When Will the Military Services Come To Grips With a New Era of Austerity?

By Nathaniel H. Sledge Jr.
Even with a smaller funding pie, the U.S. military services should be able to weather the coming budget reductions. But the services are anxious and insecure institutions. They want more, and they insist that their equipment is aging and in need of modernization.

But if in fact the services’ inventories are not in good shape despite the budgetary largesse of the last decade, someone should explain why.

It should be Congress’ role to carefully examine the processes and procedures for planning and programming.

Just because we have the best equipment and well-trained forces doesn’t mean that we have a military that is in line with our foreign policy, suited to the security environment, affordable, and in tune with the priorities of the nation. Spending trillions of dollars to defeat non-state actors is nothing to cheer about. We must not conflate having the best military with having an effective and sustainable national defense. A strong military is only one of many elements of power at the nation’s disposal. The United States’ cultural, economic, and military powers are so overwhelming relative to other countries that our primary enemies are more likely to be socio-economic instability, arrogance, profligacy and waste.

Looking forward into a less exuberant future, it is clear that things must change. A Henry L. Stimson Center study, “What We Bought: Defense Procurement from FY01 to FY10,” concluded that the services are modernized. So what are the implications for the services if their budgets are reduced by an average of 17 percent per year over the next 10 years, as could happen according to some deficit-reduction scenarios?

What modernization remains to be achieved in an era of austerity? And how will the services distribute and sustain the already modernized equipment? In sum, how should the services establish priorities with meager personnel, operations, maintenance, research, developing and acquisition funding going forward?

Grief teaches the steadiest minds to waver (Sophocles, Antigone).

There are seven stages of grief. The services seem to have skipped the shock stage and are now in denial. What will it take to convince Pentagon leaders that the tide of spending has turned, and that the services need to come to grips with a new era of austerity? The anger and bargaining stages will come just as soon as future budgets are settled. The services will need to see quickly that severely reduced budgets are “serenity” issues, so they can get on with defending the nation effectively, efficiently and sustainably.

If the vast numbers of modernized systems exceed the shrinking force structure and the correspondingly lower operations-and-maintenance funding, what should be the disposition of the high-tech systems? The services’ instincts might compel them to abandon, moth-ball, or sell off some of their modernized systems or to double-down and continue doing what they have been doing regardless the changing nature of threats. Recent history suggests they will attempt to do the later. Perhaps the services will follow the Air Force’s example and chase next-generation systems at the expense of more numerous and more affordable existing systems.

Acknowledging critical problems without solving them is not sufficiently redemptive. On the contrary, it is irresponsible. Somehow, the services must transform their coming challenges into opportunities. Funding must be allocated to what is needed to address the present and most likely future threats and what is within the art of the possible politically and economically. The politics must come second to operational merit and stewardship of taxpayer dollars. But allowing the services to make the hardest calls is unrealistic. This is not within the bounds of their DNA. Americans should be skeptical if unexpected future threats look like the Cold War’s or today’s threats.

The pursuit of many of the weapon systems that the services have been funding over the past several decades are illuminating and shocking examples of resources looking for systems. Killing or severely scaling back the expensive programs that remain will require hard decisions from the Defense Department and Congress. Only then will adjustment and transition to a new reality begin. Sadly, Congress is the weaker of these two saviors. But if history is any guide, we shouldn’t be too hopeful that the secretary of defense will act.

Secretary of Defense Leon Panetta’s recent public statements cautioning that cuts to the defense budget might render the military hollow are pure bluster and rhetorical finery. The warning is grand and, on some level, genuine, but it is incredible. The secretary’s authority as embodied in his vast experience in politics, budgeting, and national security is all but wiped out by the fact that as the defense secretary he must protect the interests of his department. Perhaps he was only playing to the gallery.

There are only three ways to go. We can rule out the status quo because it will end soon with imminent budget reductions. So Panetta can either stand with the well-intentioned but culturally bound service chiefs, who make no apologies for getting while the getting is good, or he can face reality and through force of will, persuade the services to behave responsibly under austerity. The first step in expressing the new paradigm and achieving more effectiveness and efficiency is publishing much more structured and restrictive defense planning guidance.

Military strength has multiple sources, many of which must be brought into an integrated whole to yield an effective military enterprise. Doctrine, organization, manning, and training are essential. It is not clear that the services are making the necessary investments in these areas. Given the sometimes specious rationale and incentives for defense spending, it is doubtful.

Service identity and priorities are the primary drivers of modernization. Personnel and O&M funding tend to have stable trends and they rise or fall according to the force structure and the secular trends in the economy, such as housing, salaries, benefits, and health care costs. On the other hand, research, development and procurement funding is more volatile. So it is not surprising that when opportunities arise such as funding windfalls, senior Pentagon officials don’t reflexively expand the force and increase spending on training facilities and opportunities.

Unfortunately, as the past decade’s spending practices demonstrate, the services reach for the procurement lever but don’t always pump up procurement accounts to gain new capabilities. Sometimes they are more eager to reinforce or validate yesterday’s requirements. The Army’s “holes in the yard” funding campaign is an example.

Muddled modernization is directly attributable to the nature of incentives for and relationships between politicians, corporations, and government and military leaders. The military services have frittered away billions of dollars on the toys preferred by Congress, major corporations, and senior military leaders, many of whom end up seeking employment at the companies benefitting from the services’ largesse. This is not meant as a gratuitous jab. In the real world people are political, partisan, and beholden to personal motivations. But this temperamental nature has to be banked and cooled and channeled into productive policy. This underscores the need for objective and courageous leadership to break from the status quo. The alternative is imbalanced investment when our military can least afford it.

Many careers have been made based on the ability to engage in PowerPoint sophistry to help the services win the resource war. What was formerly called the Global War on Terrorism enabled many to win this war without the charts. Clever but misguided politicians and their enablers in the Pentagon used two far-flung wars to drive defense and intelligence budgets. Whether the incidental benefits to modernization were known or anticipated is a topic for another day. But the lessons of the past decade will at least not be lost on future generations of Pentagon programmers. Reasonable politicians, watchdog groups and the American people should be on guard.

Nathaniel H. Sledge Jr., PhD, is a retired U.S. Army colonel who served as acquisition program manager in four project management offices, and worked at the Army Budget Office in the Directorate of Investment.

Topics: Procurement, Acquisition Reform

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