Defense Reductions Done Right Posted by Jacob Stokes

This week has seen a good deal of commentary about looming defense budget reductions, enough that a round-up of salient points is warranted. Any defense spending reductions discussion needs to start with strategy. Joe Nye’s piece in the Times today gets at that point. He proposes a move away from the oft-cited “lands wars in Asia”:

We also need to rethink how we use our military power... Opponents of defense cuts are raising the specter of isolationism and the weakening of American power. But there is a middle way…Counterinsurgency is attractive as a military tactic but it should not lead us into a strategy of nation-building in places where we do not have the capacity to engineer change. The maxim of avoiding major land wars in poor countries does not mean withdrawing our military presence from places like Japan and South Korea, or ending military assistance to countries like Pakistan and Egypt. Some analysts call this “off-shore balancing,” but that term must mean more than just naval and air force activity. For example, in Japan and South Korea, our allies pay a significant portion of the cost for basing American troops there because they want an insurance policy in a region faced with a rising China and a volatile North Korea.

The “roles and missions” review going on at Defense right now is set to address this, although I wouldn’t leave the burden of making tough choices on Defense to DoD—they have only a small interest in slimming their role.

Looking at strategy doesn’t mean we have to execute a radical change though. Even the largest cuts being discussed aren’t draconian by historical standards , writes Gordon Adams over on Battleland.

[Defense] can live with the roughly $400 billion in lower budgets than they planned over the decade. After all, that would be the savings from the current budget plan if Congress simply provided DOD with inflation growth every year over the next decade. But from where I sit, the Department can also live with $900 billion in budget discipline. It is, after all, only 14% of the currently projected defense budgets over the decade, a more moderate build down than the one Secretary Panetta helped execute (though Secretary Cheney and Chairman Powell began it) in the 1990s… In fact, from 1985 to 1998, defense spending (outlays) fell more than 35% in constant dollars. The force that remained, which was smaller, was also organized, coherent, and lethal. It was globally dominant and used Saddam Hussein as a speed bump in 2003. That was one of the best managed build-downs we have ever done; and it was the third one since 1950.

This is not to say the biggest budget reductions in wouldn’t demand hard choices; it’s just that those choices are possible to make without endangering American security. Reductions could even force a much-needed rebalancing of American power, writes Fareed Zakaria.

Defense budget cuts would also force a healthy rebalancing of American foreign policy. Since the Cold War, Congress has tended to fatten the Pentagon while starving foreign policy agencies. As former defense secretary Robert Gates pointed out, there are more members of military marching bands than make up the entire U.S. foreign service. Anyone who has ever watched American foreign policy on the ground has seen this imbalance play out. Top State Department officials seeking to negotiate vital matters arrive without aides and bedraggled after a 14-hour flight in coach. Their military counterparts whisk in on a fleet of planes, with dozens of aides and pots of money to dispense. The late Richard Holbrooke would laugh when media accounts described him as the “civilian counterpart” to Gen. David Petraeus, then head of U.S. Central Command. “He has many more planes than I have cellphones,” Holbrooke would say (and he had many cellphones).

That rebalancing is unlikely to happen, however. The dark underbelly of this deal is that 1) as Josh Rogin has written, nobody knows how big the defense cuts will really be, if they come at all. And 2) many of reductions will come from the larger “security” spending category that includes State, USAID, Energy, and Intel. In other words, if the Pentagon gets a haircut, expect the civilian agencies to get an even larger one, in percentage terms if not in dollars. 

Understanding this budgetary formulation and where that road is likely to lead, John Kerry made a passionate defense of civilian international affairs spending earlier this week, explaining foreign aid as a cost-effective use of American power and leadership to help prevent more costly conflicts down the road. 

Is there a cost to taxpayers? Of course. But all of our foreign aid programs and foreign policy initiatives— from sending diplomats to Afghanistan to helping reverse the HIV/AIDS epidemic in Africa—barely make up 1 percent of the annual budget. It is a relatively small investment for such a great return. This year alone we will spend approximately $700 billion on our military. The entire international affairs budget is less than one-tenth of that. As former Secretary Gates once pointed out, if you took the entire Foreign Service roster, you could barely staff one aircraft carrier…We can either pay now to help brave people build a better, democratic future for themselves or we will certainly pay later with increased threats to our own national security.

Doesn’t look good for the civilian side though. Up against defense’s constituency, State and AID look, well, a little under-gunned. That’s not to say the politics of budget cuts will make DoD work better, as Rob Farley laid out in his WPR column this week. He predicts that, “In the short run, cuts are going to lead to bloody fights that will leave behind a diminished military and a nasty bureaucratic mess.”

Standing in between cuts and that nasty bureaucratic mess will be Panetta and Pentagon weapons buyer Ash Carter, who will take Bill Lynn’s place as Deputy Secretary of Defense. Battleland’s Mark Benjamin called Carter a “budget cutter.” He sent a pretty strong signal earlier this year when Boeing announced cost overruns on the Air Force tanker. Carter’s response, as the WSJ put it: That’s Boeing’s problem, not the taxpayer’s.That’s an encouraging sign. In a time of less fat, the Pentagon needs to learn how to get more bang for the buck. All the money in the world won’t impose discipline on weapons design and procurement—and without discipline things can go wildly astray. (See David Axe’s detailed look at the Navy’s Littoral Combat Ship program for a blow-by-blow account of what a lack of clarity can do.)

Here’s how Carter plans to trim, according to Battleland:

Carter has outlined clearly in the past how he would like to shave the billions:

• He wants government contracting officials to reconsider contracts and try to figure out how much supplies "should" cost, rather than basing cost estimates on historical data.
• Particularly thrifty contractors who can prove they save money will get the contracts, though a "preferred" supplier program.
• Everybody knows about sole-source contracts and limited competition on contracts. Look for the sweetheart deals to decrease.
• Services, rather than bullets and tanks and things, makes up about $200 billion in Pentagon spending every year. Carter thinks there is a ton of fat here. Pay attention, service providers. One particular focus will be eliminating contracts for reports. The building is full of studies and reports that cost a lot and don't do much for anybody.

Lots of moving parts here. We’ll keep on it in the days and months ahead.

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