Strength vs. Stupidity
The New York Times weighs in this morning with a timely and sensible editorial on military spending. The main focus is on the increasingly outdated pay and benefits system for the nation’s troops. Some choice excerpts:
Military pay, benefit and retirement costs rose by more than 50 percent over the…decade (accounting for inflation). Leaving aside Afghanistan and Iraq, those costs now account for nearly $1 out of every $3 the Pentagon spends.
Much of that is necessary to recruit and retain a high-quality, all-volunteer military….But current military pay, pension systems and retiree health care benefits are unsustainable and ripe for reform.
[...]
The retirement system is both unfair and increasingly expensive. Most veterans, including many who have served multiple combat tours, will never qualify for even a partial military pension or retiree health benefits. These are only available to those who have served at least 20 years. Those who do qualify can start collecting their pensions as soon as they leave service, even if they are still in their late 30s, making for huge long-term costs.
So far, so good. Two essential points bear repeating.
First, the rise in military spending over the past decade has not been driven solely by the costs of the wars in Iraq and Afghanistan. Pentagon costs are growing, and the rate of growth is rising. Programmatic reform is needed to reign in those costs; avoiding stupid wars won’t solve the problem (although it won’t hurt).
Second, the current system disproportionately rewards individuals who stay in the service for 20-plus years, and undercompensates those men and women who serve several tours, but who do not qualify for military retirement. A better system would allow anyone who has served to retain some of what they paid (or what taxpayers paid for them) into a portable retirement account that they control. Private industry has been steadily moving away from a fixed-benefit, pension-style system for years. I have heard the arguments against such a move, but I don’t find them particularly convincing.
One point from the Times editorial, however, calls out for clarification. The editors claim on two separate occasions that current military spending patterns are “unsustainable.” They conclude:
The United States already has a comfortable margin of [military] dominance….The Pentagon’s ambitions expanded without limit over the Bush era, and Congress eagerly wrote the checks. The country cannot afford to continue this way, and national security doesn’t require it. (emphasis added)
The latter point, “national security doesn’t require it,” is crucial, correct, and should be repeated at every opportunity. The former assertion, “the country cannot afford” it, is false. Repeating that claim plays into the hands of the inveterate hawks who never saw a war, or a weapon system, that wasn’t deserving of more lives/money.
The hawks are correct to point out that the United States has in the past, and could in the future, choose to spend as much or more on our military. Current spending levels amount to about five percent of GDP (when including the costs of the wars), and military spending as a share of total government spending has been falling steadily for years. According to the hawks, it is other spending, or too little revenue, that is putting our children and grandchildren into debt.
I wish that the Times had spent more time hammering the point that such spending is unnecessary. Contrary to anecdote and the evening news, the international system is remarkably stable and peaceful. The United States need not spend more than we did at the height of the Cold War in order to be secure from most threats. And those few genuine threats to our security could be handled with a smaller, more efficient military—if we offloaded some responsibilities to other countries that have sheltered under the U.S. security umbrella for decades.
The Times doesn’t directly address that last point. By focusing most of their attention on programmatic reforms to pay and benefits, and a bit on costly procurement of unnecessary weapons, but not enough to the underlying flawed assumptions that drive military spending, the editors contribute to the misconception that the U.S. military should continue to be the world’s policeman, and find ways to do this on the cheap.
That is unfortunate. Spending more than we need to doesn’t make us stronger. Ignoring our favorable strategic circumstances is simply stupid. We spend too much on our military because we ask our troops to do too much. To spend less, we must do less. The good news is that we can. The bad news is that too few people understand that.
