia has as much to gain from increased 
European stability, security, and prosperity as any other country. And 
it recognizes that NATO enlargement is not about excluding Russia but 
instead about encouraging democratic reform across a united Europe, 
including Russia. It represents an historic change in the relationship 
between the United States and Russia and between Russia and NATO. It is 
a change that recognizes the positive transition Russia is trying to 
make to democracy and free markets.
    The Founding Act does create a number of forums for consultation 
between NATO and Russia. Some have argued that an obstructionist Russia 
could use such forums to disrupt the Alliance and compromise its 
ability to make decisions and take action to protect the interest of 
its members. But the Administration has said and the Congress can 
confirm that this is not what the Founding Act contemplates or what the 
United States will permit to occur. Rather, the North Atlantic Council 
will remain the supreme body of Alliance decision making, will not be 
subordinated to any other institution or procedure, and Russia's 
``voice but not a veto'' will not diminish the Alliance's right and 
ability to act to defend its members and its interest as it deems 
necessary.
Q: Won't an expanded NATO place Russian democrats at risk and stall 
        progress toward democratic reforms?
    Opinion polls reveal that Russian voters care very little one way 
or the other about NATO expansion. The average Russian is concerned 
about securing a job in a growing economy and about safety and 
security. In the long run, an expanded NATO will further the case of 
Russian democrats by guaranteeing the stability of nations near 
Russia's borders and by encouraging democracy and economic prosperity 
in these states. To give in now to the complaints of Russian extremists 
would only undermine the democratic forces. And NATO enlargement has 
motivated NATO to offer Russia a new partnership that will ultimately 
strengthen the democracies by strengthening Russia's ties to the West.
    As Secretary of State Madeleine Albright told the Senate Armed 
Services Committee (April 23, 1997), ``The people of Russia have a 
chance to achieve the deepest and most genuine integration with the 
West that their nation has ever enjoyed.''
Q: What are the consequences for those countries not invited to join 
        NATO? Isn't this destabilizing?
    The first new members invited to join an enlarged NATO will be just 
that--the first new members. The door will be open to others and the 
prospect of inclusion in a stronger, larger NATO will continue to be a 
catalyst for reform in those states. The inclusion of a first set of 
new members will strengthen the security of those not included by 
bringing NATO closer to their borders.
Q: What the new democracies of Central and Eastern Europe really need 
        are more economic opportunities not military expenses. Why not 
        just work to enlarge the European Union?
    There is a critical link between security and prosperity and no 
reason to believe that the new democracies of Central and Eastern 
Europe will settle for anything less than full membership in all the 
Western associations. Expanding the European Union is important but 
prosperity will not come without the security NATO offers. In addition, 
expanding the European Union will take time as nations must make 
significant changes to their regulatory and legal systems. NATO 
expansion can proceed today. NATO alone can ensure a stable Europe that 
is strongly connected to the United States.

                               __________

               NATO ENLARGEMENT & MILITARY EFFECTIVENESS

    The addition of new NATO members from among the Central and Eastern 
European states who have proven themselves ready for membership will 
strengthen the Alliance. A number of NATO's current members have less 
combat power than Hungary, for example, and Poland represents a 
significant military contribution to NATO. These states showed their 
commitment to freedom particularly during the waning days of the Cold 
War. Several of them have made significant contributions both during 
the Gulf War and in the Bosnia crisis. Because of their history, they 
understand firsthand the cost of inadequate national defense and are 
likely to be among the more sturdy members of the alliance on hard-core 
military issues. On balance they will make a net contribution both to 
the military capability of the Alliance and to its political cohesion.
    Adding these new members will not overextend NATO or leave it with 
defense commitments that are beyond its capabilities. Although the 
defense budgets and military force levels of the United States and the 
rest of the NATO allies have been significantly reduced since the end 
of the Cold War, this simply reflects the fact that the massive Soviet 
military threat that dominated NATO military planning during that 
period no longer exists. The military forces currently available to 
defend NATO and those planned for the future are more than adequate to 
the task of defending an expanded Alliance from current and projected 
threats.
    No additional army divisions, combat air wings, or naval ships 
above current levels are required to defend adequately a NATO that has 
prudently expanded to include appropriate Central and Eastern European 
states. NATO has revised its defense strategy from one of a massive 
``forward defense'' to reliance on smaller, more capable conventional 
forces able to move quickly to the area of conflict or need. For this 
reason, NATO has no military requirement to station permanently 
substantial combat forces or nuclear weapons on the territory of the 
new member states and has said so publicly.
    As a consequence, the cost of NATO enlargement is modest. The costs 
directly attributed to enlargement are those required to make it 
possible for the forces of the new members to operate with those of the 
Alliance. This requires such things as adopting NATO procedures, 
assuring the forces can communicate with each other, and training with 
NATO forces. These costs are estimated by the Pentagon to run about 
$700 million to $900 million per year, of which the U.S. share would be 
$100 million to $150 million per year. The remaining costs often 
attributed to NATO expansion are either costs associated with steps 
that current members should take whether or not NATO expands, or costs 
the new members must assume to upgrade their own forces. But these 
costs can be spread over the next decade or two and the costs to new 
members are much less--than the costs that the new members would have 
to incur if they were to try to provide for their security outside of 
the NATO alliance.
    These costs are more than outweighed by the benefits and there are 
potentially even greater costs if NATO does not expand. Failing to pay 
now the cost of assuring the stability of Europe may require the United 
States--as it has twice before in this century--to bear again the much 
more painful cost of instability and conflict in Europe.

