FPI Analysis: No Way to Run the Defense Department

August 1, 2013

The House Armed Services Committee (HASC) will hold a hearing today with senior Pentagon officials to discuss a critical internal study ordered by Secretary of Defense Chuck Hagel earlier this year.  Hagel has already briefed lawmakers and reporters on the study’s initial findings, which describe a bleak future for our Armed Forces.  It has been clear for years that the military is set lose roughly $1 trillion from planned defense spending between 2012 and 2021, but what we now have with Hagel’s internal study is an official approximation of the damage that such deep and sustained cuts would yield.

Congress continues to debate an appropriations bill to fund the Defense Department in fiscal year (FY) 2014 (which starts on October 1, 2013), but it has not taken any actions to soften or avert these cuts to defense spending.  Today’s HASC hearing therefore gives lawmakers a critical opportunity to debate publicly the growing dangers posed by defense cuts to troop readiness for combat operations, long-term plans for modernizing and replacing the military’s aging weapons systems, and America’s future strategy for national security.

Pentagon Studies Three Scenarios for Deep Budget Cuts

Known formally as the Strategic Choices and Management Review, or SCMR (pronounced “skimmer” or “scammer”), the Pentagon’s internal study was ordered by Secretary Hagel in March 2013, several days after the start of what’s known as “sequestration”—nearly a decade’s worth of massive cuts to previously planned defense and non-defense federal spending.  Defense sequestration was automatically triggered on March 1, 2013, by amended provisions of the Budget Control Act of 2011 (Public Law 112-25) after President Obama and Congress failed to meet a deadline for reducing the federal deficit by more than $1.2 trillion over a ten-year period.

The SCMR study examines three scenarios for the Defense Department’s future budget outlook, weighing various additional cuts on top of the $487 billion that the Budget Control Act slashed before sequestration:

  • The first scenario assumes that the Pentagon avoids defense sequestration after FY 2013, and executes President Obama’s proposed long-term defense budget for FY 2014, which would cut an additional $150 billion, but mostly at the end of the decade.  Plans for that scenario were first outlined by the Strategic Defense Guidance of January 2012—which, in a surprise move, President Obama personally unveiled in a press briefing with then-Secretary of Defense Leon Panetta, and General Martin Dempsey, Chairman of the Joint Chiefs of Staff.
  • The second scenario assumes that the military endures the Budget Control Act’s long-term budget caps under sequestration, which will cleave an additional $500 billion from planned defense spending over a nine-year period that runs from FY 2013 to FY 2021.  The Pentagon’s civilian and military leaders, along with senior U.S. policy makers and lawmakers, have established a long record of describing this magnitude of defense cuts as “devastating” to the military and “dangerous” to national security.
  • The third scenario assumes what Hagel called an “in-between” budget outlook in which the Pentagon would cut roughly $250 billion over the next ten years, but mostly at the end of the decade.

Sequestration Already Has Hurt Troop Readiness for Combat

Before turning to the SCMR’s findings on how the Pentagon would manage deep defense cuts in the future, it is informative to understand how the Pentagon has struggled to manage sequestration cuts to defense spending in FY 2013, which ends on September 30, 2013.

Like an avalanche falling down a mountain, the effects of defense sequestration will only worsen with time, cumulatively turning the U.S. Armed Forces into an increasingly “hollow force.”  But in the near term, sequestration has made the military less ready for combat operations, and harmed activities for better training our troops, and maintaining and fixing their weapons, vehicles, and other equipment.  In particular, the Defense Department has taken the following actions to deal with sequestration’s cuts of $37 billion in FY 2013:

  • The Army cut training for soldiers above basic squad and platoon levels, and nixed nearly all troop rotations to national training centers.  It stopped depot maintenance, which delays the readiness of military equipment for six divisions—that is, for as many as 100,000 troops.  And it slashed nearly 40,000 flying hours for the service’s pilots, yielding shortfall of some 500 Army aviators this year.  As General Ray Odierno, the Army Chief of Staff, warned lawmakers just prior to sequestration’s start this year, the “creation of a pool of unready units means that should a contingency arise, there may not be enough time to avoid sending forces into harm’s way unprepared.”
  • The Navy delayed sending the aircraft carrier USS Harry S. Truman to the Persian Gulf and other planned fleet deployments.  Worse, it will not meet readiness targets for two-thirds of its non-deployed naval vessels and aviation squadrons.  Admiral Jonathan Greenert, the Chief of Naval Operations, warned Congress earlier this year:  “In the near term, we will not be able to respond in the way the nation has expected and depended on us.  We should make that decision consciously and deliberately.”
  • The Air Force grounded 33 squadrons—including 12 combat-coded squadrons amounting to roughly 250 planes.  It canceled “Red Flag,” its primary air-combat training exercises, as well as courses at the Air Force Weapons School.  And it delayed equipment maintenance and upgrades for aircraft, including F-22 fighters, F-15 fighters, F-16 fighters.  General Mark Welsh, the Air Force Chief of Staff, warned in June 2013 that “we can’t just all of a sudden accelerate training and catch up,” adding:  “It costs up to two-and-a-half times as much to retrain a squadron as it does to keep it trained.”
  • The Marines are shifting readiness funds from other units in order to fully man, train, and equip those specific units bound for Afghanistan.  General James Amos, Commandant of the Marine Corps, warned lawmakers in April 2013:  “bring in sequestration and we’ll be down [from 23 planned infantry battalions] in the teens for battalions, and we will be very, very strained to be a one-MCO [major contingency operation] Marine Corps.”

