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Posted at 07:30 AM ET, 10/10/2011

On Pentagon budget matters, telling it like it is


Defense Secretary Leon E. Panetta greets personnel at Sigonella Naval Air Station in Sicily last week. (Reuters )

When Defense Secretary Leon E. Panetta met with service personnel in Naples late last week, the first question he got after giving his quick around-the-world review of budget challenges faced by the Pentagon, was: “Is the military retirement system going to be changed?”

That was the same question Panetta’s predecessor, Robert M. Gates, used to get first after he began discussing the inevitable cuts in Defense Department spending almost two years ago.

Panetta, a politician at heart, has learned to take his time in answering this and other personnel questions that are weighing on the minds of those now in the military as they hear talk of cuts in healthcare, retirement pay and other benefits that over the past decade helped sustain the all-volunteer force during two wars.

Retirement pay? “Your benefits ought to be protected. For future people coming in, there may be changes.” Healthcare? “See whether we can in fact find reforms there that not only improve it, but deal with some of the cost increases that are taking place.”

Panetta has also worked out a summary of where other cuts must come from: “We’ve got to look at efficiencies, we’ve got to look at going after duplication, we’ve got to look at going after overhead, we’ve got to look at going after procurement problems that sometimes develop systems over a 20- or 30-year period and by the time the damn weapon comes on board it’s outdated. We’ve got to develop greater competition in terms of contracts.”

Panetta has also spoken in public on budget matters the way journalists often imagine Pentagon officials and officers almost always speak in private meetings.

At the Naples session, a sailor working in logistics asked what can be done about his unit being undermanned. Panetta’s immediate response: “You’re telling me you’re working your ass off.”

When the laughter died down, the defense secretary followed up by saying that everyone is being asked to do more because “we’re spread out in a number of places ... and in many ways we ask you to do a hell of lot more than you would normally be doing in order for us to accomplish the mission, but that’s what makes us the best military in the world.”

Panetta’s response was reminiscent of another recent exchange with a top military official in which the official seemed to be telling it like it is.

Last month, Mike Hostage, commander of Air Combat Command, was asked at a conference hosted by the Air Force Association how the Air Force has paid for its operations in Libya, since those funds had not been originally budgeted.

Hostage said the operations he ran were all funded through the Overseas Contingency Operations (OCO) accounts, which have also been used to pay for fighting in Iraq and Afghanistan, rather than core Defense Department budget dollars.

“The OCO budget is intoxicating,” Hostage said. “You can get done anything you need to get done because all you do is ask for it and it shows up. As a taxpayer I was a little sensitive to our ability to do that, but I was not going to fail in mission due to that sensibility.”

But he cautioned that at some point OCO funding will get turned off. “The challenge we face is as we taper down these operations,” he said. “How to go smoothly back down to steady state baseline from the OCO, the crack cocaine of OCO money.”

By  |  07:30 AM ET, 10/10/2011

 
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