Washington, D.C. Ronald Reagan Building July 13, 2005 (Remarks as Prepared)

Thank you, ladies and gentlemen. I thank all of you who join me today – Members of Congress, state and local leaders, private sector partners – and, of course, my fellow employees of the Department of Homeland Security.

Today, we gather once again in the shadow of a despicable act of terrorism. And make no mistake – the terrorists seek to destroy not only our lives, but our entire way of life. Our hearts and our prayers go out to the British people and everyone who suffered loss in this barbaric attack.

For most Americans, last week’s attacks in London were sobering and jarring reminders of the threats we now face.

But for my fellow employees at DHS, facing those dangers and reducing those threats is a daily responsibility. In his remarks about the London attacks, President Bush captured the essence of what motivates these outstanding men and women when he said: “The terrorists cannot shake our will. America and its allies will act decisively, because we know that the future of civilization is at stake in this struggle, and we know that the cause of freedom will prevail.”

All Americans owe a tremendous debt of gratitude to the patriots and pioneers who built this Department in record time. Because of their dedication, security at our ports, airports, critical infrastructure and borders has been significantly strengthened. Our nation has thwarted plots and captured terrorists. As a result, in the period since 9-11, the American people have begun to live under an umbrella of greater security, with greater peace of mind than we imagined on that terrible day.

My friends, much work has been done. Much remains to do.

My job – and the job of the leadership team at the Department – is to provide the strategic direction, tools, and aggressive support needed by our colleagues who carry out the vital mission of protecting America. We must continue to build effectiveness, agility, and capacity in this effort every day.

So we ask: What exactly are the next steps at DHS as we continue to make the homeland more secure?

2SR – Philosophy

To help answer that question, shortly after taking office at Homeland Security, I launched the Second Stage Review – a systematic evaluation of the Department’s operations, policies and structures.

We finished that review last month, I’ve spoken to the President and Members of Congress about our conclusions, and today I will explain our review and outline the path ahead for DHS.

Our review was conducted with several core principles in mind.

First, as I have said before, DHS must base its work on priorities driven by risk.

Our goal is to maximize our security, but not security “at any price.” Our security strategy must promote Americans’ freedom, prosperity, mobility, and individual privacy.

Second, our Department must drive improvement with a sense of urgency. Our enemy constantly changes and adapts, so we as a Department must be nimble and decisive.

Third, DHS must be an effective steward of public resources.

Our stewardship will demand many attributes – the willingness to set priorities; disciplined execution of those priorities; sound financial management, and a commitment to measure performance and share results. Perhaps most of all, DHS must foster innovation.

Finally, our work must be guided by the understanding that effective security is built upon a network of systems that span all levels of government and the private sector.

DHS does not own or control all these systems.

But we must set a clear national strategy, and design an architecture in which separate roles and responsibilities for security are fully integrated among public and private stakeholders.

We must draw on the strength of our considerable network of assets, functioning as seamlessly as possible with state and local leadership, law enforcement, emergency management personnel, firefighters, the private sector, our international partners and certainly the general public. Building effective partnerships must be core to every mission of DHS.

So, with these principles in mind – we went to work.

2SR Process

From across the Department and elsewhere in the federal government, we pulled subject matter experts and talented individuals away from their day jobs to focus on how well we tackle our tough fundamental challenges: prevention, protection, and all-hazards response and recovery.

This Second Stage Review utilized 18 action teams -- involving more than 250 DHS staff – to evaluate specific operational and policy issues. We asked each team to answer a couple of simple questions. First, freed from the constraints of existing policies and structures -- writing on a clean slate -- how would you solve a particular problem? And then, how would you take the best solutions and implement them aggressively?

We actively sought opinions from hundreds of public and private partners at the federal, state, local, tribal and international levels. Finally, we examined the DHS organizational structure, to make sure that our organization is best aligned to support our mission.

This work, along with the experience of the last two years in the Department’s existence, will now play a critical role in setting our agenda moving forward.

Six Imperatives

In the weeks and months to come, the Department will launch specific policy initiatives in a number of key areas. Here, then, are six of the key imperatives that will drive the near-term agenda for DHS. We must:

1. Increase preparedness, with particular focus on catastrophic events.
2. Strengthen border security and interior enforcement and reform immigration processes.
3. Harden transportation security without sacrificing mobility.
4. Enhance information sharing with our partners, particularly with state, local and tribal governments and the private sector.
5. Improve DHS stewardship, particularly with stronger financial, human resource, procurement and information technology management.
6. Re-align the DHS organization to maximize mission performance.

We will put more muscle on the bones of these six areas and others with additional actions and policy proposals in the weeks and months ahead. But today, let me give you a broad overview of our agenda for the future of the Department.

1. Preparedness

First, preparedness. In the broadest sense, preparedness addresses the full range of our capabilities to prevent, protect against, and respond to acts of terror or other disasters.

And, of course, America’s critical infrastructure is not a government asset; roughly 85 percent is privately owned or operated.

At the outset, we must acknowledge that although we have substantial resources to provide security, these resources are not unlimited. Therefore, we as a nation must make tough choices about how to invest finite human and financial capital to attain the optimal state of preparedness. To do this we will focus preparedness on objective measures of risk and performance.

Our risk analysis is based on these three variables: (1) threat; (2) vulnerability; and (3) consequences. These variables are not equal – for example, some infrastructure is quite vulnerable, but the consequences of attack are relatively small; other infrastructure may be much less vulnerable, but the consequences of a successful attack are very high, even catastrophic.

