Hey Pentagon, Don’t Stop Reforming Now

Defense reform has gotten a lot of attention around Washington—from members of Congress and senior Pentagon leaders as well as the usual policy mavens and influencers. Lately, though, whispers wafting from the Pentagon have suggested that perhaps defense reform has peaked, that Congress won’t support meaningful reform. Bushwah! Defense reform is far from dead in Congress. In fact, its vital signs are looking great. So what’s given rise to the whispers? And why are they off base? Last week, Jamie Morin, director of DOD’s Cost Assessment and Program Evaluation office, made this passing comment: “We also understand that [BRAC] has been a politically difficult agenda item for the Congress for many years. I frankly was hoping that this year would be a good year for the discussion and it doesn’t seem to have turned out to be one.” This is a true and fair comment from one senior Pentagon official. But Pentagon leaders would be mistaken to conclude from a few specific issues (like BRAC and TRICARE fees) that defense reform has stalled. In reality Congress is more open to defense reform than ever before. Rather than give up on defense reform, Pentagon leaders should renew their efforts and advance creative and innovative ideas in their fiscal 2017 budget proposal. While Pentagon leaders may be misreading the political tea leaves of defense reform, their pessimism is understandable. Congress has a history of opposing money-saving proposals from the Department of Defense. Congress has repeatedly prohibited a new BRAC round, largely opposed TRICARE changes (with some exceptions) and continued to subsidize commissaries. Congress also has a record of opposing efforts by individual services to get rid of older platforms like A-10’s and Navy cruisers. It is not unreasonable for Pentagon leaders to be frustrated by Congressional opposition to some reforms, but it is absolutely incorrect to conclude that Congress is done with defense reform. Rather than look at reform’s batting average (i.e. how many times BRAC and TRICARE fees have been rejected), Pentagon leaders should look at the trajectory. Five or 10 years ago Congress was rejecting any change to TRICARE and forcing higher pay raises on the Department almost annually. In recent years, however, Congress has not forced higher pay raises on the military, and lawmakers have started making incremental steps on TRICARE and BAH. This might not add up to as much savings as the Pentagon hoped for, but it marks a significant change. And the fiscal 2016 NDAA (National Defense Authorization Act) looks to be the biggest defense reform bill in recent memory. SASC Chairman John McCain and HASC Chairman Mac Thornberry have both indicated that more reform measures will be on the table next year. The trend is clearly toward more congressional interest in defense reform, not less. Second, Pentagon leaders should recognize that Congress is leading the way on retirement reform; it’s the DoD that’s playing catch-up. When the Military Compensation and Retirement Modernization Commission (MCRMC) issued its report earlier this year, there was widespread expectation that Congress would ignore its recommendations. The Department of Defense, for all its talk about reform, was publicly lukewarm on the Commission’s proposals. But Congress stepped up, and both Thornberry and McCain included the central retirement reform proposed by the MCRMC. Only after the blended-retirement proposal had already been incorporated into both the Senate and House versions of the NDAA did the Pentagon finally came out in public support of the proposal. Next, Pentagon leaders shouldn’t get hung up on BRAC. Yes, another BRAC round might be a good thing, but Congress has pointed out that the costs of BRAC are upfront while the savings don’t arrive until much later. DOD faces an immediate budget crunch, so it is not unreasonable for Congress to question the financial wisdom of starting a new BRAC round now. Unfortunately, many in Congress oppose BRAC for parochial, rather than financial reasons. Parochialism will remain a problem, even in better budgetary times, but Pentagon leaders should not discount Congressional interest in defense reform Lastly, Pentagon leaders should pay more attention to politics: not the partisanship, but rather how stakeholders will react to proposed reforms. Military retirement reform is moving forward in large part because it is seen as something beneficial to many service members, rather than another effort to balance the DOD budget on the backs of the troops. TRICARE reforms need to be approached the same way: stop nickel-and-diming the troops with new copays; instead, make systemic changes that provide better care for service members and their families while also saving money. In a democratic system, reform proposals need to be attractive to stakeholders. The opportunity for continued defense reform remains great, but it could be squandered if Pentagon leaders misread the situation and conclude that Congress is done with reform. Yes, personnel and infrastructure reforms are harder than acquisition reform, but the trend is good. Thornberry and McCain have made it clear that defense reform will remain a priority for them. The Pentagon should seize this opportunity and propose meaningful reforms that add value to the relevant stakeholders. Defense reform can continue to happen: Congress is interested, but the Pentagon needs to lead. Justin Johnson, a former House Republican congressional aide, is the senior analyst for defense budgeting policy at the conservative Heritage Foundation.

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Hey Pentagon, Don’t Stop Reforming Now

Posted on September 28, 2015

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