Ladies and gentlemen, it is an honor to be among you this morning. I take distinct pleasure in being invited to a place so fervently committed to the success of America's future, and the continued promise of freedom and prosperity.

As you well know, our future as a nation is founded on the heritage of our past. And it is the very firmness of that heritage that will determine the strength of our future. I represent a venerable service that has been an integral part of that heritage from the beginnings of our nation.

But we do not live in the past. And we have
gathered here today to talk about the future. As President Reagan once said, "While I take inspiration from the past, like most Americans, I live for the future."

I firmly agree.

It has also been said that the future has a way of arriving unannounced. The future arrived suddenly, violently, and without warning on a clear autumn day in September. The future, ladies and gentlemen, is now.

In past years, our view of national security has been projected mainly abroad, rather than within our own borders. However, after the recent attacks on our own cities, we now have good cause to be more concerned about the threats right under our own noses as well. Today, we suffer under the constant threat of
terrorism as a means of coercion or retaliation, as much of the world already has. That will likely continue for some time in the future.

In past years, the United States was ill-
prepared to deal with such an enemy as the terrorists who attacked our country on September 11. The enemy who attacked us on that day is unlike any other in our history. He has turned the tools of our own prosperity as weapons against us.

As a nation that depends so heavily on the oceans and sea-lanes as avenues of that prosperity, we know that whatever action we take against further acts of terrorism must protect our ports and waterways and the ships that use them, which are arguably more valuable to our commerce with the world than airlines and trade centers, and even more vulnerable.

Valuable and vulnerable--not a bad combination, if you're on the targeting team for the bad guys.

Terrorism is not the only threat we face,
however. It is only one of many modern threats that confront us. Migrant and drug smuggling, for example, compound the threat of terrorism, because they contribute to the illicit movement of people, money, and weapons across borders.

These threats have been with us for many years. They have continued to grow in severity each year, and will likely continue into the future. Profits from these non-nation-state-sponsored threats are well-documented as significant funding engines for international terrorism.

Common to each of these threats is the potential for an attack against the United States by a state or non-state actor who is either unwilling or unable to confront us directly.

All of these threats bring the problem of national security much closer to home.

My thesis today is simply this: the Coast Guard--with its multiple missions, maritime expertise, military discipline, and civil law
enforcement authority--is a unique instrument of a broad strategy to ensure our nation's security. And
I believe that in its own way, it has become the
harbinger of the future.

Let me explain what I mean by examining how the Coast Guard is working to meet the emerging challenges of a changing world and the "new normalcy," both at home and abroad. But first, I'd like to examine more carefully what those challenges are.

HOMELAND SECURITY AS THE PRIMARY ELEMENT OF A NATIONAL SECURITY STRATEGY

Looking at the multitude and complexity of the threats and challenges we now face, it's kind of like preparing to play a game of checkers against a familiar opponent, only to sit down and discover that you are already ten moves into a chess game but, it is three-dimensional chess against multiple opponents whose pieces are unconstrained by your previous understanding of their rules of movement. Such a game would be so unrecognizable that we wouldn't even know what to call it. And that is true of this new era in which we are responsible for national security.

Homeland Security has emerged as a very important element of a broader, deeper, and more complex National Security Strategy. The President has now responded to the new complexity of threats and challenges by establishing a new Cabinet-level position, the Director of Homeland Security, whose job it is to coordinate the national effort to defend the homeland against terrorism-and the other
transnational threats that feed it.

Much has been written on the issue of Homeland Security over the past few years. Much of it has been rather narrow in scope, focusing mainly on "Homeland Defense" as a function of the military. This view is much too restrictive, however, as recent events have proven.

The main exception to this rather narrow view has been the Commission on National Security Strategy/21st Century, a.k.a. the Hart-Rudman Commission. Their findings were published in a report earlier this year.

Here is what the Hart-Rudman report said in a nutshell: "The United States will become increasingly vulnerable to hostile attack on the American homeland, and U.S. military superiority will not entirely protect us...."

And it concluded: "[T]he security of the American homeland from the threats of the new century should be the primary national security mission of the U.S. government."

The commission finally recommended:

The President should develop a comprehensive strategy to heighten America's ability to prevent and protect against all forms of attacks on the homeland, and to respond to such attacks if prevention and protection fail.

The commission was right.

