- President Trump is setting records

by approving a $716 billiondefense budget this year.

- I've rebuilt and am in the process

of rebuilding our military.

We're gonna have the strong, very shortly,

we're gonna have the strongest military

our country has ever had.

- But a new report toCongress is sounding alarms

that the US is losing its military edge,

warning the countrycould lose possibly a war

if it broke out with China or Russia.

The bipartisan NationalDefense Strategy Commission

issued the report.

The Commission includes 32 recommendations

on why the US is losing its edge,

including a lack of fundingand a lack of innovation.

Well John Hannah served

as former Vice President Dick Cheney's

National Security Adviser,and he's now Senior Counsel

at the Foundation forDefense of Democracies

and he joins us now.

John, thanks so much for being here.

- Thank you, Jenna.

- Defense Secretary JamesMattis said he was humbled

by the largest defense budget in history,

but now, it sounds likeit wasn't enough money.

What does that mean for thefuture of the military, John?

- Well, this is a veryalarming report, Jenna.

It basically says that, ifthe US is not able to sustain

the kind of defense increasesthat President Trump allowed

for 2018-2019 over the next decade or so,

the United States risksreal strategic insolvency

and the danger that wecould lose regional wars

in critical theaters of operations,

including a possible conflictwith China over Taiwan

or Russia over the Baltic States.

- Now this report out by acommission of bipartisan experts

says the US would sufferunacceptably high casualties

and even lose a war against,say, China or Russia.

How dire, John, is this warning?

- It's a real dire warning.

This is a flashing red light

to the American Presidentand the American Congress

that they really need to payattention to the question

of whether or not we'vegot enough resources,

if we know how to fight and win these wars

with major peer competitors

in China and Russia, in particular,

who have spent the last several decades

building up capabilities to challenge

and defeat the United States in areas

that have been key to American security

and prosperity now for several decades.

- And the report did agreewith the goal of the President

to massively overhaul the military,

but said that the overhaulwasn't happening quick enough.

Is it possible to speed that up at all?

- It's very difficult I think,

particularly now we dohave a Democratic Congress

coming into place, being able to sustain

these kinds of defense increases.

The Commission actually talks about

three to five percentincreases year over year.

That's gonna be, I think,very, very difficult

without some major re-jiggering

of our entire American budget.

- John, what is the solution then?

- Well, the solution, I think,

is for the President and the Congress

to figure out a way to get together

to understand the kindof national emergency

and challenges that we face

and figure out a bipartisan way forward

to meet what, after all,is the first obligation

of our national governmentunder the Constitution,

which is to providefor our common defense.

- John Hannah, thank you so much.

Good to see you, sir.- Thank you.