New Pentagon Chief Expected to Follow Familiar Patterns

After being introduced by President Obama as his pick to be the next defense secretary, Leon E. Panetta said his number-one job will be to ensure the United States “remains the strongest military power in the world.” Yet, he added, “This is also the time for hard choices.”
Anyone trying to read between the lines may wonder what magic tricks Panetta might have up his sleeve. He is taking over a mammoth agency where hard choices are terra incognita. Joint Chiefs Chairman Adm. Michael Mullen noted that, after two decades of largesse, the building has lost its ability to prioritize. Outgoing Secretary Robert Gates scored a few tactical victories for fiscal responsibility, but shielded the Pentagon from serious pain, and is leaving with many of the toughest choices largely unsettled.
Defense spending is the highest it’s been since the height of World War II, and yet military leaders complain about budgets being too tight, and sound alarms about the “hollowing out” of the armed forces as the Pentagon heads for a period of flat budgets. It’s been about two years since Gates warned that the post 9/11 spending gusher is over, but that essentially meant a slowdown in spending, not a serious attempt to make the Pentagon’s budget part of the “grand bargain” to contain the national debt. Mullen dubbed the soaring debt “our biggest security threat.” The Congressional Budget Office estimated that by 2017, the annual interest on the debt alone will exceed the entire defense budget.
The Obama administration last year unveiled a national security strategy that was widely derided as a PR document and as an unconstrained wish list that dodged tough choices. Now the inside-the-Beltway intelligentsia is making wagers on whether Panetta can be the guy who will finally set a coherent path toward an affordable military that is not going to end up like the post-Vietnam hollow force. How will Panetta grapple with the gaping mismatch between the nation’s military strategy — which calls for being prepared for any form of conflict and to be forward deployed around the world — and the resources available to sustain it? Even if all U.S. troops left Iraq and Afghanistan today, the over-commitment problem would not be solved, as the U.S. military strategy still requires forces to be available and ready to deploy anywhere in the world. Such level of engagement and readiness requires huge resources.
"Most military leaders believe we live in a time of persistent conflict," Mullen says April 28 at a Government Executive forum. "Demand will continue.”
The emerging consensus in Washington since Panetta was officially announced as the next defense secretary is that he will be highly competent in the position, but most likely will fall short in eliminating bloated spending and scaling back on questionable global deployments, says Christopher Preble, director of foreign policy studies at the libertarian-leaning Cato Institute. “We expect more of the same,” he says. “What I’m most worried about is that there is downward pressure on the budget and there is not a rethinking of roles and missions, which is long overdue.” Panetta is expected to lead a strategic review that Obama mandated in order to identify $400 billion in national-security budget cuts over the next 12 years. Preble, who co-authored a proposal to cut $1.2 trillion from the defense budget, says he is skeptical that Panetta will even reach Obama’s target of $400 billion. “I see Panetta as more of a consensus, status quo figure. I didn’t see his selection as a signal that the president is committed to a major strategic shift.”
Panetta has a distinguished career, he notes. “Every single job that Panetta’s been given he has done well. But his other jobs haven’t asked him to be a strategic thinker.” As defense secretary, it will be his “core responsibility to align resources and missions.”
Preble predicts that this upcoming review will follow familiar patterns of avoiding hard decisions. “Typically reviews look at the existing force structure, and the force structure [the military services] would like to have in the future, and they create a rationale for why they need” to keep existing assets and force sizes. “I’d love to be proved wrong,” Preble says. “Historically, it hasn’t happened that way.”
Much attention will be paid to how Panetta deals with Congress. Truth is that no matter how tough-minded a Pentagon chief might be, Congress will put up impossible barriers.
The Pentagon has been Congress’ go-to piggy bank for many decades. It is the largest spender and the biggest employer, with 2.3 million people on its payroll. Defense contractors hedge their programs from cuts by spreading facilities and jobs in as many states as possible, which adds huge overhead costs to military projects. In addition to saddling the Pentagon with pork-barrel projects, Congress also has stuffed all sorts of benefits and entitlement programs into the defense budget that the Pentagon has to keep funding ad infinitum. Military health care costs, Gates has said, are “eating the Defense Department alive.”
Preble anticipates Panetta will have to engage in a “lot of horse trading, a lot of give and take” to get any reforms through Congress. Playing to his advantage might be the unusual political climate in Washington, where conservative fiscal hawks may join forces with progressives who oppose the militarization of U.S. foreign policy. “There is the potential for a weirdly ideological coalition” that may provide the votes necessary to push through change.”
The upcoming showdown on Capitol Hill over allowing the U.S. government to lift the nation’s borrowing limit should provide important clues to the Pentagon leadership,  says Maren Leed, senior fellow at the Center for Strategic and International Studies. “The debt level debate will be very telling” of whether the political winds will be blowing in favor of drastic defense cuts, she says.
Obama did not pick Panetta to be a change agent, she says. But just to be able to slow down the rate of spending and achieve the $400 billion in savings will test every bit of Panetta’s deal-making skills. “It is a question of how much chicken Panetta wants to play.”
Even if the top line stays flat for some time, Panetta is inheriting the problem of how to slow down rising personnel costs so he can secure enough funding for weapon modernization programs.
“At some point you will end up with a hollow military if you don’t do something about [personnel] compensation,” Leed says. “We continue to have rapidly declining purchasing power. … You’ll get less and less force structure for the same money.”
Leed speculates that Panetta might end up pulling a rabbit out of the hat by shifting a big chunk of the $400 billion cuts to the intelligence community. “It will be interesting to see how much of the $400 billion will come out of intelligence agencies,” she says. Having been CIA director for two years, “Panetta knows where the intel money goes. He knows where the wasteful spending is.”

Topics: Defense Department, DOD Leadership