                               __________

                       NATO ENLARGEMENT & RUSSIA

    As the North Atlantic Alliance takes its historic step of 
enlargement, it is simultaneously engaged in a dialogue with Russia to 
ensure a cooperative relationship with Moscow in building a new Europe 
that is undivided, secure, and free. This dialogue has produced a 
series of mutual understandings and reassurances that should ensure, 
for example, that the achievements of arms limitation that marked the 
end of the Cold War will continue. This dialogue culminated the summit-
level signing, in Paris on May 27, of the NATO-Russia ``Founding Act''. 
As President Clinton declared at the signing, NATO ``will work with 
Russia, not against it. And by reducing the rivalry and fear, by 
strengthening peace and cooperation, by facing common threats to the 
security of all democracies, NATO will promote greater stability in all 
of Europe, including Russia''.
    NATO's enlargement cannot threaten Russia. NATO has always been a 
defensive alliance, and it poses no offensive military threat. Nor does 
enlargement aim at anything other than consolidating the stability and 
security of a region whose instability and insecurity have propelled 
all of Europe--and the world into so many cataclysms in this century. 
To foreclose, once and for all, future ambiguities or power vacuums or 
crises over Central and Eastern Europe is a service to wider European 
and global peace. Russia is invited to be a partner in this enterprise, 
in collaboration with the Atlantic Alliance.
    Russia's future relations with the West will depend on the 
statesmanship with which all sides approach future challenges that may 
arise. Opportunities for cooperation will be many--witness Bosnia. The 
future of Russia's democracy rests with Russia's people and leaders; it 
will depend above all on their ability to confront their many internal 
challenges, from corruption to job creation. The Russian people, 
surveys indicate, are not opposed to NATO enlargement; they are focused 
on domestic issues such as jobs, housing, and crime.
    President Clinton has also made clear that the new Permanent Joint 
Council created by the ``Founding Act'' gives Russia a voice but not a 
veto in NATO's own deliberations, which take place in the North 
Atlantic Council. Nor does anything in the ``Founding Act'' or any 
other document diminish the Alliance's right or ability to defend its 
members or its interests as it deems necessary.
    As Secretary of State Madeline Albright told the Senate Armed 
Services Committee on April 23, 1997: ``In this new Europe, the United 
States and Western Europe have a chance to gain new allies and partners 
who can and will contribute to our common security. The people of 
Central Europe have a chance to see the erasure of a Cold War dividing 
line that has cut them off from the European mainstream. The people of 
Russia have a chance to achieve the deepest and most genuine 
integration with the West that their nation has ever enjoyed.''

                               __________

                            NATO ENLARGEMENT

                          The Road From Madrid

July 1997
                                        Invitations extended:
                                        At Madrid Summit, heads of 
                                        Government of NATO
                                        nations invite at least three 
                                        Central European nations
                                        (Poland, Hungary, and the Czech 
                                        Republic) to join
                                        NATO.

July 1997 -
 December 1997
                                        Agreements negotiated:
                                        NATO officials will negotiate 
                                        with each of the nations
                                        invited the terms of their 
                                        admission to NATO in so-called
                                        ascession negotiations.

 December 1997
                                        NATO Ministerial:
                                        NATO Ministers are expected to 
                                        sign an amendment to
                                        the NATO Treaty

1998
                                        Legislatures ratify:
                                        The amendment to the NATO 
                                        Treaty adding new member
                                        nations is sent to the 
                                        legislatures of existing NATO
                                        members for ratification. 
                                        (Other NATO members are
                                        expected to postpone meaningful 
                                        action until the U.S.
                                        Senate takes action. U.S. 
                                        Senate action is hoped for by
                                        mid-1998.)

April 1999
                                        NATO 50th Anniversary
                                        New nations admitted for 
                                        membership

                               __________

                            NATO ENLARGEMENT

                          Speaking of Support

    ``Today, I want to state America's goal: By 1999, NATO's 50th 
anniversary, and 10 years after the fall of the Berlin Wall, the first 
group of countries we invite should be full-fledged members of NATO.''

                                                --President Bill 
                                                Clinton, Detroit, 
                                                Michigan
                                                  October 22, 1996

    ``Let us begin by reaffirming that Europe's security is 
indispensable to the security of the United States, and that American 
leadership is absolutely indispensable to the security of Europe.''

                                                --Bob Dole, 
                                                Philadelphia, PA
                                                  June 5, 1995

    ``Now the new NATO can do for Europe's east what the old NATO did 
for Europe's west: vanquish old hatreds, promote integration, create a 
secure environment for prosperity, and deter violence in the region 
where two world wars and the Cold War began.''

