Matt Yglesias

O’Hanlon: Real Defense Spending Must Always Increase

Michael O’Hanlon had a somewhat curious op-ed earlier this week arguing against the idea that we can hold the defense budget constant in inflation-adjusted terms. You might expect such an argument to involve some strategic assessment of the threats facing the nation, but as Benjamin Friedman observes he just punts on what these capabilities are for. Instead, he asserts that for “the Defense Department to merely tread water, a good rule of thumb is that its inflation-adjusted budget must grow about 2 percent a year (roughly $10 billion annually, each and every year.”

I think there’s a grain of truth to this with regard to personnel. Real wages increase over time, so unless the military wants to lose out in labor market competition with other agencies, it needs its real wages to increase as well.

That said, this is a perfectly general phenomenon. The CIA and the State Department and the guys who regulate banks all face the same issue. So there’s still a need to make an argument for spending increases that takes some real account of tradeoffs. There are costs to spending more money.

Then there’s the whole rest of the defense budget. Many organizations have been able to offset rising labor costs by taking advantage of technological improvements. For example, almost every organization employs fewer secretaries and typists than it once did. Instead, we have more (and cheaper!) email, voice mail, online calendars, cell phones, etc. to help keep track of what’s going on. The Department of Defense has not been very good at taking advantage of technological improvements to reduce equipment costs. Instead, the tendency has been to design new generations of ships and planes that are vastly more expensive than their predecessors. But this is not a general phenomenon. Labor costs grow for the military because they grow for everyone. But the real price of lots of other things falls. Not just computers, but also things like cars:

I think there’s a good case to be made not that defense budgets need to rise because equipment gets more expensive, but that equipment gets more expensive because defense budgets rise. A more budget-constrained military would pose different incentives to contractors, and I bet they’d be able to find ways to start building more cost-effective systems.

Or to take a related example, if you read Peter Singer’s Wired for War it’s clear that there are large cost savings to be achieved by relying more on remotely operated “drones” and less on planes with human pilots. But the services have been resistant to this change out of a mix of machismo and traditionalism. The experience of actually engaging in warfare has, as Singer details, began to spur changes. And there’s good reason to believe that more change would happen if it were necessary.

US Defense Spending In Context

I’ve shown charts before showing how absurd the American defense budget looks in context. Now a new chart making the same point, but with slightly more up-to-date 2007 spending data:

As you can see, not only is the United States spending well over double the combined defense budgets of Russia and China, but America’s close allies constitute the bulk of the other big spenders. Indeed, if you add all the European countries together, they spend about 50 percent more than Russia and China combined.

John Cornyn’s Defense Budget Fearmongering

Robert Gates reform-oriented defense budget would mean less money for some defense contractors and fewer jobs in the districts of some members of congress. Under the circumstances, I’m not surprised that it’s being met with some skepticism. That said, the idea that the Gates/Obama budget would somehow leave us “unprepared” for conventional war is just silly:

Others, like Senator John Cornyn, a Texas Republican, cite the threats posed by nations around the world that remain true adversaries — or at least are competitors to American interests.

In a speech to the American Enterprise Institute, a conservative policy center in Washington, Mr. Cornyn said that China was upgrading and expanding its navy to challenge American warships, that Russia was striving to intimidate its neighbors and re-establish a sphere of influence, and that North Korea and Iran continued to expand their missile arsenals while pursuing nuclear weapons.

Time again to take a look at US defense spending in context:

If we decided to take the threats Cornyn names seriously and spend double the combined budgets of China, Russia, North Korea, and Iran then that would imply large cuts in our current levels of spending. And keep in mind that under such a scenario we’d still be able to call on allies such as South Korea, Japan, and our friends in NATO. The west would still have an overwhelming preponderance of military power.

It’s true, as Cornyn says, that we still face international security problems. But it’s not because we’re not spending enough on defense. It’s because we face problems we can’t solve with more defense spending.

What Do Federal Taxes Pay For?

A very nice chart from the Center on Budget and Policy Priorities:

A European made the point to me a few weeks ago that even though the political constituency for the enormous defense budget is huge, the Pentagon (and defense-related programs in the Department of Energy) doesn’t really provide a service people use. If we did something crazy like resolved to limited defense spending to twice the combined budget of Russia and China and reallocated the money to other priorities people would probably feel, on an intuitive level, that they were getting more “bang” for their tax “buck.”

The other related point is that a ton of tax money is going to health care, and a very large proportion of health care spending is waste—either medically useless or counterproductive—and this would look even bigger if we could see implicit tax subsidies.

Building a Pirate-Fighting Navy

The annals of defense contracting are full of horrendous mismanagement and cost overruns. They’re also full of hulking, pointless systems that have little to do with the military’s modern-day missions. When critics are lucky, these two issues go hand-in-hand, as with the F-22. But sometimes they come apart. The Littoral Combat Ship, for example, has been a disaster as a program in terms of screw-ups and cost-overruns. But the basic idea of a small, fast, modular ship that can operate in very shallow waters does seem genuinely useful.