Make-Believe Defense Cuts
Earlier this week, the House Armed Services Committee Republican staff released a video using the anniversary of September 11 to argue for higher military spending while pretending that lately we have cut the defense budget. Chris Preble and I rebutted these outlandish claims, and Evan Banks made our comments into a cool video:
Hawks like HASC Chairman Buck McKeon (R-CA)—who thinks that “power in benevolent hands is a virtue, not a vice,”—pretend that we are about to slash military spending thanks to the Budget Control Act, the deficit deal legislated early last month. Reporters abet them by repeating the White House PR myth that the bill’s security budget cap will cut Pentagon spending by $350 billion over ten years, and writing that the sequestration provision will probably cut another $500 billion. But as I explained here, the BCA will likely produce either a miniscule defense cut in the near term or no cuts at all. That is because I consider a “cut” to mean spending less than we do now, not less than plans say, because agencies other than defense can absorb the cuts required by the security cap, and because the bill encourages lawmakers to move capped base defense funds into the uncapped war bill.
The Senate Appropriations Committee’s proposed funding levels (302b allocations in budget speak) released earlier this week bear out those concerns. Because they come after the BCA, the Senate spending levels are likely to guide those set by the House. Compared to 2011, the committee would cut just under $3 billion from the base defense budget, which is less than one percent. That cut comes entirely from the military construction and family housing account, which was recently bloated by the Base Realignment and Closure (BRAC) process. The senators get another chunk of the $4.5 billion in security spending cuts required by the BCA from State, which would lose $3.5 billion, and Homeland Security, which loses a half billion. The National Nuclear Security Administration and the Veterans Administration get minor increases. For more on these allocations, see Stimson’s The Will and the Wallet blog, especially Matthew Leatherman and Russell Rumbaugh’s recent posts.
So that’s a minor defense cut, right? Maybe not. The Senate appropriators seem to have slipped a larger amount of base defense spending into the war bill (Overseas Contingency Operations funding). The committee’s markup press release brags that it fully funded the president’s war request of $117.8 billion, but then claims that they cut $6.6 billion from that request by trimming funding for U.S. and native forces in Afghanistan. What that most likely means is that the committee, probably in league with the Pentagon, cut the war bill by that amount and shifted the same amount over from the base, keeping the war bill flat and maintaining the fiction of a minor base defense cut. We won’t know for sure until the appropriations bills are published.
The longer term prospects for the BCA cutting defense spending are a story for another time. For now, suffice it to say that the prospects of the bill’s current spending limits staying in place for ten years are slim. Future Congresses easily free themselves from legislative bonds set by prior ones, and democracies with two-to-six-year election cycles can’t stick to ten-year plans.
The Curious Case of Lloyd Chapman
Last week, I flayed the American Small Business League’s Lloyd Chapman for his absurd claim that legislation introduced by Sen. Richard Burr (R-NC) would close the Small Business Administration (see here). As I expected, Chapman’s response is equally absurd.
In an ASBL press release, Chapman actually threatens to take me to court over my calling him a “conspiracy theorist”:
The next time you call me a conspiracy theorist, be ready to back it up with facts. You just might find yourself in court.
Good luck with that, Lloyd. In the meantime, let’s allow the court of public opinion to decide if the following claim you recently made is the stuff of a conspiracy theorist:
Clearly Republicans like Senator Burr, his supporters and groups such as the CATO Institute are directed like puppets by the defense and aerospace industry.
I can’t speak for Sen. Burr, but Chapman’s assertion that the Cato Institute is being “directed like puppets by the defense and aerospace industry” is ridiculous. Cato’s Downsizing Government website, which I co-edit, lays out the case for cutting the Department of Defense.
My Cato colleagues past and present have consistently advocated for a limited U.S. presence abroad:
Cato’s foreign policy vision is guided by the idea of our national defense and security strategy being appropriate for a constitutional republic, not an empire. Cato’s foreign policy scholars question the presumption that an interventionist foreign policy enhances the security of Americans in the post-Cold War world, and maintain instead that interventionism has consequences, including the formation of countervailing alliances, the proliferation of weapons of mass destruction, and even terrorism. The use of U.S. military force should be limited to those occasions when the territorial integrity, national sovereignty, or liberty of the United States is at risk.
