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MR. CRAIG KENNEDY: So we are ready for the next session. Which kind of logically follows the opener today. I want to thank our panelists this morning. That was really a great start on a Sunday morning, got the blood flowing. Now we go to Nukes: Whose Got'em? Who Wants'em? Whos Giving Them Away? And What Do We Do About It? And weve asked Mr. Roger Cohen to be the moderator of this very distinguished panel. MODERATOR: Craig obviously believes in a nice light relaxing Sunday morning. I had Iran, then Iran, and now Ive got nukes. At least you have the future of NATO to look forward to. I thought it was getting colder in here. I don't know if that is the Canadian winter or nuclear winter or what. In any event weve got no shortage of things to talk about this morning, not least President Obama's call in Prague repeated at the United Nations in September for a while without nuclear weapons. That, of course, sounds very nice, but the world of 1914 and also the world of 1939 were worlds without nuclear weapons. Is this a nice line or is it actually a good thing? In fact, of course, the world has been going in the opposite direction. From the nice compact group of 5, the P5, United States, Russia, China, Britain and France. And we have gone in the last decade to something like a group of 9.5 which includes in addition Pakistan, India, North Korea, a much less ambiguous Israel and the .5 being a much more ambiguous Iran. So as we go forward into the nuclear proliferation treaty NPT review next year, are we going to really be able to resurrect the nonproliferation program or are we heading into a much more dangerous world? It is already clear that the nuclear issue has moved largely from a transatlantic issue to an Asian issue both northwest Asian and northeast Asian. So that is another issue we need to look at. We need to look at the follow up treaty that Ellen has been working very hard on. Does the reset button really work with Russia in this respect? I know when I hear were trying to reset the video system on [INAUDIBLE] my heart sinks. Maybe the reset in this instance will work. We have lots of other nuclear acronyms. The comprehensive test band treaty also has to be addressed in the coming period. Before we get lost in those acronyms Id like to start us off here. Fortunately I have an absolutely glittering panel. On the left here Camille Grand who is Executive Director of The Foundation for Strategic Research. And on his left is Ellen Tauscher who is Undersecretary for Arms Control and International Security at the Department of State. On her left is Stephen Hadley who is now Senior Advisor for the U.S. Institute for Peace and was of course the National Security Advisor in the Bush administration. And last but not least Nabe Watanabe who is Senior Fellow at the Tokyo Foundation. I know we had the last session on Iran. But I feel I have a slightly more [INAUDIBLE] panel here. And also representatives of the administration. So with your permission I would like to spend just a few minutes at the outset on that following up on that. And I think I would like to 12 2 start with you, Stephen. What we were hearing in effect was if we cap North Korea and we flood Iran with inspectors is that good enough? Is that stable enough for the United States and its allies going forward? THE HON. STEPHEN HADLEY: I think that is a question. It's where people think we ought to shift to a containment strategy. And I guess the question you have to ask about that is, one, given all the effort the international community has made over ten years, three administrations, taking the position that we don't want new states to get in the enrichment business and that Iran really, not a single centrifuge needs to be spinning in Iran. For us now to say we didn't mean it, Iran can have an enrichment capability, the question what does that do to the credibility of the proliferation regime internationally? What does it do to the thinking of the Iranians who will be widely viewed in the region and in themselves as having defeated the international community? How empowered will they feel in other activities, terrorism that destabilizes Lebanon, threatens Israel, mixing in Iraq and Afghanistan? And of course the other question will be, what will other states in the region do? Will they want a similar capability? Will you see an Egypt and Saudi and a Turkey also wanting their own breakout capability if you will to get into the enrichment game and rather than getting people out of enrichment and reprocessing, which has been an objective we have had for many years, youll have everybody getting into that regime? And then lastly the $64 question. Does Iran really want the bomb? Because this is really the next step, the enrichment that gets them the nuclear material that is the long poll and the tent on the road to a nuclear weapon. The bottom line I give you is I don't think it is a stable world. I don't think it is a world that meets our interest. And I think it really will mean the end of the proliferation regime as we know it. MODERATOR: What about you, Ellen, is limited enrichment in Iran acceptable and also could you tell us a little bit more about the nuclear research facility deal that has been on the table? It looked pretty good in Geneva and Vienna. It seemed like we were creating the time and space, maybe a year, for President Obama to be able to tell Congress, you see my engagement is beginning to work, weve got a little bit of time here, tell Israel the same thing. Instead of which we have a very confused picture in terror and as we were hearing in the previous panel and it seems that deal is at the very least stalled. Do you still think that deal can happen? THE HON. ELLEN TAUSCHER: Yes I do. First let me say that its great to be in Halifax and thank you for putting Steve Hadley to my left, I could have used a thirty second [INAUDIBLE] - MODERATOR: He should be to your right I think. THE HON. ELLEN TAUSCHER: [INAUDIBLE] could have helped me a lot. [INAUDIBLE] my former colleague. I wanted to say hello to him. There is so much to talk about here and I want to echo some of the things that Steve said because not surprisingly I agree with much that he said. When the Obama administration came into office it was very clear that we wanted to create a new opportunity to engage with the Iranians. And we put with P5 plus 1 a very important, an almost historic offer on the table to engage. And they had their election coming in April and then they had the mixed results of the election. And it took them frankly until the 11th hour plus 59 minutes to come back to us in late September. And what they came back with was a problem, a problem with their table and research reactor which the United States 06 3 built a couple of decades ago. And the need to find a way to get some reprocessing done and to have some rods put back. And we looked at this deal, the P5 plus 1 and said that this was one of those great opportunities to do a couple of things at once. Multi tasking is a great thing. We can take some material out of the country which gives us the trade space which is at such a premium right now. Time is the issue here because the Iranians have squandered the ability to gain confidence of the world community. Even in September as we were looking to the hour glass just dropping right to the bottom with the offer to engage, the Iranians were found to be once again at compliance with their facility. This was a scenario when we were looking to do everything we could to find a way to engage, to legitimately help Iranians with a humanitarian problem get material out of the country and make sure that we were taking the trade space away, the sense that many of us have that Iran will always play for time, always use time to their advantage, hold off agreements. And as Secretary Clinton said we want to have a dual track. It is a persuasion track to persuade Iran not do the wrong