Marine Chief Predicts Coming Budget Crisis Will Be the Worst One Yet

5/26/2011
By Sandra I. Erwin
The coming defense downturn is viewed by analysts as part of the predictable boom-and-bust cycles that the United States has experienced throughout its history.
But the lean times that the U.S. military now faces may be unlike any other, said Gen. James F. Amos, commandant of the Marine Corps.
The looming budget crunch will be “different” from previous fiscal crises, Amos said May 26 at the Brookings Institution, in Washington, D.C.
“I’ve been in the Marine Corps for 41 years. I’ve seen the ebb and flow, and the budget go up and down in typical 10-year cycles,” he said. “I am probably more concerned now than I ever have been before.”
Amos’ apprehension also is shared by his fellow service chiefs, he said. “All of us, this has caught our attention.”
What makes the budget outlook far more worrisome than past downturns is that, even though the projected spending reductions are relatively modest — budgets would be flat or slightly down over the next decade — the fast growth in personnel costs since 9/11 has outpaced the Pentagon’s ability to absorb these expenses without increasing the top line. The services’ senior leaders dread the prospect of having to cut pay, healthcare or retirement benefits even as troops are still deployed in three wars.
“We have this friction,” Amos said, “We are fairly heavily engaged, but the vision is the budget is going down.”
Even if every major weapon procurement were terminated, that would hardly make a dent in the problem, said Amos. Sixty percent the Marine Corps’ budget is for manpower, and 25 percent for operations and equipment maintenance. “Do the math,” he said. That leaves only 15 percent for procurement, research and development of new weapon systems. “The personnel piece has to be reduced,” he said. “It’s a sensitive topic.”
Amos agrees with Defense Secretary Robert Gates' stance that military entitlements should be on the table. “I do think it’s time for a healthy look at where all this money is going. The entitlement piece is increasing, personnel costs are increasing," he said. When the service chiefs testified on Capitol Hill in March, they unanimously supported a $5 dollar increase to monthly Tricare health insurance premiums for retirees who were working full time. But Congress has refused to act on it. “That’s pretty modest since we haven’t adjusted Tricare premiums since the 1990s,” said Amos.
Weapon programs, although a small piece of the budget, will need a major shakeup in how they are managed and supervised, Amos said. One of his first major decisions as commandant was to cancel the Marine Corps’ cherished Expeditionary Fighting Vehicle, an amphibious landing craft envisioned as essential for ship-to-shore assaults.
The program had become too expensive, with a projected price tag of $17 million per vehicle, or more than three time its original estimate, said Amos. He also was disturbed by the fact the program has been in development for more than two decades. That is a sign of poor management, he said. One of the Pentagon’s most successful Cold War weapons, the SR-71 spy aircraft, was developed in the 1960s in 18 months, he noted. The Defense Department must do better, he said. “We made the acquisition process way too hard."
Amos called for the service chiefs to “claim ownership” of major programs, rather than turn them over to faceless acquisition professionals, then forget about them, and react only when they’re hit by sticker shock.
“I think the services have abrogated their responsibility to the acquisition community” to deliver new equipment,” he said. “Congress gives money to the service chiefs and expects the service chiefs to be good stewards of that money.”
But typically the service chiefs regard themselves as unqualified to provide oversight, he said. “We give it to the professionals, and we go off and focus on other things like Iraq and Afghanistan. … Then we find out we are billions over budget and we go, ‘How did that happen?’”
Amos has taken a morehands-on role in the troubled F-35B program — the vertical-takeoff version of the Joint Strike Fighter. Under the 1986 Goldwater Nichols Act, military service chiefs are restricted in how closely they can manage acquisition programs, which by law have to be civilian-run. Working within those legal limits, he has increased his involvement in the F-35B program, which has been plagued by technical setbacks. The users of the equipment, he said, should be able to participate in key program decisions instead of just saying what they want, not be concerned by how much their wishes might cost, and then be shocked about budget overruns.
Pointing to the severity of the Pentagon’s fiscal situation, Michael E. O'Hanlon, senior fellow and military expert at Brookings, noted that Secretary Gates' speech this week — billed as his last major policy address before he leaves office June 30 — mostly dealt with budgetary dilemmas. “This greatly revered, respected, experienced secretary of defense didn’t give us a speech for the history books on where we stand vis-à-vis the rising China, Islamic extremism, and three wars,” said O’Hanlon. “It came down to pay, and pensions and Tricare as his valedictory set of issues for his sendoff,” he said. “It was sort of striking.”

Topics: Defense Department, DOD Budget

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