                                                --Secretary of State 
                                                Madeleine Albright, The 
                                                Economist,
                                                  February 15, 1997

    ``...NATO remains a force for stability, as it has been for five 
decades. It keeps America anchored to Europe and Germany peacefully 
anchored to its neighbors. And once you recognize NATO's value, there's 
no justification for excluding those reborn democracies of Central and 
Eastern Europe, which the Soviet Union forcibly cordoned off and which 
now want to resume their rightful places...''

                                                --The Washington Post, 
                                                Editorial ``A NATO-
                                                Russia
                                                  Agreement'', May 15, 
                                                1997

                               __________

                     U.S. COMMITTEE TO EXPAND NATO

    The U.S. Committee to Expand NATO was created by American citizens 
committed to the admission of additional European nations to membership 
in NATO as a way to strengthen democratic institutions and market 
economies in these nations
    The U.S. Committee seeks broad bipartisan political and public 
support for NATO enlargement, ultimately expressed by U.S. Senate 
ratification of the accession of new members to the NATO alliance. The 
Committee believes that such a course will promote the national 
security of the United States and that of its allies by enhancing 
security for all Europeans and by reaffirming U.S. leadership in the 
Atlantic Alliance. The Committee believes that an expanded NATO will 
play a critical role in promoting a Europe that is undivided, 
democratic, and free. The Committee believes that such a Europe win be 
a more secure Europe and one less likely to require American men and 
women in uniform to go in harm's way.
    The U.S. Committee is seeking to help support U.S. lawmakers in 
their consideration of this important issue and to provide substantive 
assistance to U.S. Senators as they prepare for their important role in 
the ratification debate.
    The U.S. Committee to Expand NATO was incorporated on November 1, 
1996 as a Washington, DC nonprofit corporation. It is operating under 
Section 501 (c)(4) of the Internal Revenue Code. It is governed by a 
bipartisan Board of Directors of up to 15 persons who share a common 
commitment to the national security of the United States and to the 
goal of expanding NATO. Its work is supported by a board of Senior 
Advisors, including political leaders, former Secretaries of State and 
Defense, retired senior military officers and prominent business 
leaders.

                               __________

                           BOARD OF DIRECTORS

                               Fact Sheet

Jenne Britell

Former CEO of Homepower, Inc., advisor to various public and private 
organizations and institutions active in Central Europe, and holder of 
senior positions with Republic New York Corporation, Citicorp, and Dime 
Bancorp. A former Trustee of the Teachers Insurance and Annuity 
Association (TIAA-CREF) and the Women's Campaign Fund, currently 
President and General Manager of G.E. Capital Mortgage Services, Inc.

Sheila Burke

Former Chief of Staff to Senate Majority Leader Bob Dole and Deputy 
Staff Director of the Senate Committee on Finance. Currently serves as 
Executive Dean of the John F. Kennedy School of Government, Harvard 
University.

Landon Butler

Former Deputy Assistant to the President in the Carter Administration; 
coordinated the ratification of the Panama Canal Treaty and SALT II 
Treaty ratification efforts and for liaison with organized labor. 
Currently Vice-chairman of Poland Partners, L.P., a venture capital 
fund investing in Poland and President of Landon Butler & Company.

Julie Finley (Treasurer)

Former Co-chairman of the Dole for President National Finance 
Committee. Currently board member and trustee for numerous 
philanthropic organizations and Chairman of the D.C. Republican 
Committee.

Dave Gribbin

Former Assistant Secretary of Defense for Legislative Affairs in the 
Bush Administration and former Chief of Staff for Congressman Dick 
Cheney and for Senator Dan Coats. Currently Vice President for 
Government Relations for The Halliburton Company.

Stephen J. Hadley (Secretary)

Former Assistant Secretary of Defense for International Security Policy 
in the Bush Administration and former member of the National Security 
Council staff in the Ford Administration. Currently a partner in law 
firm of Shea & Gardner.

Bruce Jackson (President)

Former staff officer in the Office of Secretary of Defense (Nuclear 
Forces & Arms Control Policy). Served as co-chairman of the Dole for 
President National Finance Committee and on the Platform Committee of 
1996 Republican National Convention. Currently Director of Strategic 
Planning, Lockheed Martin Corporation.

Sally A. Painter

Former Deputy Director, Office of Business Liaison of the Commerce 
Department in the Clinton Administration. A member of the Board of 
Advisors of the Democratic Leadership Council. Currently Director of 
Government Relations, International for Tenneco Corporation.

Paige Reffe

Former Deputy Assistant to the President and Director of Advance in the 
Clinton Administration and former Chief of Staff to Congressman and 
Senator Tim Wirth. Currently a partner in law firm of Cutler & 
Stanfield.

Peter Rodman

Former Deputy Assistant to and Special Assistant for National Security 
Affairs in the Reagan and Bush Administrations and former Director of 
the State Department Policy Planning Staff. Currently Director of 
National Security Programs at the Nixon Center for Peace and Freedom.

