May 5, 2011

Leon Panetta may still be savoring the successful operation against Osama bin Laden in a month or two. But as the incoming defense secretary, he will have a major challenge of a different order: presiding over a defense build-down.

President Obama’s proposal to reduce the projected defense budget by $400 billion over the next 12 years underlines a reality that is driven by concern over deficits, debt and a declining interest in having the United States act as global cop. And his proposal is only the opening bid on how far down defense budgets could go.

While outgoing Defense Secretary Robert Gates reacted to Obama’s decision as though it had created a crisis in defense planning, the reductions that Panetta must carry out are inevitable, even necessary. As Adm. Mike Mullen, chairman of the Joint Chiefs, put it in January: “The budget has basically doubled in the last decade. And my own experience here is that in doubling, we’ve lost our ability to prioritize, to make hard decisions, to do tough analysis, to make trades.”

Panetta has a chance to bring much-needed discipline to a Pentagon budget that has spun out of control. And the cuts could be an incentive to design a military force that is globally superior, more focused, leaner, less bureaucratic and tailored to the missions it will face.

The defense budget could actually be cut by $1 trillion, or 15 percent below current projections over the next decade, and there is a wealth of proposals for how to do it, starting with those from the president’s own fiscal responsibility commission, the Rivlin-Domenici debt task force and the report by Reps. Barney Frank and Ron Paul.

The first step is to set priorities for military missions, something the 2010 defense review did not do. That review gave every mission equal priority and sought to reduce risk to zero for all of them. It was an open door for endless budget growth, but it’s not a strategic plan.

Given the approaching exit from Iraq and the coming decline in our deployment in Afghanistan, the counterinsurgency/nation-building mission for which the Army is being tailored today needs to be de-emphasized. We do not do that job well, particularly when we invade to topple a regime and stay around while insurgencies begin, and we are unlikely to repeat the Iraq and Afghan experiences anytime soon. We can slenderize this mission and reduce the size of the ground forces needed to carry it out, while retaining the niche capabilities that helped get bin Laden.

Hardware programs also need tough love. We should buy things that are needed for priority missions and that are meeting performance and budget targets. But do we need to buy three versions of the F-35 fighter (one capable of carrying nuclear weapons), a large supply of attack submarines and yet another next-generation armored vehicle? The defense research and development budget, larger than the entire defense budget of any other country, also could be reduced. We need to take a critical look at a growing research budget for nuclear forces — warheads, nuclear facilities, a new bomber — at a time we are reducing our nuclear arsenal.

The Pentagon’s infrastructure needs much deeper scrutiny. The Defense Business Board notes that more than a third of the force is never deployed; a fifth of it is carrying out commercial functions; and overhead consumes 42 percent of the defense budget. Everything the government does, the Defense Department does — education, health care, stockpiles, real estate management, pensions, etc. Shrinking this “back-office” work and the number of people doing it would reduce overhead.

Pay and benefits are another target. Panetta will need to go further than Gates has in trying to raise health insurance rates for younger retirees, who are paying a tenth of what the average American family pays for health insurance. We should also look at less expensive ways to retain skilled personnel than providing everyone with the same pay raise; more efficiencies in health care; and retirement system reform.

This is the fourth scaling back of defense spending since the 1950s. It is predictable, normal and, like the others, driven by fiscal concerns and the end of wars. Contrary to Gates’s oft-repeated view, we have gotten it right in the past. President George H.W. Bush, Defense Secretary Dick Cheney and Joint Chiefs Chairman Colin Powell took 500,000 people out of the military and cut the defense budget 25 percent but left in place a force that treated Saddam Hussein’s military as a speed bump in 2003.

The build-down provides the new Pentagon leadership with an opportunity to rethink U.S. military strategy and missions, bring discipline to Pentagon planning and budgeting, and put in place a leaner but significantly more efficient military to serve America’s purposes.

Gordon Adams is a professor of international relations at American University’s School of International Service and a Distinguished Fellow at the Stimson Center. From 1993 to 1997 he was the principal White House policy official for national security budgets.