Gates Planning Major Changes in Defense Programs, Budget

Gen. George W. Casey last year displayed a vehicle from the Army's Future Combat Systems program, which is expected to be heavily cut.
Gen. George W. Casey last year displayed a vehicle from the Army's Future Combat Systems program, which is expected to be heavily cut. (By Haraz N. Ghanbari -- Associated Press)
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By R. Jeffrey Smith and Ellen Nakashima
Washington Post Staff Writers
Saturday, April 4, 2009

Defense Secretary Robert M. Gates is expected to announce on Monday the restructuring of several dozen major defense programs as part of the Obama administration's bid to shift military spending from preparations for large-scale war against traditional rivals to the counterinsurgency programs that Gates and others consider likely to dominate U.S. conflicts in coming decades.

Gates's aides say his plan would boost spending for some programs and take large whacks at others, including some with powerful constituencies on Capitol Hill and among influential contractors, making his announcement more of an opening bid than a decisive end to weeks of sometimes acrimonious internal Pentagon debate.

Among the programs expected to be heavily cut is the Army's Future Combat Systems, a network of vehicles linked by high-tech communications that has been plagued by technical troubles and delays; with a price tag exceeding $150 billion, it is now one of the most costly military efforts.

Gates also is considering cutting a new $20 billion communications satellite program and reducing the number of aircraft carriers from 11 to 10, and he plans to eliminate elements of the decades-old missile defense effort that are over budget or considered ineffective, according to industry and administration sources.

They cautioned that not all the details have been decided.

"He is strategically reshaping the budget," said Gates's spokesman, Geoff Morrell, who declined to provide details. The secretary is "subjecting every program to harsh scrutiny, especially those which have been over budget and/or behind schedule. . . . The end result, we hope, is a budget that more accurately reflects the strategic priorities of the president."

Gates has signaled for months that the Pentagon's resources are misallocated, but his embrace of the budget increase proposed by President Obama represents an abrupt turnaround. Late in the Bush administration, he blessed a military-service-driven budget proposal for 2010 packed with $60 billion in spending beyond what the Pentagon had earlier recommended. Much of the added funds would have accelerated the production of existing ships, airplanes, Army vehicles and missile defenses.

The proposal became known among some analysts as Gordon England's "fairy dust," after the deputy defense secretary who helped put it together. The name suggested the magical touch that would be needed to win a proposed 14 percent budget increase amid a global recession.

Even though the Office of Management and Budget last April ordered all Cabinet agencies to avoid presenting plans that might box in the next administration, Gates got permission to present the proposal to Obama's transition team.

The new president agreed instead to a 4 percent increase in defense spending, which put Gates, whom Obama decided to keep on as defense secretary, in the position of having to reorient military priorities within a smaller spending limit than he had initially supported.

The turnabout has not been easy, according to a senior official involved in the process, because the military services "became vested stakeholders" in last year's ambitious proposal. Gates has become so consumed by the internal discussions that, after briefing Obama Monday on his thinking, he skipped the celebration of NATO's 60th anniversary in Europe this weekend.

Several experts said the Pentagon budget plan last year was an effort to force the hand of a new administration and stands as a textbook example of military service pressures that have driven the growth in recent years of the defense budget, which has more than doubled since 2001. The 2009 total of $513 billion -- not including special Iraq and Afghanistan war costs -- exceeds the combined military budgets of the next 25 highest-spending nations.

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