Troops from syria. The foundation for defense of democracies and washington, d. C. , hosted this event. It is about an hour and a half. An hour and a half. Welcome. Im pleased you are with us today for a very special fdd welcome. Im pleased you are with us today for a very special fdd conversation. 18 years ago we were attacked out of a clear blue sky, litter literally attacked out of a clear, blue sky, literally and figuratively. Since then, russia has not moderated, russia has not reset relations, more than ever we need to integrate all tools, all weapons, all power. This has to be leveraged if we defend our interests at home abroad. This submission mission must be accomplished if we are to defend our interests at home and abroad. Fdd has launched three centers on American Power, expanding the work we have done in the past , providing research, analysis, and creative policy ideas on current and emerging threats. Fdd has launched three centers on American Power, expanding the work we have done in the past providing research, analysis, and creative policy ideas on current and emerging threats. We share these ideas with policymakers from both parties, administrations, congress, the media, and the security community. Fdd focuses on military and political power and cyber power and economic power, all are doing cuttingedge research and analysis. Led andnters are staffed by thought leaders of varying backgrounds including academic and military intelligence. We are immensely proud to have them as colleagues. You will hear from the chairs of our three centers, all who have served by providing analysis at the most senior levels. H. R. Mcmaster the chair of our center on military and political power. He previously served as the National Security advisor to President Trump. Dr. Samantha, is the chair of vice chair of the president s Advisory Board and served as a deputy security advisor to Vice President cheney. And the chair of our economic and financial power chair served previously as the Deputy Assistant to the president and deputy National Security advisor for combating terrorism. Americas adversaries are determined to reshape the world order and to diminish and displace the United States in any ways that they can. These nations and nonstate may employ hybrid and gray zone tactics, operating against the United States and our allies in new domain such as race and cyberspace, and these new forms of Economic Warfare. In some cases, they wage their campaigns using sophisticated , asymmetrical capabilities below the threshold of war as the United States has defined it traditionally. They believe operating this way will enable them to achieve timemental, but over substantial process substantial progress, without eliciting a consequential response from the United States. Our leaders have too often found they cannot compete effectively until they use a holistic , comprehensive and forwardthinking strategy. America has powerful tools and they must be employed better than they have dig day if we are to if we are to deter our enemies and defeat those we cannot do tour. This is one of many forums we host throughout the year. For more information on our work and areas of focus we encourage you to visit our website, fdd. Org. We take no Foreign Government or foreign corporate money and we never intend to. We are glad to be joined by a distinguished audience of diplomats and representatives from the state department, pentagon, activeduty military personnel and a few members of the media. Todays event is being livestreamed and broadcast on cspan. I encourage guests here and online to join in on the conversation on twitter. Just use fdd. Thank you for being here in person, or watching on cspan, or watching online. If you are in this audience, you are not just anyone you are , participating and in many cases helping drive the policy debates in what remains a free and open society. Im going to start the questioning and get a few issues on the table and are not just then turn to you, not least the serious journalists who are with us today. But let me begin by talking up by talking about americas instruments of power. Two years ago, the National Security strategy that you oversaw said the United States was to compete with all tools of National Power. I think its fair to say that over the last decade the u. S. , has learned to use sanctions in a more muscular and targeted way and i believe you played a , role in that. The u. S. Has also utilized Cyber Capabilities to achieve ends that might have previously required economic pressure orwaa military might, samantha youve , played a role in that. The u. S. Has built bilateral and multilateral alliances to increase pressure on adversaries , and the u. S. Military has been forward thinking to ensure that we outpace enemies. I dont think it has consistent had the resources to achieve that mission. Let me just start with that, h. R. Am i painting too rosy a picture . Is there more dismal picture . How have we been doing over the past two years . Mr. Mcmaster cliff, i think you raise the essence of strategic competence, and is foundational to our ability to compete effectively against the adversaries you have mentioned. Great power competition is back with the revisionist powers of china and russia. We have a threat from nonstate actors, jihadist terrorist organizations who want to kill our children and who are the enemies of all civilized people, hostile states such as iran, youve seen what theyve done over the past several months not , only to attack broadly against the west, against our partners to keepegion, but also burning the fires of the sectarian