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Cut DoD Budget With Care; Sustain Development Dough

Posted by Marion Blakey on

When Secretary Panetta visited troops in Afghanistan and Iraq last month, press reports heralded his “rough and tumble” rhetoric and “salty” exchanges with the troops. But beneath these lighthearted personal moments lies a serious truth: short of the president, no one bears greater responsibility for the safety and well being of our military volunteers than the secretary of defense. In a time of expanding missions, shrinking budgets, and the prospect of hundreds of billions of “Super Committee” cuts waiting in the wings, those responsibilities must lie heavy on the secretary’s brow.

Fortunately, this is not Secretary Panetta’s first time in the budgetary rodeo. He has a well-earned reputation as a tough budgeteer, earned from his tenure as chairman of the House Budget Committee and as director of the Office of Management and Budget. So when he warns that Congress is looking at “doomsday” cuts, America would be wise to listen.

As Secretary Panetta has dug into the numbers at the Pentagon he has undoubtedly seen disturbing news about our military readiness. After more than a decade of war upon war, our forces are showing signs of wear. The Navy has fewer ships than at any time since 1916, and the Air Force inventory is smaller and older than ever. The mission capable rate for our bomber fleet is a startling 60 percent.

While troops abroad have been doing their best with aging equipment – much of which was designed in the 1970s and 80s – factories at home have grown quieter and quieter. Since the end of the Cold War, the Pentagon has reduced the number of weapons systems it has bought and program starts have become fewer and further apart. In 2010, for the first time in 100 years, the United States had no manned military aircraft in design. Forty-nine military aircraft programs were underway in the 1950s, seven in the 1980s and three in the 1990s. Today, looking beyond the F-35, there are none – with the possible exception of a long-range bomber that is not yet approved for development.

Investment in procurement and research and development drive U.S. technological superiority and give our troops an unparalleled advantage on the battlefield. They help ensure our national security and employ approximately 800,000 workers and support 2 million indirect jobs, as well as one of the only dependable U.S. trade surpluses. They’re the reason an American fighter jet can destroy an adversary before it even appears on the horizon; why our troops can use unmanned drone aircraft to spot Taliban insurgents in the act of planting roadside bombs; and why medics in cargo aircraft equipped as flying hospitals can save lives on the way from the Middle East combat zone to hospitals in Germany. And they are also a big part of why the U.S. aerospace industry has consistently been first to roll out next-generation technologies from the U-2 to stealth to unmanned aircraft.

Right now the Pentagon’s investment budget makes up less than a third of total defense outlays, but as the congressional debt committee begins its work, these R&D and procurement accounts will likely end up in the crosshairs, as other savings like troop drawdowns and entitlement reform will be politically sensitive and will take longer to implement.

The strident calls for defense budget cuts from many quarters of the political spectrum give a false credence to the idea that our Defense Department budget can easily bear another rounds of cuts. But despite preconceptions of a bloated Pentagon, the defense budget is historically low as a percentage of overall federal spending, amounting to only 16 percent of the budget compared to roughly 40 percent three decades ago. Former Secretary Gates already cut most of the fat (and possibly some muscle) out of the department, canceling $300 billion in modernization programs and wringing almost $200 billion more in efficiencies and other savings out of the Pentagon bureaucracy. These cuts, he warned, already mean “we will be able to go fewer places and do fewer things;” another round of overly deep reductions he cautioned would be “catastrophic.”

Further savings may be possible by reforming our troop structure and rationalizing military health care and similar programs; however, such changes will require careful management and deliberation, not indiscriminate cuts based on budget numbers that seem drawn from a hat. Defense Secretary Panetta warned against the automatic cuts in the second phase of the debt ceiling deal, saying, “If they do the sequester, this kind of massive cut across the board which would literally double the number of cuts that we’re confronting, that would have devastating effects on our national defense.”

No one disputes that debt reduction is critical to our long-term security. However, it’s hard to see how another major round of national security cuts can be made without putting critical capabilities and missions at risk. The president seems to share Panetta’s doubts. At his July 15 press briefing President Obama acknowledged that as commander-in-chief he has huge responsibilities that can’t be ignored, apparently rejecting earlier proposals to cut another trillion dollars from defense.

AIA released a report recently that examined the historical ebb and flow of defense investment. Defense Investment: Finding the Right Balance makes the case that 35 percent of the base defense budget (excluding the war costs) should be devoted to forward-looking investment to defend future American generations. This includes spending approximately $90,000 to $100,000 per service member – an accepted standard – with the addition of the necessary R&D funding.

And while today’s current investment funding approaches that level, past experience shows that, as conflicts wind down, investment funding does too. We saw this after World War II, Korea and Viet Nam. A repeat of that scenario would leave our troops vulnerable to rising threats and make it impossible to replace equipment worn down from a decade of combat in brutal desert conditions.

In fact, the risks are even greater today because of the precarious state of our overall aerospace and defense industrial base. The fact that there are fewer new program starts and there are no new manned military aircraft – including rotorcraft – in design is very frankly alarming. Dozens of modernization programs have been shut down in recent years, putting expertise and industrial capabilities built up through generations of investment at risk. This comes on top of devastating layoffs in our space sectors with the retirement of the shuttle program and the lack of funding and consensus to move forward quickly with the next steps in space. This combined loss of unique aerospace engineering will-if not addressed- lead to the withering of capability and an atrophied workforce that’s no longer able to remain the global leader in technological innovation. Other countries are already challenging the United States as the world leader in aerospace and defense, which raises grave risks for the technological edge that our military enjoys today.

DoD is aware of this issue and is conducting a detailed review of the industrial base. The Pentagon, however, hasn’t asked for input from all of industry on the review. We believe that including detailed information about plant equipment, technology investment, workforce size and capabilities and other issues could help the Pentagon plan its investments to save money and critical high-tech jobs.

While Washington has revolved around the issues of spending and debt in recent months, one word has been strikingly absent from the debate: strategy. What is our national security strategy and what capabilities does that strategy require? If we answer those questions and then drive the budget to meet those answers, everything else will follow, but right now we’ve strayed far from that approach and Congress seems to approach the defense budget as if it were a grocery list to pick and choose from, with no consequences beyond whether or not the country has chocolate or vanilla ice cream for dessert. And we know that’s just not the case.

As the debt talks resume this fall, it will be Secretary Panetta’s challenge to insist on clear answers to these fundamental strategy questions before further national security cuts are made. Considering the stakes – for our foreign policy, national security, U.S. jobs and the fragile economy – the troops fighting overseas and their families back home will train the keenest eyes on the debate. After all, they are the ones taking the risks; they are the ones that must live with the consequences.

Marion Blakey, the newest member of the Breaking Defense Board of Contributors, leads the Aerospace Industries Association. The first woman to head the FAA, Blakey held four senior government posts before joining AIA.

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