Does that strike the reader as anything the defense and aerospace industry would direct Cato to advocate? Clearly, Chapman is hopelessly lost in a fantasy world of his own creation.
Wartime Contracting Report Provides More Evidence to Exit Afghanistan
Over the past decade, American taxpayers have lost as much as $60 billion dollars to massive fraud and waste in the nation building campaigns of Iraq and Afghanistan, according to a report released today by the Commission on Wartime Contracting. The independent panel confirms much of what we already know about rent-seeking in wartime; nevertheless, the panel details specific reconstruction projects and programs that display a stunning array of mismanagement:
- A modest $60 million agricultural development program in northern Afghanistan expanded to the south and east to the tune of $360 million. The cash-for-work program was intended to distribute vouchers for wheat-seed and fertilizer in drought-stricken areas. Today, the program spends $1 million a day. The panel reports, “The pressure to quickly spend the millions of dollars created an environment in which waste was rampant. Paying villagers for what they used to do voluntarily destroyed local initiatives and diverted project goods into Pakistan for resale.”
- During operations in Iraq and Afghanistan, waste and fraud averaged about “$12 million every day for the past 10 years.” [Emphasis in original];
- The Department of Defense (DoD) awarded an $82 million contract for the design and construction of an Afghan Defense University. Now, DoD officials say it will cost $40 million a year to operate—beyond the indigenous government’s ability to fund and sustain;
- The U.S. Agency for International Development, the U.S. Government’s main distributor of development contracts, funded the Khost-Gardez road project. Originally valued at $86 million it has since mushroomed to $176 million;
- The insurgents’ second-largest funding source is the U.S. taxpayer. Money for construction and transportation projects are diverted to the insurgency so Afghan subcontractors can pay them for protection. Of course, the insurgents use this money to buy bombs, IEDs, and other explosives to kill foreign troops and civilians.
The report goes on and on with examples that should disgust U.S. taxpayers. In addition, the report was released amid news that August 2011 was the deadliest month for U.S. service members, and 2011 shaping up to be the deadliest year for Afghan civilians. Despite the spin from warhawks, people in the region know the coalition has lost. Last year, the “Godfather of the Taliban,” Hamid Gul, the former head of Pakistan’s Inter-Services Intelligence agency, laid out in extensive detail why America has been defeated (for skeptics of withdrawal, it’s worth reading).
The United States has largely disrupted, dismantled, and defeated al Qaeda. America should not go beyond that objective by combating a regional insurgency or drifting into an open-ended occupation. We have endured enough with tens of thousands of people killed, injured, and traumatized, and billions of dollars wasted.
Debt Deal Signed, Fights over Military Spending Next
The legislation signed by President Obama yesterday, as a solution to the debt ceiling debate, includes the possibility of cuts to military spending. But as Chris Preble points out, the legislation guarantees no defense cuts. Republicans will try to dump all the required cuts on non-defense areas. And the White House has already distanced itself from the prospect of any real defense budget cuts, as did Secretary of Defense Leon Panetta. Both support only the first round of cuts, which will at best halt Pentagon growth at roughly inflation.
On The Skeptics blog, I take a more detailed look at deal’s likely impact on military spending. I also examine its political effect, arguing that it will cause at least four political fights.
The first concerns war funding. As Russell Rumbaugh notes, hawks will be tempted to shift the Pentagon’s bill into the war appropriations (overseas contingency operations, officially), which the bill does not cap. That problem is not new, but the bill worsens it. We’ll see if the White House and Congressional Democrats fight to stop it.
Second, for the two years while the security cap is in place, the bill pits security agencies and their congressional advocates in zero sum combat. For obvious electoral reasons, no one will go after veterans. Defense hawks and top military officers will push to make DHS and State eat the minor cuts required. House Republicans negotiated to expand the security category for this reason. DHS, State and the subcommittees that pass their appropriations will fight back. Republicans and thus the House will tend to the first camp; Democrats and the Senate to the second. So the fight will occur in the appropriation committees, conference, and probably White House-Hill discussions. The paucity of cuts limits the carnage, of course.
