Big Programs Survive QDR
By GOPAL RATNAM
Once feared as a mighty slayer of major U.S. weapon programs, the Quadrennial Defense Review (QDR) may have become a milder call for changes to Pentagon business and acquisition practices — and cuts to tens of thousands of troops and civilian employees.
The QDR began as a grand exercise to reorient the U.S. military to take on a variety of new forces and threats. But despite hundreds of studies, sources say that in the last few weeks the review has boiled down to a “budget-cut drill.”
The defense budget has grown about 40 percent in the past four years, excluding wartime supplements, but spending on major new weapons has largely been limited to research and development. Budget pressure threatened to kill off some of these weapons just as they were ready for purchase. Faced with the dilemma, all the military services have chosen to forgo troops to buy weapons.
Confronting the “end of this buildup and yet having no program on hand, services are squaring the circle by trimming force structure to pay for modernization,” said Andrew Krepinevich, executive director of the Center for Strategic and Budgetary Assessments, a think tank in Washington. Krepinevich said it is unclear how the new budget plan “deals with the issue of transitioning the force to deal with irregular, catastrophic and disruptive threats.”
But for now, the big weapons are expected to stay. In November, the Pentagon’s top weapon buyer approved limited production of the DD(X) destroyer. Air Force sources say the F/A-22 Raptor and F-35 Joint Strike Fighter programs, as well as competitions for new search-and-rescue helicopters and even new aerial tankers, will go ahead as planned. Army leaders expect their Future Combat Systems (FCS) to press on, though with some delays.
The final draft of the QDR is to be briefed to Defense Secretary Donald Rumsfeld on Dec. 21, sources said, and is expected to be published around the second week of January and delivered to Congress along with the 2007 budget in early February.
Rumsfeld appears to have convinced the White House to preserve DoD’s planned $443 billion budget for 2007, although the military services will have to cut as much as $15 billion that year alone to cover skyrocketing fuel bills and other unanticipated costs.
To make up the internal shortfall and preserve key modernization programs, the Pentagon appears ready to shrink its payroll accounts — a victory for Rumsfeld, who has long favored a smaller but more lethal and agile force. The Air Force will soon unveil plans to cut up to 40,000 slots from its active, reserve and civilian work force, allowing an extra $6 billion a year to be devoted to acquisition.
Senior officials said the cuts make sense because new weapons require fewer people to operate. Sources said the Navy also is eying cuts. The Army is resisting troop strength increases that would take effect just as the Iraq mission winds down.
“The key to buying things in the future is controlling our people cost,” said Vice Adm. Lewis Crenshaw, deputy chief of naval operations for resources, requirements and assessments. “Some things I can’t control, like the pay structure and benefits, but I can control how many people work for me.”
Crenshaw spoke at an annual investors’ conference in New York, Dec. 8, organized by Aviation Week and Credit Suisse First Boston.
At the conference, Army Lt. Gen. Joseph Yakovac defended FCS spending, warnings that taking money from weapons could leave a hollow force. Military sources said the Army’s top priority modularity initiative to field 48 more mobile and powerful combat brigades could cost as much as $180 billion.
FCS is only one of the “top 20 Department of Defense programs,” said Yakovac, who is the military deputy to Claude Bolton, the Army’s assistant secretary for acquisitions. “Why can’t I fight for it?”
Business Reforms
A special panel constituted to study the Pentagon’s acquisition system and earlier reform attempts is recommending the military’s procurement, research and development budget be separated from the overall defense budget. This would help prevent the kind of financial whiplash that causes cost overruns, said retired Air Force Lt. Gen. Ronald Kadish, panel director and a vice president at Booz Allen Hamilton, a government consulting firm in Fairfax, Va.
The panel found that every dollar taken from a program induces $4 of cost increases in later years, Kadish said. Though many in Washington blame the uncertainty on Congress, Kadish said most of the damage was self-inflicted by the Pentagon.
The final report from the panel, expected Dec. 14, is to become part of the QDR.
But analysts said that if all the QDR does is advocate acquisition reform,”it would get an ‘F’ grade” from the Joint Chiefs of Staff, said Steven Grundman, a former Pentagon official now with CRA International, a consulting firm in Boston. The Joint Chiefs must assess the risk of implementing QDR’s recommendations for Congress.
Christopher “Ryan” Henry, principal U.S. deputy undersecretary of defense, is spearheading the QDR effort. He said the review was paying equal attention to capabilities mix; joint capability enablers; roles, missions and organization; business practices; human capabilities strategy; and authorities required to execute strategies.
