2. $100 billion savings will be reinvested in procurement and operations
a. About $28 billion on unexpected training, operations, and maintenance costs.3. EFV cancelled. F-35B on two-year probation. If engineers can’t fix its problems, it will be cancelled. Army SLAMRAAM and NLOS cancelled.
b. Remaining $70 billion goes to the services for procurement:
i. Air Force: more Reapers and start of next-gen nuclear-capable bomber, which will have an unmanned option. More satellite launchers. New F-15 radars.
ii. Army: Overhaul/upgrade/SLEP for M-1, M-2, Strykers. More UAVs. More for soldier mental health and base facilities. New tactical comm. systems.
iii. Navy/Marine Corps: one new DDG, LCS, 2 fleet oilers. New and overhauled F-18s. More electronic attack. More for UAV development. Overhauled/upgraded/SLEPed Amtracs.
4. Army and Marine Corps will cut headcounts by 2015; Army by 27,000, USMC by about 15-20,000.
5. Gates to try again to get Tricare premium increase for working-age retirees.
6. OMB has delivered to DoD new top-line figure for next five years – will be $78 billion less than last year’s five-year projection.
First, he is asking for a bit less money than was originally projected. When does a SecDef do that? Note that each branch is going to be focused on more UAVs--these are big force multipliers as they say.
Second, more importantly, he is canceling programs (including the Marine Expeditionary Fighting Vehicle) and putting the short/vertical takeoff version of the F-35 on probation. Both programs suffer from the "we want everything possible on the platform so that it is too expensive to purchase enough" disease.
“As a result, I am placing the STOVL variant on the equivalent of a two-year probation,” Gates said. “If we cannot fix this variant during this time frame and get it back on track in terms of performance, cost and schedule, then I believe it should be canceled.”
The big question is whether it makes sense to cut the Army and Marines by about 40k combined? This would cut costs, but the past decade has demonstrated how finite the ground-pounders are with so many folks doing repeated tours. I guess with the US out of Iraq by the end of 2011 and smaller in Afghanistan by 2014, there will be less stress on the force. But shrinking the force will cut against other priorities, such as improving the health of the soldiers and marines. That is, fewer troops, more tours in hots spots, more stress, less health.... Given that one key element of the Chairman's intent focuses on health, there might be a contradiction here. Of course, personnel is where lots of the costs are so cutting 40k soldiers and marines will make a difference. However, as Gates notes, even with these cuts, the force will still be larger than when he started as SecDef.
A third source of savings: cutting headquarters and expensive billets. It looks like Gates is proposing a cut of 100 general/flag officers out of 900 spots. A lot fewer jobs for generals and admirals, which means not just fewer folks with stars on their shoulders but less staff, vehicles, helos and everything else that goes with a star or three on one's shoulder. About 200 out of 1400 senior civilian spots will also be cut. The intent, he says, is not to save money:
The monetary savings from these reductions in senior personnel will be relatively modest and mostly consist of the extra staff and amenities that by tradition follow high rank. The primary purpose behind this shift is to create fewer, flatter, more agile, and thus more effective organizations.
To be clear, the SecDef is constrained by politics. Closing down the big NATO headquarters (Joint Forces Command) and other assets at Norfolk has been adjusted to keep heaps of jobs still there. This reduces the savings but also the opposition. Note how it is pitched in the SecDef statement:
The Navy also proposes to disestablish the headquarters of Second Fleet in Norfolk. During the Cold War, this command had distinct and significant operational responsibilities. Today its primary responsibility is training and mission preparation, a function that will be transferred to the Navy’s Fleet Forces Command. This change would affect approximately 160 military positions. And no ships will depart Norfolk as a result. ... In the case of JFCOM, we have identified a number of missions since the August announcement that should be retained in the Norfolk/Suffolk, Virginia area.What I like best about Gates is that he is realistic about the world and about the defense department.
No doubt these budget forecasts and related program decisions will provoke criticism on two fronts – that we are either “gutting” defense or we have not cut nearly enough. ... When it comes to global reach and striking power, the gap between the U.S. military and the rest of the world – including our biggest potential rivals – will continue to be vast, and in some key areas will grow even wider. We must come to realize that not every defense program is necessary, not every defense dollar is sacred and well-spent, and that more of nearly everything is simply not sustainable.Another reason I like Gates is that he picked Chairman Mike Mullen, a huge improvement over Myers and Pace (not that is saying much). "Adm. Mike Mullen, chairman of the Joint Chiefs of Staff, said that all four service chiefs supported the proposals, and that the military would still be able to manage global risks. “We can’t hold ourselves exempt from the belt-tightening,” he said. “Neither can we allow ourselves to contribute to the very debt that puts our long-term security at risk.”(NYT) I really appreciate that Gates and Mullen get the idea that big debt is bad for national security and that the defense department does not live in a world without tradeoffs.
Is there other stuff he could have cut? Certainly. I'd like to see less spending on missile defense (more money down a hole), less on manned bombers to penetrate Russian/Chinese airspace, less on carrier task forces (since UAVs make them less necessary and proliferation of missiles make them bigger targets), and other capital intensive programs. Should he? Perhaps, but these cuts are significant. And Congress can always shove back into the budget things that the SecDef wants to cut. So the big question now is how much of this will stick?