Secretary of Defense Robert Gates is ignoring the legal mandate to rationally reexamine defense spending priorities every four years, and he is remiss in two ways, a well-known analyst asserted.
First, Gates came out with his defense spending plans, including major funding cuts for missile defense and other weapons procurement programs, before the Quadrennial Defense Review (QDR) even got into gear.
Second, and more worrisome, Gates virtually ignored the need to apply any similar rigor and discipline on skyrocketing personnel costs, according to Loren B. Thompson, chief operating officer of the Lexington Institute, a think tank near the Pentagon that focuses on defense and other issues.
Personnel costs are uncontrolled, on an unsustainable upward trajectory, Thompson argued. And inevitably, they will crowd out weapons procurement costs, increasingly, he predicted.
All of this doesn’t bode well for a successful QDR, he continued.
“This year’s review is already degenerating into the kind of budget drill that led to criticism of the process in years past,” Thompson argued.
Rather than waiting for a lengthy and thorough QDR to conclude, Gates has decided he knows what the military needs, and wrote that into his defense budget proposal for the fiscal year ending Sept. 30, 2010, Thompson wrote in an issue brief.
“… Gates has been in his job for two years, and doesn’t want to spend a lot of time rehashing what he already knows,” the analyst continued. “So he preempted much of the QDR discussion with his [budget] program recommendations on April 6, and the only big item that remains to be decided is what force-sizing construct will prevail for the next four years.”
This is the wrong way to approach the budget, and the QDR, “because the process is ignoring the biggest single management challenge that Gates and his successors will face,” Thompson alleged. “That problem, bluntly stated, is that the All Volunteer Force is becoming unaffordable. Military personnel costs are out of control, and the Obama Administration is making the problem worse by sticking with Bush Administration plans to increase the size of the ground forces by 92,000 personnel.”
Thompson cited numbers to back his assertions:
- According to Stephen Daggett of the Congressional Research Service, the annual cost of an average uniformed member of the joint forces has increased 45% after inflation since 1998, from $55,000 in constant 2009 dollars back then to $80,000 today.
- That number does not include the cost of healthcare for the military and civilian defense workers, which has increased 144% since President Bush took office to over $40 billion per year.
- Despite these extraordinary increases in the cost of personnel, Congress continually legislates new benefits for warfighters and their dependents, including everything from free college tuition to supplemental Medicare payments.
And the result of those soaring personnel expenses inevitably will be money torn out of defense procurement programs, Thompson predicted.
“Rapid increases in pay and benefits are already squeezing money for new weapons out of the Pentagon budget,” he stated.
In his budget proposal to President Obama, Gates called for cutbacks in missile defense programs, such as no more planes for the Airborne Laser program, no more interceptors for the Ground-based Midcourse Defense program, no fiscal 2010 funds at all for the European Missile Defense program, and a hazy future for the Kinetic Energy Interceptor.
As well, existing programs being terminated (sometimes after a final batch of wares is bought) include the C-17 transport plane, F-22 superstealth supersonic cruise fighter aircraft, the vehicles in the Army Future Combat System, the CSAR-X search and rescue helicopter, the future Transformational Satellite program, and more. (Please see Space & Missile Defense Report, Monday April 6, 2009.)
Much of the Gates plan showed up today in Obama’s detailed fiscal 2010 federal budget plan that the White House sent to Congress, asking for its approval. (Please see separate story in today’s issue.)
Other fallout from the Gates fiscal 2010 moves are more subtle, Thompson added.
“For instance, the defense department’s operations and maintenance accounts are increasing about 2.5% annually after inflation, in large part because of expenditures related to the cost of personnel. As Daggett points out, most of the costs associated with healthcare for warfighters, retirees and military dependents are subsumed in the operations and maintenance accounts, as are the pay and benefits of civilian employees in the department.”
Overall, Thompson faults Gates for not recognizing and addressing the gargantuan personnel cost problem.
“Secretary Gates talks a great deal about the need for a balanced defense posture, but apparently this aspect of balance has eluded him,” Thompson stated. “Not only does the current QDR look unlikely to address the burgeoning cost of military and civilian personnel, but it is grounded in the implausible assumption that defense spending will be stable for the next four years. How likely is that in a government that projects budget deficits above half a trillion dollars every year through 2019, and in which the chief executive is determined to implement the most ambitious domestic agenda since Lyndon Johnson’s Great Society?
“The answer is that it isn’t likely at all. Which means that regardless of what force-sizing construct the QDR comes up with, it isn’t going to be sustainable, because policymakers refuse to confront the biggest management challenge they face — the rapidly rising cost of all the people hired to defend America.”