thing, to do the right thing and not develop nuclear weapons. And then there is a pressure track which is if they don't take us up on our offer to bring the world community together and make sure we can deal with them sufficiently. I think the thing for everybody to look at is in just about in 6 months we will all be in New York doing the Nuclear [INAUDIBLE] and this is not the time for us to get weak kneed. This is not the time for us to basically kick the NPT in the teeth and say Iran. It's difficult. We've got to stand together and we've got to stand together and make sure that they live up to the NPT obligations and we live up to our NPT obligations by saying they cannot use a civil program to enrich and to get a weapon. MODERATOR: Do you think the deal on getting the LEU out is still alive? THE HON. ELLEN TAUSCHER: Our offer is still on the table and, of course, it is still alive. We are looking for the Iranian regime to think again and to understand that this is not only a legitimate offer but it would very, very unfortunate if they tried to turn around which is a very big consensus of the international community to make an offer to help with a humanitarian gesture for cancer patients in Iran if they turned it around and made it sound as if they had an alternative to it. The requirement for this is to get material out of the country so we actually can understand and get inspectors in there so we can actually understand what they're doing and to take the time pressure away that in the basement there has been such refusions. MODERATOR: Camille, we have been in this slightly odd situation, at least it feels a bit odd, of France and President Sarkozy being more hocus on Iran, or at least times it seems than the Obama Administration. Could you talk a little bit about that and about your own feelings about this issue? DR. CAMILLE GRAND: I guess [INAUDIBLE] to try to be [INAUDIBLE] between bombing Iran or the Iranian. And I think this is not only a French choice but it is a choice for everyone. The issue here is how doe we manage this? France has been pushing for this very, very consistently since 2003. The fact that the United States finally joined in the process is making that proposal very, very credible because it was missing in the early stage of the negotiation because the Iranians would say can the European deliver the U.S. [INAUDIBLE] Indeed, I don't think we're there now. But I think the belief in France is really that we are at the 24 4 sort of tipping point. Can we with the upcoming NPT conference live in a world in which a second country withdraws from the NPT and can the regime survive that? My assessment is that it is unlikely that it will survive that at least in its current form. It might unravel slowly or rapidly and approach the end of the NPT. But I think the NPT is really at stake here. And what do we expect? Do we expect Luxemburg to reassess its nuclear policy before we say the NPT is in danger? I think it was a mistake to allow North Korea out of the treaty. I would like to discuss all of the reasons why. I think it was a huge mistake. By the way, I think this is always illegal in any case but that is another issue. I think we really need to think of what kind of world we want to look at in the next 15 years and what we do about Iran and North Korea in the next couple of years and our ability to manage those two crises through diplomatic channels would be to decisive frame the nuclear future. MODERATOR: Nabe, what about a nuclear free world? It sounds lovely. How do people in Japan respond to that? How does that look from Tokyo? MR. TSUNEO "NABE" WATANABE: Sounds lovely. There is a very important factor in Japan because I think that if you are familiar with the Japanese politics still the very pacifist sentiment. It is very strong among several people because I think Japan is a victim of nuclear [INAUDIBLE]. And Obama the message was very well taken. Even though the person who the social democrat some of who were liberal who didn't like some military cooperation with the United States said U.S. president said no nuclear so this message is going nice to Japan. The reality is sometimes a mixed feeling because is some kind of anxiety because in Japan that depends on the U.S. nuclear arms. If we are going to no nuclear arm in the process if the guarantee of nuclear is not so perfect than reliable will [INAUDIBLE] trouble for. So Obama has a message causing two different reactions in Japanese society. And that is not well coordinated because as you know now Japan is having a new administration, the Hatoyama Administration, the DPJ. A new administration after almost 50 years of Liberal Democratic Party. Japan's policies are kind of ABL, not anything but LDP that political reaction is trying to deny everything LDP did. That is very risky. And already from [INAUDIBLE] management is the kind of anxiety. And especially the facing issue, the nuclear North Korea issue. I would like to point out one thing. Iranian issue is whether they will make a nuclear weapon or not. North Korea already had it. They conducted a few nuclear tests. So if as Mr. Hadley suggested that two countries but the situation is different and probably Japanese people are not so happy with the containment policy. Probably more people want it to dismantle. That is the situation. MODERATOR: Which is stronger in Japan? The nice touchy feely notion that a nuclear free world is great or the anxiety of the loss of that nuclear umbrella? Also, what does Japan think what China is doing with its nuclear arsenal is very opaque. Does Japan apart from the North Korea issue, does Japan worry that China's actually very busy modernizing and enlarging its nuclear arsenal? MR. TSUNEO "NABE" WATANABE: I think that is a good question. I think also the mixed one is a different opinion. The worry over the United States and Russia agreed to have the post start because I think they agreed to have 1500 warhead between. And China may have probably some around 400. That means that if the post warheads in U.S. and Russia are going 18 5 down to the [INAUDIBLE] with China. That was also Japan's anxiety. I think that is a [INAUDIBLE] don't care much. MODERATOR: Stephen, when you heard our president in Prague say he saw a world without nuclear weapons what did you feel and what did you think? THE HON. STEPHEN HADLEY: It is an aspiration and like an aspiration that we would like to have a world in which war is no more. I mean, these are useful aspirations to describe the world we would like to live in. But I think operationally the Obama Administration has the same dilemmas and challenges that every other administration has. We have made - we have - administrations Democratic and Republican since the Cold War have talked about de-emphasizing the role that nuclear weapons play in national security strategy. And we have made good on that. If you look at the reductions in strategic nuclear warheads by the United States and Russia they are a small fraction of what they were in the Cold War. The Moscow Treaty in 2002 brought it down to 1700 to 2200 deployed nuclear weapons. The administration is continuing effort to get a legally binding extension of the start agreement and they are actually going to bring the numbers a little lower. I think you can do that but as was suggested there are dilemmas here. Because if actually the U.S. nuclear deterrent has been a terrific agent for minimizing proliferation by assuring countries that do not have nuclear weapons that they can rely on U.S. security assurances so they don't feed need to have nuclear weapons to safeguard their own security. Ironically U.S. is a strategic nuclear deterrent has been an important element in proliferation. And then there is the cheating problem. In a world with no nuclear weapons MODERATOR: People cheat? THE HON. STEPHEN HADLEY: The country with one or two is key. And that's a problem. And this is a problem that we have not solved. What do you do about those