The 29 members of the House-Senate budget conference committee are at work as they seek to reconcile differences between their respective budgets. They face a Dec. 13 deadline.
Members have warned that nobody should expect a grand bargain out of the conference. The Defense Department and industry are hoping for a delay to sequestration, so that a return to regular order — that is, real budgets — can permit rational planning. The delay would allow government agencies and contractors to attain a more reasonable and doable glide slope. As things stand now, sequester has been a disaster, but one that promises to grow much worse.
Aside from the obvious adverse impact to investment accounts and programs, near term readiness rates are approaching dangerously low levels. Most people, including members of Congress, lacked a sufficient appreciation of just how dangerous this really was. To address this gap, the House Armed Services readiness subcommittee chaired a classified readiness briefing for members and senators. NDIA and partner associations dispatched letters to all congressional leaders urging attendance.
Many observers only see the obvious impacts of sequester that have been covered by the news media, such as the effects on high visibility programs like the F-35 Joint Strike Fighter, the Virginia-class submarines and DDG-51 destroyers to name a few. These three programs come down 22 percent in fiscal year 2014 under sequester, compared to 2013. News articles often point out that the “generals are still asking for more.” The implication is that military officials are really asking for too much. Again, this goes back to the under-appreciated outcomes from sequestration.
The HASC recently sent an analysis to the conferees that detailed a loss of 100,000 troops with continued sequestration, a Navy of 230 ships, the smallest Air Force ever and the leanest ground forces since 1940. At this level, the military will lose the ability to conduct multiple contingencies at the same time. Think back to recent events such as the capture of Osama bin Laden, the response to the Japanese tsunami and the intervention in the Libyan crisis. In five more years, we will only be able to respond to one.
Just this month, Defense Secretary Chuck Hagel dispatched the George Washington carrier battle group to the Philippines to assist in recovery operations following the devastating typhoon that roared through those islands. In five years, we might be reluctant to send similar help, as we would hold our forces back for a military-to-military contingency. If we elected to respond to a humanitarian disaster, we might be unable to respond in a timely fashion to hostile acts against the United States.
In fiscal year 2013 alone, the Air Force has reduced flying hours by 15 percent and the Navy is now only able to respond with one carrier strike group and one amphibious ready group — compared to the three-in-14-days capability the Navy had just a year ago. In the Army, 85 percent of the active and reserve brigade combat teams are unprepared. Only two of 42 brigades are combat ready, and units now being deployed are unqualified for combat.
The Bipartisan Policy Center estimated that Army divisions will drop from 10 to six, Air Force fighter/attack aircraft inventory will decline from 1,493 to 1,157, Navy carriers from 10 to seven and the overall naval fleet from 275 to 228. By 2021, all investment in modernization is crowded out of the budget. The military’s tooth-to-tail ratio worsens under sequester, personnel costs and defense-wide overhead expenses go up, and acquisition cost growth and inefficiency continues.
BPC details another more insidious effect of sequester, one not readily appreciated. That is the effect of budget sequestration on outlays. In fiscal year 2013, a budget authority sequester of $37 billion was accompanied by an outlay hit of only a little more than $10 billion. But as budget authority tends to roll forward for outlays, we see a sequester of $52 billion in 2014 having an outlay hit of more than $30 billion, and sequester in 2015 would result in an outlay hit of more than $45 billion. Thus the elephant in the room is the burgeoning outlay hits.
The next two years are critical for the defense budget. Force structure adjustments can’t be implemented fast enough to compensate for the magnitude of these cuts. One might argue that if the service chiefs were given the freedom to balance all the accounts in their budgets, they might be able to absorb these cuts without major damage. But under sequestration, this is not possible.
So it is necessary for defense to have, at a minimum, a sequester delay of two to three years. This would allow the necessary adjustments to be rationally planned and executed by the services.
From a broader perspective, it should be noted that national security is much larger than just the Defense Department and the military services. Our security is tied in large measure to a robust diplomacy, undergirded by a robust and responsive defense, and global deterrence. If we diminish the robustness of the U.S. nuclear posture, we encourage proliferation. Timely response to contingencies, humanitarian or otherwise, maintains and enhances U.S. relevance and influence. These are key attributes we lose with sequestration. Ultimately, it leads to a more dangerous world.
One wonders why these unsatisfactory outcomes do not figure more prominently in the debate over government spending. Just because the public at large does not understand the readiness issue and its implications for national security doesn’t quite explain the callous attitude toward defense budget cuts. Perhaps, we have been lulled into believing that the military can live with smaller budgets by its own superb performance. It has never let us down over the many years of budgets ups and downs, always performing superbly and without complaint. Years of “generals requesting more” funds to field world-class troops and systems have paid off, and handsomely.
We should be under no illusion about the outcome. Sequestration, if continued on present course, will result in serious damage and degradation to U.S. military capability and to our national security writ large.
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