JIM LEHRER: President Obama presents a revamped national security team.

The shuffle has been in the works for some time. And today, the president made it official in the White House East Room.

PRESIDENT BARACK OBAMA: I have worked closely with most of the individuals on this stage, and all of them have my complete confidence. They are leaders of enormous integrity and talent who've devoted their lives to keeping our nation strong and secure. And I am personally very, very grateful to each of them for accepting these new assignments.

JIM LEHRER: Today's announcement was triggered by Secretary of Defense Robert Gates, a holdover from the Bush administration. He told the president last year he wanted to step down this summer and has now fixed his departure for June 30.

CIA Director Leon Panetta was the president's choice today to succeed Gates at the Pentagon. Panetta would be the oldest person to become secretary of defense at 72 years old. He's served in government for decades, as budget director and White House chief of staff in the Clinton administration, and before that, as a longtime Democratic congressman from California.

LEON PANETTA, CIA director: As the son of immigrants, I was raised to believe that we cannot be free unless we are secure.

Today, we are a nation at war. Yet, this is also a time for hard choices. It's about ensuring that we are able to prevail in the conflicts in which we are now engaged. But it's also about being able to be strong and disciplined in applying our nation's limited resources to defending America.

JIM LEHRER: The nominee to replace Panetta at the CIA: Army Gen. David Petraeus. The general is now overall commander of the International Security Assistance Forces in Afghanistan. Prior to that, he ran the U.S. Central Command, and he oversaw coalition forces in Iraq during the surge of U.S. troops there.

GEN. DAVID PETRAEUS, International Security Assistance Force: I've had the privilege of working very closely with the quiet professionals of the Central Intelligence Agency. I have seen first-hand their expertise, their commitment to our nation and their courage in dangerous circumstances. Their service to our country is of vital importance.

JIM LEHRER: The president wants U.S. Marine Lt. Gen. John Allen to take over in Afghanistan. Allen is Petraeus' former deputy at CENTCOM. He joined the Marine Corps in 1976 as a commissioned officer after graduating from the U.S. Naval Academy.

LT. GEN. JOHN ALLEN, International Security Assistance Force: I understand well the demands of this mission.

And Mr. President, if confirmed by the Senate, I will dedicate my full measure to the successful accomplishment of the tasks and the objectives now set before us.

JIM LEHRER: Gen. Allen would be joined in Afghanistan by a new U.S. ambassador, taking the place of Karl Eikenberry, who's expected to leave shortly.

Ryan Crocker is being nominated for the posting in Kabul. Crocker is a career diplomat who retired from the State Department after serving as U.S. ambassador to Iraq.

RYAN CROCKER, U.S. ambassador to Afghanistan-designate: The challenges are formidable, and the stakes are high; 9/11 came to us out of Afghanistan. Our enemy must never again have that opportunity.

JIM LEHRER: The personnel changes come as U.S. forces in Afghanistan are set to begin pulling out in July. But recent incidents won't make that any easier.

Yesterday, an Afghan pilot shot and killed eight American soldiers and a U.S. contractor at the Kabul airport. It was the seventh such attack this year. On Monday, more than 400 prisoners, mostly Taliban, escaped from a prison in Kandahar, after digging a 1,000-foot-long tunnel. And there are reports that Pakistan is pressing Afghan President Karzai to scale back his country's reliance on the U.S.

Those challenges and others will confront the president's new team once they clear Senate confirmation. White House officials indicate they hope to have Panetta in place at the Pentagon by July 1 and Generals Petraeus and Allen in their new positions by September.

Some analysis now from Jessica Tuchman Mathews, president of the Carnegie Endowment for International Peace. She served in the Carter and Clinton administrations. John McLaughlin, former CIA deputy director and then acting director, he now teaches at the Johns Hopkins School of Advanced International Studies. And Army Gen. Jack Keane, Army vice chief of staff from 1999 to 2003, he now has his own consulting firm.

First, just in general, General, what do you think of the new team?

GEN. JACK KEANE (RET.), U.S. Army: Well, they're good choices. They're very capable.

And I think it says a lot about continuity. Three of them are already serving in national security. And they have got a lot of experience with it. And we're bringing Ryan Crocker back into government, absolutely one of the most accomplished diplomats operating in this region we've ever had. So, it's -- they have made all solid choices.

JIM LEHRER: All solid choices?

JESSICA TUCHMAN MATHEWS, Carnegie Endowment for International Peace: Oh, yes. And individual ability, continuity, ability to deal with Congress, I think, and ability to sell the plan in Afghanistan, those were -- that's what they were looking for here.

JIM LEHRER: What do you see?

JOHN MCLAUGHLIN, former acting CIA director: Yes, very much so.

I can't think of anyone more prepared to step in behind Bob Gates than Leon Panetta. And at CIA, there is always a little anxiety when a popular, respected director like Leon Panetta leaves, but I'm confident they will embrace Gen. Petraeus.

