Telling Hard Truths: Budget Cuts Are Coming; Protect Crown Jewels

In August 2011, the Budget Control Act was signed into law and sequestration quickly became a buzzword in Washington. Facing the prospect of $500 billion in defense cuts over the next decade, the Department of Defense (DoD) has spent the past two years moving through the classic five stages of grief.

■Denial. Senior defense officials refused to believe that budget cuts mandated by law would ever materialize, and thus chose not to prepare for them.

■Anger. Once the bipartisan “super committee” failed to agree on deficit reductions, DoD officials voiced their frustration with political leaders who were unable or unwilling to compromise.

■Bargaining. Rather than implementing sequestration budget cuts evenly over the 10-year period and across all accounts as required by the Budget Control Act, DoD pleaded for greater flexibility to limit the damage.

■Depression. With sequestration taking effect March 1, officials recalled the hollow forces of the 1970s and ’90s to warn of the possible consequences.

■ Acceptance. The Strategic Choices and Management Review ordered by Defense Secretary Chuck Hagel considered potential changes to US military capabilities under several budget scenarios, including the mandated $500 billion reduction.

This review could be a step in the right direction. While the consequences of sequestration may be severe, there is little to be gained by avoiding difficult strategic choices. Hope, as the saying goes, is not a strategy. The question, then, is how will the Pentagon choose to adapt? Will it rely on savings from “efficiencies” that may not materialize and cut personnel uniformly across the services, an option that would lead to a US military that is simply a smaller version of the current force? Or will the Pentagon set clear priorities and use sequestration as an opportunity to rebalance its capabilities for future challenges?

There is an emerging consensus that DoD must implement major changes, regardless of the size of future budget cuts, and that Congress and the White House should set politics aside and push for change if the Pentagon will not.

Defense analysts from multiple Washington think tanks have called for pursuing another round of base closures, reducing the size of DoD’s civilian workforce and undertaking serious compensation reform for military personnel to rein in the fastest-growing part of the defense budget.

Yet these measures alone won’t achieve the savings required by law or help the Pentagon avoid the worst-case outcome: that the confluence of politics, interservice competition and a lack of foresight lead to a military that is not just smaller, but also ill-suited for likely security challenges.

Despite all the attention paid to sequestration, the strategic environment is in flux as well. For example, China is developing advanced capabilities such as ballistic and cruise missiles, submarines, and anti-satellite and cyberwarfare systems that could upend the balance of power in East Asia. Nuclear proliferation represents a growing danger, with an unpredictable North Korea threatening its neighbors and an unfriendly Iran expanding its nuclear infrastructure.

Thanks to the support of sponsors such as Iran, non-state actors are acquiring increasingly sophisticated weapons that could further destabilize strategically important regions like the Middle East.

Given these challenges, now is the time for the Pentagon to make smart choices that will preserve the US’ ability to project military power abroad. Identifying DoD’s new “crown jewel” capabilities that should be shielded from budget cuts or even receive additional resources would be a start.

These include cyber and electronic warfare systems to disrupt enemy forces; undersea warfare platforms that are more survivable and versatile than surface combatants; stealthy, long-range surveillance and strike aircraft to penetrate contested airspace; special operations forces to conduct missions in sensitive areas; directed-energy weapons to provide cost-effective defenses against air and missile attacks; and a modernized nuclear force, which remains the ultimate deterrent for the US and its allies.

The hard truth, then, is that the Pentagon may need to make larger-than-anticipated cuts in some areas to invest in future capabilities. For example, armored forces that were designed to fight tank armies that no longer exist, surface warships to defeat a Soviet blue-water threat and aging fighter jets may have to be reduced. In fact, cutting $500 billion over the next decade while making room for investments in crown jewel capabilities may require sharp cuts in military and civilian personnel and even near-term readiness.

During a recent multi-think tank exercise organized by the Center for Strategic and Budgetary Assessments, players found that the only way to cut $500 billion from DoD’s budget and simultaneously rebalance the military for future challenges was to cut funding in all of these areas.

In the end, the Pentagon is likely facing a stark choice between preserving near-term readiness and modernizing for the future. The wrong choice will leave America with a military that is prepared for fading threats. The right choice requires accepting risk now, developing a force that will be more ready in the future and avoiding another cycle of grief down the road.

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