James Rowe

Former Chief Counsel and General Counsel for several House and Senate 
committees, including Chief Counsel for the House Judiciary Committee 
Subcommittee on Crime and Criminal Justice. Former Vice President, 
Washington, for NBC Inc. Currently Vice President for Government, 
Community and Public Affairs for Harvard University.

Paula Stern

Former Commissioner and Chair of the U.S. International Trade 
Commission and Senior Legislative Assistant to Senator Gaylord Nelson. 
Currently President of the Stem Group, an economic analysis and trade 
advisory firm in Washington, D.C.

Gregory F. Treverton

Former Vice Chairman of the National Intelligence Council and former 
member of the National Security Council Staff in the Carter 
Administration. Currently Director of the Center for International 
Security and Defense Policy at RAND.

Robert Zoellick

Former Undersecretary of State and White House Deputy Chief of Staff in 
the Bush Administration and former Counselor to the Secretary of the 
Treasury in the Reagan Administration. Currently serving as the Vice 
President for Housing and Law at Fannie Mae.

                               __________

     Prepared Statement of the Lithuanian-American Community, Inc.
    It is with a deep of sense of history and moral obligation that the 
Lithuanian American Community, Inc. adds its voice in support of NATO 
enlargement and urges the members of the United States Senate to vote 
for the admission of Poland, Hungary and the Czech Republic into the 
North Atlantic Treaty Organization (NATO).
    Distinguished and renowned scholars of foreign policy have already 
addressed this committee over the past few weeks concerning the 
fundamental issues at stake in NATO enlargement. It may seem a harsh 
judgment, but the critics of NATO enlargement seem to us to be driven 
by calculations of short-term gain. However, as recent history has 
demonstrated, long-lasting security and long-term development are best 
achieved by clear, serious, steady and firm investments. Whatever 
short-term gains in reducing defense spending the United States might 
achieve by failing to enlarge NATO would be outweighed by the risks to 
security created by a weak eastern half of Europe never fully 
integrated into transatlantic structures.
    Half a century after WW II and the creation of NATO, the western 
half of Europe still relies on the United States for leadership on key 
issues of security and cooperation. This was amply demonstrated by the 
West Europeans failure (first within a United Nations mandate and later 
among themselves) to stop, let alone resolve, the bloody conflict in 
southeastern Europe which created one of the worst genocides in recent 
history. American leadership was the key element in mobilizing Europe's 
resources, both West and East, and without that leadership the carnage 
would have continued.
    We view the present debate over NATO enlargement as a debate 
concerning American values and American influence. The Russian 
government's attempt to block NATO enlargement is a direct challenge to 
the spread of American influence and the strengthening of American 
values in the eastern half of Europe. There is nothing in the 
historical experience of the nations of Eastern Europe that should 
relegate them to a Russian sphere of influence for time immemorial. The 
colonizing armies of Russia, whether Czarist or Soviet, failed to alter 
the national traditions of these countries. Western beliefs, values and 
customs survived even the totalitarian repressions of Soviet 
imperialism during this last half of the twentieth century. We will see 
a consolidation of democratic institutions and practices in the 
countries of Eastern Europe, if American influence remains in these 
countries.
    American interests are already established in the nations of 
Eastern Europe. Now the question remains as to whether the United 
States government will support the growth of those interests. Our 
members who have financial, professional and personal interests in 
Lithuania are deeply concerned that the Clinton Administration, at 
times, has not shown enough resolve in defending American interests in 
Lithuania. For instance, in a report issued October 28, 1997 by 
President Yeltsin's advisory Council for Foreign and Defense Policy, 
entitled, ``Russia and the Baltics'', the report states that, ``... the 
United States is prepared to allow the restoration of Russian influence 
in the Baltic states...'' If the United States Congress would fail to 
support the enlargement of NATO in this first round, thousands of 
Americans would reconsider their commitments to the area, fearing a 
return of Russian influence over the long term.
    There is a tendency among some critics of NATO enlargement to 
romanticize the development of Russian democracy, forgetting that the 
resources of the Russian state can be harnessed to advance the economic 
interests of Russia which are in large part in the hands of state and 
private monopolies. Russian ideas and values are not attractive to the 
peoples of Eastern Europe, nor do Russian economic interests compete 
effectively in a free trade environment. If NATO fails to expand, we 
will soon see momentum among the economic and political forces in 
Russia urging the reestablishment of Russian military bases in Eastern 
Europe as a way of securing a wider field of opportunity. It is highly 
questionable if American business and professional interests would stay 
to compete in an area where a foreign, non-indigenous, army holds fort.
    Just as Russia has economic interests, it has geostrategic 
interests as a continental power with nuclear weapons. One should not 
underestimate the desire of Russian military planners to regain access 
to strategic assets they have lost over the last decade. In Lithuania 
alone, Soviet forces, inherited by Russia, numbered over 50,000 with 
thousands of battle tanks and the largest strategic bomber base in the 
entire region. The recent offer by President Yeltsin to Lithuania's 
government to grant unilateral security guarantees to Lithuania is but 
the first salvo in a political campaign to regain access to those 
strategic assets, while denying them to NATO and the United States.
    Numerous critics of NATO enlargement have invoked the security 
status of Lithuania, Latvia and Estonia as a reason to prevent NATO 
enlargement arguing that the admission of Poland into NATO will provoke 
a Russian pre-emptive strike against Lithuania. Even accepting the 
sincerity of the critics of NATO enlargement, this seems a curious 
scenario to advance. The Lithuanians, having fully considered the 
risks, have themselves applied for NATO membership and are vigorously 
working to achieve NATO interoperability. Therefore, the short-term 
risk is overstated.
    As Americans who regularly travel to the region, we can assure the 
committee that the presence of NATO forces just across the border from 
Lithuania will enhance the security climate for American business and 
visitors in Lithuania. As the trans-atlantic zone of stability expands 
into Eastern Europe, it will enhance the security of the democracies in 
the region. If the United States remains engaged in Lithuania, helping 
Lithuania achieve NATO interoperability, we have every confidence that 