civil war that is also allowing groups like isis, al qaeda, and other groups to continue to portray themselves as patrons and protectors of sunni arab populations in particular. So we have to be able to integrate all elements of National Power to compete effectively with powers and hostile states and nonstate actors. I would say we are doing better. But what you have seen in recent weeks, months, days, i think is an underappreciation for the degree to which all elements of National Power have to be combined to achieve sustainable , political outcomes that are consistent with our vital interests. For example when we talk about , the operations that our military is conducting, they are not operations as ends in and of themselves. They are part of a larger effort to ensure the security and prosperity of the American People, and to do that by competing effectively against determined and often as we see across the middle east, very brutal enemies. Cliff you can you pick up on any of that, and i will throw in addition. As our capabilities have evolved, i would argue so have the capabilities of our adversaries. China is well in advance of where was, taking over reefs, turning them into islands. We have deprived the Islamic State of territory, but it still exists, and i would say that those who proclaim themselves to be fighting a jihad against us have spread around the world, in more countries, far from being defeated. And russia has shown how, under putin, it can play that rather well. Russia goes into the middle east, obama says, its a quagmire, even for us, and putin says, i am willing to show how to operate and let me show you what i can do. So our adversaries are also not standing still. Me. thank you for having its an honor to be here. The map of the world is being reshaped by americas adversaries in many ways, physically as youve demonstrated, russia in crimea, China Building islands, isis has erased borders, there is a physical and virtual dimension, sam has done great work in that domain. The cyber world brings new communities, new borders and borderless communities, and you have also reshaped alliances that are not just being affected by americas adversaries, but being reshaped by how we think about power. Just to start off and take a step back, i think the map of the world is being reshaped as we speak. And the challenge we have is to give life to the strategy that h. R. Helped formulate. The problem, and this is the less rosy dimension of the picture, is that we are not good at combining elements of power but also thinking about how the , asymmetric properties of the Global Environment are actually taking place, and how we operate in them. What we have done at our center is to think about how we use economic and financial elements of power that we have used quite , well over the past 20 years to affect americas enemies, to bankrupt them, to dismantle Financial Networks that threaten us, to exclude illicit capital and rogue actors from the financial system. Thats the strategy we have used. And the reason we have been successful in that regard is that we have had primacy and we have maintained escalatory dominance. Because of the primacy of the dollar, the role of the economy and our ability to find the to define the rules of the road, thats part of it. But all of that is being challenged by our adversaries. And what is interesting, we forecasted this in the creation of our center over five years ago. We were saying the realm of economic and financial power as part of a broader tableau of asymmetric power happening around the world. Our enemies are getting smarter and more nimble, they understand how to use the elements of the financial system, they are Getting Better at the use of cyber tools they understand how , to use kinetic activity, drone warfare, other things in ways that make us more vulnerable, not just the u. S. But our , allies. So we have to think aggressively about how do we use these powers properly, strategically, sustainably. We think about how we use sanctions and financial regulations to drive the exclusion of rogue actors from the system. Secondly, we think about defensive strategies, because its the russians and the chinese and even nonstate actors that are thinking about how to use financial and Economic Resources to influence, coerce, and to shape environments. So what does that defensive posture look like . And finally one part of the , strategy that has not been fully articulated yet is how do , we use positive economic power as a complement to what we are do, both defensively offensively, to reshape the environment . This comes up when we talk about china in the one belt one road context, how are we investing strategically . How are we promoting the Good Behavior and alliances, both state and nonstate, that we want to see . So how we think about the use of the economic and financial power and that of our allies becomes a part of it. And i think we have not figured out as a country, how do we stitch this together so we can compete in an environment where our state adversaries are operating in an asymmetric domain, allying with nonstate actors, the russians with organized criminal networks, china using cyber activists and hackers, the iranians attacking not only our interests, but our allies interests . We have yet to figure out how do we deal aggressively in an asymmetric environment where, in many cases we have predominant , power and we dont know how to use it. I also want to emphasize the extent to which you have been instrumental in making clear the extent to which Cyber Weapons and Cyber Capabilities can impact our economic strength and our