When Noah Schachtman asked Gates about the LCS the other day, Gates basically just said the capabilities are really useful. I pressed him on what, exactly, was so appealing about it and he specifically cited pirate-fighting, telling me “You don’t need a $5 billion ship to go after pirates” and, indeed, the high cost of a ship might dissuade you from risking it against a relatively trivial enemy.

I’m not entirely sure how I feel about that at the end of the day. But as Schachtman point out, it certainly is true that the Navy we have is not well-suited to the doctrine we’ve adopted in terms of anti-piracy missions, while the shift to the LCS would leave us with forces that were better-suited to that policy. My view is that ultimately if you want to tackle the pirates issue, you need to do it on land. Which, in practice, means we probably don’t want to tackle the pirates issue and shouldn’t let this specifically concern play too large a role in our thinking. But LCS has other kinds of appeal as well and on the whole I’m equivocal about it.

Sestak, Korb Support Gates/Obama Defense Reforms

One big political problem with the Gates/Obama reform defense budget is that it cuts a lot of programs near and dear to the hearts of the military-industrial complex and their tame dogs in congress. Thus a lot of talk about how Gates is “gutting” the military. But another problem is that Gates actually isn’t cutting spending so his reforms don’t open up a bonanza of new money for tax cuts or social spending that libertarians or liberals get all that excited about.

That said, Brian Beutler notes that retired Admiral Joe Sestak, now a member of congress, is ready to champion the Gates reforms. And Larry Korb, who’s been waging the battle against bloated defense spending since the end of the Cold War, observes that this budget really is a key step in the right direction.

I would urge progressives who are having trouble getting themselves excited about this fight to recognize two points. One is that it really is nice to reorient a given quantity of military spending in more useful directions even if it doesn’t lead to cuts in the headline number. But the other is that if you ever do want to see further-reaching reform, we need to pass something like this budget first. It’s a key political test of whether it’s even possible to defy what the defense contractors and the joint chiefs want. If that does prove possible, then in years to come many things are possible, including a long-term trajectory that has defense declining as a percent of GDP. If it’s not possible then nothing is possible, and no future president will tackle it.

Subtraction by Addition

The Gates/Obama budget provides for the end-strength of the United States Army to increase, which makes it difficult to characterize as a cut. Nonetheless, Pete Hegseth at The Corner gives it the old college try:

However, for me (and fellow infantry grunts), the most disturbing portion of the budget is the de-facto cut (or non-increase, increase) in Army end-strength. Secretary Gates announced, “we will stop the growth of Army Brigade Combat Teams (BCTs) at 45 versus 48 while maintaining the planned increase in end strength of 547,000.” Gates cited “better manned units” and “an end to stop-loss” as the reason for this change.

There are two important parts on this: 1) the “planned increase” to 547,000 soldiers in the Army was proposed under Bush, and will now be funded under Obama. This is a good thing, but not really a new increase; 2) cutting the number of proposed BCTs from 45 to 48, in order to fully staff them, is an admission that we don’t have enough soldiers to fully support the needs of the Army.

Look, you can fairly say that this is “not really a new increase.” But it’s still an increase. There will be, in the future, more BCTs than there are now. And they’ll be better-staffed. This isn’t like one of these things where you enact a deep cut in inflation-adjusted per student spending and call it a “spending freeze” and try to deny that you’re cutting anything. Gates and Obama are proposing to increase the number of soldiers, they’re just planning a smaller increase than some might like to see. But it’s definitely an increase.

A Defense Budget for the Real World

As Spencer Ackerman puts it, while Tom Donnelly and Gary Schmitt don’t much like the Gates/Obama defense budget they do seem to love KKK founder Nathan Bedford Forrest:

More often it rewards those who arrive on the battlefield “the fustest with the mostest,” as Civil War Gen. Nathan Bedford Forrest once put it. If Mr. Gates has his way, U.S. forces will find it increasingly hard to meet the Forrest standard.

This is just insane. Let’s look once again at U.S. defense spending in context:

There’s no reason at all to think that the United States will have any problem arriving anywhere “with the mostest” any time soon. There is, however, still a question of how to allocate resources. The Gates/Obama proposal is to shift resources away from the kind of Cold War-style systems designed to fight a big adversary and toward greater investment in flexible equipment and the military’s human capital. Donnelly and Schmitt say that without the F-22 we’ll be going to war with “the 660 F-15s flying today, but which are literally falling apart at the seams from age and use.” In fact, we’ll be going to war with F-35s. It’s a cheaper and more flexible product as well as higher in quality than even a brand-new F-15. And the F-15 is a pretty solid plane in the first place.

But rather than get bogged down in the details, it’s worth looking at the big picture. The problem with the F-22, or the DDG-1000, or the FCS is that for systems with a limited range of practical applications they’re terrifyingly expensive. Buying them would force us to choose between starving the military of other resources—adequate manpower, for example—or letting the defense budget just endlessly explode.

