By Sandra I. Erwin
In the high-stakes bargaining between the White House and Congress on how to avert the fiscal cliff — a mix of steep spending cuts and expiration of tax breaks scheduled to begin Jan. 2 — the Pentagon’s budget will be one of many chips on the table.
The president has said he would support a deal that cancels across-the-board sequestration cuts if they are offset by a mix of targeted spending reductions and tax revenues. The ultimate fate of defense funding depends on the size of the deficit-reduction package, and how it ends up being split between spending and revenues.
The administration and Congress have agreed in principle to remove $487 billion from future defense spending beginning in 2013. But it is possible that, as part of a grand bargain to tame the federal budget deficit, defense could be squeezed a percentage point or two more.
Defense sequestration cuts — projected at $55 billion for fiscal year 2013 — will not trigger massive layoffs or program cancellations, analysts have said. Congress is expected to delay those cuts as it works on a budget deal, but the underlying issue remains: The Pentagon might have to accommodate deeper cuts — beyond the $487 billion it is already programming.
“Much ambiguity remains, particularly in specifics of how sequester would be applied,” said David J. Berteau, senior vice president of the Center for Strategic and International Studies. “The automatic cuts only apply to FY13, but there are significant challenges in FY14 and beyond,” he said Nov. 16.
There is no shortage of proposals on how the Pentagon could downsize responsibly. Just this week, defense think tanks, special advisory panels and lawmakers have unleashed a torrent of studies and recommendations. They all agree on one fundamental point: The nation’s current defense apparatus will no longer be affordable, even if sequestration cuts are avoided. Following are some of the latest recommendations:
Sen. Coburn: Go Back to Basics
Sen. Tom Coburn, R-OK, says defense costs too much because of uncontrolled mission creep. Defense has become the “Department of Everything,” which is the title of Coburn’s Nov. 15 report. He concludes that the Pentagon could save $67.9 billion over 10 years by jettisoning “non-defense” defense splurging. “Spending more on grocery stores than guns doesn’t make any sense,” Coburn said. “And using defense dollars to run microbreweries, study Twitter slang, create beef jerky, or examine Star Trek does nothing to defend our nation.”
Programs that the Pentagon funds but Coburn considers irrelevant include non-military research and development ($6 billion), education ($15.2 billion), alternative energy ($700 million), grocery stores ($9 billion) and excessive overhead support staff ($37 billion).
“Our nation’s $16 trillion debt is the new red menace, posing perhaps a greater threat to our nation than any military adversary,” the report said.
Coburn called out the Pentagon for maintaining 64 elementary and secondary schools at 16 military facilities in the United States, which support 19,000 students. The cost is more than $50,000 per student, said the report, which greatly exceed the national average of $11,000 per student. These schools are located in Alabama, Georgia, Kentucky, New York, North Carolina and South Carolina.
RAND: Prioritize, Prioritize, Prioritize
“Establishing a strategic direction limits the risk the cuts may impose or, at the very least, makes that risk explicit to the nation’s leaders,” said a RAND Corp. study titled, “A Strategy-Based Framework for Accommodating Reductions in the Defense Budget.”
It’s simple: Prioritize defense challenges, decide what risks to accept, and make corresponding force structure and program decisions.
The authors offer several possible paths to sizable defense reductions beyond the $487 billion already sought by the administration: Rebalance force structure and investments toward the Asia-Pacific and Middle East regions while sustaining key alliances and partnerships in other regions; plan and size forces to be able to defeat a major adversary in one theater while denying aggression elsewhere or imposing unacceptable costs; protect key investments in the technologically advanced capabilities most needed for the future, including countering anti-access threats; and no longer size active forces to conduct large and protracted stability operations.
RAND also suggests the Pentagon must cut health, retirement and compensation costs. “Even cutting force structure, in some cases deeply, may not suffice,” the study says. “Constraining the cost of personnel is becoming a more pressing option.”
Stimson Center: Cut Fat, Keep Muscle
Under the auspices of the fiscally conservative Peter G. Peterson Foundation and the Stimson Center, a group of 15 policy makers, retired general officers and academics delivered a proposal that calls for a restrained military posture, but no substantive cuts to programs or force structure.
The group’s study, “A New U.S. Defense Strategy for a New Era: Military Superiority, Agility and Efficiency,” embraces the Colin Powell doctrine of a strong military that is restrained in how it’s used.
“U.S. military power is not unlimited,” the report said. “The Afghan and Iraq wars demonstrated how difficult it is to stabilize distant nations, to provide security to their populations, and to facilitate effective and honest governance.” The United States should shift from a “mind-set that emphasizes static deployments overseas, relying instead on frequent rotations of expeditionary forces home-based in the United States.” The goal should be to “exercise jointly with allies, to familiarize themselves with potential combat theaters, and to demonstrate U.S. resolve and capabilities.
The Stimson report does not recommend specific spending cuts, but estimated that the Pentagon could save from $200 billion to $400 billion over 10 years by eliminating duplicative layers of management, overlapping programs and untold other inefficient ways of doing business. Some savings could be achieved by reforming military compensation, the report said. Although it is important to take care of troops, “specific compensation policies are not inherently sacred.” The study endorses other blue-ribbon panels’ recommendations for changing retirement rules, including age eligibility, vesting schedule, calculation of benefits and retention bonuses.
Current methods for buying weapon systems also contribute to inefficiency, said the report. It dittoed proposals to streamline the system already put forth by the Defense Business Board and the Center for Strategic and International Studies.
Project on Defense Alternatives: Debt Is Enemy #1
The Project on Defense Alternatives, a progressive think tank, calls for a leaner military, with more strictly defined missions. In “A Reasonable Defense,” PDA executive director Carl Conetta, offered a blueprint on how to achieve an additional $550 billion in defense savings beyond President Obama’s 2013 budget request. These savings, he said, are “appropriate to a grand fiscal bargain and avoid the institutional and economic harm that might result from sequestration.”
Contrary to election-year rhetoric, said Conetta, “There is broad bipartisan support for cutting the deficit by more than $2 trillion over the next decade. Unfortunately, the current panic about the pending sequester discourages clear thinking about the United States’ role in the world and how much it should spend on national security.”
Reasonable Defense proposes that the U.S. military focus on those missions and responsibilities for which it is best suited — traditional defense, deterrence, and crisis response — while foregoing large national-building efforts and counterinsurgency campaigns. The study advocates more and better-balanced security cooperation with other nations, but sees “preventive security” initiatives to be largely the job of the State Department. “Our military is a fabulously expensive tool,” said Conetta, “and we can no longer afford to misuse it.”
Correction: An earlier version of this post said the Stimson Center study was backed by the Peterson Institute for International Economics. The correct name of the organization is the Peter G. Peterson Foundation.
via More Than One Way to Skin the Defense Budget (Updated) – Blog.