Third, if the legislation remains in place after two years and a single cap covers all discretionary spending, the fight will shift and become more partisan. To get under the cap, Republicans will push domestic spending cuts. Democrats will prefer defense cuts. The 2012 elections will determine the institutional contours of this fight.
The fourth fight will center on the Joint Committee, with the most interesting conflict among Republicans. Democrats will likely advocate taxes and more defense spending cuts. Even if they can get a deal including taxes with Republican committee members, the House is unlikely to pass it. Democrats’ most attractive option may then be sequestration. Anti-tax Republicans will accept that outcome but clash with neoconservative Republicans happy to raise taxes to pay for military expenditures.
Those that see this plan as a disaster for defense ought to explain why hawks, like Rep. Buck McKeon (Chairman of the House Armed Services Committee), Rep. Bill Young (a leading House defense appropriator), and Senator John McCain, support it. They evidently prefer this deal to any available alternative and are gambling that they can protect military spending from the knife.
My guess is that defense spending will be level in 2012, growing roughly with inflation, but get hit by sequestration, meaning real defense cuts in 2013. After that, who knows? The political dynamics will then be quite different.
An original version of this post appeared on the National Interest.
Senate Vote on Rand Paul’s Budget
Last week, a motion to proceed on a budget resolution introduced by Sen. Rand Paul (R-KY) was decisively defeated in the Senate (7 in favor, 90 opposed). Paul’s proposal would have balanced the budget in five years (fiscal year 2016) through spending cuts and no tax increases. Social Security and Medicare would not have been altered. Instead, the proposal merely instructed relevant congressional committees to enact reforms that would achieve “solvency” over a 75-year window.
That’s hardly radical.
Paul’s proposed spending cuts were certainly bold by Washington’s standards, but they weren’t radical either. For example, military spending would have been cut, in part, by reducing the government’s bootprint abroad. From the Paul proposal:
The ability to utilize our immense air and sea power, to be anywhere in the world in a relatively short amount of time, no longer justifies our expanded presence in the world. This budget would require the Department of Defense to begin realigning the over 750 confirmed military installations around the world. It would also require the countries that we assist to begin providing more funding to their own defense. European, Asian, and Middle Eastern countries have little incentive to increase their own military budgets, or take control of regional security, when the U.S. has consistently subsidized their protection.
Over 750 confirmed military installations around the world. That’s enough to make a Roman emperor blush. Isn’t continuing to go deeper into debt to subsidize the defense of rich allies the more “radical” position? (See these Cato essays for more on downsizing the Department of Defense.)
Other cuts included eliminating the Department of Housing & Urban Development, the Department of Energy, and most of the Department of Education. But unlike most Republicans, Paul didn’t apologize for the cuts or use the debt dilemma as a cop out. Instead, he explains in his plan why these federal activities are counterproductive and should be devolved to the states or left to the private sector.
It’s disappointing that Paul could only get seven Republicans and no Democrats to support his budget. For all the bluster about needing to cut spending, not raise taxes, and stop the Obama administration’s big government agenda, most Republican senators said “no dice” when given the chance to vote in favor of a plan that would accomplish all three objectives and balance the budget in five years.
Has President Obama Given up on Changing U.S. Foreign Policy?
Today in Politico I have an op-ed titled “How Washington changed Obama.” In the piece, I argue that the recent appointments of Leon Panetta as secretary of defense and Gen. David Petraeus as director of the CIA, combined with revelations in the recent New Yorker article by Ryan Lizza, suggest that President Obama has given up on changing U.S. foreign and defense policy:
Panetta is a dubious choice to fulfill Obama’s recent pledge to trim military spending. Any secretary charged with realizing that pledge would need extraordinary credibility with Capitol Hill Republicans, many of whom are determined to continue raining money on the Pentagon regardless of the nation’s parlous fiscal position. Despite having once been a Republican, Panetta ran for Congress as Democrat and has served prominently in Democratic administrations. He is unlikely to craft the pragmatic consensus needed to give the Pentagon a haircut.
