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Cutting defense spending won’t make the budget balance

By John Hillen and sequestration,

Occasionally we republish blog posts, press releases and other commentaries of interest to the greater Washington business community. Here are excerpts from remarks made by John Hillen, chief executive and president of Sotera Defense, from a recent panel discussion on the sequestration budget reduction process, hosted by the Greater Washington Board of Trade.

Let me say up front that like most Americans, I’m keenly tuned into to the series of fiscal crises faced by the country and our government. So I’m not knocking the importance of applying the affordability lens to defense, or any other government spending.

Even though national defense is constitutionally the first task of our federal government — and importantly a role that only the federal government can play — it must be affordable as well as tied to our strategic ambitions and the nature of the international political arena. But the problem with applying sequestration to national security in the name of affordability is that while the cuts will severely degrade our military capabilities, they will not make a recognizable difference in the long term budget picture.

Let’s look at the math. In the period between 2012 and 2013 in which the Budget Control Act cuts defense spending by $55 billion, mandatory entitlement spending and interest on the debt will rise almost $75 billion. So in year one of sequestration our defense savings are erased by the commensurate increase in other spending in under nine months. In year two of sequestration, a year in which mandatory entitlements and interest on the debt (assuming a historically low interest rate) will rise $154 billion, our defense savings are overcome in just over four months; the next year, three months. And, as I’m sure you all can imagine, it gets worse.

So, in the very short term, let alone the medium and long, we get precious little budget balancing and certainly almost no long-term federal debt benefit from sequestration applied to the Defense Department. Defense is only 20 percent of the federal budget (half of what it was 25 years ago) and going down fast as a percentage of federal spending. If we are hoping to balance the annual federal budget deficit or affect the $16 trillion debt through defense cuts, we’re in for a surprise.

In the meantime, in the absence of any strategic rationale in a dangerous world, we will have stripped the military of real capability. By the way, this is not just for war fighting or responding to contingencies. The shape of the strategic environment in which all decisions are taken is profoundly affected by the unique role the United States plays in global security — a strategic environment we have shaped to American interests since the end of World War II. I was once reminded by a Southeast Asian diplomat that even local trade deals in Asia are affected by the perceptions of future U.S. military power dedicated to the region.

The decline in real military capabilities is aggravated by the fact that many of the personnel accounts (the majority of the Defense Department budget) are off limits to sequestration and so the cuts largely need to come from procurement, research and development, operations and maintenance and other accounts that produce real capability — today and for the future.

If we’ve learned anything from history, a peace dividend never delivers peace for long ... but it always delivers unpreparedness. Every U.S. peace dividend in the past 100 years has been followed by a moment or period of strategic unpreparedness that has unnecessarily cost American lives.

Prior to his role at Sotera, John Hillen was a defense planner, an assistant secretary of state dealing with military strategy and a think tank member who co-wrote and edited a book on alternative defense strategies.

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