Lithuania will qualify for the second round of NATO enlargement.
    However, we need a successful first round of NATO enlargement to 
begin the process. The Lithuanian-American Community, Inc. supports the 
admission of Poland into NATO because we understand how deeply the 
Poles are committed to the development of a democratic, peaceful and 
prosperous Europe. We are pleased to give testimony to this commitment 
because we remember very well the risks taken by Poles a few short 
years ago to come to the assistance of Lithuania's fledgling democracy.
    In January, 1991 when Lithuania's democratically-elected parliament 
was threatened with imminent attack by paratroopers of the Soviet Union 
and dozens of Soviet battle tanks, a delegation of eight members of the 
Polish parliament crossed the heavily patrolled border to come to the 
assistance of Lithuania. They reached Vilnius and stayed inside the 
parliament building with Lithuania's parliament members from January 
13-17 until the immediate danger of attack had passed. Unlike the 
American President, these Polish parliamentarians did not question the 
necessity of taking risks in the defense of liberty and democracy. 
Their names will long be remembered in the annals of East European 
democracy: Adam Michnik, now the editor-in-chief of Gazeta Wyborcza, 
the current Marshall of the Polish parliament Alicija Grzeskowiak, 
Andrzej Selinski, Krzysztof Dowgela, Jacek Kuron, Jan Litynski, 
Zbigniew Janaw, Boltromiej Kolodziej, and Antoni Tokarszuk.
    Much like America's revolutionaries of the 18th century, the 
democratic leaders of Eastern Europe have understood the necessity of 
working together to ensure the success of democracy and freedom in an 
area too long dominated by the forces of dictatorship and imperialism. 
The words of Benjamin Franklin at the signing of the Declaration of 
Independence, ``We must all hang together or assuredly, we shall all 
hang separately.'' aptly describes the relationships forged over the 
last decade of struggle in the region; although the Poles might rightly 
invoke their eloquent battle cry of the 19th century, ``For your 
freedom and ours''. The question now faced by Americans and America's 
political leaders is whether we will remember our own commitment to 
democracy and liberty? Can we be reliable allies to the democrats of 
Eastern Europe?
    If the United States Senate fails to ratify NATO admission for 
Poland, Hungary and the Czech Republic over the coming months, the 
democracies of Eastern Europe, including Lithuania, will continue their 
everyday struggle to secure their future. All of them have armies with 
fine young soldiers committed to defending their homes and their loved 
ones. They will continue trying to build a zone of stability where free 
markets can prosper and the full talents of their people can be 
developed.
    Lithuania and Poland have established joint institutions at the 
presidential, ministerial and parliamentary level to enhance their 
bilateral cooperation and geostrategic partnership. This is a serious 
effort to achieve regional cooperation which still respects the 
sovereignty of the people, unlike the commonwealth model promoted by 
Russia in its relations with neighboring states. There is an intensive 
working relationship between Lithuania and Poland in military affairs. 
Poland has been generous in providing Lithuania's armed forces with 
critical equipment: armored personnel carriers, light weapons and 
ammunition, as well as five MI-2 helicopters. In January, 1997 the two 
countries signed an agreement to create a Joint Peacekeeping Battalion 
(LITPOLBAT) which will be fully trained and equipped by December 1998. 
The battalion will be based in Orzysz, Poland and the battalion will be 
commanded first by a Lithuanian, followed by a Polish officer assigned 
in a yearly rotation.
    The countries of Eastern Europe have a long and rich history. There 
has been as much cooperation as there has been conflict in the region. 
Lithuania enjoys a positive relationship with both the Hungarians and 
the Czechs which stretches back to the XIV and XV centuries. At the 
Battle of Tannenberg in 1410, Czech forces fighting with Lithuanians 
under the command of Lithuania's Grand Duke Vytautas helped crush the 
Order of the Cross, the germanic knights, who had been plundering and 
subjugating the nations of the region. That battle also involved Polish 
forces commanded by the King of Poland, an ethnic Lithuanian. In that 
same century, Lithuanian students were attending the University of 
Prague which was one of the few universities in Central Europe. In the 
XVI century, the Hungarian Stephen Bator was elected the King of Poland 
and the Grand Duke of Lithuania. In 1579 he signed the charter 
establishing the University of Vilnius which continues today as a major 
center of learning in Eastern Europe.
    Today the cooperation between Lithuania, Hungary and the Czech 
Republic is substantive and multifaceted. Hungary was the first of the 
former Warsaw bloc countries to reestablish diplomatic relations with 
Lithuania. In the interwar period Czechoslovakia maintained both a 
legation and a consulate in Lithuania, and today maintains an embassy 
in Vilnius which serves Czech interests in the wider region. The Czech 
Defense Ministry has provided Lithuania armed forces with technical 
equipment for both the army and air force. Lithuanian officers are 
attending the Czech military academy at Brno. Shortly, when Lithuania 
and Hungary sign their negotiated agreement, Lithuania will become a 
member of the Central European Free Trade Association (CEFTA). Although 
Lithuania currently has a sizeable trade deficit with both Hungary and 
the Czech Republic, entry into the CEFTA will aid the development of 
Lithuania's industrial sector and lead to a more balanced trading 
relationship. During this past summer's floods, Lithuania provided 
financial, material and human resources to Poland, Hungary and the 
Czech Republic to alleviate some of the hardship inflicted by the flood 
waters and to help rebuild the towns and villages.
    The democracies of the eastern half of Europe are building an 
integrated network of prosperous and just societies. They seek to 
contribute to the solution of humanity's problems, not create new ones. 
The people of those democracies know full well the costs of freedom and 
are prepared to make further sacrifices so their children will live in 
freedom as well. That is precisely why they have applied for NATO 
membership.
    In the euphoria of 1992 as the Soviet Union and its Warsaw bloc 
dissolved, there was great optimism for the future of all of the 
countries stretching from the Baltic to the Black Seas. Today, a number 
of those states have growing dictatorships such as in Belarus and are 
lost to this family of new democracies. Looking back, who can pinpoint 
the exact date that Belarus was lost to us? Or was it incremental; an 
accumulation of missteps and missed opportunities? Without the 
successful enlargement of NATO, we risk, over time and inattention, the 
loss of more of these states. We therefore, urge the members of the 
United States Senate to remember our American values and to vote for 
the ratification of the admission of Poland, Hungary and the Czech 
Republic in this first round of NATO enlargement.

