Most Gates' Defense Cuts Will Survive Fights-Kiplinger

Washington Matters


Most Gates' Defense Cuts Will Survive Fights


Defense industry lobbyists and congressional defense hawks got their wake up call this week with major billion-dollar-a-year programs slated to be cut or even scrapped. They'll turn out in force to limit the industry's pain. They'll be partially successful, but, as we said last month, cuts are coming without doubt.

The weapons program cuts Defense Secretary Robert Gates unveiled this week will surely get a less-than-fair hearing in Congress from program champions looking out for home-state defense jobs (every state has some); a more than fair hearing from liberals eager to tap defense dollars for domestic programs; a full force fight from high-powered industry lobbyists who'll bang on congressional doors; and they'll be hammered by some defense think tank types and respected former generals and admirals on the talk-show circuit as dangerous to national security and American military dominance.
 
Maybe it's no surprise the defense secretary announced his future defense vision, which favors preparing for current needs and conflicts rather than future, uncertain military engagements, when Congress was out on a two week recess and scattered.
 
Why, then, are several billions of dollars in his proposed cuts (in the F-22 fighter jet, C-17 transport plane, the Future Combat Systems integrated communications, stealthy destroyers, missile defense, combat search and rescue helicopters, Marine One helicopter replacements and others), in some manner or fashion, bound to happen?
 
After all, Congress is legendary for approving funding to keep defense programs alive that the Joint Chiefs of Staff opposed for being unneeded and untested -- from space-based laser guns to heavy tanks originally envisioned for war with the Soviet Union to more nuclear subs. Many of the large programs, Navy shipbuilding, fighter jets, cargo transport planes and missile defense and scores more, have work scattered liberally, some would say defensively, in dozens of states. From the state and local level, defense programs are not a part of an overall national strategy, they are a jobs program and part of regional identity. Factories and plants can be extremely project specific, so the loss of submarines, for instance, can be an economic catastrophe for cities like Groton, Conn., home to Electric Boat, and nearby New London, Conn.

That makes congressional votes on canceling or curbing hard. Big defense projects are far better protected and openly defended than any home-state earmark. And the more spread out work for a project is, the more defenders it likely to have -- Lockheed Martin's F-22, for instance, has work being done in 44 states.
 
Here's why some of the cuts will happen anyway:
 

  • For one, defense spending is going up next year, by at least 4%, as Gates is proposing, to $534 billion (not counting $130 billion for Iraq and Afghanistan). That's more than half of all spending Congress has a hand in deciding. The Pentagon budget is not being gutted, despite loud criticism to the contrary..
  • A $1.4 trillion or higher federal budget deficit this year and another huge one next year is a real deterrent to simply trying to shove programs Gates doesn't want back into the budget. 
  • A major top-to-bottom "Quadrennial defense review" of weapons programs and all other defense programs will occur later this year with the result gaining full backing of military brass and the president and it surely will reflect Gates' strategic vision and proposed cuts. (Much of it has already been vetted internally.)
  • Defense procurement reform is gaining bipartisan speed in Congress, with Senate Armed Services Chairman Carl Levin, D-Mich., and Sen. John McCain, R-Ariz., in lock step to reform costly program management practices, such as "cost-plus" contracts that lead to sometimes shocking cost overruns.
  • Major cuts as proposed won't happen in the next year or two, and they'll only start in 2011. That gives program champions time to hold hands of companies affected, many of which clearly stand to gain from spending boosts Gates wants for other programs, such as unmanned aerial drones and the Joint Strike Fighter jet program.
  • Defense contractors have been bracing for expected cuts for at least a year given the years long explosion in defense spending. That's one big reason that they have upped efforts to market their wares overseas.
  • The congressionally backed plan to increase the size of the Army by 60,000 and the Marines by 20,000 in a few short years will clearly cost many billions and may well prove more important than funding sophisticated weapons still in the blueprint stage at defense labs. And simply restocking the military with supplies and arms depleted by two long, ongoing wars also sucks up available cash.
  • President Obama will use the bully pulpit to define the cuts as a matter of fiscal discipline. He might say: "Michele and I don't need a new fleet of presidential helicopters for $13 billion (twice the original estimate). Why should you have to pay for them if they are not needed?" A new, state-of-the-art fleet of presidential helicopters is among programs headed for the dustbin.
 
Bottom line: Gates won't get everything he wants. But his proposal is far from dead on arrival. There is real pressure to save real money. There may be some more F-22s orders than Gates wants (beyond the 183 already delivered at $140 million each), a few more transport planes (than the 205 already on order), one or two more destroyers than he wants (which take four years to build), some fewer cuts than Gates wants in future combat system communications (despite 300% cost escalations in recent years), and a billion or so more than than the $6.4 billion he wants (but still less than the $8 billion being spent this year) for missile defense (even though engineering challenges in intercontinental missile shoot-downs are myriad and will take many years to resolve).
 
A few increases along those lines will allow home-state lawmakers to say they kept the worst from happening and kept the money and job spigot on while defense contractors and affected communities adjust to the possibility that it could be a long time before they see paydays like they have for most of the this decade.




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