countries that don't believe that the world is safer and they are safer without nuclear weapons? They have concluded for various reasons that they want one and that brings us back to Iran and North Korea. And that's why they are really the challenge to ever getting to that world without nuclear weapons that aspirationally we would all like to live in. MODERATOR: What do you make of the argument that is made by some that it is only by committing to a world without nuclear weapons that the have countries can have the moral persuasion to tell the have nots that this is not the way to go? Mohammed Elbaradei, for example said in September by demonstrating the irreversible commitment of achieving a world free of nuclear weapons the weapon states only this way gain the moral authority to call on the rest of the world to curve the proliferation of these inhumane weapons. Do you buy that argument? Because as you have just said Russia and the United States have been reducing their nuclear arsenals for quite a while. It seems to have none of that kind of effect on the aspiring would be nuclear nations. THE HON. STEPHEN HADLEY: I think what it does and it is part of article 6, the nuclear proliferation treaty, I think it doesn't really help you with the Irans and North Koreas. It helps you with everybody else when you go and ask for international solidarity to deal with countries like Iran and North Korea and that is why we have been bringing down our level of nuclear weapons. It is why people talk about maybe we ought to internationalize enrichment and reprocessing so they are not national responsibilities but international responsibilities so we can 12 6 credibly say nobody should be getting into this business. All of those I think are useful to prepare the stage and to give us some leverage but in the end of the day we have to recognize that North Korea and Iran are not doing what they're doing because they are outraged and in a discriminatory regime. They are doing what they are doing either because they are concerned about their security or they want to impose their will on their neighbors. And so it's great mood music but it doesn't really get you to the heart of the problem. MODERATOR: Ellen, how are the [INAUDIBLE] follow up talks going? Are in encountering a kind of nice [INAUDIBLE] Russia or a nasty [INAUDIBLE] Russia to take the distinction that Secretary Gates made the other day. How is it going? THE HON. ELLEN TAUSCHER: When we came into the administration Secretary Clinton and President Obama went about resetting the relationship with the Russians. But as we all know resetting is not flipping a switch. It is a warming opportunity. And I think that we had very, very constructive talks. We had very senior teams on both sides in Geneva working hard. We do have the inconvenience of the treaty expiring on December 5 but I believe that we will be able to move forward toward what the presidents have agreed to. It has always been clear because of the legislative calendar that we would not get to ratify this year neither the Senate nor the Duma. It has always been a case of having a legally binding extension bridging agreement that would put is in a place where verification at least is maintained while we were going to a new treaty that would be signed later this year and ratified next year by the Senate. I think we are impressed by the relationship and constructive talks that we are having. It is very clear that we are working hard to do it. We do have the inconvenience of the deadline. I am confident that we will live up to what both presidents want which is something that will be able to replace it in the interim while we go for ratification next year. MODERATOR: Will you meet the deadline? THE HON. ELLEN TAUSCHER: We will meet the deadline in the extent that we will be able to maintain for verification protocols to extend them so that we can go forward. But to go back to what Mr. Watanabe was talking about, we like every other administration is mandated to do a nuclear posture review. What is going to be clear when it comes out in the January and February timeframe is that the Obama Administration, even though the President's speech was a historic visionary speech that for the first time put a dot on [INAUDIBLE] and said that is where nuclear might be the President was clear that it was going to take resistance and patience, that it may not happen in our lifetime, that this was a goal. What it was was a reaffirmation of our commitment of article 6 of the NPT. We keep coming back to the NPT not only because its got a review conference in May but because it fundamentally is what we have been using for all of these years to keep people in line, to remember that we certainly agree in article 4 which is the ability for countries to have peaceful civilian nuclear power. We in the United States have signed a number of 1,2,3 agreements. We certainly support that. The question of cheating is a nontrivial one. We have to have unanimity among ourselves that we want to keep the NPT. We want to strengthen it. That means in the short term we need to do everything we can to not allow folks using article 4 do things that cause them to be part of article 6. We are not going to stand idle and allow that to happen. Our concerns about North Korea and Iran are significant. And I think we have many people that agree with us that we have got to hold the line and we have got to make clear that these are unsustainable ambitions 06 7 that these countries have. MODERATOR: How important is it in terms of those NPT talks to first get a deal that brings Russia and the United States down to 1500 nukes? THE HON. ELLEN TAUSCHER: It is important because we hold well over 95 percent of the nuclear weapons together. It is important to show countries that we are committed to our article 6 commitments to disarm. And it is also important to create a question of stabilization in our relationship. We do not consider the Russians to be a strategic threat. At the same time the United States has extended to 30 some odd of our allies a nuclear deterrence and we have to be able to make a case, which we will make the case during the NPR, Nuclear Posture Review, that we have sustainable nuclear weapons that are reliable and safe and are effective and that this is not a quantity issue, this is a quality issue and that we are very much assured that are deterrence is as strong as it ever has been. MODERATOR: My sense is that in France the president's vision of a nuclear free world caused some shaking of heads. The [INAUDIBLE] is clearly important to French identity. Is there a lot of skepticism? Do you feel skeptical about this idea? That's my first question to you. And the other, thinking ahead to this NPT which is clearly critical, if you were setting the agenda for it and laying out what had to be achieved, what would you do? DR. CAMILLE GRAND: Looking at the division of the nuclear weapon free world and there is one way of looking at the French which would be somehow critical. Saying that the French smoke and love nuclear weapons so they don't want to go along with that vision. I think it is slightly more complicated than that. It is sort of a caricature. MODERATOR: I didn't mention smoking. DR. CAMILLE GRAND: I smoke. But I guess France because it has lived through two world wars on its territory really doesn't want to - if the nuclear free world is about 1939, although the whole is not convinced that it is the path that we want to take. When we are talking about creating the conditions for a safer world and eventually moving to 0 [INAUDIBLE] once we have created the conditions for that. That's a different story. So basically the way I would describe the French position on that is really to say, A, there are plenty of things that need to be done immediately: no addition to nuclear weapon states taking care of the 22,000 weapons that are somewhere in the Russian or American arsenal. We are awaiting dismantlement, getting