Recently, I have had the pleasure of sitting with Senator Hart and several other members of the Hart-Rudman commission on a variety of panels. Senator Hart has painstakingly laid out what he calls "Five New Realities" of the new normalcy in America.

First , our borders are not secure.

Second , traditional rules as we have known them concerning national security no longer apply.

Third , the distinction between war and crime is blurred.

Fourth , the conflicts in the world today will be cultural, rather than ideological.

And fifth , we are being forced to make tough choices between constitutional liberties and security.

Therefore, we will need a new strategy to meet the challenges of the new realities of American life.

What might such a strategy look like, given that traditional and conventional uses of military, diplomatic, or economic power would likely not be effective in countering the threats?

It must be preemptive in nature; it requires us to develop special forces with new skills; it demands restoration of a broader and deeper intelligence
network; it must rely on an expanded role of the militia and national guard. Above all, it must never sacrifice our constitutional principles.

Some additional capability is needed.

That capability is civil authority blended with the other forms of state power.

THE IMPORTANCE OF CIVIL AUTHORITY TO HOMELAND SECURITY

Civil authority has usually been linked mainly with domestic security, rather than national security policy. But as the Hart-Rudman Commission observes, "the distinction between national security policy and domestic security is already beginning to blur and in the next quarter century it could altogether disappear."

When viewed against transnational and asymmetric threats, such blurring tends to make sense. Terrorism, for example, has consistently been defined as a criminal act, and if terrorists are rooted out from among our own population, they will most likely be tried as criminals. The proper response to a criminal act within our own borders is to enforce the law. Yet, we have found it necessary also to use military means to destroy terrorist organizations that have a global reach, and the nations that give them refuge.

Similarly, inspecting cargo shipments for contraband is an expression of civil authority, whether the contraband is computer technology, financial instruments, drugs, or weapons of mass destruction. But that has not prohibited us from using Navy ships as platforms for Coast Guard boarding teams to interdict cocaine shipments headed for the United States.

We have to be careful, however, that we do not blur our vision to the point that we can no longer distinguish the big picture. A correct response to these new threats must adhere to the principles of the Constitution and the rule of law. We must continue to protect the civil liberties of our citizens while we protect their security.

William Gladstone, the Prime Minister of Britain during the reign of Queen Victoria, once wisely observed, "Liberty must be curtailed to be secured."

On the other hand, another wise man by the name of Ben Franklin once said, "They that can give up essential liberty to obtain a little temporary safety deserve neither liberty nor safety."

That's the delicate balance we must maintain.

We must protect our nation from those who would do us harm. But if our gut reaction to terrorism or any other threat is to militarize our borders, we would undermine our own freedoms, and we would hand a victory to the terrorists.

Though we can and should use the might of our military to meet these threats at our borders, it must always be used only as necessary to support and aid those who have the responsibility to enforce the civil authority of America.

THE MARITIME DIMENSION OF HOMELAND SECURITY

Let's talk briefly now about the maritime dimension of Homeland Security. First, a few facts.

Maritime industries contribute over $1 trillion annually to the gross domestic product. Over 95 percent of our commerce is carried on through the seaports. We have about 95,000 miles of coastline in this country, and 3.5 million square miles of EEZ (exclusive economic zone). More than 7,500 ships and 200,000 sailors make 51,000 port calls every year in the United States. And those ships carry 6.5 million passengers, 1 billion tons of petroleum, and 6 million containers a year--that's 16,000 a day.

With that picture in mind, how do we prevent another attack? And what can the Coast Guard do to protect the vulnerability of our maritime interests? More importantly, how do we get out of the response mode and into the prevention mode?

It's about prioritizing difficult lists and getting very good at risk-based decision making.

Preventing another attack requires an understanding of the maritime dimension of Homeland Security. We can't afford to bring the maritime dimension of the economy to a stop. After September 11, we painfully restored movement by aviation in days. The aftermath of losing several ports would involve months, if not years, of recovery.

The biggest challenge facing our marine transportation system today is how to ensure that
legitimate cargo is not unnecessarily delayed as we and other nations introduce enhanced security measures against some very real and potent threats.

Sustained prosperity clearly depends upon our accommodating the global trade that is predicted to double or triple in the next 20 years. Most of that trade will take place through our seaports.

So government needs to be attentive to finding ways to minimize the disruptions and delays caused by federal inspections and other requirements in our seaports. More stuff has to move through faster--so ports need to become more open.

