Mr. Chairman, Senator Warner, members of the Committee. I appreciate the opportunity to discuss with you the future of NATO.

As happens from time to time, especially since the West's victory in the Cold War, questions arise about NATO's relevance. Such questions are useful. We shouldn't take large institutions for granted. It is salutary to review the Alliance's rationale and examine its institutions.

Today, we perform this review in light of the lessons of September 11th: lessons about key vulnerabilities of our country despite our conventional military power; lessons about new types of threats; lessons about the global nature of our military responsibilities; lessons about surprise, unpredictability and the necessity for the U.S. military to be adaptable and flexible; and, lessons about the value of our community of allies and friends around the world.

In his statement to NATO defense ministers last June, Secretary Rumsfeld listed terrorism first among the types of new threats facing the Alliance. The others he mentioned were cyber-attack, high-tech conventional weapons; and ballistic and cruise missiles armed with weapons of mass destruction. Three months later, on September 11th, the first of these anticipated threats materialized with awful impact in New York and Washington.

NATO and our NATO Allies responded to the September 11 attack quickly, loyally and usefully. NATO showed it can adapt and respond to unforeseen challenges.

Less than 24 hours after the terrorists' attack against America, our NATO Allies invoked, for the first time in history, Article 5 -- the collective defense provision of the 1949 NATO Treaty. Soon thereafter, NATO took a series of steps to assist us in the war against terrorism. For example, seven NATO Airborne Warning and Control System (AWACS) aircraft are now patrolling U.S. skies, relieving us of a significant burden and freeing up the U.S. AWACS fleet for important work abroad. Individual NATO Allies and Partners are contributing to the war effort and to the post-Taliban reconstruction and security effort in Afghanistan. Some of the Allies' contributions have come through formal Alliance structures and some outside those structures. All those contributions, however, should be appreciated as the fruit of more than 50 years of joint planning, training and operations within the NATO Alliance.

NATO's core mission remains, as it should, the collective defense of its members, as stated in Article 5. But NATO will continue to adapt to deal with new threats and to capitalize on its strengths in the current era. The Prague Summit - NATO's first in the new millennium -- is scheduled for November of this year. At that Summit, the United States hopes to accelerate NATO's transformation, stressing three themes: new members, new capabilities, and new relationships.

Enlargement

President Bush has reaffirmed the U.S. aspiration to promote a Europe "whole and free." In Warsaw last June, he declared: "I believe in NATO membership for all of Europe's democracies that seek it and are ready to share the responsibility that NATO brings ... As we plan the Prague Summit, we should not calculate how little we can get away with, but how much we can do to advance the cause of freedom."

Mr. Chairman, we recognize that enlargement of the Alliance is not an exercise free of risks and difficult judgments. People of experience and wisdom warn of the dangers of making the Alliance excessively unwieldy. They do not want the Alliance to dilute its military capabilities through expansion and they are concerned about NATO's relations with important neighbors. They want to ensure that any enlargement will strengthen NATO's ability to perform its essential defense mission. They want to ensure that the commitment of new members to the Alliance's principles and work will be enduring and fulfillable.

These are prudent cautionary considerations and they are informing the Administration's enlargement strategy. We think NATO can enlarge -- indeed should -- in ways that will serve the national security interests of the United States and our current Allies. A Europe united on the basis of democratic principles, the rule of law, respect for individual rights and the other tenets of the Alliance will be better able to resist and defeat terrorist threats and other threats. The U.S. government believes that an enlarged Alliance that conducts joint defense and operational planning, promotes interoperability, and encourages realistic training exercises will be a more effective partner in answering global security challenges.

The aspirant countries have made impressive contributions to NATO-led operations in Bosnia and Kosovo. In 2001, seven of the nine NATO aspirants made force contributions to NATO operations in Kosovo and eight of the nine to NATO operations in Bosnia: They have also shown much-appreciated solidarity with the United States-through their contributions to Operation Enduring Freedom. They have conducted themselves as we want our Allies to act. For operations in Afghanistan, the aspirants have provided troops, intelligence, over-flight rights, access to bases, and public diplomatic support.

As the Administration deliberates on specific candidacies, the Defense Department will be assessing the state of the aspirants' military structures, their implementation of defense reform, the readiness of military units dedicated to NATO missions, and the military value the aspirant countries can add to NATO.

Transformation

The transformation of NATO's capabilities can and should proceed hand-in-hand with its enlargement. This may be the gravest challenge for the Alliance in the coming years. NATO operations in Bosnia and Kosovo exposed collective Alliance shortfalls in the capabilities most relevant to modern warfare; they also exposed a disturbing -- and growing -- capabilities gap between the United States and its Allies. We heard encouraging rhetoric at the 1999 Washington Summit, but by-and-large have seen meager results. The widening capabilities gap not only weakens the Alliance's military potential, it could in time erode NATO's political solidarity.

In our view, the Alliance needs to focus on a few priorities, including: defending its forces and populations against weapons of mass destruction; doing a better job of getting Allies' forces to the fight; ensuring that Allied forces can communicate easily with one another without fear of eavesdropping or jamming by their adversaries; and improving Allies' contributions to modern, fast-paced, and more precise combat operations.

We cannot transform NATO capabilities overnight, but we cannot afford to settle for "business as usual." As we encourage Allies to spend more on defense, it is even more important that we get them to "spend smarter." The Joint Strike Fighter Program is a model of cooperation and efficiency involving the United States and several Allies.

New Relationships

A third goal for the Prague summit is strengthening NATO's relationship with Russia and revitalizing its relations with other Partners.

We are working hard with our Allies to enhance the NATO-Russia relationship. The best way to proceed, we think, is to build a record of success on practical projects that benefit everyone involved. We believe that this effort can dissipate vestigial fears in Russia that NATO threatens its security. We also think that fostering engagement with Russia can induce further democratic, market and military reform in that country and contribute to improved Russian relations with its neighbors. In short, we view the NATO-Russia relationship as complementary to our bilateral efforts to establish a new framework of U.S.-Russia relations.

As we build this enhanced relationship, and as the Alliance and Russia work together where we can, it is essential that NATO retain its independent ability to decide and act on important security issues. We are conscious of the importance of protecting Alliance solidarity and effectiveness. The North Atlantic Council will decide, by consensus, on the form and substance of our cooperation with Russia. Russia will not have a veto over Alliance decisions. And NATO-Russia cooperation will not be allowed to discourage or marginalize other Partners. We are confident that we can respect these safeguards as we improve NATO's ties to Russia.

The Partnership for Peace (PfP) is a NATO success story, having produced practical cooperation between the Allies and 27 Partners from Europe through Central Asia. We want to maintain and strengthen Partnership programs beyond Prague, especially in ways that increase the Partners' ability to operate with NATO forces in crisis response operations. And we should not be surprised if, following invitations to some number of aspirants at Prague, other Partners step forward to declare interest in NATO membership.

Conclusion

Mr. Chairman, for over 50 years, NATO has been a successful alliance, perhaps the most successful alliance in history. This year, we have an opportunity to enlarge and transform NATO to help ensure that future generations of our Euro-Atlantic community -- the core of the community of the world's democratic states -- are ready and able to secure their freedom.