the CBT ratified, [INAUDIBLE] and all of these issues are on the table immediately and we need to take care of them. And then work on the conditions. And then there are issues that involve the second tier nuclear weapon states, France, U.K. and China. France and the U.K. have done a lot already. We have [INAUDIBLE] I think there are clearly issues about the Chinese arsenal that is probably modernizing and still increasing while it is a very [INAUDIBLE] and that goes back to the Asian transatlantic issue on that. So how do we manage that? More transparency and commitment not to increase arsenals and things like that. Those are critical issues. And finally obviously non proliferation so no additional nuclear weapon players. Bearing all of this in mind the NPT conference is a fantastic opportunity to bring together all of these agendas because at the moment these agendas are taking place in separate worlds. There is a moral discussion about the virtue of evolution. There is an immediate focus on the Iranian crisis from a nonproliferation perspective. There is the real disarmament agenda in the U.S./Russian framework. As a European I would like to attack the nuclear weapon issue. There are 2500 Russian nukes that are not being taken care of so should we remove the U.S. weapons knowing those are on there and that is a NATO issue. [INAUDIBLE]So all of these issues and the NPT is a fantastic opportunity to bring these together and try to what I would suggest is restore it on a non proliferation consensus. Bring this community of NPT member states together as we did in 95, for instance, with a clear road map and a clear view of where we want to go in the next 15 years. MODERATOR: Stephen, do you feel comfortable that nobody is going to lay their hands, for example, on Pakistani nuclear weapons. We don't want to have them? Is this something that keeps you awake at night? THE HON. STEPHEN HADLEY: Obviously, the situation in Pakistan is troubling from a lot of perspectives. There has been a lot of concern about what happens to Pakistani nuclear weapons if the government fragments in some way. I will tell you when in the discussions after 9/11 about military action in Afghanistan one of the scenarios that we talked about five days after 9/11 was if we go into Afghanistan do we destabilize Pakistan and do we end up having a Taliban control of the Pakistani government and a Taliban government in Islamabad fighting with the military over control. The answer is it did not happen largely because President Musharraf took a tough decision that he was going to get on the side of the United States and other countries to confront terrorism. And we now have a democratic government in Pakistan that is really revitalizing their effort against the Taliban. They see it now as to what it is, a strategic threat to the stability of that democracy. I think that is a problem that we have done pretty well in managing, all of us together in the last eight years. The Pakistanis have talked about the efforts they have taken to maintain command and control. It is no secret that we have tried to help and support those efforts. So it is a risk out there. I think every time in our administration I expect it is true you check in with your military and intelligence people and say is this a nuclear arsenal at risk. The answers have been so far no. MODERATOR: I'm going to ask one more question and then throw it open to everybody. So start thinking about your questions. In North Korea there is a U.S. delegation, I believe, going to [INAUDIBLE] next month. There have been on and off negotiations of various kinds for a long time. Are you at all optimistic that there could be some significant change of direction that would be reassuring to Japan in North Korea so long as Kim Jong-il is sitting there? MR. TSUNEO "NABE" WATANABE: The Japanese public opinion is different. [INAUDIBLE] considering the past trajectory. And also this time some anxiety that Japan has been very reluctant to participate in the [INAUDIBLE] The reason is simply because of objection issue of Japanese cities. And these are less serious about [INAUDIBLE] but I still don't know what kind of a position they will take. I seriously doubt that direction of the current Japanese government. So if some negotiation happens, even me, myself, don't know what degree Japan can be cooperating with this talk. Also, one thing in Japan is the key figure that eventually if North Korea believed it could be beneficial for them to be cooperative with [INAUDIBLE] I think when Kim Jong-il [INAUDIBLE]or when of North Korea [INAUDIBLE] is money. Because many people believe 19 9 that Japan could be the last resort to give money to economic development because over [INAUDIBLE] World War II not going to North Korea. I think the money already went to South Korea. So Japan will still be the key. The direction is not sure. MODERATOR: You are saying there could be some reparations paid to North Korea? MR. TSUNEO "NABE" WATANABE: I think kind of [INAUDIBLE] of course Japan didn't pay this money to South Korea but gave big huge economic assistance in the 50s and 60s. MODERATOR: I'm going to start on this side of the room. Yes, sir. AUDIENCE: [INAUDIBLE] from Portugal. One question about [INAUDIBLE] and another one about Iran. Last year we had the [INAUDIBLE] case in London. If the case is state sponsored is serious because it is the use of clandestine material by a state. If it is not state sponsored I think it is even more dangerous because it means we are going into the smuggling of nuclear materials. So I would like for you to maybe touch a bit on talking about that especially knowing that Russia is one of the countries that could have some influence in the present Iranian situation. I dont know if you know that yesterday Iran started a month long air defense exercise and the first thing they said is that the Russian missiles that was supposed to have been delivered were not delivered in time. So they are already saying to Russia that maybe [INAUDIBLE]. Second question is about Iran. I think our German colleague told us in the last session that there are no declarations neither official declarations nor leaked classified declarations from Iranian authorities saying that we want nuclear weapons. And both in the case of Pakistan, India, Israel, and other nuclear powers there was always something written saying we have a right to use these weapons as defensive nature. Because we [INAUDIBLE] and there are the famous fact was that I don't know the text of the fact was exactly but they exist condemning anyone participating in a nuclear program. Should we take this non declaration as something indicative of the true nature of a peaceful nuclear program in Iran? DR. CAMILLE GRAND: On non declaration, first of all there are declarations by [INAUDIBLE] in the early 90s that were around the issue of a nuclear program. The second thing is I really would like to look at facts on Iran. And I think this is the facts that are troubling, not the declaration. And that I agree with you. If you look at the enrichment program, this program makes no sense from an economic or a scientific perspective. The fuel that is going to go out of the [INAUDIBLE] facility will not be allowed into the [INAUDIBLE] nuclear plant by Russia for safety reasons. So I describe the situation as a country that is about to buy a washing machine and that insists on having a bunker, an underground bunker facility, designing and producing washing powder on the industrial scale and that washing powder will not be allowed into the dishwasher. And nevertheless you insist that your neighbor shouldn't be worried. I don't get it. THE HON. ELLEN TAUSCHER: I don't get it either. I think from our point of view this is less about what people say than what they do. I'm the mother of a teenager. THE HON. STEPHEN HADLEY: Say no more. THE HON. ELLEN TAUSCHER: So for us, first of all, we are glad the S300s have not been delivered. Clearly