The latter is, I think, the Donnelly/Schmitt agenda. With the U.S. military already accounting for half of global defense spending, it’s clear that any inability to meet our core needs stems from bad priorities rather than inadequate funds. Donnelly and Schmitt both come to us from the American Enterprise Institute, though, so they get to make their budget decisions in the wacky world of conservaland. In this thrilling universe, tax revenues don’t need to relate to spending levels at all, and spending on defense doesn’t count as “spending.” Consequently, there’s no need to put the utility of given weapons systems in context or set any kind of priorities. Secretary Gates and President Obama, by contrast, are trying to outline a defense budget for the real world—one which recognizes the need to get the most national security bang for our Pentagon buck, and that therefore prioritizes the programs that combatant commanders say they need most and lets the desires of big defense contractors take a back seat.

Defense Reform for the Long Haul

Noah Schachtman writes about an intriguing element of yesterday’s Pentagon conference call that hinted at the logic of deeper future reforms:

Marine General [and] Vice Chairman of the Joint Chiefs of Staff James Cartwright says the Review will handle all kinds of tradeoffs. For instance: “If you have bombers in the Pacific, do you also have to have aircraft carriers?” he asks. “Do we always have to have every thing in every service? How much of this do we really need, especially given the situation we face which is a much broader spectrum of conflict over a much great geographic dispersal than we’ve had in the past?”

Essentially everyone agrees that this is a problem. At the margin, each service prefers to have more capacity inside its own bureaucratic boxes rather than be dependent on other services. Consequently, around the margins there’s a lot of overlap, even though “jointness” has allegedly been the main strategic concept of the military for a while now. Spencer Ackerman observes that the implications of taking this idea more seriously could be large “if the services and Congress don’t like the fiscal 2010 budget, they’ll absolutely hate the QDR and the fiscal 2011 budget that the QDR informs. Reform is starting to seem like the new normal at the Pentagon under Gates.”

I think that’s right. Early in his remarks, Gates specifically linked the reform-oriented 2010 budget request to a larger process. He said that what he’s doing in this budget flows from the 2008 National Defense Strategy and that the drive to change will continue in both the next Quadrennial Defense Review, the next Nuclear Posture Review, and then the 2011 budget request.

This is important because it’s in the nature of military procurement programs that there are necessarily large lag times. Consequently, over the short run the only way to realize really major savings would be to just abandon existing expensive equipment in a way that’s not very efficient. But the move to curtail the F-22 in favor of increased orders of the F-35, which is both cheaper and “jointer” (i.e., used by more than one service) points in the direction of the possibility of substantial long-term potential savings. That’s not only because you can have direct efficiency gains through more joint procurement, it’s because by moving the services to a more homogeneous set of tools you do much more to lay bare redundancy and overcapacity. In Gates’ example, we’re thinking about the general presence of strategic air power in the Pacific rather than so many carrier-based craft and so many bombers. The presumption that you need “some of everything” in any important region winds up setting an unreasonably high floor for capabilities.

Gates on the Defense Budget

I’ve just gotten off a conference call with Secretary of Defense Robert Gates in which he talked about the budget.

Probably the most notable thing he said was the stern words he offered for members of the military who may not be happy with some of the decisions he’s made. At first it was all sweetness and light with Gates remarking that “we had a process that was very inclusive” and observing that there were “a lot of meetings and a lot of dialogue on all this, and I think everybody knows that they had a chance to put their oar in and make their case” so everyone should be happy. But then he started to get real and said:

One of the concerns that I have had in the past has been the discipline in this building after the decisions get made; I understand that the chiefs in particular can give their professional military advice to the congress and to the president, but the fact is that for everyone else and, frankly, for them in terms of executing their positions once I have made my decision and the president has made his decision, that is the policy of this department . . . I don’t want to see any guerilla warfare on this . . . we have a chain of command.

In addition to tough talk, the specific bureaucratic plan of action is to portray the shift in spending priorities as, implicitly, a shift away from what folks inside the Beltway may like to what combatant commanders out in the field are asking for. Gates said that these aren’t cuts. Rather, it’s “reshaping” specifically the kind of reshaping “that the combatant commanders are asking for.” The process, he said, “is a lot about the warfighters, the combatant commanders and the fight they’re in.” Though he was quick to say that he believes his choices reflect not only the priorities of combatant commanders actively engaged in military action, but also those primarily tasked with “preventing war.”

On specifics, Gates said that the problem with the Army’s Future Combat Systems program isn’t just the cost. It’s that there wasn’t enough flexibility. Based on the operational lessons learned in Iraq and Afghanistan, it’s useful to have a broad range of different kinds of vehicles, and it wasn’t proving feasible through the FCS process to design a system that could replace the full spectrum of currently available vehicles.