Petraeus’s nomination poses a different problem. He has spent the past decade focused— at the behest of his commanders in chief — on what we used to call the “global war on terrorism.” But is U.S. nation-building in the Muslim world the most important national security and intelligence problem we face today?
[…]
The U.S. desperately needs to change its focus. We account for roughly half the world’s military spending, yet we feel terribly insecure. We infantilize our allies so that they won’t pay to defend themselves and instead allow us to do it for them. We stumble into small- and medium-sized foreign quagmires the way many people eat breakfast — frequently and without much thought.
Read the rest of the op-ed here.
Appointment of Panetta and Petraeus Signals More of the Same
The report that Leon Panetta will be appointed Secretary of Defense, and Gen. David Petraeus will become the new CIA director, does not come as a huge surprise. But I worry that President Obama’s decision to fill these positions from within his administration signals an unwillingness to rethink U.S. foreign policy. Such a reevaluation is desperately needed.
Leon Panetta brings some experience in national security affairs to DoD, including his stints at CIA and on Capitol Hill, and as a member of the Iraq Study Group. His more relevant experience, however, may be as Director of the Office of Management and Budget in the Clinton administration. Bob Gates effectively shielded the Pentagon from spending cuts, but that merely postponed the reckoning that Panetta will have to confront.
Considerable cuts, beyond even the $400 billion-over-12-year target that President Obama announced earlier this month, will require a fundamental rethinking of the military’s role, something that Gates was unwilling to do. It remains to be seen whether Panetta will tackle this challenge, or whether he will defer to others within the administration.
A new role for the military and the United States would shed unnecessary missions, and relieve some of the burdens on our troops. In all likelihood, such a change must be directed from the Oval Office, not the Pentagon.
The appointment of Petraeus to head the CIA is puzzling. I worry that the appointment of a military officer to lead a civilian agency raises questions about Obama’s faith in senior leaders from within the CIA who might have moved into the top role.
The agency has questioned some of the rosier predictions of impending success in Afghanistan, and I hope that Petraeus’s move to Langley doesn’t result in a change of those candid assessments. More generally, Petraeus has focused nearly all of his energies over the past nine years trying to perfect the U.S. military’s ability to fight wars that most Americans now wisely oppose. His insights into future opportunities and challenges is unclear. We should be putting these wars that sap our nation’s strength and undermine our security in the country’s rearview mirror. Instead, Petraeus appears committed to a long-term nation-building mission in Afghanistan, and others like it.
A New Low for GOP’s ‘YouCut’
Last year the House Republican leadership created the GOP’s “YouCut” website, which offers several possible spending cuts for citizens to vote on. The cut with the most votes goes to the House floor for an up-or-down vote. It’s a decent idea, but unfortunately, most of the cuts the GOP have offered thus far only amount to chump change.
This week the House Republican leadership finally put the Pentagon on the YouCut chopping block. However, the possible cuts suggested by the GOP are pathetic:
1. Reduce the Department of Defense’s printing and reproduction budget by 10 percent ($36 million in savings in fiscal 2012).
2. Reduce spending for Defense studies, analysis and evaluations by 10 percent ($24 million in savings in fiscal 2012).
3. Restrict payout of annual nationwide adjustment and locality pay for “below satisfactory” civilian Defense employees ($21 million in first-year savings).
To put the potential “savings” in perspective, the United States’ latest act of military adventurism (Libya) has already cost taxpayers $550 million. Take that military-industrial complex!
The Washington Times recently reported that Sen. Rand Paul’s balanced budget plan drew “several fairly vocal objections to it” from his GOP colleagues because he dared to include defense cuts. Indeed, House Republicans left the Pentagon alone when coming up with $61 billion in cuts to discretionary programs for the remainder of the fiscal year.
