In an effort to reduce costs, Secretary of Defense Chuck Hagel has pledged to cut the Army by 80,000 soldiers while reducing the size of the Marines by a an unspecified amount. But a new study by former military commanders suggests that Hagel could be cutting much, much more—while doing no harm.
The report, issued by the non-partisan Henry L. Stimson Center released on Tuesday, found that DOD could cut an additional 60,000 troops and 50,000 civilian workers without harming the military's operational readiness.
That would mean the size of the Army, currently at 570,000 soldiers, could be reduced by 140,000 and still be just as capable as it is today. (The report was funded by the Peter G. Peterson Foundation. Pete Peterson separately funds The Fiscal Times.)
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Entitled "Strategic Agility: Strong National Defense for Today's Global and Fiscal Realities," the report also identified $50 billion of potential annual savings by cutting spending in three areas:
- $22.4 billion in management changes, including eliminating unnecessary workers from headquarters and all of DOD's various agencies. This includes reforming retirement and health care benefits and getting rid of redundant commissaries.
- $21.4 billion by cutting active forces trained to fight traditional wars, along with some nuclear forces.
- $5.7 billion in modernization cost cuts.
The report acknowledges that these changes carry a small degree of risk, but said they're necessary given the unsustainability of DOD's current spending path.
"Realistically, however, significant belt-tightening inevitably means doing without some forces we would have preferred to maintain, forces that provide insurance against less likely threats," the report says. "However, we must stop ignoring fiscal realities; the consequences of continuing along the current path are far too dangerous."
Business as usual?
DOD commanders have repeatedly said that the $600 billion in cuts set to take effect in the coming years will hurt operational readiness. But business has continued largely as usual at the Pentagon. DOD brass, for instance, has cut furlough days for its workers to six days, down from 22.
At the same time, the Pentagon's books remain a mess; the agency has never been successfully audited. Budget hawk Sen. Tom Coburn (R-OK), speaking at a recent event in Washington, said the Pentagon's inability to pass an audit was unacceptable.
"The problem is culture and leadership," Coburn said. "If you look what is in front of us in terms of our finances and debt, it's going to be even more important that we get value for everything we do. We need to have the strongest, best, most flexible and most efficient military in the world to carry out a cogent foreign policy. We also need to be able to afford it."
Coburn added that DOD had no idea how at least $20 billion was spent each year. Last week, he and Sen. Joe Manchin (D-WVA) introduced legislation that would create incentives for DOD to pass an audit, along with penalties if it is unable to.
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"It is simply unacceptable that the Department of Defense is the only major federal agency that has not completed a financial audit. Our bill will help to solve that problem," Manchin said in a statement announcing the bill.
The bill requires DOD to pass an audit by 2018. If it does not, funding for major programs and weapons upgrades would go unfunded and IT programs that were not installed within three years would be eliminated.
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The bill faces an uphill battle in Congress, as DOD's budget is stuffed with pork and other pet projects. But Coburn warned that unaccountable spending at DOD puts the country at risk.
"Every year [that] the Pentagon fails to produce a viable financial audit, they not only violate the Constitution, but put our nation's security at risk because of a failure to effectively prioritize spending," he said. "A full and complete audit is the only way the department will be able to make better decisions about how it uses valuable taxpayer dollars. This bill helps the Pentagon help itself by simply requiring the Pentagon to meet its own deadlines."
—By David Francis, The Fiscal Times.