    The Lithuanian-American Community, Inc. is a non-profit, community-
based organization providing educational, cultural, and social services 
to our membership in 67 local chapters in 28 states and the District of 
Columbia. Serving the interests of over one million Americans of 
Lithuanian heritage, LAC, Inc. is in the forefront of supporting the 
growth of democratic institutions and economic reform in Lithuania.
 Prepared Statement of Mr. Armand Scala, President of the Congress of 
                           Romanian Americans
    I am the President of the Congress of Romanian Americans. Romanian 
Americans, approximately 1 million people in the U.S., join with some 
22 million other Americans, whose origins are in Central and Eastern 
Europe, to ask you, and your other colleagues in the Senate, to 
overwhelmingly ratify the expansion of NATO, beginning with an 
invitation to Poland, Hungary and the Czech Republic.
    Since 1949, the NATO Alliance not only helped to protect its 
members from outside aggression, but brought peace and stability within 
its membership. Expansion now, and further expansion in the future, 
will accomplish the same end for the nations and people of Central and 
Eastern Europe. This furthers the interests of the United States and 
the American people.
    Some say there is no longer a threat in, or to, that part of the 
world. That notion is wrong. On a daily basis, some nations' leaders 
threaten the principles held high by NATO member nations and directly 
threaten specific NATO member nations. The current NATO members, 
Poland, Hungary, the Czech Republic and other prospective NATO members 
have much in common with one another. Many of the remaining of the 
world's nations do not share the values and heritage which characterize 
the Europeans and the Americans. As Americans, we are fearful of the 
result of extreme differences in values and heritage that may threaten 
the future of our democracy, freedom and economic system. A strong, 
fully developed, expanded NATO, to include all of those who wish to 
participate, is the greatest deterrent to threats from the outside and 
within NATO as well.
    NATO's continuance is the most effective means for the U.S. to 
maintain influence in Europe.
    The expansion of NATO in stages is an excellent method to develop 
and control an effective process. It sets attainable goals and 
minimizes errors. Building on favorable experiences, the next stage and 
the subsequent stages of expansion will proceed smoothly.
    The cost of NATO expansion is a small price to pay if one considers 
how much we have spent in funding the ``cold war''. It is the ``balance 
due'' in an effort to obtain security and stability in Europe. We are 
talking about approximately $150 million a year as the U.S. portion of 
this project, a relatively small price to pay to insure, for our 
children and grandchildren, the cherished conditions of life in the 
U.S. today. The cost of NATO expansion is more reasonable today than it 
will be at any other time.
    Historically the U.S. and its people, have withdrawn from 
international responsibility. We became isolationists following both of 
the World Wars and, on each occasion, we paid dearly for our non-
involvement with the lives of courageous, peace-loving Americans and 
monetarily as well. We fear that failure to expand NATO, or closing 
NATO down, will repeat the past with the same or similar results.
    An expanded NATO will result in economic growth and stability for 
its new members who currently hold the U.S. and its products in high 
regard. New members have excellent market potential for the U.S. and 
its members quite well. It is the perfect vehicle to continue that 
function. To continue effectively however, it must expand to include 
other nations with characteristics and goals consistent with ours. As 
their development is facilitated, a unified, powerful alliance will 
emerge, able to protect the interests and values of each individual 
country and of the allies as a whole.
    NATO provides the U.S. with a strategic presence in Europe. A non-
expanded NATO will wither to non-existence and our presence and 
influence in Europe will diminish.
    In summary, Poland, Hungary and the Czech Republic should be 
invited to join NATO in the expansion followed, in phases, by other 
European nations. Ultimately all of the nations of Europe which desire 
membership should be phased in, including Russia.