But not so fast!

Ensuring maritime security suggests a requirement to tighten down the ports. Government has an obligation to keep illegal immigrants, drugs, weapons, and other contraband from entering
and leaving through those same ports whose throughput we want to maximize in the interests of prosperity.

This is precisely the dichotomy presented to us in the Hart-Rudman Commission Report--Phase I.

MARITIME DOMAIN AWARENESS

How in the world do we protect our nation's maritime security in such a dynamic environment against such elusive threats? Given the incredible numbers of people and goods cascading over international borders and through our ports, how do we filter bad from good, and the dangerous from the benign? These are questions that we had discussed rather academically until September. They have now become vitally important to us as a service and as a nation.

Today, the answer unfortunately is we don't and we can't!

We need to develop a systematic approach of complementary security measures to put together an effective offense and defense on this multi-level chessboard of maritime security.

Of course, we need to think more seriously than ever about how to prevent, how to respond, and how to manage the consequences of asymmetric attacks. The old paradigm of prevention, response, and consequence management failed us on September 11. It must now become awareness, prevention, response, and consequence management.

Awareness involves recognizing the threats well in advance, and anticipating our vulnerabilities. In the maritime domain, it's about knowledge of ships, people, and cargo. It has to do with having access to detailed intelligence about our adversaries, and sharing that information more effectively among federal agencies and with our domestic and international partners in both the private and public sectors.

Not just talking about it, but doing it.

Without better awareness, we will be forced
to take more stringent actions with regard to prevention and response that will close down our economy and threaten our economic security.

Maritime Domain Awareness (MDA) is a concept that serves to reconcile the competing interests of security and prosperity in our ports and waterways. MDA covers all of the information requirements of everybody with any responsibility for homeland security in the maritime domain.

Applied to the government interest of getting more cargo through Customs and Coast Guard inspectors in less time with greater security, its
key elements would be an integrated, accessible database of information; point of origin inspections by U. S. inspectors; sanitized facilities; in-transit transparency; high technology sensors, readers, and gamma-ray scanners; and solid risk-based decision-making forums charged with taking on and solving problems.

Thus armed, the agencies on the front lines can take a risk management approach to decide which vessels need to be boarded on the high seas, based on the greatest threats represented to us.

Maritime Domain Awareness will enhance homeland security by allowing us to push the maritime borders out from the coastline by sharing information on international arrivals and departures within the United States and among our partners around the world, and that will help prevent future attacks.

We could even provide incentive to the good guys by offering "Quick-pass" handling to those who are fully compliant on security measures.

MDA will also help by telling us what is going on daily in our ports and waterways--events that very well could have escaped our attention before, but may be vital to understanding the impending threats against us.

International and domestic cooperation, both civil and military, is essential in this regard, because we can't hope to ensure our security by working alone or by waiting until the threats have already crossed the thresholds of our ports.

Awareness is the key to preventing the potential threats from being realized and becoming a consequence to manage.

It is an all-hands evolution--including the return of Coast Guard to important national security
missions in the deepwater environment.

THE COAST GUARD'S UNIQUE QUALITIES

What is the role of the Coast Guard in Homeland Security?

The Coast Guard is committed to improving awareness of our maritime vulnerabilities and threats, using the very means that I've already described to you.

With regard to the other elements of a maritime security strategy--prevention, response, and consequence management--the Coast Guard also stands ready.

As both a military service and a federal law enforcement agency, we are uniquely positioned among federal agencies to fight an enemy that crosses boundaries with seeming impunity.

Threats can pose as legitimate trading vessels very easily among the large volume of commercial traffic that plies our waters.

Somebody has to engage these vessels one at a time, up close and personal. Somebody has to
distinguish the suspicious from the obviously
innocent. To separate the guilty from the merely suspicious, somebody has to get alongside and put a boarding team aboard, even if the suspect vessels resist or won't stop.

Somebody has to size up each case and dispose of it based on the complex humanitarian, diplomatic, military, geo-political, environmental, and legal issues at stake.

Somebody has to coordinate proposed enforcement actions with other government departments, flag states, law enforcement agencies, and everybody else who has a legitimate voice in the matter. It must all be done according to the rule of law.

For 211 years, that somebody in our country has been the United States Coast Guard.

The Coast Guard offers scalable command and control frameworks suitable for preventing or responding to nearly any military or civil domestic emergency.