Spectrum is an important concept. The weighting from regular to irregular warfare in the budget is undeniable, but Gates said he didn’t want to see it as a binary choice. Instead “there is a spectrum of conflict” and the goal of the force needs to be to be able to shift up and down the spectrum.

Conversely, Gates is holding on to the Littoral Combat System project for the Navy even though the program has had a lot of cost overruns and so forth. Gates said that despite the problems “I think it has a capability we just have to have.” Specifically, the promise of a ship that’s not only agile, but relative cheap on a per-ship basis is large. “You don’t need a $5 billion ship to go after pirates,” Gates said.

Obama is Reorienting Defense Spending, Not Cutting It

An excellent point from Brian Beutler about the media’s weird framing of the current defense budget debate. Barack Obama and Robert Gates are proposing big cuts in a number of programs in order to finance increased spending on other aspects of defense that they think are more important. This, though, is being reported as if they’re taking an ax to the defense budget, when they’re not:

In other words, by retooling the Pentagon, Obama and Gates plan to move a lot of money around, but they also plan to increase the overall defense budget. In the final year of the Bush administration (and excluding the costs of the wars in Iraq and Afghanistan) the defense budget was $513 billion. In FY 2010, if Gates and Obama get their way, it will be $534 billion–$534 billion that will be spent much differently than last year’s outlays were.

But you’d never know that from the news coverage.

This does relate to the prospects for overall reductions in defense spending, since if it proves politically impossible to do a restructuring of the Pentagon budget that would indicate that it’s not politically possible to ever cut it. But the actual program here reflects a philosophical disagreement about the nature of defense spending. Relative to his predecessors, Gates and Obama are trying to put less emphasis on expanding the technological gap between the United States and other major countries, and put more emphasis on relatively flexible systems, on the military’s human capital, and on the ability to do low-intensity operations.

Framing the spending shift willy-nilly as “cuts” helps allow the defenders of the status quo to paint themselves as more committed to national defense than their opponents. In reality, they’re just more committed to parochial interests.

Review of Wired for War

My review of Wired for War: The Robotics Revolution and Conflict in the 21st Century is now up at The American Conservative.

Key excerpt:

Unfortunately, too many of Wired for War’s human characters seem to have fallen into the trap of seeking to substitute technical solutions for problems of war that are fundamentally political or strategic in nature. Singer quotes Noah Shachtman fretting that excessive use of unmanned systems “makes us look like the Evil Empire [from Star Wars] and the other guys like the Rebel Alliance, defending themselves versus robot invaders.”

True, perhaps. Yet surely human invaders are just as unwelcome as robotic ones. American Predator airstrikes are unpopular in Pakistan not because the planes doing the bombing are unmanned, but because no country likes to see another country dropping bombs within its territory.

A great nation requires capable armed forces. And that, in turn, requires a military equipped with up-to-date technology. But no amount of technology is a substitute for sound strategy. Warring automatons, no matter how ingenious, cannot save a nation that squanders its wealth on foreign misadventures and risks undermining the economic foundations that support its military establishment by throwing ever more money at defense contractors rather than productive investments in domestic infrastructure and private business.

This book is almost certainly the first time that a Brookings Institution scholar has used the term “frak” in print. But with luck, it won’t be the last. So say we all.

The Gates/Obama Reform Budget

Let me quote Matt Duss’ Wonk Room post on today’s defense budget announcement:

I don’t think it’s overstating things to say that Defense Secretary Gates’ announcement of his 2010 defense budget recommendations represents an appreciable shift in the way that the United States approaches the issue of military acquisitions. Applying lessons learned in the wars in Afghanistan and Iraq, as well as signifying a recognition that the continuing economic crisis places real constraints on defense spending, Gates’ recommendations are an important — but by no means comprehensive — move toward a responsible re-balancing of America’s defense priorities. [...]

Gates laid a shot across the bow of those in Congress who are likely to try and reinstate beloved boondoggles like the Airborne Laser and the F-22 Raptor, (which Gates recommended canceling after 187 are built) saying “I know that in the coming weeks we will hear a great deal about threats, and risk and danger -– to our country and to our men and women in uniform –- associated with different budget choices. Some will say I am too focused on the wars we are in and not enough on future threats.”

These are important shifts and this is audacious policy. Frankly, you’ve got to worry that it may be too audacious. The defense budget looks the way it looks because that’s how the key players in congress want it to look, and I don’t really know what Robert Gates or Barack Obama can do about that.

Skelton on Gates

Rep Ike Skelton doesn’t seem to be leaping to embrace Defense Secretary Robert Gates’ efforts to change the Pentagon budget. His office released this statement:

Secretary Gates has set out major changes to the defense budget based on changed assumptions about the wars our military must be prepared to fight. This is a good faith effort, and I appreciate the hard work and thoughtful consideration Secretary Gates and his staff put into these proposals.

