The time for a strategic rethink at the Defense Department has arrived. It is signaled by the third straight year of declining defense budgets and the reality that the sequester will bring the defense budget down even more -- and more quickly than forecast.
Not surprisingly, these budget realities are stirring up the same sentiments that we encountered at the end of the Cold War. The defense community is beginning to search for ways to prevent what Colin Powell and Les Aspin called a "freefall" in the early Clinton years, when they were chairman of the Joint Chiefs and the secretary of defense, respectively. "Stability" is the defense community's new goal, and a more intense strategy review than the one Leon Panetta oversaw is what will get them there.
Last November, I flagged five think tank reports that rethink fundamental U.S. strategy to frame options for the forces and their budget. With Secretary Hagel's arrival and the beginning of the Quadrennial Defense Review, it's time to put that approach into practice.
The latest signal that we need to rethink America's defense missions comes from five former deputy secretaries of defense: John Deutch, John Hamre, John White, Rudy de Leon, and William Lynn. They sent Secretary Hagel a letter on March 5, urging him to take a page from the Aspin era and carry out a separate "Bottom Up Review," or BUR, of our defense posture. Their intentions are good, but adding another review to Hagel's agenda would seriously compound his difficulties in getting control over the Defense Department -- and it wouldn't necessarily focus attention on the areas that most need it.
Strategy and force posture are driven by shrinking resources. As strategist Bernard Brodie once put it: "strategy wears a dollar sign." The deputies urge the secretary to take a new look at the threats we face and specify the forces we need, the tempo at which they should operate, the level of readiness they should have, and the training equipment they need. But they put "the resources needed for the posture" at the end of their list of priorities, instead of at the beginning where it belongs in the current budget atmosphere. They are still locked into the blue sky world of defense planning -- we decide strategy first, then we worry about the money.
To be fair, they ask that the review present the secretary with a "range of postures" at different levels of cost and capability, which is something the Quadrennial Defense Review has never done. They point out that savings will take time, that the hard choices need to be made early, that terrorism and cyber should be priorities, and that the rising costs of pay and benefits are a growing problem for Pentagon planning. Perhaps most importantly, their proposed review incorporates a key principle: "More cannot be done with less."
That is a crucial observation, and it flies in the face of the endless, mindless chatter from many officials that the Pentagon will now have to do "more with less." Nobody is asking DOD to do more! As Iraq is forgotten (though see the excellent report from the Special Inspector General for Iraq Reconstruction on the many negative lessons learned from our invasion and occupation) and we leave Afghanistan, the fact is that we are asking the military to do "less with less."
But there are serious problems with the planning process they propose.
I was around for the BUR; I remember it well, as an OMB participant in the process. Secretary Aspin brought to the Pentagon a pre-formed idea about U.S. force posture, based on years of thinking and testimony before his House Armed Services Committee, and informed by the "base force" concept Chairman Powell had already begun. The goal was to shrink the force, but guided by a set of strategy considerations.
The process of downsizing the force was already well underway when he took office. Secretary Cheney and Powell had already drawn down roughly 500,000 people from the Cold War force. In his first few months, Aspin was confronted with budget realities: The planning process for the first Clinton budget had lowered the resources he thought he might have. So the BUR was immediately "resource constrained," and the force had to come down even further.
The BUR was a new process; Pentagon planning processes before then had always been ad hoc and informal, at best. There was no QDR around to compete with it, or run parallel to it. In fact, the BUR could be seen as the "parent" of the QDR, which first took place under Secretary Bill Cohen in 1997.
Now the Pentagon is in a different place, and it has a different institutional problem. The QDR is a statutory requirement and has, as the deputies rightly point out, been "captured," as many Pentagon processes are, by the services. This makes the process a forum for advancing service goals, but not a process which the secretary can use to set overarching priorities for the Department. But it is and should be the secretary's tool. Unfortunately, instead of stiffening the secretary's spine so he can recapture his planning process, the deputies' proposal of reinstituting the BUR would either leave the QDR churning away in parallel under the old rules or abolish it altogether (the deputies leave this entirely vague).
The real problem for Chuck Hagel is that over the past 12 years, the military services have captured much more than the QDR inside the Pentagon. In an era of runaway resources, they had no incentive to rethink strategy or make hard choices; they just spread out to do everything, as the last two QDRs have done.
When the time came to make hard choices -- the last two years -- the services have railed against the necessity, still arguing for everything, trying to plug the leaky fiscal dike with their fingers. And in the most recent round of the sequester battle, the White House made the tactical decision to step aside and let the services become the poster child for the entire budget war, further encouraging them to wander outside the box of proper civilian control.
One of Secretary Hagel's most important challenges, then, is to reassert civilian control in the Pentagon. The services are magnificent, in many ways, but they have not been disciplined for more than a decade -- disciplined about what really matters: planning sensibly to spend the resources the Pentagon will have to perform the military's missions.
The best managed drawdown, for that is what Hagel will oversee, depends on his gaining control over the existing machinery, not inventing new machinery to run parallel or instead of what exists. Instead of abandoning the QDR, he should be encouraged to embrace it, make the QDR a resource-driven exercise, and run it from his office using his staff.
Above all, he should ensure that it is focused on doing what the deputies recommend: producing options for strategy, mission, force structure, readiness, and equipment. And these need to be real options, such as the proposal made last week by former Navy CNO Adm. Gary Roughead that would dramatically shrink the ground forces and enhance the role of the Navy. That's an option, and it breaks a lot of china in the Pentagon. It should be on the table, and the services are unlikely to put it there.
And there are a few budgetary and management options the former deputies left out. In addition to this strategic rethink, and reducing/changing the personnel mix, the next QDR should tackle the two other big sources of Pentagon fiscal indiscipline: the back office (the administrative overhead which employs more than a third of the active-duty force), and the out-of-control acquisition system (which leads to endless cost growth for military equipment, delays in production, and diminished capabilities from those promised).
These two major problems seriously compromise the secretary's effort to keep the point of the spear sharp, because they devour the shrinking resource pie. And they pass unmentioned by the former deputies.
Shrinking resources and sequester are, like the Chinese symbol, both a crisis and an opportunity. The arrival of a new secretary and the start of the next QDR strategic review are the place to start.