The wages of fear

The epilogue of the sequester drama is nigh; the fiscal cliff looms, and once again the Pentagon has yielded to the temptation to describe a fantasy past and a fantasy future, in the hopes of avoiding the inevitable: a defense drawdown. Will they never learn?

For the Department of Defense, we would all be Katherine, the Shakespearean shrew, once broken. We should cry out, as Secretary Panetta asks us to: "sun it is not, when you say it is not; and the moon changes, even as your mind. What you will have it named, even that it is; and so it shall be still for Katherine."

The past, our last three drawdowns, were the worst of times, as Secretary Panetta said yesterday: "We have been determined to avoid the approach taken in past drawdowns, where, as I said, there were deep, across-the-board cuts that hollowed out the force and weakened our military, left the military demoralized and unready to carry out the missions assigned to it."

And yet, as Galileo suggested, it is not so. Two of the last three drawdowns were well managed and thought out. And even including the uneven one, America's military remained a globally capable and dominant force. After Korea, President Eisenhower drew down the ground force and brought the budget close to balanced. We still had a ground force, a navy, an air force, and military power that bestrode the world like a colossus. It was not hollow, it did not fall faint to the floor in pitiful sorrow. Morale was high and no adversary crossed the line.

After the debacle that was Vietnam, Secretary Laird and President Nixon devised a realistic strategy of 1.5 wars (down from over two), and transitioned the forces from conscript to volunteer, as they are today. The Army did, indeed, warn of hollowness; it was our least well-managed drawdown. But, setting aside the hysteria at the time of the Committee on the Present Danger, America retained the globe's most powerful military capability; the nation remained secure, and the forces were strengthened. Looking backward, historians have concluded both the threat and the weakness were exaggerated.

At the end of the Cold War, President Bush, Secretary of Defense Dick Cheney, and Joint Chiefs Chairman Colin Powell developed the force planning algorithm (it was not a strategy) of two major regional contingencies, leading to the base force, and the third and last Cold War drawdown. In their tenure, the active duty force shrank by 500,000 troops and the budget by 25 percent in constant dollars.

The last stages of that drawdown took place during the first Clinton term. The OMB, led by Secretary Panetta, oversaw the budget planning for that drawdown and set the overall budget plan that ultimately led to two things: 1) the first sustained federal budget surplus since Eisenhower, and 2) the best managed defense drawdown we have seen. The ground force shrank, the Pentagon managed better, and the force that was in place used Saddam Hussein as a speed bump. It was neither hollow nor weak.

America's military was always, and remains, a globally dominant force, as it has been for the past sixty years.

If we are to believe the Pentagon, the future is worse than we have ever seen, full of fearful threats, "threats that are more complex, more dispersed, and in many ways, more dangerous." Terrorists coming at us from all sides, IEDs constantly aimed at our troops, a rising China, a Middle East in turmoil. Is fear the only basis on which we can sustain unprecedented defense budgets at a time of minimal threat?

We do not face any existential enemy. An overwhelming swath of the globe is at peace, from Latin America, to Europe, to Asia. And a "rising China" is far from a military threat, rather a broad relationship to be managed.

Where there is trouble -- the Middle East -- is in the region where we are drawing down militarily. Secretary Panetta said, "Even after the withdrawal of troops from Iraq, we have maintained a substantial military presence in the Middle East in order to deter aggression, respond to crisis, ensure regional stability in the face of historic unrest and the continuing threat from Iran."

Indeed those forces are there, but the ambition is an unachievable overreach for the military. Our forces are secondary, even tertiary, as an instrument for our statecraft in Syria, or Egypt, or Lebanon. They will not now, not in the future, invade Iran or Pakistan. Large or small, our military forces will not shape the region. The changes under way there are "far above our poor power to add or detract."

