You Want Government to Spend More Wisely? Give It Less Money

By Sandra I. Erwin
Fiscal responsibility is the mantra du jour in Washington. The government’s biggest spenders — the Pentagon and defense agencies — are slowly coming to grips with the realization that lean times are indeed coming.

Within organizations that oversee big-ticket military programs, there is also a growing recognition that austerity may finally achieve what reams of acquisition reforms have failed to do: Force the government to spend more wisely.

“Money is the enemy of innovation,” said Elliott Branch, the U.S. Navy’s executive director of acquisition and logistics management, and former executive director for contracts at the Naval Sea Systems Command.

With the largest discretionary budget of any government agency, the Defense Department is expected to step up and deliver big savings. Secretary Robert Gates has called for $100 billion in overhead and contract spending cutbacks over the next five years. “Much has been made of Secretary Gates’ targets,” Branch said at an industry conference in Washington, D.C. But it’s only when the money is actually taken away that acquisition professionals can shine by showing they can give taxpayers value for their dollars, Branch said. “It’s a propitious time for the acquisition work force,” he said. “We now have the leverage to do what we know we always should have done.” Gates’ directive essentially tells acquisition professionals to go do their jobs, said Branch.

The Navy accomplished one of its most successful submarine modernization programs in the late 1990s, when its budgets were being slashed, Branch noted. That project, a comprehensive overhaul of submarine combat systems, departed from the norm by using commercial off-the-shelf technology, which saved billions of dollars over the long run, Branch said.

At the Pentagon, the notion that less money can be a good thing is likely to be as welcome as a skunk at a garden party. But several insiders privately are saying that budget cuts, at least in weapon programs, could be beneficial because they will engender much needed discipline and creative thinking. Defenders of the less-is-more approach to buying military hardware point to the Air Force’s recent unveiling of a 500-teraflop supercomputer which, with a $2 million price tag, was built for less than a tenth of what a traditional system would have cost. The secret: Engineers used strictly off-the-shelf products, including 1,760 Sony PlayStations. The Marine Corps introduced a new weapon in Afghanistan — what marines call a “poor man’s AC-130 gunship” — by strapping a kit of sensors and missiles on a KC-130J tanker aircraft, at a fraction of the $200 million it would have cost to buy a new system.

Air Force Lt. Col. Dan Ward was an early proponent of the cheaper-is-better way of doing business. In 2004, at the height of the Pentagon’s post-9/11 spending spree, Ward forewarned about the pitfalls of overfunding. “The Department of Defense acquisition community today has too much money,” Ward wrote in the Defense Acquisition University journal. “After 10 years in this business, I can confidently — albeit naïvely — conclude we have too much money. More important, I contend this overfunding is limiting our ability to innovate, which has negative consequences for America’s war fighting capabilities.”

Ward, currently an acquisition policy advisor at the office of the secretary of the Air Force, argued in his masters’ thesis and in several published essays that a warped sense of value is partly to blame for bloated spending. “Our values can lead us to define success as taking our time, spending a lot of money, and delivering a highly complex, cutting-edge system,” he noted. “I suggest we all take a hard look at whether adding more time and money to a program really helps improve the outcome. Furthermore, we would do well to examine the desirability of complexity in our organizations, processes, and systems.” Ward’s take is that weapon buyers tend to equate complexity with sophistication, which can result not only in unnecessary cost but also in useless products.

Government procurement experts also lament that decades of so-called “acquisition reforms” have focused on the process of buying while failing to question whether purchasing decisions are the right ones to begin with.

“It’s the requirements!” exclaimed Deidre Lee, a former administrator of the office of federal procurement policy during the Clinton administration. As regulators and Congress kept mandating more acquisition reform, “We said, goodie, we can now buy the wrong things faster,” Lee said at a conference in Washington, D.C., hosted by the software firm Compusearch. “As a nation, when things get tough, we should redo our requirements,” Lee said. “Does every program office need all these service support contracts? To me that’s where we can make a huge difference.”

Prudent stewardship of tax dollars, Lee said, sometimes means “having the courage to stop.”

Talks of austerity no doubt make many people in Washington uncomfortable. In downright good humor, Ward advised the readers of his “Doing More With Less” article that his writings “may offend the professional opinions and sensibilities of certain individuals.” Discontinue reading, he cautioned, “if any of the following occur: itching, aching, dizziness, ringing in ears, vomiting, giddiness, auditory or visual hallucinations, loss of balance, slurred speech, blindness, drowsiness, insomnia, profuse sweating, shivering, or heart palpitations. May be too intense for some readers and not intense enough for others.”

Topics: Defense Department, DOD Budget

Comments (0)

Retype the CAPTCHA code from the image
Change the CAPTCHA codeSpeak the CAPTCHA code
Please enter the text displayed in the image.