DHS will concentrate first and most relentlessly on addressing threats that pose catastrophic consequences. Some of the tools needed to prevent, respond and recover from such awful scenarios are already in place; but others need significant improvement.

The first step in enhancing national preparedness is establishing a preparedness baseline that measures the effectiveness of our planning for preventing, protecting against, and responding to terrorist acts or disasters. A second stage review team has, therefore, constructed the model for an analytic matrix that will set that baseline. The matrix will allow us to match possible threats against possible targets, and will map the current state of prevention, protection and response planning with regard to each. This matrix will be a critical tool enabling us toentify and remedy current gaps in preparedness.

Bringing greater planning discipline to each of these risk scenarios is another dimension of our preparedness mission. And simple common sense counsels that we begin by concentrating on events with the greatest potential consequences. That is why the Department’s recently released National Preparedness Goal -- and additional, risk-based planning -- will form our standard in allocating future DHS grants to our state and local partners so that we build the right capabilities in the right places at the right level. Federal money should be distributed using the risk-based approach that we will apply to all preparedness activities. And DHS needs the discretion to award infrastructure protection grants in a more flexible manner, as provided by the Administration’s proposed Targeted Infrastructure Protection Plan.

Of course, federal funds are not the only resources available to strengthen the protection of our valued infrastructure.

Three years ago, Congress passed the SAFETY Act to enable our private sector partners to develop innovative technology to protect the homeland without the fear of unduly high transaction costs imposed by the possibility of frivolous lawsuits. There is more opportunity to take advantage of this important law, and we will do so.

Finally, of all the catastrophic threats we face, a nuclear attack on our soil would be uniquely threatening to our society. The President’s budget asks Congress to establish and fund a Domestic Nuclear Detection Office (DNDO) to develop and deploy the next generation of systems that will allow us to detect and intercept a nuclear threat. We have begun to take the steps to make this office a reality. The DNDO will report directly to me under our new structure – and I have asked Congress to support this critical resource.

2. Borders and Immigration

Our second imperative is the need to strengthen border security and interior enforcement, as well as improve our immigration system. We cannot have one approach without the other.

As to the first, we must gain full control of our borders to prevent illegal immigration and security breaches. Flagrant violation of our borders undercuts respect for the rule of law and undermines our security. It also poses a particular burden on our border communities. We are developing a new approach to controlling the border that includes an integrated mix of additional staffing, new technology and enhanced infrastructure investment. But control of the border will also require reducing the demand for illegal border migration by channeling migrants seeking work into regulated legal channels.

I look forward to working with Congress this year to improve border security significantly through the President’s Temporary Worker Program (TWP).

Immigration policy is about more than keeping illegal migrants out. Our heritage and our national character inspire us to create a more welcoming process for those who lawfully come to our shores to work, learn and visit. Secretary Rice and I will, in the near term, announce a detailed agenda of work and innovation that the Department of State and DHS have begun together to ease the path for those who wish to visit, study, and conduct business in this country.

Of course, some people come to our shores to seek a better life for themselves and their children. Ours is a nation of immigrants, but, for legal immigrants trying to become American citizens, the process can be confusing, frustrating, and seemingly endless.

Part of the problem is that the current business model fosters a long delay between application and final adjudication of applicants for residence and citizenship, during which many applicants stay here as temporary residents. But this system puts some of the most important security screening at the end of a lengthy process rather than the beginning, and leads to an unnecessarily high rate of rejection late in the process.

As a result, too often, this system leaves a negative first impression of our nation with our new fellow countrymen. Worse yet, it causes unnecessary security risks because people enjoy temporary residence while we are completing the screening process. Restructuring this process to enhance security and improve customer service will be an important part of our agenda.

3. Transportation Security

Creating better systems to move people and goods more securely and efficiently was a core objective in founding DHS. It remains so today.

(a) Enhancing Transit Safety. The tragic events in London last week served as a reminder of the terrorist threat against innocent civilians in our mass transit systems. Following last year’s Madrid train bombings, DHS took important action not only by increasing funding for rail security, but also by conducting over 2,600 individual consequence assessments. Since 9/11, the Transportation Security Administration and the Federal Transit Administration have worked extensively with the transit industry and first responders to strengthen the overall security capabilities of transit systems, with a special emphasis on the largest systems. Together, we have developed a significant tool-kit of protective measures, which include the coordination and training needed to recover from possible attacks. Multiple funding streams within DHS have been made available to support such projects, including eligibility for roughly $8.6 billion under our State Homeland Security and Urban Area Security Initiative grant programs.

We are also working to develop next-generation explosive detection equipment specifically for use in mass transit systems. We will continue to apply enhanced resources to this groundbreaking work. At the same time, we must also prepare for terror attacks of even greater consequence -- attacking transit systems with biological, radiological or chemical agents. We now have a network of bio-sensors, but we will accelerate the development and deployment of next generation technologies that more quickly detect biological, radiological and chemical attacks.

(b) Strengthening Aviation Security. After 9-11, TSA was created to deny terrorists the opportunity to use aircraft as weapons and to defend our vital national infrastructure. Extraordinary progress has been made, but more remains to do. In aviation, our security and efficiency can be strengthened by better use of technology, both existing and next generation technologies.

Let me observe that the Congress intended TSA to be almost entirely supported by user fees, but it is not. The Administration has proposed a modest increase in user fees to fund the infrastructure needed for this job. I believe travelers are willing to pay a few dollars more per trip to improve aviation security and enhance efficiency. I call on Congress and the aviation