Once feared as a mighty slayer of major U.S. weapon programs, the Quadrennial Defense Review (QDR) may have become a milder call for changes to Pentagon business and acquisition practices — and cuts to tens of thousands of troops and civilian employees.
The QDR began as a grand exercise to reorient the U.S. military to take on a variety of new forces and threats. But despite hundreds of studies, sources say that in the last few weeks the review has boiled down to a “budget-cut drill.”
The defense budget has grown about 40 percent in the past four years, excluding wartime supplements, but spending on major new weapons has largely been limited to research and development. Budget pressure threatened to kill off some of these weapons just as they were ready for purchase. Faced with the dilemma, all the military services have chosen to forgo troops to buy weapons.
Confronting the “end of this buildup and yet having no program on hand, services are squaring the circle by trimming force structure to pay for modernization,” said Andrew Krepinevich, executive director of the Center for Strategic and Budgetary Assessments, a think tank in Washington. Krepinevich said it is unclear how the new budget plan “deals with the issue of transitioning the force to deal with irregular, catastrophic and disruptive threats.”
But for now, the big weapons are expected to stay. In November, the Pentagon’s top weapon buyer approved limited production of the DD(X) destroyer. Air Force sources say the F/A-22 Raptor and F-35 Joint Strike Fighter programs, as well as competitions for new search-and-rescue helicopters and even new aerial tankers, will go ahead as planned. Army leaders expect their Future Combat Systems (FCS) to press on, though with some delays.
The final draft of the QDR is to be briefed to Defense Secretary Donald Rumsfeld on Dec. 21, sources said, and is expected to be published around the second week of January and delivered to Congress along with the 2007 budget in early February.
Rumsfeld appears to have convinced the White House to preserve DoD’s planned $443 billion budget for 2007, although the military services will have to cut as much as $15 billion that year alone to cover skyrocketing fuel bills and other unanticipated costs.
To make up the internal shortfall and preserve key modernization programs, the Pentagon appears ready to shrink its payroll accounts — a victory for Rumsfeld, who has long favored a smaller but more lethal and agile force. The Air Force will soon unveil plans to cut up to 40,000 slots from its active, reserve and civilian work force, allowing an extra $6 billion a year to be devoted to acquisition.
Senior officials said the cuts make sense because new weapons require fewer people to operate. Sources said the Navy also is eying cuts. The Army is resisting troop strength increases that would take effect just as the Iraq mission winds down.
“The key to buying things in the future is controlling our people cost,” said Vice Adm. Lewis Crenshaw, deputy chief of naval operations for resources, requirements and assessments. “Some things I can’t control, like the pay structure and benefits, but I can control how many people work for me.”
Crenshaw spoke at an annual investors’ conference in New York, Dec. 8, organized by Aviation Week and Credit Suisse First Boston.
At the conference, Army Lt. Gen. Joseph Yakovac defended FCS spending, warnings that taking money from weapons could leave a hollow force. Military sources said the Army’s top priority modularity initiative to field 48 more mobile and powerful combat brigades could cost as much as $180 billion.
FCS is only one of the “top 20 Department of Defense programs,” said Yakovac, who is the military deputy to Claude Bolton, the Army’s assistant secretary for acquisitions. “Why can’t I fight for it?”
Business Reforms
A special panel constituted to study the Pentagon’s acquisition system and earlier reform attempts is recommending the military’s procurement, research and development budget be separated from the overall defense budget. This would help prevent the kind of financial whiplash that causes cost overruns, said retired Air Force Lt. Gen. Ronald Kadish, panel director and a vice president at Booz Allen Hamilton, a government consulting firm in Fairfax, Va.
The panel found that every dollar taken from a program induces $4 of cost increases in later years, Kadish said. Though many in Washington blame the uncertainty on Congress, Kadish said most of the damage was self-inflicted by the Pentagon.
The final report from the panel, expected Dec. 14, is to become part of the QDR.
But analysts said that if all the QDR does is advocate acquisition reform,”it would get an ‘F’ grade” from the Joint Chiefs of Staff, said Steven Grundman, a former Pentagon official now with CRA International, a consulting firm in Boston. The Joint Chiefs must assess the risk of implementing QDR’s recommendations for Congress.
Christopher “Ryan” Henry, principal U.S. deputy undersecretary of defense, is spearheading the QDR effort. He said the review was paying equal attention to capabilities mix; joint capability enablers; roles, missions and organization; business practices; human capabilities strategy; and authorities required to execute strategies.
posted by Marko at 12/15/2005 09:29:00 AM
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