                               __________

            Prepared Statement of the U.S.-Baltic Foundation
    Thank you for your support of Estonia, Latvia and Lithuania and for 
the opportunity to express our own support for a vigorous and continued 
process of the enlargement of NATO.
    The U.S.-Baltic Foundation. (USBF) is a national grassroots 
organization of Americans and American institutions which are dedicated 
to assisting the development of market democracies in the Baltics. 
Since 1990--before the Baltics regained independence--USBF's extensive 
network of professional associations, corporations, universities, 
foundations and individuals has designed and conducted programs that 
build civil society and an understanding of American values. Our 
programs have focused, on local democracy and public administration, 
independent media, NGO development, ethics in government, rule of law 
and anti-corruption.
    This may be the first statement you consider which begins with a 
reference to local self government and public administration programs 
in the Baltics. The Baltic leaders that USBF's programs arc training to 
manage open, democratic institutions, will be the US's partners in the 
discussion and development of NATO enlargement policy. USBF's democracy 
building programs are helping the Baltic people use American resources 
to construct free markets and a civil society--which are fundamental 
components of the enlargement process we see today. Without the basic 
building blocks of a democratic society existing in Central Europe 
today, we would not be able to discuss NATO enlargement and we would 
not be discussing the end of U.S. foreign assistance to Central Europe, 
starting with the graduation of Estonia and the Czech republic last 
year.
    While we see the need for continued transition assistance 
throughout the region, we believe that this should become a privatized 
effort, modeled on, and guided by the regional experience and 
demonstrated private commitment of the members of the U.S. Baltic 
Foundation's network.
    In the seven years since we accepted the challenge of engaging 
Americans--sometimes one at a time through academic exchanges, other 
times to a broader sponsored by America's largest corporate investors 
in the Baltics--USBF has grown tremendously. Today, this group which 
was started by a small group of Americans with private contributions, 
has offices in Tallinn, Riga, Vilnius and Washington and has launched 
seven local training institutions with our Baltic partners. In 1995, 
after successfully managing local democracy and independent media 
programs, USBF was selected to manage the $2.6 million U.S. Agency for 
International Development funded Democracy Network program which is 
strengthening the NGO sectors.
    The Foundation's programs have attracted many of the best and most 
qualified U.S. professionals to voluntarily transfer their skills and 
understanding to their Baltic counterparts. This is reflected in our 
highly diverse Board of Directors, funding sources and in-kind 
contributors. These programs are true U.S. partnerships with Baltic 
leaders, citizens, and non-governmental organizations. We have worked 
with tens of thousands of Americans throughout the United States from 
North Carolina to Oregon who are experts in municipal management, media 
relations, municipal finance, environmental protection, economic 
development, and many other areas that challenge local leaders. Our 
program is unique since it taps into the rich experiences of Americans 
in their own fields of study and work, We believe this American 
contribution is at the heart of any successful assistance program.
    Through USBF's seven years of program management and diligent 
oversight and discussions with participants in our programs, we have 
reason for our Baltic optimism. The Baltic people continue to 
demonstrate the courage, intelligence and competence--which they 
displayed during fifty years of Soviet occupation--which make them 
viable and competitive as partners to NATO. Estonia, Latvia and 
Lithuania each have much to contribute to our security as well. Each 
country in it's own way has adopted and begun to embrace Western and 
American ideas and values and each will certainly continue on this 
course, which will lead eventually to greater security in the region, 
if the West continues to support and encourage the right steps. USBF's 
experience has given us a unique perspective on the readiness and 
abilities of the peoples of the Baltic nations to contribute to Western 
security.
    We appreciate the opportunity to express USBF's support and hope 
that your considerations of the aspirations of the Baltic nations to 
join NATO begin, but not end, with this hearing, We would like to 
conclude by inviting you to learn more about the people and potential 
of the Baltics by viewing the upcoming nation-wide broadcast premiere 
of the PBS television documentary ``One World: The Baltic States,'' 
narrated by Charles Osgood and produced by the award-winning public 
television company Cronkite Ward/Ward TV with assistance of the U.S.-
Baltic Foundation.
             Veterans of Foreign Wars of the United States,
                                                  November 4, 1997.
Hon. Jesse A. Helms,
Chairman,
Committee on Foreign Relations,
United States Senate,
Washington, DC 20510

