April 17, 2014

Defense Secretary Gates Warns Military That "Gusher of Spending" Is Over, Making Reforms Essential

  • The federal budget is an expression of our country's values. Where we choose to spend and at what levels, how and who we tax, and the borrowing we...

Holding up Dwight D. Eisenhower as a model, Defense Secretary Robert Gates is urging the American military to cut bureaucracy, improve its efficiency and “make every dollar count” as the country struggles with its fiscal challenges. 

Pentagon reform is critical, Gates argues, if the military is to retain its current force structure. That is because the military cannot expect a repeat of the “gusher of defense spending” that nearly doubled the Pentagon’s basic budget in the last decade (not counting additional appropriations for the conflicts in Iraq and Afghanistan). 

“Given America’s difficult economic circumstances and parlous fiscal condition, military spending on things large and small can and should expect closer, harsher scrutiny,” Gates said in a recent speech at the Eisenhower Library in Abilene, Kansas. “The gusher has been turned off, and will stay off for a good period of time.” 

The Governmental Accountability Office, which has issued many reports suggesting improvements at the Pentagon, criticizes it for unrealistic planning, inefficiency and "lack of a strategic approach to investment decision-making." Gates offers some striking examples to bolster his case for significant changes and reforms:

  • The U.S. battle fleet is larger than the next 13 navies in the world combined -- and 11 of those belong to "allies and partners" of the United States.
  • Health care costs are "eating the Defense Department alive," rising to $50 billion from only $19 billion a decade ago. Yet premiums for the military's health insurance program have not been raised in more than a decade, with many working age military retirees relying on the government rather than their current employers' health plans. 
  • A request for a dog-handling team in Afghanistan must go through at least five "four-star headquarters" to be processed and eventually dealt with.
  • Two decades after the United States sharply reduced its forces in Europe with the end of the Cold War, more than 40 generals, admirals, or civilian equivalents are still based there.

The defense secretary said Eisenhower believed the United States “could only be as militarily strong as it was economically dynamic and fiscally sound.” Consequently, Gates said, the World War II general who later became president pushed the military to set priorities and make difficult budget choices. 

Gates places some of the blame for military inefficiency on Congress and political pressures. Lawmakers and veterans groups, for example, have repeatedly rejected even modest increases in premiums and co-pays in the health insurance program. Gates also complains that Congress routinely increases military pay beyond Defense Department requests. 

Congressional Budget Office data support Gate’s caution on those pay increases. The agency found that in 2006, average cash compensation for service members exceeded that of more than 75 percent of civilians of comparable age and education. Since 2006 military pay hikes have continued to outpace civilian increases. 

In a speech earlier this month, Secretary of the Navy Ray Mabus also addressed military inefficiencies and promised specific steps that the Navy would take to improve. 

The Concord Coalition commends military and political leaders who recognize that military spending -- like everything else -- should be on the table in discussions about dealing with the nation's fiscal difficulties.