from our point of view the Iranians have a very clear choice. We have made it very, very clear that we respect the right for civilian nuclear power. And I think in the last conversation there was some discussion about multilateral fuel banks and other things. We 10 have got to do things that cause there to be a general acceptance of the fact that civilian nuclear power is a sovereign right which is what the Iranians have been claiming but at the same time the NPT is very clear. The issue of enrichment and reprocessing is something that the Iranians have cheated on and they have been caught and they have actually turned themselves in a couple of times. This is not about what they are saying. This is about what they're doing. It also is about what they are doing causes other people's calculations to be [INAUDIBLE]. If the neighborhood calibrates that what the Iranians are actually doing is not what theyre saying but what they are actually visibly doing and getting caught on then everyone's calculation is going to be how do I react to that? How do I defend against that? And all that does is completely destabilize an already volatile region. From our point of view just like I think in the previous administration, our position is that we want to take tensions down. We don't want there to be things that are destabilizing. We want there to be more of a sense of cooperation and moving forward in a respectful and peaceful way. MODERATOR: If we do move to sanctions aren't we back to the confrontation of the eight years of the Bush Administration when Iran grew more powerful? How would it be distinct in any way from the former situation when President Obama came in saying he wanted to try something new? THE HON. ELLEN TAUSCHER: I think this is where the evidence for some of our friends who rightfully so want us to maintain the persuasion track eventually you have to do the math and you have to say here we did in the Obama Administration a historic change in making it clear that we were willing to in the P5 plus 1 environment talk to the Iranians. We came up with what we think is a very creative solution to a humanitarian problem that they have that also solves one of our problems which is time and to relieve them of this LEU that is causing tremendous instability and concern. And they rejected. And so we have done exactly what we were asked to do by many of our friends who wanted us to go one more time on a persuasion route. What we are saying to our friends now is don't be fooled. Understand that you have to have a dual track here. Persuasion for persuasion sake is only good if you understand what to do when it clearly is rejected. And if the Iranians continue to reject our persuasion route we have to go to pressure because we cannot sustain what they are doing. If they are exactly doing what we are worried that they are doing which is playing for time we have got to then move to something that causes that to be painful. That is why when the secretary talked about crippling sanctions we have to make it clear that this is an unsustainable situation and they cannot continue to play for time. AUDIENCE: [INAUDIBLE] Director of Strategic Affairs in the Spanish Ministry of Defense. I would like to make a short comment and a question to the panel. The comment is that when we have a Japanese friend or colleague or both in the audience I always feel very sensitive when it comes to nuclear weapons because they are the only nation, the only people who have been to a huge scale personal experience of being bombed by nuclear weapons. So thanks to you there is this consensus in the world of thinking the unthinkable to nuclear weapons. The question is many people say that the treaty is [INAUDIBLE]. Isn't that an incentive for some states to withdraw from the treaty and go nuclear? After all Israel has a right to [INAUDIBLE] and this brings us back to yesterday's panel about law versus power. Is it an incentive and how do we [INAUDIBLE]? 11 THE HON. STEPHEN HADLEY: I don't think discriminatory itself has been responsible for any country going to nuclear weapons. I think what is interesting is as difficult as this has been and I think it was 1998 the international community by consensus agreed to make the Non Proliferation Treaty permanent. And I think it's because most nations agreed with the first part of your statement. We want to try and get nuclear weapons out of the equation of national security calculations. And that is really what has sustained the treaty in all the ins and outs about are the nuclear weapons states satisfying their obligation under article 6 and all the rest and the fact that yes there is a discrimination and there are nuclear haves and nuclear have nots. Its endemic in the structure. But I think the international community has felt it still was a good deal in terms of global stability and the security of individual countries. And that's what we need to reaffirm. And I would just underscore what my French colleague said. I think the upcoming NPT review conference is an opportunity for a work plan on all the aspects of this problem so we get concrete and get to working on these problems because only by solving these problems are we ever going to get to anything like a world without war and a world without nuclear weapons. DR. CAMILLE GRAND: A very quick follow up to what he was saying. The NPT is about balance of proliferation. [INAUDIBLE]There is commitment not to go nuclear by many countries. There is a commitment not to assist anyone in going nuclear which is just as important. There is a commitment to take the path of disarmament. It is equally important. And there is a commitment to promote and facilitate distribution to [INAUDIBLE]. Those three pillars, as we say, are very, very important and should be addressed. And that's the purpose of the NPT conference. Including in the context of a nuclear renaissance where there are more countries are interested in nuclear energy. My last point is that the NPT is sometimes a bit overlooked, a security arrangement. This is something about all system and how do we manage collective security and making sure for many countries that they are a regional neighbor that is big and wealthy will not go into the nuclear business and providing credible reassurances about that. And I think we should not completely forget that. AUDIENCE: I'm [INAUDIBLE] Member of the Ukrainian Parliament. [INAUDIBLE] happened to be chief negotiator of weapons in Ukraine with the United States and Russia. And I would like to make a short comment. I was looking at the background paper in the program and I found the list of nations here in this program a very strange one. We see here Iran, North Korea, Burma as threshold nuclear countries and we do not see Pakistan, India and Israel. We see here the countries which have relinquished their nuclear problems like Lybia and South Africa. And I haven't seen here my country, Ukraine. Let me remind you that few countries in the world have the right to talk about nuclear nonproliferation and Ukraine is one of the countries who has the right to talk about this. Let me remind you that there was 176 intercontinental missiles in Ukraine with close to 2000 nuclear warheads on them. Ukraine has cooperated closely and as a result we diminished this nuclear threat to the world by 2000 nuclear warheads. We received instead a memorandum on national security assurances in Budapest next Saturday will be 15 years. In several instances not a single commitment of countries which were parties to this memorandum were implemented. I mean, the United States, the United Kingdom 12 and Russia. So a lot of this content in this regard is being spread in Ukraine. I would like to ask our distinguished panelists whether they see it possible to come back to the negotiations over legally binding Ukraine. Thank you. THE HON. ELLEN TAUSCHER: I think certainly South Africa, Belarus, Kazakhstan and the Ukraine need to be congratulated for