The defense budget is going down. The Defense Department has been through the first two stages of grief: denial and anger. Denial was from FY 2010 to FY 2012 -- "the budget should not go down, we need more." Anger was 2012 -- the Aerospace Industries Association campaign to halt sequestration, Senators McCain, Graham, and Ayotte touring bases and plants, "defending defense" and hoping to influence the election and reverse the tide.
Now we are at "bargaining," the stage where the department and the services try to make a deal that will slow the decline, delay the effects. Secretary Chuck Hagel and Admiral Sandy Winnefeld, the vice chairman of the Joint Chiefs of Staff, made this clear on Wednesday, July 31, when they rolled out the Strategic Choices and Management Review (SCMR). The key signal that we have arrived at "bargaining" was the demand the secretary made for "time." Just give us more time because these cuts cannot come so fast, he argued. We cannot manage them.
He particularly argued for time in his commitment to cut 20 percent out of the tiny staffs for the Office of the Secretary of Defense and the Joint Staff -- by 2019, not this year or next.
The reality, however, is that budget cuts are coming fast. Time is not available; the time is now. But nothing the secretary announced on Wednesday demonstrated anything more than the fact that the Department of Defense is able to implement the president's budget request, if that's the funding they get in the end.
Any cuts beyond that budget, the secretary warned, would be lethal to the department and the nation's military capability. Sequester-level cuts ($500 billion over 10 years) "would be a huge strategic miscalculation that would not be in our country's best interests."
Note that he said "sequester-level cuts," not "sequester." The resistance at DOD is not to sequestration -- which is bad enough -- but to any approach that would reduce the defense budget by $500 billion over 10 years from the current Defense Department projections. Any approach at all.
That's just not reasonable. A $500 billion reduction from the current projection would be consistent with prior defense drawdowns, not a "strategic miscalculation." That kind of grandstanding may play to the president's desire to get a budget deal by threatening to kill the DOD "hostage," but it is not good planning.
So the secretary set up another "bargain." If we have to make those cuts, we can shrink the forces, driving the Army down as deep as 380,000 troops and eliminating air wings, and use the funds to buy technology to keep up the defense investment budget. Or, bargain the other way, we can keep up the size of the force, but then we have to make "massive cuts" to procurement and take the risk, globally, that entails.
This is a false choice. The reality is that the "big money" is in the department's overhead. Secretary Hagel knows this -- he focused on overhead at the start of his briefing. But his statement on overhead was simply a confession that it is hard to get savings from the overhead. He noted that Secretaries Gates and Panetta had sought $210 billion in savings; that he himself has proposed $34 billion, all over 10 years. And he offered up such things as his 20 percent cut in the secretary's office and the Joint Staff, reductions in direct reports to him as ways to, maybe, get another $40 billion over 10 years. Maybe we get the overhead czar he proposed.
But if this is the extent of the overhead reforms he proposes, no wonder he is facing a tradeoff between forces and technology if budgets go down by $500 billion. These reforms barely scratch the surface of the Pentagon's "back office." The secretary threw up his hands on doing a lot more: "Unlike the private sector ... the department simply does not have the option of quickly shutting down excess facilities, eliminating entire organizations and operations, or shedding massive numbers of employees."
Or maybe DOD lacks the political will. If not now, when? What are we to do with a contractor force in the Pentagon that is almost as large as the civil service? Where once we had twice as many active-duty combat forces as civil servants, we now have more civil servants and "ghost" civil servants than we have soldiers, sailors, and pilots. What do we make of the duplicative offices, bureaus, and agencies among the services; when are finances, health, personnel functions consolidated?