Our Captains of the Port have broad and strong legal authority to secure and manage any situation that arises in our ports or on our waterways. This authority gives them the legal basis for ordering or approving just about any movement of shipping within the port. And our Port Security Units give enforcement teeth to that legal authority.

To that foundation, we offer experience in
disaster relief and pollution response--experience that has made us the most proficient agency
anywhere in conducting emergency operations through the Incident Command Structure. Our Incident Command Structure, which has been adopted by the Federal Emergency Management Agency, is the most effective way of coordinating inter-agency responses to domestic emergencies.

And if one of those emergencies should require the involvement of the Department of Defense, our status as one of the nation's five armed services links us to the others in a joint warfare environment.

The sum of these elements--legal authority, coastal assets, command structure for military and civilian agencies, command and control systems--offers a bridge among the various players who have to get involved within the civilian inter-agency community and the Department of Defense.

THE COAST GUARD RESPONSE

Since September 11, we have had five goals: to control movement of shipping in our ports, increase Maritime Domain Awareness, increase presence within the ports, inventory critical infrastructure, and reach out to others who can help us--the Office of Homeland Security, the Joint Forces Command, the U.S. Navy, state and local governments, the private sector, and the international maritime players. The purpose of these goals has been to restore public confidence in the marine transportation system.

Immediately after the attacks on September 11, the unique multi-mission nature of the Coast Guard allowed us to increase our security posture, using existing active-duty, reserve, civilian, and auxiliary personnel, as well as existing shore units, ships, boats, and aircraft.

We began placing sea marshals on arriving commercial vessels to control the movement of shipping in some ports, which we hope to do on a broader basis very soon. We increased to 96 hours the advance reporting requirement for foreign flag vessels arriving in U.S. ports.

Coast Guard men and women everywhere have significantly increased the security of the nation's ports and waterways, protected people and property, and assisted in rescue and recovery efforts. We have increased our presence within the ports, while doing our very best to keep commerce flowing smoothly.

We have begun to take inventory of critical infrastructure in each of our major ports. We also have begun to assess the vulnerability of those ports. It is clear, however, that the Coast Guard does not have adequate resources to guard every piece of that infrastructure, even in the Tier-One ports.

Our broad outreach to federal, state, and local government partners, as well as members of the maritime industry is leading to a mutual understanding of ways and means to improve the security of our ports and waterways.

Although the Coast Guard is primarily responsible for the security of our ports, it is clear that we can't do it alone.

Civil and military authorities will act together to protect our ports and waterways. Private industry must also take a lion's share of responsibility for protecting their vital interests.

The Coast Guard is making and will continue to make our contributions where we can. And we will also be there to ensure that the industries achieve a layered approach to security, including adequate facility, vessel and port security plans--the exercises that will demonstrate their adequacy--and the resources that will make them real.

CONCLUSION

The role of the Coast Guard in homeland security is to help provide the maritime security piece to the comprehensive puzzle. We aim to be so effective as to remove maritime security from the host of issues that Tom Ridge, the Director of the Office of Homeland Security, is concerned about.

Last week I traveled to Ottawa with Governor Ridge to attend a joint U.S.-Canadian meeting on border security. It was an enormously successful session that developed a 30-point action plan. We found our Canadian partners to be very forward-leaning with respect to a long list of issues often dealt with between our respective INS services,
customs services, and coast guard services.

Last month, I traveled to London to address a meeting of the International Maritime Organization. In that meeting, the member nations agreed to commit time, resources, and energy to addressing the issues of international maritime security as a priority of concern to us all.

The Coast Guard is committed in every way to be most effective in the maritime domain by helping to coordinate the efforts of various levels of federal, state, and local civil authorities, as well as the industries of the private sector, and our partners around the world. We already perform on a smaller scale the necessary function that is vital to the overall success of the Office of Homeland Security.

Some people see this function as an adjunct
mission--another new task added to a growing constellation of tasks for the Coast Guard. But I
see it as our North Star. The mission of maritime security may be more urgent today than it was three months ago, but it is no less important than it was 211 years ago.

Since our founding in 1790, our primary
purpose has been to provide maritime security to our homeland by guarding its coast.

We plan to continue to do just that.

Thank you. Semper Paratus.

Admiral James M. Loy is Commandant of the U.S. Coast Guard.