As my colleague Chris Preble told the Times, playing GloboCop isn’t cheap:
“At the end of the day, even when you take out the cost of the wars, military spending in the base budget has grown close to $1 trillion since 2000,” said Christopher A. Preble, director of foreign-policy studies at the libertarian-leaning Cato Institute. “So, I think there is kind of a growing realization that the cost that we have incurred on behalf of a lot of other places around the world are growing increasingly burdensome, and the military has not exactly been starved of funds.”
The YouCut website says that it “is designed to defeat the permissive culture of runaway spending in Congress.” Nice line, but when it comes to the Pentagon, it appears that the Republican leadership continues to be a-okay with runaway spending. That mentality will hopefully be forced to change due to the government’s sorry fiscal state of affairs. If it does, a Cato essay has plenty of good suggestions for military spending cuts.
The Pentagon’s Faux Cuts
President Obama might want it to appear as though he is reining in defense spending with his budget submission for FY 2012, but his approach to the Pentagon’s budget reveals the opposite.
Perhaps the president hopes that his adoption of the faux cuts that Secretary Gates put on the table last month will be seen as responsible. Perhaps he is taking a prudent first step and signaling to the military, and its suppliers and contractors, that the days of double-digit increases are over. That may be; but far deeper cuts are warranted. . If the president had truly wanted to send a signal, he would have followed the advice of his own deficit reduction commission and endorsed far deeper cuts in military spending.
The Department of Defense will spend $78 billion less over the next five years than previous projections. This amounts to a drop in the bucket — technically just over 2% — of total Pentagon spending over that period. Nonetheless, in Washington-ese, this constitutes a cut. But the base budget (excluding the costs of the wars in Iraq and Afghanistan) will increase — from $549 billion to $553 billion, the largest budget in the department’s history. In the past 12 years, the budget that has doubled in real, inflation-adjusted terms.
Deeper cuts should be made along with an effort to lessen worldwide defense commitments, reducing the strain on the force. It will be up to outside pressure — either from Congress or from interested groups outside of government – to force Washington to cease acting as the world’s policeman, and forcing other countries to take responsibility for their own defense.
We Fail More—So Put Us in Charge
The Washington Post reports today on an article coming out in Foreign Affairs in which Deputy Defense Secretary William J. Lynn III reveals a successful 2008 intrusion into military computer systems. Malicious code placed on a thumb drive by a foreign intelligence agency uploaded itself onto a network run by the U.S. military’s Central Command and propagated itself across a number of domains.
The Post article says that Lynn “puts the Homeland Security Department on notice that although it has the ‘lead’ in protecting the dot.gov and dot.com domains, the Pentagon — which includes the ultra-secret National Security Agency — should support efforts to protect critical industry networks.”
The failure of the military to protect its own systems creates an argument for it to have preeminence in protecting private computer infrastructure? Perhaps the Department of Homeland Security will reveal how badly it has been hacked in order to regain the upper hand in the battle to protect us.
Report to DoD: Data Mining Won’t Catch Terrorism
Via Secrecy News, “JASON”—a unit of defense contractor the MITRE Corporation—has reported to the Department of Defense on the weakness of data mining for predicting or discovering inchoate terrorist attacks.
“[I]t is simply not possible to validate (evaluate) predictive models of rare events that have not occurred, and unvalidated models cannot be relied upon,” says the report.
In December 2006, Jeff Jonas and I published a paper making the case that predictive modeling won’t discover rare events like terrorism. The paper, Effective Counterterrorism and the Limited Role of Predictive Data Mining, was featured prominently in a Senate Judiciary Committee hearing early the next year.
Privacy gives way to appropriate security measures, as the Fourth Amendment suggests, where it approves “reasonable” searches and seizures. Given the incapacity of data mining to catch terrorism and the massive data collection required to “mine” for terrorism, data mining for terrorism is a wrongful invasion of Americans’ privacy—and a waste of time.
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