However, the buck stops with Congress, which has the critical Constitutional responsibility to decide whether to support these proposals. In the weeks ahead, my colleagues and I will carefully consider these proposals and look forward to working with Secretary Gates and Admiral Mullen as we prepare the Fiscal Year 2010 defense authorization act.

And, indeed, stop with congress the buck does.

OMB Un-Disavows “War on Terror”

One interesting sub-plot thus far in the Obama administration has been the not-quite-official disavowal of the term “war on terror.” This saw another flair-up recently when a civil servant named Dave Riedel emailed Pentagon officials to tell them “OMB says: ‘This Administration prefers to avoid using the term ‘Long War’ or ‘Global War on Terror’ [GWOT]. Please use ‘Overseas Contingency Operation.’” But according to Brian Beutler, when Peter Orszag was asked about this he distanced himself from the distancing saying “I’m not aware of any communication I’ve had on that issue. It was a communication by a mid-level career civil service.” Brian observes:

So GWOT it is. That doesn’t mean the Riedel email didn’t go out, though, and some (me, for instance) wonder if some at the Pentagon might stick with the supposedly new moniker (Overseas Contingency Operation) leading to some amusing confusion on the Hill.

This has been a problem for the government for some time, and to such an extent that even George Bush was willing to admit error. “We actually misnamed the war on terror,” Bush said in August 2004. “It ought to be the struggle against ideological extremists who do not believe in free societies who happen to use terror as a weapon to try to shake the conscience of the free world.” Touche.

I think this is a more important issue than people realize. Names of programs matter. The fact that the Future Combat Systems project is named “Future Combat Systems” allowed John McCain during the campaign to try to get people to believe that Barack Obama had some kind of blanket opposition to funding future combat systems, rather than opposition to a specific boondogglish program. Similarly, it sounds and feels a lot more reasonable to say that Pentagon requests for money to use in overseas contingency operations need to be weighed against other priorities than it does to question funding requests aimed at winning a “Long War” or a “War on Terror.” Completely non-military endeavors have often tried to leverage the term “war” into increased funding (War on Poverty, War on Drugs) but obviously this works a lot better for the military which is in the business of fighting wars.

But reducing the world’s exposure to terrorists is neither an enterprise with a defined beginning and end, nor is it mainly a military undertaking. “War on Terror” and “Long War” thinking distort our policy approaches, distort our budgetary priorities, and encourage the problematic idea that we need to fight a hazily defined “global counterinsurgency” and can’t afford to think about the costs of doing so.

Steven Metz: Why Are We Planning an Occupation of Lagos?

One interesting thing that happens as a general interest policy blogger is that I shift between discussions about domestic social policy and national security policy. Whenever there’s a conversation about domestic social policy, the overwhelming assumption is that virtually no new funds will be made available for any purpose no matter how worthy unless you can identify offsetting reduced expenditures elsewhere, and that the entire suite of social problems afflicting American citizens will just be perennially underfunded. When you’re a defense policy conversation, by contrast, it’s like all the planning is happening with monopoly money. If you can devise an even remotely plausible rationale while doing something might be useful, you just kind of charge ahead. Consequently, very abstract conversations about defense planning tend to take on a kind of surreal air with grandiose goals framed on the thinnest of pretexts.

All of which is by way of saying that I thought this Steven Metz post on his reaction to “a Department of Defense symposium which discussed the future strategic environment twenty years out” was very insightful:

I was aghast when people talked about future missions like controlling the vast slums of Lagos or Karachi, both because I don’t think those who made this point understood the magnitude of such a task, and because I don’t think doing so would promote American security. None of the architects or implementers of 9/11 were motivated by the lack of jobs or emerged from a teeming slum. On 9/11 we were attacked by a dispersed, non-state entity but in a perfect illustration of the idea that when all you have is a hammer, everything looks like a nail, we did what we knew how to do: we overthrew two national governments. But–and this is the important part—because there were no subsequent successful attacks on the United States, we assumed this was the right approach. I non-concur.

In the coming decades we’re going to have to re-address the basic assumptions of the post-9/11 strategy. We‘ve skated by with flawed assumptions for the past five years, but the day of reckoning is near. I think this revolutionary shift in the strategic environment will be particularly momentous for the Army. The Army’s core function has always been to seize and control territory. That made sense during all of human history to this point since threats were geographic in essence. They arose from an identified place, and if we could control that place, we destroyed or minimized the threat. But if you buy the notion that future threats will not be linked to a particular piece of geography–enemies can mobilize resources and undertake operations from almost anywhere–then seizing and controlling terrain will no longer be the essence of security. This led me to predict at the symposium that 20 years hence, the U.S. Army’s role in promoting American security will decline precipitously.

I keep thinking about the alleged need to provide effective governance over 100 percent of the territory of Afghanistan because in the absence of such governance an al-Qaeda safe haven might emerge. This seems to ignore the fact that there are plenty of other Muslim-majority countries that fall short of the 100 percent effective governance standard. But more importantly it ignores the fact that the major al-Qaeda terrorist plots were hatched from the middle of major western cities. We’re not going to make Lagos as well-governed as Madrid, and even if we did it wouldn’t accomplish the goal.

