Four think-tanks do sequestration exercise, still gut the military

In late May, four Washington think-tanks conducted a computerized budget exercise in which they had to cut almost as much from the defense budget ($500 bn) as the DOD will have to under sequestration, but had the flexibility to allocate the cuts, and these cuts were backloaded into later years of the budget window decade.

The participating think-tanks were the Center for Strategic and International Studies, Center for a New American Security, American Enterprise Institute, and Center for Strategic and Budgetary Assessments, the hosts of the exercise. Each team had 650 defense budget items they could either cut or invest more in, but in any case they had to fit within the budgetary limits, i.e. to cut $500 bn from the base defense budget over the next fiscal years – and could not make up for that by increasing OCO spending.

In other words, each team had to make many choices.

The exercise presumed that efficiencies targeting “waste, fraud, and abuse” would already be implemented, as would be crucial cost-saving reforms to military healthcare, retirement, and benefit programs as well as base closure – which Congress reflexively opposes. It also presumed that the DOD would have total flexibility in where to make the cuts and reinvestments, completely free from any Congressional interference.

And yet, the best minds from the American think-tank world were unable to craft a defense budget under the draconian cuts of the sequester without severely weakening the military one way or the other. The AEI team, led by Tom Donnelly, even admitted they could only “delay disaster”.

Why? Because in any case, under the “full sequestration” scenario, all teams had to:

• Dramatically cut the size of all services, especially the Army and the Marines (which are very manpower-intensive, so that’s where the money is).
• Dramatically cut the fleet of fighters – stealthy and nonstealthy – and surface ships (carriers, cruisers, etc.).
• Cut the nuclear deterrent, including at least one ICBM wing, and (except the AEI team) eliminate the ground-based missile defense interceptors protecting the homeland against missile attacks. (Which means: North Korea would be free to fire its ICBMs at the US as it has threatened to.)
• Limit America’s military involvement to only two areas – the Western Pacific and the Middle East. (Or, in the CSIS case, only to the WestPac – CSIS conducted a “strategic withdrawal from the Middle East”.)
• Dramatically cut funding for military readiness – i.e. for the troops’ training, for ammunition, spare parts, and fuel, and for the maintenance of current equipment. In essence, they sacrificed military readiness for long-term modernization (somewhat less so in the AEI’s case), thus assuming that America’s enemies would give her at least several years of pause before causing any problems. The recent standoff with North Korea proves just how fallacious that assumption is. Indeed, when the exercise was changed to assume that only half of sequestration – $250 bn – were mandated, all teams chose to “buy back” some readiness, but even then couldn’t prevent a significant loss of it.

This proves that, even if the DOD were a superefficient agency, even if Congress authorized all of the reforms that the DOD has requested (after stubbornly refusing them for years), and even if the sequester’s cuts were distributed in the most intelligent manner possible, the military would still be gutted – it would be dramatically cut in size, from today’s (already barely adequate) level, and it would be unready for combat in the near and mid term, as it would be poorly trained and its equipment poorly maintained.

This would be unavoidable due to the depth of the cuts required by the sequester, as the below graph demonstrates.

In short, this proves that the sequester, no matter how inteligently implemented, would still gut the military. This is no surprise, because the sequester was INTENDED to do exactly that. It was INTENDED to gut the military. The idea was that the mere threat of enacting it and gutting the military would be so unpalatable that Congress and the President would agree on a serious deficit reduction deal. But it didn’t happen; the Super Committee (does anyone remember it yet?) failed, and the sequester took effect on March 27th.

But even worse, the AEI team was unable to prioritize anything in the exercise and simply cut everything across the board in a salami-slicing manner (just like the sequester will – it does not allow for prioritizing anything and requires uniform cuts across the board). It cut all services and all capabilities roughly by the same proportion.

The other three teams managed to craft some sort of strategy, resource it (more or less), and – more or less – save what they considered to be the crown jewels.

And there was actually broad consensus, in most cases, on what to prioritize and what to cut:

• All four teams cut the number of DOD civilians and contractors deeply.
• All four teams chose to invest in paying the up-front costs of BRAC to reap some BRAC savings later.
• All teams chose to reduce surface ship fleets (carriers, cruisers, DDGs), and retain or even increase the procurement of Virginia class submarines.
• All four teams chose to retain the nuclear triad.
• All four teams maintained, or increased spending on, Special Operations units, cyberwarfare, space assets, and Science&Technology, including electromagnetic railguns, directed energy weapons (lasers), robotics, etc.
• 3 of the 4 teams chose to cut back on the F-35.
• 3 of the 4 teams chose to retain or even accelerate the development of the Next Generation Bomber.

Overall, however, in my assessment, the relatively best strategy and set of budgetary choices allowed under those circumstances were developed by the CSBA team, led by Jim Thomas. That team developed a cohesive, sound strategy which, in my judgment, fits the current threat environment well:

• It aims to preserve America’s global power projection capabilities despite anti-access/area-denial threats while protecting the US and its allies from WMD threats.
• It prioritizes capabilities and weapons well-suited for such a threat environment – ones that are low-signature (i.e. stealthy), are not dependent on in-theater bases, and can deliver much firepower over long distances. They advocate (as CSBA has been for years) shifting the military towards such weapons and capabilities, and away from ones that are heavily dependent on in-theater bases or suitable only for permissive environments (where the opponent is an insurgency or a primitive state and thus unable to e.g. contest control of the air).
• It seeks to strike the right balance between weapons’ survivability, range, firepower, and affordability.

I completely agree with these principles.

Informed by these, the CSBA team’s strategy proposed to deeply cut readiness, the ground force, fighters (stealthy and nonstealthy alike), and nonstealthy drones (Predators, Global Hawks, Grey Eagles, etc.).

But the CSBA was able to, more or less, protect the crown jewels: long-range strike weapons (including the Next Gen Bomber), the nuclear deterrent, jammers, submarines, cruise missiles, lasers, railguns, high-power microwave weapons, stealthy drones (including a carrier-capable type), and funding for base hardening and force dispersal.

This did not come without a price, however. In addition to cutting readiness, the ground force, fighters (stealthy and nonstealthy alike), and nonstealthy drones (Predators, Global Hawks, Grey Eagles, etc.) – and thus accepting high risk for the short- and mid-term, the CSBA also eliminated one ICBM wing and the Ground-Based Interceptor system if forced to cut a $500 bn from the defense budget, but did not cut these crown jewels if a full $500 bn cut was not required.

This shows that under full sequestration, even if you try to protect your crown jewels – your utmost priorities – you still can’t do that fully, and you can’t avoid gutting the military one way or the other, as you still have to make deep cuts elsewhere in the military.

There is no “smart” way to implement the sequester’s cuts. Under that insane mechanism, there would simply be insufficient funding for national defense – even to protect America itself. The only right thing to do about sequestration is to repeal it completely.