Hagel’s Defense Cuts are Just a Start | Spotlight | The Stimson Center | Pragmatic Steps for Global Security

By Russell Rumbaugh

Secretary of Defense Chuck Hagel’s announcement last week of a 20 percent cut in his headquarters was a necessary but minimal step in the major restructuring needed in the Department of Defense to respond to budget cuts under the sequester.

Hagel actually announced five months ago that the department would cut all headquarters by 20 percent. He specifically said he would apply the same cut in the Office of the Secretary of Defense.

The Stimson Center report, “Strategic Agility: Strong National Defense for Today’s Global and Fiscal Realities,” which was issued at the end of September, echoed the call for reducing defense headquarters, arguing to cut staff itself by 20 percent and noted the cost of these headquarters staff now exceeds $40 billion annually.

The report calls for such reductions not just to achieve savings but also because “reducing headquarters would increase the Department’s agility and speed of decisions, and reduce frustrations created by top-down directives that suck up the attention and energy of line units.” In other words, headquarters reductions would not only save money but also make the Department of Defense more effective.

Unfortunately, last week’s announcement does not live up to real change. Most obviously, it’s not a 20 percent cut in staff, just claimed savings. The announcement described a reduction of 200 personnel – certainly a sizable amount and a fundamental disruption in the lives of many civil servants and military officers. But the announcement also acknowledged the 200 were cut from a baseline of 2,400 personnel. Cutting 200 from 2,400 is not a 20 percent reduction. It only amounts to an 8 percent cut in staff.

To his credit, Hagel emphasized that this effort was only a first step and that more cuts will be needed, including further headquarters reductions. Still, such a disconnect between stated goals and announced plans is disconcerting.

Less obvious but possibly even more disconcerting, many of the announced changes stemmed from efforts started years ago. Hagel acknowledged that one aim of these organizational changes is to fulfill guidance from Congress, particularly in eliminating several deputy under secretary positions that are not subject to congressional confirmation.

The chairman of the Senate Armed Services Committee first wrote the Pentagon about his concerns over these positions in 2009. A compromise was reached in that year’s defense authorization bill to allow only certain of these positions to remain. The following year’s defense bill extended the deadline for eliminating these positions until January 2015.

So last week’s announcement is responding to congressional guidance more than three years old and may not fully be in effect for another year. The delay will be even longer for the full reduction of 200 personnel, which will not be fully phased in until 2019.

Four-year reduction plans hardly seem like strong responses to the sequester cuts that are occurring today. Hagel acknowledged that very point, noting: “We recognize that the dollar savings generated by the OSD reductions, at least $1 billion over the next five years, is a small percentage of the sequester-level cuts, underscoring the challenges that face this department in absorbing these very large sequester-level reductions.”

Yet the secretary’s own caveats emphasize how difficult the task of reducing defense spending is, even with the forcing function of sequester. Inevitably, any attempt to find efficiencies in the defense budget is likely to encounter strong resistance. Responding to this resistance by setting only a few limited goals for savings will only ensure even more limited results. Instead, policymakers should aim high and move boldly to make the Pentagon more efficient, even while acknowledging that the results may be less than anticipated.

The Stimson Center report makes 26 such bold reform recommendations besides the headquarters reductions. These recommendations include other management reforms, force structure changes and changes to modernization programs.

Our recommendations are not all cuts. Even as the report calls for reducing military and civilian manpower, it also calls for increasing spending on cyber and theater missile defense, as well as protecting spending in special operations forces and key modernization programs like the Air Force’s long-range strike bomber.

Many of these recommendations – including benefit and retirement reform, smaller ground forces, and even delays of America’s largest acquisition program, the F-35 fighter jet – have now been floated by senior military and civilian leaders, suggesting they are possible, even though they seemed bold when we proposed them.

Even more boldly, our report says our recommendations could be in place by the end of fiscal year 2015, which is only 21 months away. To meet such an abbreviated schedule, progress must be made quickly.

Most importantly, calls for action are not without opportunity. Our report was not based solely on the need to cut defense in the face of sequester. It was based on the idea that a new defense strategy coupled with a comprehensive national security strategy that includes all of the tools of U.S. foreign policy – diplomacy, development, and even trade and commerce – could better secure American safety at home and advance American interests abroad.

Though the steps necessary to achieve changes and savings in defense and elsewhere are difficult, they are also opportunities that must be seized.

Russell Rumbaugh is director of the Budgeting for Foreign Affairs and Defense program at the Stimson Center, a nonprofit and nonpartisan international security think tank.

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