military strength. And i dont think everyone has been aware of this. Its not just about getting your personal information so you can be blackmailed online. This is way beyond that. Pick up on that. In 2015 we really started exploring the notion that we coined, cyber enabled Economic Warfare. That means the use by adversaries using cyber means to undermine key elements of our economy and economic strength in order to weaken us strategically. To weaken our military, our ability to finance our military, our Innovation Base, and to weaken our ability to project power strategically. Because we were concerned that these episodes of Cyber Attacks that we saw, whether it was iran against the Banking Industry in 2012, what north korea did against a u. S. Company, sony industries, and what they have been doing in south korea for many years, what china and russia have been doing. We see this as episodic. They were seen individually as acts of aggression, but they were not being taken as part of a Campaign Plan, a Campaign Plan to weaken our greatest source of is the private sector. We are the number military in one the world because we are the numberone economy in the world. The Innovation Base drives our position. We have been focusing on it, writing about it and understanding that the adversary understands it differently in beijing, moscow, we have great reports you can get online. And we were really high heartened when the notion of cyber enabled Economic Warfare was called out specifically in the 2017 National Security strategy. It was the First Time Ever our country at the highest level understood that type of intersection of our economy and our vulnerabilities to our economy and how that leads to , vulnerabilities in the strategic sense. And the center for cyber and technology innovation, we do two things. We focus on the adversary Campaign Plans, what they are going after, how they are going after it, why they want to undermine certain parts of our economy and maybe not others, looking at what they are doing in allied nations. So that is the first part, kind ringingthe bal, the bell, ringing the bell on the hill and the executive branch and dod and the department of energy because grid resiliency is critical for all of this as well as the , corporate sector. Its easy for our corporate citizens to hide as we are all being hit, or what are we supposed to do about it . So we really opened their eyes to that. But the second is that we are living, i want to say frighteningly, in a pre9 11 mindset. Except where i look at it, its the cyber vulnerabilities. So on the other part of the center, we look about how we can harden our defense because as we get out there, as anybody understands our use of sanctions , our use of treasuries more. Good call out, right . Thank you. Of the last chapter of treasuries war, juan predicted some of the conclusions as well. Its a powerful tool, but im not going to say people in glass houses should not throw stones , but we do need to harden our capital walls. Because we are out there and , when a country like iran, north korea, china, russia, looks at how they can undermine us, the cyber enabled Economic Warfare, getting into the supply chains, which we will talk about in a little bit is key to their , strategy. So at the other part of our center, we focus on what are some ways to harden the castle walls . We partnered with microsoft on a supply chain Defense Project for the pentagon. Real ways that can be piloted to make us stronger. When we talk about peace through strength, everyone nods their head, but i dont know if we thought through what that means. It essentially means theres one guy in the bar you dont mess with, hes too tough. We could be that guy, im not sure that we are. If you think about it, iran downs a u. S. Drone in International Airspace and attacked Saudi ArabianEnergy Facilities that are a key to the u. S. Economy. China has for years been stealing us blind, hundreds of millions of dollars in intellectual property, including military secrets, building their defenses on that basis and what , have we done . And again, we have got to the point where the nba dare not insult them. Russia has attempted to attack our electric grid and undermine us in various ways and , north korea has been escalating its military tests. Yes it may be that the president , tried to use a positive economic incentive with kim i think kim jongun does not believe that fire and fury awaits him if he does not compromise. And i think without that, the idea of having a nice resort on the sea of japan will not do the trick. ,will start with you, h. R what is this a about our assumptions of American Power . Do we not have the tools . Are we not using them properly . How do we reinvigorate deterrence, so that we can determine most of our enemies . Mr. Mcmaster i think that we have improved, just based on the recognition that we can compete more effectively. And im sitting next to two people who have pioneered in making us more effective in arenas of competition. Juan really started our counter threat finance efforts as part of a way to defeat terrorist organizations who attacked our country. Samantha has opened everyones eyes to this new domain of competition in cyberspace and , the use of technology to go after us in new ways to attack , our National SecurityInnovation Base, for example, in ways that we thought were invulnerable or not that important. So i think we are Getting Better, but we have to recognize that we are behind. At the end of the cold war, we ofe flush with a great sense triumph and optimism and overconfidence and maybe hubris to an extent. We thought these