JIM LEHRER: Jessica, Jessica Mathews, what about the idea that -- though, that there is no new face here? It is continuity. And is continuity always a good thing, when you don't have any fresh faces, any fresh thinking that comes with it?

JESSICA TUCHMAN MATHEWS: Well, I would say that the flip side of continuity is fresh ideas.

And if -- if you develop a sense in an administration that only insiders can see what they are doing, can understand it, can execute it, then I think, pretty soon, you get a -- sort of a feeling of circling the wagons, both the perception of it and the reality of it. And that's a -- that's a weakness that every administration has to guard against.

So, I think there is a cost to always and only looking inside.

JIM LEHRER: Do you agree?

JOHN MCLAUGHLIN: Well, I see it a little differently. I think the world itself today guarantees that there is no continuity. So, in other words, whatever team is there -- and these are all qualified, proven people -- they are going to have to deal with turmoil in the world and transition.

So, there is no plan someone can put on the table and say, we're going to follow that ceaselessly and without any change over the next period of time. So...

JIM LEHRER: But nobody should expect any dramatic differences with the total -- what the team itself has been doing and what the new team will do, correct?

GEN. JACK KEANE: Well, that's correct, in terms of what is in front of them.

JIM LEHRER: Policy and stuff, yes.


But, I mean, listen, we deal with strategic surprise continuously. We just had it again with the revolutions that are taking place in the Middle East. Most people did not have that on their charter. So, having experienced, capable professions that have been through crisis before, I think, bodes well here to deal with it.

My only reservation about all of this is taking Petraeus away from Afghanistan at this critical time while we're trying to change the momentum in that war and how much he means to that. That is my single reservation with it.

JIM LEHRER: And he would be replaced by Gen. Allen. You have some questions about Allen or just -- just leaving Petraeus...

GEN. JACK KEANE: No, no questions about Allen. Allen is overseeing that war from CENTCOM. He is Gen. David Petraeus's recommendation. He has got a tremendous reputation himself.

It's just that this is a very critical time. And let's be frank about it. I mean, Petraeus is the best we've got. And we're right in the middle of turning this war around.

JIM LEHRER: And the same thing has been said about Bob Gates, the secretary of defense, that he's going to be very tough to replace by anybody, even Leon Panetta. Do you agree?

JESSICA TUCHMAN MATHEWS: I do. And I have a slightly different view, I think, than John did about Panetta.

Obviously, nobody comes close to him in Washington experience, at both ends of Pennsylvania Avenue, on the Hill and in the White House, as chief of staff. And he knows budget-cutting. But he doesn't know defense, per se, right?

And, you know, coming in not knowing the culture of that building and the substance of the thousands of issues that he has to deal with is to come in, I think, with one hand tied behind your back. It's -- it's - you've got two wars. You have got huge a budget cut coming; in the Pentagon, issues of -- I mean, cuts of bone and of fat are all tangled up. You can -- there is plenty of waste.

JIM LEHRER: And machines as well.

JESSICA TUCHMAN MATHEWS: But you have to have a vision of what kind of military you are trying to build in order to get the cuts to make sense. And he's coming in, really, without experience on those issues.

So, I think there's a real challenge there.

JIM LEHRER: Speaking as a military man, how do you see that? Is Panetta really the man to run the Department of Defense?

GEN. JACK KEANE: Well, first of all, Gates is really tough shoes to fill.


GEN. JACK KEANE: He's one of the most effective secretaries we have ever had. So, that would be tough, no matter who you are picking.

But what I like about this is, look, Panetta has got a real solid reputation for good judgment, common sense, works well with people, listens to people. At the same time, he's been on this national security team, listening to all the policy formulation and development that's been taking place.

So, his knowledge is very high coming in, even though he specifically doesn't know how those departments are running. I think his spin-up will be pretty quick.


JOHN MCLAUGHLIN: ... because I think one of the things we have to remember here is that the CIA, since 9/11, has been essentially a war-fighting machine.

And so Leon Panetta, by virtue of his time there, has been very close to the military. And there's no closer relationship, by necessity, in Washington -- or should be -- than between the CIA director and the secretary of defense.

JIM LEHRER: Do they get along? Did Gates and Panetta, Gates as secretary of defense, and Panetta as head of the CIA, did they work well together, play well together, as they say?

JOHN MCLAUGHLIN: Absolutely, very closely together. Before they came to office, they knew each other well. And after coming to office, they were very close.

JIM LEHRER: Now, correct me if I'm wrong, but the general consensus was that when Panetta became head of the CIA, some of the folks in the agency doubted whether or not he was qualified to come in. And he was looked upon as somebody, a politician who had come in and may not be the right person.

He did -- did he, in fact, win over the troops of the CIA?

JOHN MCLAUGHLIN: He did very much so. There's a bit of a myth that the CIA will not embrace an outsider. They will if it's someone who is as respected and connected and savvy as Leon Panetta.

