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August 01, 2013

DoD Announces Sequester Cut Options And They Are Ugly

The "Super Committee" failed back in November of 2011, making sequester the next option. For almost two years the Department of Defense has been hoping and praying someone or something would protect it from the inevitable. Yesterday, reality hit and hit hard.

The incredibly short version:

We'll have the smallest Army since WWII, a vastly reduced Marine Corps, less tactical and cargo capability for the Air Force and the loss of two or three carrier groups for the Navy. This will mean forgoing some missions we currently plan on taking on. As Robert Caruso put it, "do less with less"

The longer version:

Secretary of Defense Chuck Hagel outlined a series of options he will present the President with how to move forward in meeting the cuts mandated by the Budget Control Act.

The Strategic Choices and Management Review did not produce a detailed budget blueprint. That was not the purpose of this review. It generated a menu of options, not a set of decisions, built around three potential budget scenarios:

• The President’s FY 2014 budget, which incorporates a carefully calibrated and largely back-loaded $150 billion reduction in defense spending over the next ten years;

• The Budget Control Act’s sequester-level caps, which would cut another $52 billion from defense in fiscal year 2014, with $500 billion in reductions for the DoD over the next ten years;

• An “in-between” scenario that would reduce defense spending by about $250 billion over the next ten years, but would be largely back-loaded.

How do you get there?

Cut staff and management in some areas up to 20%

These management reforms, consolidations, personnel cuts, and spending reductions will reduce the department’s overheard and operating costs by some $10 billion over the next five years and almost $40 billion over the next decade. They will make the Department more agile and versatile.

Everyone likes that, right? Well unless you're one of the staff getting cut. After that it gets hard and controversial.

Military pay and benefits are going to be on the table (if Congress allows it, which is...doubtful)

• Changing military health care for retirees to increase use of private-sector insurance when available;

• Changing how the basic allowance for housing is calculated so that individuals are asked to pay a little more of their housing costs;

• Reducing the overseas cost of living adjustment;

• Continuing to limit military and civilian pay raises.

According the Hagel those cuts and efficiencies get you to about $150 billion of the $500 million in cuts.

And then you get into systems and capability.

Credit where it's due, Hagel's plan isn't the normal, "ok, everyone gives up x% so no feelings are hurt". Feelings will be hurt because the cuts will focus more on some branches than others to reflect the threat assessment at the moment and the existing strategies to deal with them. That means more cuts for the manpower intensive Army and Marine Corps than for the Air Force and Navy (though the latter two take some serious hits as well).

This is where the real choice is to be made. Do you go for size or technological superiority? While no final decision has been made, Hagel is leaning toward technology.

Significant reductions beyond the President’s plan would require many more dramatic cuts to force structure. The review showed that the “in-between” budget scenario we evaluated would “bend” our defense strategy in important ways, and sequester-level cuts would “break” some parts of the strategy no matter how the cuts were made. Under sequester-level cuts, our military options and flexibility will be severely constrained.

Given that reality, the review examined two strategic approaches to reducing force structure and modernization that will inform planning for sequester-level cuts. The basic trade-off is between capacity – measured in the number of Army brigades, Navy ships, Air Force squadrons and Marine battalions – and capability – our ability to modernize weapons systems to maintain our military’s technological edge.

In the first approach, we would trade away size for high-end capability. This would further shrink the active Army to between 380,000 and 450,000 troops, reduce the number of carrier strike groups from 11 to eight or nine, draw down the Marine Corps from 182,000 to between 150,000 and 175,000, and retire older Air Force bombers. We would protect investments to counter anti-access and area-denial threats, such as the long range strike family of systems, submarine cruise-missile upgrades, and the Joint Strike Fighter. And we would continue to make cyber capabilities and special operations forces a high priority.

This strategic choice would result in a force that would be technologically dominant, but would be much smaller and able to go fewer places and do fewer things, especially if crises occurred at the same time in different regions of the world.

The second approach would trade away high-end capability for size. We would look to sustain our capacity for regional power projection and presence by making more limited cuts to ground forces, ships and aircraft. But we would cancel or curtail many modernization programs, slow the growth of cyber enhancements, and reduce special operations forces.

Cuts on this scale would, in effect, be a decade-long modernization holiday. The military could find its equipment and weapons systems – many of which are already near the end of their service lives – less effective against more technologically advanced adversaries. We also have to consider how massive cuts to procurement, and research and development funding would impact the viability of America's private sector industrial base.

This is ugly stuff but...it's the results of choices made. You simply can't have European style welfare state and American style taxation rates and military. Something has to give and this is what it looks like.

Of course there are some Republicans willing to move towards more taxes to avoid these cuts.

As I wrote back last November, sequester is a horrible idea and I'm for it. This is an absolutely irresponsible way to get budget cuts but it's the only one to get them apparently. People need to make choices and see the results of them. Conservatives can never truly start to fix things as long as liberals, Democrats and Republicans tell Americans fairy tales about how they can have everything and there are no costs to be paid. If American's think their options are "sure you can have ice cream and not gain weight" or conservatives saying, "sorry, you have to eat healthy" we'll lose. Forever. Once the choices become clearer...fiscal/national ruin or a sustainable path to health we might have a chance win the argument.

The sooner the facade is ripped off the liberal/Democrat/Republican fantasy the better it will be for conservatives.

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posted by DrewM. at 10:24 AM

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