giving up their nuclear weapons. That is certainly a model that we hope others would follow. As far as what is going on now with further talks with Ukraine I really can't comment on those. I would have to go back and find exactly out what the antecedent issues are. Obviously, we very much respect what those countries did back in the late 80s and early 90s, 15 years ago and we think that is a good model for others to follow. MODERATOR: Why do you think that trend has sort of dried up? THE HON. STEPHEN HADLEY: I'm not sure it has. THE HON. ELLEN TAUSCHER: Libya is a good example, Argentina, Brazil. There are other countries that decided not to become nuclear weapon states. I think we have to get back to the antecedent issues here. The Non Proliferation Treaty is a very, very organic hopefully a situation that we can add more umf to in May. But it is a time for us all to recommit to these principles. And for us, the United States, I think we feel very often that we don't get enough credit for the disarmament that we've done. We feel that there is almost a lack of recognition for what we've done over the last 15 years and both clearly bilaterally and unilaterally. But I think the NPT for us in May is a test for everyone. It's a test for the countries that want to make it stronger and have it once again stand for an optimistic future where we rid the world of nuclear weapons over time. But it is also a test for the folks that decide to cheat and how do we make the NPT something that you just can't walk away from and basically act as if it was inconvenient for you and now you have decided to get out of it and have no repercussions whatsoever. So we have to make some decisions about that, too. MODERATOR: Yes, sir. And then you and then you. AUDIENCE: Thank you. Steve, if I remember correctly several years ago before entering into the administration you told me it's not in the U.S. national interest to ratify the CTBT. Would you - do you see the situation the same way now? THE HON. STEPHEN HADLEY: What year was that? AUDIENCE: The second problem that we have is in the wake of the NPT we have some element of unity in the Middle East about the status of Israel. And a number first of all Iran is making the argument that it's not possible to accept to be singled out with a very hard, tough verification controlled regime while Israel is out of any framework legally binding. How do you see the evolution of that? MODERATOR: I think this issue of double standards - I spent more than 5 weeks in Iran this year. And you year it throughout the region. And the United States has had quite an understanding some decades now with Israel. But in our more open world is that becoming more and more attainable I think is the question? THE HON. STEPHEN HADLEY: I lead most of the Israel point. I'm squirm on your CTB point. My view then has been - I am not - I don't think personally the CTB makes a particularly major contribution on any of these issues. It's my own personal view. I don't think it is the heart of the NPT. We had a vigorous debate on this in the end of the 1990s and the Senate decided not to ratify. I'm confident now that there will be a vigorous debate again. Some things 13 need to be looked at again whether the nuclear stockpile is survivable and is credible going forward without testing. We need experts to look at that. There were verification concerns. I think this will all get a very good vetting and we'll see where the Senate comes. It's very ironic for Iran to talk about a double standard of Israel when it is Iran's leadership that talks about the elimination of the state of Israel and pushing Israel into the sea. And if you need any better example of why if you are Israel you think you might have a hold card like nuclear weapons - listen to the rhetoric that comes out of the Iranian government. It is a lot of [INAUDIBLE] for the Iranians to be criticizing the double standard with respect to Israel. THE HON. ELLEN TAUSCHER: I absolutely agree with Steve on that case. On the Comprehensive Test Ban Treaty I thought I had the opportunity to name Steve the chairman of the [INAUDIBLE] CTBT ratification but I guess I'm going to have to work on him a little bit more. Clearly the issue is the safety, reliability and effectiveness of the stockpile. Yesterday the Jason's report came out, the senior wise men and women in the nuclear business. And they came out with a report basically very, very supportive of the Comprehensive Test Ban Treaty and the survivability of a smaller, more durable stockpile. We had Vice President Biden who is the head of the team to get ratification of the CTBT as the President suggested we want to do in the Prague speech. We are not going to take it to ratification of the Senate until we can win it. It is a 67 vote test. And we have a number of data points that are emerging that make it very clear that we have a stockpile that is safe, reliable and effective and that we have the investments and the tools to maintain a stockpile through the science life extension programs without testing for quite a long time. So I think that we will have a vigorous debate. I think we understand where the opponents have been, what their requirements are. But in the end I disagree with Steve. I think there is a lot about ratification of the CTBT for the United States that not only reinforces the NPT but says a lot to the countries that have already ratified. There are [INAUDIBLE] two countries that if we can persuade them upon ratification by the United States and they should come along the treaty would go into force. And we believe that that is not only a good optic but it is a reward for countries that have decided to not have nuclear weapons and have supported the elimination of nuclear weapons. So I think that we will look forward to the opportunity to go for ratification and to build our case, to do that over the next year or two. DR. CAMILLE GRAND: I think the CTBT and the [INAUDIBLE] are really key elements of this sort of nuclear period. They are part of the grand bargain. They signal the fact that nuclear weapons states are not going to increase their arsenal [INAUDIBLE] and they are not going to develop new weapons through testing because testing is the best way to do that. So I think for that reason. On the Middle East issue I wouldn't do it because of Iran. I would do it because of Egypt. If we want to keep Egypt inside the nonproliferation consensus we need to address their concern about that. And I think we can do better because there is commitment to a weapons of mass destruction free zone in the Middle East. I think are things to be done by Israel in terms of ratification of the CTBT policies. There are things to be done also by Egypt by joining the [INAUDIBLE] convention would be a good step, by Syria and so on. So I think we should try to 14 level the playing field there and so there is a joint endeavor that applies to everyone including countries outside the region to [INAUDIBLE] MODERATOR: What about Israel and double standards? MR. TSUNEO "NABE" WATANABE: I wanted to talk about CTBT. Japan has been pushing the CTBT for a long time because before it was difficult to say that even in Japan but depending on the nuclear umbrella. So they have to send the U.S. Senate to ratify. And the Israel case I think the one thing we'd like to think about the civilian nuclear things, too. This is covered by the NPT, too. I think Japan is seriously inspected by [INAUDIBLE] by Japan civilian nuclear. That is going to be a good start to do. And Israel case I'm not sure the [INAUDIBLE] the nuclear case is. But probably may be a good start. Politics in the Middle East very different. But the approach could have been civilian nuclear. MODERATOR: Are there any circumstances you can imagine in which Japan would decide it has to take the next step and produce a weapon? MR. TSUNEO "NABE" WATANABE: Next step for what? MODERATOR: Are there any circumstances you can imagine in which Japan obviously