Dear Mr. Chairman:  The Veterans of Foreign Wars of the United States 
strongly supports the enlargement of the North Atlantic Treaty 
Organization (NATO) to include the countries of Poland, Hungary, and 
the Czech Republic. In the midst of the rapidly changing political 
situation in Eastern Europe, NATO has remained a stable, steadying 
influence in the region. These countries now seek the benefit and 
security of joining the most successful defense alliance in history.
    While NATO's enlargement would extend the U.S. nuclear umbrella as 
well as a commitment of U.S. forces to defend these countries, we 
believe that a carefully paced, non-threatening enlargement of the NATO 
alliance will enhance the peace and stability in Europe. As economic 
stability and growth bolster our NATO allies in Europe and as Eastern 
European countries clamor for membership in NATO, we recognize that 
some are concerned that enlarging NATO might cause Russia and some of 
the states of the former Soviet Union to form an opposing alliance. 
While we acknowledge the risk of the possible formation of a counter-
alliance, we firmly believe the political and strategic benefits that 
are likely to accrue by expanding NATO and bringing security and 
stability to this troubled region outweigh such risk.
    There are several reasons why we believe NATO enlargement 
contributes not only to the security of the United States, but that of 
our allies and friends.
    First, such expansion makes NATO a stronger alliance, better able 
to address Europe's security challenges in the future. The addition 
of,these three countries to NATO strengthens the alliance by 
integrating their existing military establishments and infrastructure 
with those of the current NATO members. Strengthening NATO now insures 
against any threat which might arise in the future.
    Second, the NATO enlargement will encourage the continued 
democratic reforms and economic development in these countries by 
providing a positive atmosphere for growth and a more secure 
environment in the European community.
    Third, this enlargement encourages both current and perspective 
members to resolve their differences peacefully.
    Fourth, enlarging NATO erases the artificial dividing line which 
was created after the end of World War II. It provides hope and promise 
for the future of those Eastern European countries which were smothered 
under fifty years of communist rule.
    In support of the VFW position, I have attached a copy of the 
Veterans of Foreign Wars of the United States Resolution Number 426 
entitled ``NATO Enlargement'' for your reference. This resolution was 
approved by our organization's membership (2 million members) at our 
98th National Convention which was held in Salt lake City, Utah, from 
August 16-21, 1997.
    In order to project a peaceful image, the VFW urges consideration 
be given to the adoption of a declared policy that U.S. forces and 
weapons will not be stationed, based or deployed (except for training) 
in the countries of Poland, Hungary and the Czech Republic.
    In conclusion, the Veterans of Foreign Wars of the United States 
supports the enlargement of the NATO alliance and the extension of the 
United States mutual defense commitment to the countries of Poland, 
Hungary, and the Czech Republic as it is important to our national 
security and the security of the European region. We urge your support 
and the support of your colleagues for timely consideration.

      Respectfully,
                                      John E. Moon,
                                        Commander-in-Chief.

                           Resolution No. 426

                            NATO ENLARGEMENT

WHEREAS, in the midst of the rapidly changing political situation in 
Eastern Europe, the North Atlantic Treaty Organization (NATO) has 
remained a stable, steadying influence in the region; and

WHEREAS, the former Warsaw Pact countries of Poland, Hungary and the 
Czech Republic have thrown off the yoke of communism and reestablished 
democratic governments and now seek the benefit of joining the most 
successful defense alliance in history; and

WHEREAS, NATO's enlargement to include these countries would extend the 
U.S. nuclear umbrella as well as a commitment of U.S. forces to defend 
these countries; and

WHEREAS, there are some concerns that enlarging NATO might cause Russia 
and the other states of the former Soviet Union to form an opposing 
alliance and place additional financial burdens on the United States; 
and

WHEREAS, these concerns overlook the political and strategic benefits 
that would accrue by bringing security and stability to this troubled 
region and would act as an inducement for democracy for Russia and the 
other countries of the former Soviet Union; now, therefore

BE IT RESOLVED, by the Veterans of Foreign Wars of the United States, 
that we support the enlargement of the NATO Alliance and the extension 
of the United States mutual defense commitment to the countries of 
Poland, Hungary and the Czech Republic as it is important to the 
security of that region, our own vital interests in the region as well 
as world peace; and

BE IT FURTHER RESOLVED, that this enlargement be accomplished in a non- 
threatening manner so as not to force other countries into an opposing 
alliance and that in order to project a peaceful image we urge 
consideration be given to adoption of a declared policy that U.S. 
forces and weapons will not be stationed, based or deployed (except for 
training) in the countries of Poland, Hungary and the Czech Republic.

Adopted by the 98th National Convention of the Veterans of Foreign Wars 
of the United States held in Salt Lake City, Utah, August 16-21, 1997.

                           Resolution No. 426