But to be fair, I mean, he didn't know a lot about intelligence when he came. He was a very quick study. And he did the thing that a CIA director has to do in order to succeed. And that was, he listened. And he didn't bring a lot of people with him. He brought in one person with him. He came in...

JIM LEHRER: One outside person with him?

JOHN MCLAUGHLIN: Only one person came with him, his chief of staff.

JIM LEHRER: Everybody else that is under him at the CIA now are people who were already in office?


JIM LEHRER: Is that unusual?

JOHN MCLAUGHLIN: It is unusual. And -- but it sends a message to the troops there that this is a person who is going to rely on them, look to them, show them a lot of respect.

You know, the CIA is always in the midst of controversy, so they are always looking for someone who can defend them, stick up for them. And he's done that. And he's learned his brief very well. So...

JIM LEHRER: What do you think about turning the CIA over to a military man, Petraeus?

JESSICA TUCHMAN MATHEWS: I think there's an issue there as well.

You know, the vast majority of our 16 intelligence agencies are military, are within the Pentagon chain of command. They are inside it. The CIA is the leading policy-making intelligence -- or policy-involved intelligence agency, and the one whose charter has got to be most political, dealing with a lot of issues that are not military-related, not tactical and not war-fighting-related.

I think as a trend, it's probably not a healthy one, if in addition to all the other military intelligence agencies, we end up with the CIA being more and more led by military. This -- an awful lot of issues that the CIA needs to be smart about that are outside of the military purview...

JIM LEHRER: And out of what you would consider Petraeus' experience up until now?


JIM LEHRER: Do you agree, General?

GEN. JACK KEANE: Well, I think running the Central Intelligence Agency, the military should be exception, not the norm.

And I think, in this case, the exception is probably understandable. I mean, Gen. Petraeus has been involved in two wars, intimately involved with dealing with the Central Intelligence Agency. And some of the absolute, hands-down best professionals that they have are operating in this region.

I think his attraction to the agency -- not speaking for him, but just knowing him pretty well -- is two things. One, as John clearly pointed out, the agency's fighting a covert, clandestine war against radical Islam and al-Qaida. And Gen. Petraeus has been involved in that himself. He gets the opportunity to continue that and bring some of his unique skill sets to that.

And also, it contributes to policy formulation. And I know Gen. Petraeus has strategic interests in doing that as well.

JESSICA TUCHMAN MATHEWS: I think it's worth just mentioning...


JESSICA TUCHMAN MATHEWS: ... that, in this context, that three of the four directors of national intelligence have been military men. And these are the boss of the head of the CIA. So, there is a -- there is a -- something...

JOHN MCLAUGHLIN: I have got nothing -- I have got nothing against civilian leadership at CIA.

But, at the same time, I would say, over time, since 1947, we have had seven military officers as heads of the CIA. And many of them have done quite well, Gen. Bedell Smith in the early years and Gen. Mike Hayden more recently.

Something I would say to people at CIA right now about this general is this is a general who is a soldier-scholar. He's got a Ph.D. from Princeton. And so he's able to move in many different worlds. And I would see him being very comfortable on both the analytic and the operational side of the agency.

JIM LEHRER: Finally, why did they bring back Ryan Crocker, do you think?

JESSICA TUCHMAN MATHEWS: You can't do better.

JIM LEHRER: No? You really can't do better?

JESSICA TUCHMAN MATHEWS: I don't think so. I mean, he's been ambassador. He's had the experience in Iraq. He's been ambassador in Pakistan.

JIM LEHRER: But none in Afghanistan. But none in Afghanistan.

JESSICA TUCHMAN MATHEWS: He's been ambassador in Pakistan.


JESSICA TUCHMAN MATHEWS: That is really more important than Kabul and -- for the outcome in Afghanistan. And he's been all over the region. He has the language skills. He has everybody's respect for how he has delivered.

JIM LEHRER: Do you wonder why he took the job?




JIM LEHRER: It's really a tough job.

JESSICA TUCHMAN MATHEWS: You know, I think -- I said at the outset I thought delivery of the message about the policy was very much on their minds in these appointments.

But my guess is -- and I don't know -- that he finally agreed to do this because of how serious he thinks the situation there is.

JIM LEHRER: Quick word from you about Crocker. What do you think about Crocker?

GEN. JACK KEANE: Oh, I think he was indispensable to turning the situation around in Iraq. He's absolute, hands-down the finest diplomat I have seen in an operational setting where everything is on the line.

He works so well with the military. The civil-military relationship that he had with Petraeus is the best I have ever observed. And there's no doubt that will continue, initially with Petraeus here, and also with General Allen.

JIM LEHRER: You feel good about Crocker, too?

JOHN MCLAUGHLIN: Yes, I have worked with him in the past. And he, among other things, is a superb leader of an embassy mission. Everyone in the mission feels like part of a team when he's in charge.

JIM LEHRER: OK. All right. Thank you all very much, all three.