We can do so much better than this. Even a sequester does not mean the end of our military capability. Defense would lose 10 percent of its resources in this fiscal year -- serious, but not unprecedented and hardly the end of the world. Military personnel, retirees, and benefits would be exempt from the sequester. Contractors, who are hard at work on contracts already obligated, would anticipate that the next round of contracts might be 10 percent smaller than they hoped. Say, as Deputy Secretary Ash Carter did in August, from 29 F-35s to 25 in FY 2013. Service planners would have loose rein in the operating accounts to execute tradeoffs. The level of research and development effort would shrink by 10 percent, hardly a disaster.

This is not "doomsday," it's just a silly and arbitrary way to manage a drawdown. The Department knows it has not yet cut the projected defense budget; Secretary Panetta's "cuts" of $487 billion only reduced anticipated growth, leaving the defense budget growing with inflation over the next decade. If past is prologue, it will go down deeper. Would that the Pentagon engaged in less drama and began to plan sensibly for the drawdown everybody knows is realistic, safe, and already under way.

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National Security

Fiscal cliff follies and defense

The dance performance at the edge of the cliff continues. Boehner offers to let taxes return to their pre-2001 level for the very, very rich. The president counter-offers, putting lower Social Security COLAs on the table, much to the consternation of AARP, who fill the in-boxes of people over 50 with protest (including mine).

Boehner, in theatrical frustration, moves to a Plan B that would have the House vote to raise the millionaire tax and spare the rest. Grover emerges from the dark shadow he lives in to pat Boehner on the back, saying a vote for the millionaire tax would not violate the no tax pledge the Republicans have signed, even though it does.

Meanwhile, in the defense world, nails are being bitten. Secretary Panetta warns of a cataclysm if the president and Boehner fail to agree. Buck McKeon steps to the mike in a redux of the performance he has been executing for 18 months (isn't he tired?), decrying the fact that the Boehner tax bill left the sequester on the table, and our national security open to the barbarians. In response, Boehner added a provision that would protect defense from at least part of the sequester. (Though sequester would take only 10 percent of the resources from one of the highest defense budgets America has seen since the end of World War II.)

A deal will come, but only when the dancers are exhausted with this increasingly embarrassing performance. And when it does, what will really happen to defense? If the White House offer is any indication, not much. Defense and domestic discretionary spending have been a "residual" in the budget negotiations for months, with entitlements and revenues the leading edge of the argument.

In its latest offer, the White House has reportedly said it would make another $200 billion in discretionary spending cuts, over ten years, split 50/50 between defense and domestic discretionary spending. That would be a laughable $100 billion less for defense over ten years from the current budget projection.

Yes, that is a cut, Virginia, as the current projection would give DOD growth at the rate of inflation. But as a budget proposition, it is a joke. Senate and House appropriators regularly, annually, find $5-10 billion tucked away in the defense budget that they can use to fund things the Pentagon did not ask for, but members want.

Where do they find it? In re-estimates of the payout rate on existing contracts, in lower than projected rates of inflation (the hidden secret of defense budgeting -- project high rates of inflation, then save and reprogram the money after you get it), in lower spending for operations and maintenance (just a general O&M cut by another name -- let the Pentagon find the savings), in finding operations savings in Afghanistan because the troops are coming home faster than expected (used that one once already; more to come).

Oh, there is a lot of slush of this kind in the DOD budget and the appropriators know how to find it all when the "members' requests" come in. So, go ahead, try to tell me that $10 billion a year less than the overall budget projection is tough to manage. It's not; it is a walk in the park.

Defense will be lucky to have this "cut." And, of course, the luck will not last. Every year for the next ten years there will be more nibbles at defense, because defense can "take it" in budgetary terms.

About ten years from now we will turn around and realize how deeply we have cut defense from the peak year (war and base budget) of fiscal year 2010. The way to count that is to take that peak year and draw a line, calculating what the defense budget would have been for the next ten years, had we simply increased that amount by inflation. Then draw another line -- the one that nibbles at DOD's budget every year for the next ten years. The space between those two lines will be more than a trillion dollars.

And if that drawdown is well managed, we will not even notice its impact. The forces will be smaller, but still globally dominant, doing everything we asked them to do. And we will have taken more than a trillion dollars from projected defense budgets, which is what so many "defenders of defense" are rending their garments over today. No sweat.

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