Automatic cuts had triggered scrutiny of wasteful programs
By Bryan Bender
WASHINGTON — The automatic federal budget cuts Congress imposed in early 2013 raised hopes in some quarters that the Pentagon’s spending juggernaut, long criticized as bloated and wasteful, finally would be curtailed.
Those expectations may prove fleeting.
Working together on a broader budget deal, lawmakers in December reversed $32 billion in defense sequester cuts that would have taken hold over the next two years. The bipartisan spending deal triggered celebrations at defense firms and sighs of relief in states where job losses were feared in the new year.
But budget watchdogs and defense-contracting reformers worry that reversing the cuts will ease a rare sense of financial discipline that had taken hold in the Department of Defense, taking the pressure off Pentagon planners to cut ill-conceived weapons programs and excessive overhead.
“They were just getting serious about these spending constraints,”said Ethan Rosencrantz, a national security policy specialist at the Project on Government Oversight, a Washington think tank. “Sequestration was forcing the Pentagon to make these tough decisions and identify wasteful and duplicative programs. A lot of that pressure will dissipate with the budget deal.”
Several troubled projects that were under intense scrutiny are now considered to be on much more solid footing. That includes the F-35 Joint Strike Fighter, the most expensive weapon system in US history with suppliers in every state, and the Littoral Combat Ship, a high-tech patrol boat that is partly manufactured in Massachusetts and Maine.
The Pentagon last year had been considering curtailing both programs but specialists now predict that, despite being rife with problems, neither will face significant changes, at least in the near term.
“You’ve got a tremendous number of special interest groups. They are all looking out for themselves rather than the greater good,” said David Walker, former comptroller general of the United States and a fiscal conservative who heads the Comeback America Initiative.
The automatic sequester cuts — which were the result of a gridlocked Congress’s inability to devise a budget — imposed what amounted to an indiscriminate crash diet on much of the federal government, and the Pentagon bore a large share of the burden.
The defense reductions, amounting to about 10 percent overall, would have brought annual spending down to about the level of 2007, or just under $500 billion each year. That does not include separate spending bills to pay for military operations overseas such as in Iraq and Afghanistan.
The purposely indiscriminate nature of the cuts was intended to force Democrats and Republicans in Congress to craft a broader deal on federal spending that instituted more targeted reductions in specific departments or programs. When such a deal proved elusive, however, the sequestration took effect in early 2013.
Throughout the year a chorus of top military officials and members of the congressional defense committees warned of the dire consequences, including erosion in key training programs and shortages of supplies for front-line troops. In calling for the cuts to be reversed, they also said some big-ticket weapons systems that support thousands of jobs would be imperiled.
For example, the acting secretary of the Air Force warned that the purchase of dozens of new multimillion-dollar F-35 fighter jets would likely have to be delayed, while the office of the secretary of defense was reportedly considering cutting the number of Littoral Combat Ships in half.
The LCS, which like the F-35 has been beset with cost overruns and serious design problems, supports hundreds of jobs at General Dynamics plants in Massachusetts and Maine.
Those warnings came as good news, however, to Pentagon spending analysts who believe many of the Pentagon weapons projects needed serious pruning.
“The cost growth to buy and operate hardware has grown even more than the people costs,” said Winslow Wheeler, a defense budget expert and longtime congressional staffer.
But the bipartisan budget deal reached in December restores many of the Pentagon cuts over the next two years, reducing the $52 billion sequestration cut in fiscal year 2014 by roughly $21 billion, and also adds about $10 billion for fiscal year 2015.
The deal, crafted by Representative Paul Ryan, a Wisconsin Republican, and Senator Patty Murray, a Washington Democrat, also spread a similar amount of restored funding across other federal agencies.
Representative Niki Tsongas, a Lowell Democrat and member of the House Armed Services Committee, said she supported reversing some of the sequestration cuts because it “gives more discretion on where the cuts go.”
But she said Congress has “an important role in maintaining oversight and putting pressure on the Department of Defense to ensure cuts are targeted toward real waste without harming the readiness of our service members.’’
Secretary of Defense Chuck Hagel expressed relief at the budget deal, telling reporters in late December that reversing some of the automatic cuts will end a “prolonged period of uncertainty.” He said the additional money would be used to restore some of the cuts to troop training and to protect prized weapon systems.
The deal also buoyed Wall Street investors. Guggenheim Partners, a financial services firm, concluded that as a result overall Pentagon spending will remain relatively the same for the next several years before it begins to grow once again, at about 2.5 percent per year.
But many experts say an opportunity may be lost. Lawrence Korb, a senior fellow at the left-leaning Center for American Progress, is urging the Pentagon leadership to “not view the deal as evidence that it is out of the woods or a return to the open spigot of defense dollars that characterized the past decade.”
“Some smart decisions will be made,” Rosencrantz believes, “but I fear that a lot of this budget pressure will evaporate.”
Wheeler similarly has new doubts that the Pentagon will be forced to make necessary cuts in programs that are wasteful. The Pentagon, he said, “continues to see its problem as not enough money. ”