I think the mentality that leads to the idea that we should spend vast resources trying to control the slums of Karachi while skimping on our efforts to bring schools, jobs, health clinics, safe streets, and economic opportunity to the slums of Baltimore reflects not just a misperception of the strategic environment, but a real failure to appreciate the sources of American strength.

On the Bloated Defense Budget

Robert Farley has a provocative observation about the defense budget: “If an analyst had proposed, during the Reagan administration, that the U.S. outspend the Soviet Union by a factor of 5-10, he or she would have been laughed out of government by Republicans and Democrats alike.”

That’s a very good point. If you had a situation where we were confident that the U.S. was spending more than the U.S.S.R., that our NATO allies were collectively spending more than the U.S.S.R.’s Warsaw Pact allies, that South Korea was spending more than North Korea, and that Japan, Australia, etc. were floating around out there as additional sources of western strength you would say that Communism was being adequately contained and deterred. These days, though, the United States is maintaining a defense budget that’s ten times what Russia or China spend and yet holding that budget flat is considered an almost outrageously dovish position. And this even though our allies haven’t vanished. The combined defense spending of the UK, Japan, Germany, and France is considerably larger than the combined spending of Russia and China. And of course our contemporary relationship with Russia and China is far better than was our relationship with the U.S.S.R.

It seems to me that if you told the man on the street that you had a plan to spend double on defense what China, Russia, North Korea, and Iran spend combined that said man would assume you were proposing to spend a healthy amount of funds on national defense. Such a standard would, however, imply very large cuts.

Gates, Obama to Take on Military-Industrial Complex

There have been a lot of smoke signals indicating that Robert Gates and Barack Obama are gearing up to take on the bloated defense weapons system sector, but there have also been a fair number of contrary signals. Now the signals are looking both clear and good:

Two defense officials who were not authorized to speak publicly said Gates will announce up to a half-dozen major weapons cancellations later this month. Candidates include a new Navy destroyer, the Air Force’s F-22 fighter jet, and Army ground-combat vehicles, the officials said. More cuts are planned for later this year after a review that could lead to reductions in programs such as aircraft carriers and nuclear arms, the officials said.

This is excellent news. Matt Duss observes:

This is welcome news. As I wrote yesterday, one of the key strategic misconceptions of the Bush administration was to focus on threats from strong state actors rather than non-state actors operating within weak and failed states. (Last fall, CAP’s Brian Katulis argued — as did I — that Gates’ demonstrated approach to 21st century national security challenges was a good reason to keep him in place in an Obama administration.)

Andrew Exum observes that this means the Gates Pentagon will now be fighting a three front war, adding “the bi-partisan coalition of lobbyists, congressmen, and industry leaders” to their existing problems in Iraq and Afghanistan. Meanwhile, Gordon Adams in a guest post at Democracy Arsenal takes on the specious economic argument for continuing with strategically blinkered weapons programs.

Military-Industrial Complex Planning to Use Taxpayer Dollars to Lobby for Waste

Spencer Ackerman reports on defense contractors gearing up for battle with the Obama administration:

One Pentagon official expects much more of that as the services and the defense industry push back against reform. Their “ground game,” the official said, will be run from the services’ legislative outreach and public-affairs offices, feeding talking points and strategy information to sympathetic members of Congress — something that “got the services in trouble in 2002″ with Defense Secretary Donald Rumsfeld when the Army resisted his ultimately-successful plan to scrap an archaic artillery system called Crusader. An “air game” will feature “a lot of ominous whispers on background to the press and conservative think tanks and commentators about endangering the American people and costing lives in some future fight.”

Gates, whom Obama tasked with working closely with OMB, has told confidantes that he views a sustainable long-term rebalancing of defense priorities as one of his most important tasks now that Obama has given him the chance to continue on as Pentagon chief. His service under the Bush administration was more about supporting the immediate needs of the Iraq war after Bush fired Rumsfeld in November 2006. “The services are accustomed to reviews that start out with a lot of talk about setting priorities and making tough choices but in reality usually end with leaving everything more or less intact,” the Pentagon official said. “This time they have a secretary who really means it.”

Note that “the services’ legislative outreach and public-affairs offices” are technically part of the United States government. Indeed, they’re technically not supposed to be doing any lobbying at all. In fact, they regularly lobby congress against positions taken by the civilian leadership of the United States and on behalf of the defense contractors they’re hoping will employ them post-retirement.

Obama Looks to Ax Contracting Waste

The President today released an important memo outlining plans to try to reduce the amount of money lost on the wasteful and abusive government contracting industry that conservatives love:

Since 2001, spending on Government contracts has more than doubled, reaching over $500 billion in 2008. During this same period, there has been a significant increase in the dollars awarded without full and open competition and an increase in the dollars obligated through cost-reimbursement contracts. Between fiscal years 2000 and 2008, for example, dollars obligated under cost-reimbursement contracts nearly doubled, from $71 billion in 2000 to $135 billion in 2008. Reversing these trends away from full and open competition and toward cost-reimbursement contracts could result in savings of billions of dollars each year for the American taxpayer. [...]