you have the capacity if you decide to do it? MR. TSUNEO "NABE" WATANABE: So far Japan is trying to make the best effort for reviewing the NPT regime. Because I think some countries say the double standard to the nuclear nation. Japan is not. Japan tried not to develop the nuclear weapon and tried to review the NPT and enjoy the advantage. For example, Japanese company Toshiba purchased Westin House. Westin House is the company that has the greater technology to provide a nuclear electricity generating plant. And that could be a huge commercial opportunity for Japan. And Japan already signed a bilateral nuclear energy cooperation with Russia. And waiting for the U.S. commercial nuclear talk with Russia. It's suspended since the Russia's trouble with Georgia. MODERATOR: So you think money can solve a lot of problems? MR. TSUNEO "NABE" WATANABE: It doesnt have to be money, but commercial interest would be the key for that probably Iran and North Korea to cooperate. MODERATOR: I know a lot of people have been waiting quite a long time, but that's the way it is. AUDIENCE: [INAUDIBLE] I would like to ask the panel about the relationship between missile defense and nuclear weapons. As the United States and Russia decrease their nuclear arsenals do you think that will inversely put an emphasis on missile defense? Alternatively, as missile defense proliferates around the world both with the United States focusing on regional and on more and more U.S. allies becoming interested in missile defense, do you think that will score an interest in increasing nuclear weapons and/or ballistic missile delivery? Thank you? THE HON. ELLEN TAUSCHER: Well, the Obama Administration's position on missile defense is clear because of the phased adaptive approach that we proposed in September and the balance of the ballistic missile defense review will be done by the end of the year. Missile defense is in response to a proliferation of short and medium range missiles around the world. When Steve was the National Security Advisor in 2006 their assessment, intelligence assessment was there was the potential of an Iranian long range missile. So we have sights in 15 Port [INAUDIBLE] and in [INAUDIBLE]. A decision was to put a long range system in Poland with advanced radar in the Czech Republic. When the Obama Administration came into office a new assessment was done and it was clear that the Iranian development of the long range system had not matured as quickly but that the proliferation of short and medium range missiles had tripled. That is what this is about. This is not about nuclear weapons or who has them. This is about the fact that we have short and medium range missiles proliferating. It is a global threat. It is specific to parts of the Middle East clearly but it is a global threat because these are smaller, lighter and more portable and they are most easily sold. That is the reason why the Obama Administration has followed through on what the Bush Administration began which was a bilateral and multilateral missile defense regime beginning on ships in the Mediterranean in the first phase. There are 4 phases between now and 2020. This is really to protect American foreign deployed troops, American assets and American allies. We happen to take the finest defense alliance in the world which is NATO, our article 5 commitments very seriously and we believe that we have the technology now to protect against current threats that we find to be completely unsustainable and very dangerous. MODERATOR: I'm going to take two or three questions to try to move things along. And if you can - because questions do tend to get lost when this happens so if you can try to remember and see which ones you would like to answer. AUDIENCE: [INAUDIBLE] It's great to hear the ringing recommitment from all of you to reviewing, strengthening the nonproliferation regime. But even if the [INAUDIBLE] is successful and the NPT is strengthened relatively soon we'll still be left with the challenge of non nuclear weapon states that possess nuclear weapons. And the political strategic handling of those countries will have profound implications for security in many regions in the world and perhaps the global security. And I would like to bring a point that came up in our discussion of Pakistan yesterday to our two American colleagues. There are many analysts who are now saying that the normalization of nuclear relations between the United States and India has obliged many strategic thinkers in Pakistan to deepen their reliance on asymmetric ways of alluding support for the Taliban and other groups. I would just like your comments on how our balanced or unbalanced treatment of non nuclear states that possess the weapons is playing into regional security equations. MODERATOR: Yes, sir. AUDIENCE: Thank you very much. I have a specific question to Mr. Hadley. For non nuclear states the threat comes from the military capability and the policy intention of a nuclear state. And for Japan it is obviously from China. Capability wise they have very impressive modern nuclear arsenal still increasing including submarine missiles. Why are they dead set against Japan U.S. joint B M D research program denouncing it as being [INAUDIBLE]if they have no it tension it will not be our keeping the defense beefed up. It will not lead to an escalation. Besides in 1998 when Mr. Clinton visited China they announced that they will be detargetting the missiles pointed at the United States whereas they didn't do that to Japan although it is an easy thing if you have the political intention. Japan has no nuclear weapons to begin with. So in order to do something to Chinese increase of nuclear arsenal what you are doing 16 with Russia is commendable thing. But has it never occurred to you to propose reduction of nuclear weapons among P5? Is that a naive question to answer? If only to cap the increase of Chinese nuclear arsenal. MODERATOR: And finally you. And then we will go to the answers. AUDIENCE: I would like to pick up on the same region that Chris did. Both Pakistan and India are not part of the NPT. They both have nuclear weapons. There was an argument back in 04 and 05 where the U.S. made a deal with India that bringing them into the tent would allow them to support some of the objectives, the nuclear [INAUDIBLE] objectives, that we all hold. Is there any thought about how do we formalize that? Today perhaps with India, tomorrow perhaps with Pakistan with other countries and how to make them more formally within whether the NPT or other another such structure that they can more actively start to help support some of the regimes that we all are trying to strengthen today? Thank you MODERATOR: So Pakistan, asymmetrical and bringing them into the NPT maybe you can start, Stephen? THE HON. STEPHEN HADLEY: The deal with India was structured in such a way that nothing that we would do in terms of civil nuclear cooperation with India would strengthen their weapons program at all. So in terms of a threat to Pakistan it does not increase that threat from India's nuclear capability. Second, it was to do exactly what India talked about which was since we couldn't get India to accept the NPT to try to get India as a condition of our cooperation to accept all the other regimes so that they would defacto come into the right side of the nonproliferation or counter proliferation effort. And they had a very good record and they had not proliferated. That is the problem. Third point, with Pakistan which does not have a good record. And we would hope that Pakistan would respond to the India example by cleaning up their own history and getting control over the proliferation activities of people within Pakistan. China, I think China needs more transparency. I think China should start bringing its arsenal down and China needs to do a lot of things to make clear that it is going to be a partner in solving the world's problems and not threatening its neighbors. THE