In a July 2013 letter to the Senate Armed Service Committee’s leaders, Secretary Hagel warned that if sequestration forces the Pentagon to cut $52 billion in FY 2014, then the Army will further cut back training and other combat readiness activities, the Navy will reduce flying hours for two Navy air wings and lose readiness for special operations units, and the Air Force will go from grounding one third of its combat-coded active squadrons to half its active-duty flying units.

How Deep Defense Cuts Will Further Harm the Military

During his press conference, Secretary Hagel stressed that SCMR study “did not produce a detailed budget blueprint,” but rather “generated a menu of options, not a set of decisions,” for implementing these three potential budget scenarios.  The menu of options includes:

  • Management efficiencies and overhead reductions.  These options could entail cutting the budgets of the Pentagon’s major headquarters—including the Office of the Secretary of Defense (OSD), the Joint Staff, and the headquarters of the military services and combatant commands—by 20 percent, consolidating functions with the OSD, and reducing intelligence analysis and production at the intelligence and operations centers of combatant commands.  However, Hagel said that even if this option is aggressively pursued, it will yield at most $60 billion in cuts over a decade.
  • Compensation reductions.  These options could require limiting pay raises for the Pentagon’s military and civilian employees, cutting adjustments for the cost of living overseas, reducing basic allowances for military family housing, and increasing the use of private-sector insurance in military health care for retirees.  Hagel said that these options could yield anywhere from $50 billion to $100 billion in cuts over a decade, but added that the Defense Department would need congressional cooperation and approval to pursue these options.
  • Reductions to force structure and military modernization.  These options could entail cutting the size of Army active-duty personnel from 490,000 to as low as 420,000 soldiers and Army reserve personnel from 555,000 to as low as 490,000, slashing as many as five of the Air Force’s tactical aircraft squadrons, and reducing the number of C-130 transport aircraft.  Hagel said that these modest reductions could yield $100 billion in cuts over a decade.

However, Hagel also warned that the “in-between” budget scenario or sequestration scenario would compel increasingly difficult tradeoffs between quantity and quality in the military—or, to use the Secretary’s words, between “capacity—measured in the number of Army brigades, Navy ships, Air Force squadrons and Marine battalions—and capability—our ability to modernize weapons systems to maintain our military’s technological edge” (emphasis added).  He illustrated two basic approaches to making these tradeoffs:

  • Military quality over quantity.  One illustrative approach would cut capacity to better preserve capability.  For example, the Pentagon would cut the Army to as low as 380,000 active-duty soldiers, slash as many as three of the Navy’s 11 carrier strike groups, reduce the Marine Corps from 182,000 to as low as 150,000 personnel, and retire the Air Force’s older bombers.  Hagel said these measures would enable the Pentagon to protect investments “to counter anti-access and area-denial threats, such as the long range strike family of systems, submarine cruise-missile upgrades, and the Joint Strike Fighter” and “to make cyber capabilities and special operations forces a high priority.”  However, he warned this approach “would result in a force that would be technologically dominant, but would be much smaller and able to go fewer places and do fewer things, especially if crises occurred at the same time in different regions of the world.”
  • Military quantity over quality.  The other illustrative approach would cut capability to better preserve capacity.  The Pentagon would go on what Hagel called a “decade-long modernization holiday,” ending or shrinking programs to modernize military vehicles and equipment, curtailing efforts to improve the military’s cyberdefense capabilities, and cutting special operations forces.  These capability reductions would allow the Pentagon to make fewer capacity cuts to ground forces, ships and submarines, and aircraft, all in an effort to better sustain the military’s ability to project power internationally and maintain its presence in key regions.  However, Hagel warned that, under this approach, troops would find their “equipment and weapons systems—many of which are already near the end of their service lives—less effective against more technologically advanced adversaries,”  and America’s defense industrial base would suffer due to “massive cuts to procurement, and research and development funding.”

To be clear, neither of these approaches describes an “option,” in any meaningful sense of the word.  When it comes to national defense, quantity can have a quality of its own.  So, on the one hand, if the military were to cut its size to maintain its high-tech advantages, it could be too small to sustain critical operations or deal with major conflicts.  On the other hand, if the military goes on a “modernization holiday” to preserve its size, that could place the lives of U.S. troops at risk.  Either approach will jeopardize America’s standing in the world. 

The SCMR has not yielded real options for managing sequestration—it has only lent credence to former Defense Secretary Leon Panetta’s warning that sequestration will eventually leave the United States with “[t]he smallest ground forces since 1940”, “a fleet of fewer than 230 ships, the smallest level since 1915”, and “[t]he smallest tactical fighter force in the history of the Air Force.”


The U.S. military is suffering deep cuts at a time when our nation not only remains at war, with troops operating in post-Taliban Afghanistan and elsewhere as part of a larger Global War on Terror, but also faces grave and growing foreign threats, including:  Iran’s undeterred sprint to nuclear weapons-making capability, Syria’s escalating civil war and its many dangers to regional security and stability, North Korea’s nuclear and missile provocations, Putin’s drive to reassert Russia geopolitically, China’s growing military might, and post-9/11 terrorist plots against the U.S. homeland. 

Our troops work to tirelessly defend America from these and other foreign threats.  However, President Obama and congressional lawmakers have not put aside differences to defend our troops and our nation from the growing dangers of sequestration’s cuts to defense spending.  This is no way to run the Defense Department.  The bottom line is that if the military becomes an increasingly “hollow force,” then the U.S. Armed Forces will become less and less capable of operating internationally, and our troops will face ever greater dangers if and when they are called to protect of our nation against foreign threats.

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The Foreign Policy Initiative seeks to promote an active U.S. foreign policy committed to robust support for democratic allies, human rights, a strong American military equipped to meet the challenges of the 21st century, and strengthening America’s global economic competitiveness.
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