However, the line between inherently governmental activities that should not be outsourced and commercial activities that may be subject to private sector competition has been blurred and inadequately defined. As a result, contractors may be performing inherently governmental functions. Agencies and departments must operate under clear rules prescribing when outsourcing is and is not appropriate. [...]

I hereby direct the Director of the Office of Management and Budget (OMB), in collaboration with the Secretary of Defense, the Administrator of the National Aeronautics and Space Administration, the Administrator of General Services, the Director of the Office of Personnel Management, and the heads of such other agencies as the Director of OMB determines to be appropriate, and with the participation of appropriate management councils and program management officials, to develop and issue by July 1, 2009, Government-wide guidance to assist agencies in reviewing, and creating processes for ongoing review of, existing contracts in order to identify contracts that are wasteful, inefficient, or not otherwise likely to meet the agency’s needs, and to formulate appropriate corrective action in a timely manner. Such corrective action may include modifying or canceling such contracts in a manner and to the extent consistent with applicable laws, regulations, and policy.

Barack Obama doesn’t like to talk in broad ideological terms. But to provide some background for this, the very same right-wing politicians who like to complain about government spending actually love increasing spending in a variety of circumstances. Any time you can make something less efficient, more costly, and more wasteful by laundering public funds through a private, for-profit firm, they’re for that. That’s why they love subsidies for private student loans and hate cheaper, direct lending. They also like to deal with “out of control entitlement costs” by overpaying private insurance companies to handle Medicare patients rather than the cheaper option of doing it themselves. And of course, they have an enormous love of spending money on defense projects.

Thus, as Spencer Ackerman observes, defense waste may be unusually hard-hit by these new directives:

Clearly this has applications far beyond the Pentagon. But the list of big-ticket defense items that have experienced huge cost overruns is a long one. Future Combat Systems in the Army; the Littoral Combat Ship in the Navy; the Joint Strike Fighter in the Air Force — all of these programs, near and dear to the services, have run massively over budget. If I was a lobbyist for Lockheed or Boeing, I’d be dialing my contacts in the Pentagon and the Hill to figure out what the prospective damage to my company was. And then I’d come up with a strategy to fight this forthcoming OMB review.

Beyond the Defense Department and the special cases of student loans and Medicare that are being tackled separately, my understanding is that the mother lode in terms of privatization of core government functions is in the Department of Homeland Security. Since this agency was born, raised, and weaned under the administration of George W. Bush, it’s tended to exhibit all the pathologies of Bushian governance in unusually strong ways (hence Katrina). At any rate, the total amount of savings you can get from clamping down on contracting abuse is more than small change, but less than gargantuan. The main virtue of it is that you’re really not doing any harm to any important public purpose by doing it. It’s important at this time of stimulus bills and new investments to show some seriousness about fiscal discipline, and the right way to do that is by going after this kind of waste rather than arbitrary measures.

Defending Countries that Don’t Defend Themselves

Iceland Review reports that “Former Minister of Justice Björn Bjarnason described the Iceland Defense Agency as ‘remnants of times past’ and said it might even complicate defense relationships with other nations. The Coast Guard should be focused on instead.” Doug Bandow responds:

It may well be true that Iceland doesn’t have many enemies. But if the Europeans don’t believe they need defending, then isn’t this another good reason to bring home America’s troops? Certainly there’s no reason for the U.S. to defend countries which don’t bother to field militaries themselves!

This seems wrong on a number of levels. For one thing, it’s odd to leap from an observation about Iceland—population 320,000—to broad conclusions about “the Europeans.” Iceland is not only tiny, it’s not really located on the European continent, and it’s definitely not a member of the European Union. In fact, overall European defense spending is quite robust:

I don’t think anyone would characterize China or Russia as countries that “don’t believe they need defending” and Europe commits substantially more funds. Meanwhile, much as you could use Europe’s alleged unwillingness to defend itself as a reason to withdraw from our NATO commitments, the reasoning works equally well the other way around—if Europe is as well-defended as I say, then why do we need to help defend them? But if the argument works equally well either way, then it also works equally poorly. At the end of the day, the issue of the advisability of our multilateral defense relationships doesn’t hinge on this issue. I would say that the partnerships are valuable, well-worth maintaining, and that ultimately it makes more sense to see the existence of the partnerships as a reason that we could afford to be more restrained in our defense spending rather than as something that we ought to eliminate in the name of restraint.