HON. ELLEN TAUSCHER: India as part of the 1,2,3 agreement has just recently brought in safeguard agreement with the [INAUDIBLE] and it signs the original protocol. It has joined the consensus decision to deal with the FMCT. It has been very helpful with us. It condemned North Korea's recent test and became the third state under the chemical weapons convention to completely destroy its weapons. I was in India just ten days ago. We are deep in the middle of very interesting and strategic talks and as you know actually Prime Minister Singh is on his way to Washington right now for the first state visit is this week by India. So I think Steve is right. Not the perfect of all situations but certainly one where we were able to work with India as we recognize that they are a major player and a partner with us. And so many strategic issues and certainly in their region they are a hope of stability. We have found a way to bring them closer to what was a broken situation, much more closer to falling into line and we think that that is the choice that they made is something that should be welcomed and supported. AUDIENCE: [INAUDIBLE] from Norway. We have a strong commitment to NPT. [INAUDIBLE]In the middle of all of that we're having a debate on the strategic concepts of 17 NATO and the decision that we should also look at what could be the role of NATO in the context of nuclear disarmament and reducing the role of nuclear weapons. What exactly do you think is NATO responsibility when it comes to the nuclear weapons taken into account [INAUDIBLE] MODERATOR: And I have been told. I thought we had an hour and a half. We have to go quickly at this point. That will be it. AUDIENCE: A quick question. I think there has been a great discussion about the building blocks of getting arms around this policy of [INAUDIBLE]. But bringing it back to Iran, how does the sequencing work and the timelines? Because we have things like the STAR Agreement, the NPT conference, continued role for U.S. extended deterrence and we see this play out over a period of time. Are we against a timeline and do we run into the question that [INAUDIBLE] wants to avoid? AUDIENCE: If I can seamlessly pick up the point, if it does come to that point of bomb Iran or accept an Iranian nuclear bomb, what should it be? DR. CAMILLE GRAND: Let me start with the easy one. I guess in NATO the key issue will be to [INAUDIBLE] right balance between remains a policy of providing to NATO countries. While at the same time making clear that NATO countries and the NATO alliance is not a sort of a nuclear addict that wants keep its nuclear weapons while going elsewhere. So it is a fine tuning. And there are some that are very nervous about getting away with weakened [INAUDIBLE]. There are no [INAUDIBLE] on that. I think it is a balance to be [INAUDIBLE]. My only point would be to say I mentioned the Russian with the nukes. I think in terms of arms control there might be some cards to play here compared to what is the very, very limited U.S. stockpile of weapons stationed in Europe at this stage. On Iran, again, I think that the issue of the timeline connects to the issue of what we should do. It's very difficult to assess intentions. So the only thing we can do is assess capability. So what we know is that in terms of enrichment and how the facilities are running, assuming there is not another facility and we start discovering one every year the timeline is that within a year or 18 months there will be enough to be transformed into a - to build a bomb. Probably Iran at this stage is intending to [INAUDIBLE] threshold, but that's why I insist on the fact that the Iranian issue is not a long term issue. It is an immediate issue. What we do or not do in the next six months [INAUDIBLE] Then when it comes to Iranian bomb or bombing Iran I don't think anyone is thinking about dropping the bomb on Iran so the issue is not nuclear war with Iran. But I think the military option has been more or less on the table. I have been there in the background. One cannot completely consider that if worse comes to worse and Iran is on the verge of acquiring a nuclear capability no one will do nothing about it. So then the issue becomes what is the preferable option in that worst case scenario. I'm not sure that does the dirty job and everyone is sort of nods their head is the preferable option. So I think we have to be very careful about that and what strikes me and I finish with that is that [INAUDIBLE]. The records of friends in the gulf are extremely opposed to any military solution. Off the record they are so concerned that they are contemplating any alternative that would prevent Iran from becoming a nuclear weapon. MODERATOR: Ellen, if it came to that bomb Iran or live with a nuclear Iran - I would like to get all three of your answers to that. 18 THE HON. ELLEN TAUSCHER: I don't believe either scenario is in our interest nor do I believe that that is really on the table now. This is about making clear that Iran has what it asked for. It asked for engagement with the United States. It hasn't. Now what is it going to do? Is it going to actually stand up and say that they are going to take our deal and then turn around and research reactor or are they going to do what they say they wanted to do or are they going to use some other flimsy excuse to duck. This administration stands for engagement and persuasion. We hope that this was a big mistake for them to have nuclear weapons. It is going to greatly destabilize their security and the security of their region. We are concerned about that. We are willing to work with them to persuade them. In the end we need all of our allies and friends to stand up. If persuasion doesnt work pressure is going to have to be the next line of action. THE HON. STEPHEN HADLEY: I will quote Ellen Tauscher from an earlier meeting. We need to do everything we can to push out the timeline that Iran has nuclear capability through the two tracks. Bring in the timeline when an Iranian regime decides that, in fact, the road they are on is more of a threat to their security than it does to ensure their security. Terms we want to avoid in the case where the only choice is bomb or live with the bomb. But I just have to just close with one chilling fact. We in the Bush Administration tried very hard to convince the Israelis to adopt a diplomacy backed the threat of force approach to Syria and as good ties as we had with the administration we could not convince them and they took action against Syria as it is well known. I'm sure they view the threat of Iran proceeding down a nuclear weapon path much more seriously than they would Syria. MR. TSUNEO "NABE" WATANABE: I will respond to the role of NATO for NPT. I think as we discussed Iran and North Korea together I think are clearly different, timelines are different. But I need to coordinate. So that is probably NATO's role to some partner like Japan or Korea. That is probably very important. I think this may be a transnational issue, [INAUDIBLE] I'm sure. So I think I could have [INAUDIBLE] one thing is a partnership of NATO with Japan and North Korea and South Korea. That could be the sound solution in sharing - thats actually I'm here to give a presentation talk here. THE HON. ELLEN TAUSCHER: If I can just add very quickly on the strategic concept. Prior to the strategic concept there will be the Nuclear Posture Review and what the administration will do which is what every other administration has done is as we defined deterrence we will go about reassurance and there will be a lot of reassurance that will be done especially to the countries to whom we have extended our nuclear deterrence in the [INAUDIBLE] so I think there will be a lot of information going into this strategic concept. MODERATOR: Thank you very much everybody. We have overrun a little bit. I hope we will have the forbearance of Craig to some degree. MR. CRAIG KENNEDY: Thank you so much. That was a terrific panel.