Specifically with regard to Iceland, I think the main thing that a large country (the United States) ought to ask of a small country (Iceland) with which we have a defense relationship is precisely not to try to field a full-scale military. A full-spectrum Icelandic military would necessarily be far too small to ever be useful to the United States. And given the existence of the U.S. defense commitment, it’s also unnecessary. Far better for us to have Iceland specialize in the hopes of developing some useful capabilities. A small island nation of 320,000 people, for example, really might be able to raise a reasonably robust Coast Guard capable of performing services in a portion of the North Atlantic that are useful to a variety of nations—Ireland, the United Kingdom, Norway, Canada, the United States—whose shipping lanes pass through the area.

Indeed, in general this is the kind of thing we would do well to see more of from our European allies. More specialization, especially among the smallest NATO members.

Jason Furman on Fiscal Policy

Jason Furman is now Deputy Director of the National Economic Council. Conveniently, he also wrote an article for Slate back in April on what fiscal policy should look like. Thus far, everything that Obama’s done has been something that Furman recommended. But not everything Furman recommended has thus far made it into the budget. So it’s perhaps useful to take a look at what other kinds of ideas are bouncing around. Furman advocates:

1. “[I]ncreased sin taxes on items like cigarettes” which, as you know, I agree with. I’m not sure how much room there is left to run with federal cigarette taxes before we start producing a counterproductive black market, but there’s a strong case for higher alcohol taxes and a decent case for legalizing-and-taxing marijuana.

2. He says we should seek “a broader tax base by, for example, reforming the deductibility of the mortgage interest.” This is a very good idea, albeit politically difficult to implement. But insofar as we’re concerned with the long-run deficit, you could use a non-indexed cap such that over the years inflation will slowly phase the deduction out.
3. On Social Security he says “Two of my favorite options are raising that amount of Social Security payroll that is taxable and indexing benefits and/or taxes to the changing ratio of beneficiaries to workers.”
4. He calls for “scaling back on weapons systems originally designed to fight pitched battles on the plains of Europe,” which does seem to be the inclination of many inside the administration, but all signs are that they won’t actually seek to cut the defense budget or even to hold the defense budget steady. Instead, the White House will have a battle with the Pentagon over whether a country that accounts for half of global defense expenditures should engage in moderate real increases in defense spending or large real increases in defense spending. I expect fiscally conservative Blue Dog deficit hawks to be outraged by this state of affairs.*

Outside the realm of bullet points, two other things he suggests are switching the measure of inflation to the C-CPI-U and that cuts in small-bore government programs could be valuable “if only to create more confidence in the budget process.” The latter, I think, is something we very well may see. The President loves the line about going through the budget “line by line” and eliminating programs that don’t work, so they probably need to eliminate something or other to be able to keep saying it.

On the inflation index thing, this almost seems like a bipartisan deficit reduction no-brainer. It would, in effect, simultaneously raise taxes and cut spending but could be plausibly portrayed as doing neither—it’s just a technical adjustment to the way the Consumer Price Index is calculated! Of course, you would never want to do something like that as a one-party measure but if there’s ever a bipartisan commission or what have you, then this is a very appealing option. From an ideological point of view, I would say that the problem to watch out for is that you sometimes hear the suggestion that this switch should be made only for Social Security. That’s not something I would want to see progressives agree to. But make the switch across the board and it’s a progressive measure that, in exchange for a mild slowing of the growth in Social Security benefits, would also mildly increase not only the level of Social Security taxes but also income taxes more generally, generating revenue that can be used for all manner of worthy domestic purposes.

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Some F-22 Links

If you’re interested in a more substantive take on why Mark Bowden’s F-22 advertorial in The Atlantic was silly, please read Robert Farley.

For a really serious look at the overall defense budget, procurement priorities, and national strategy please check out this report that Lawrence J. Korb, Peter Juul, Laura Conley, Major Myles B. Caggins III, and Sean Duggan did for CAP. To just quote their brief capsule item on the F-22, however:

The F-22 is a superb fighter aircraft, but it is unsuited for the irregular challenges of the near future. Ending F-22 production after 183 planes will still leave the Air Force with a strong silver-bullet force to meet any conventional contingency. Continuing F-22 production 20 aircraft a year for the next four years would cost $12 billion; that sum would be better spent on other priorities.

It’s important to have a realistic idea about how the defense budget relates to overall national strategy. At the end of the day, spending tens of billions of dollars on advanced fighter aircraft is not the best way to avoid a military confrontation with China. Indeed, in some ways doing so actually makes a military confrontation with China more likely. Either way, our relationship with other major powers is primarily a political problem, not a technical-military one and the scenario of an armed standoff should be avoidable through political means. By contrast, all indications are that any reasonable modification of U.S. foreign policy would still leave us wanting to use and credibly threaten to use air-to-ground attack capabilities.

The whole F-22 situation, one should note, relates to the broader institutional pathologies of the Air Force. Fighter pilots and former fighter pilots have a tight grip on the Air Force’s top ranks and institutional self-conception. But barring a bad deterioration in the geopolitical situation, the practical future of the Air Force will increasingly be the use of UAVs for surveillance and tactical strikes.