[fintstone]

The necessary upkeep

The world today is, on balance, at least as dangerous as it was at the end of the Cold War. The U.S. is no longer in danger of a massive nuclear attack, nor is a major land war in Europe likely, but the threats we face are no less serious. America is engaged in a war against terrorism that will last for years. The danger of a rogue missile attack is greater than ever. China is emerging as a peer competitor much faster than most of us expected, and Russia’s brief experiment with democracy is failing.

The “operational tempo” of American conventional forces — the number, intensity, and duration of their deployments — has increased since the end of the Cold War. Yet the forces were almost twice as big in 1992 as they are today. The active-duty Army was cut from 18 divisions during Desert Storm to ten by 1994 — its size today. The Navy, which counted 568 ships in the late 1980s, struggles today to sustain a fleet of only 276. And the number of tactical air wings in the Air Force was reduced from 37 at the time of Desert Storm to 20 by the mid-1990s.

Modernization budgets also were cut substantially during the Clinton years, and procurement budgets were cut much further than the cuts in force size and structure warranted. In essence, the Clinton administration took a “procurement holiday” where the military was concerned. The contrast in the average annual procurement of major equipment in two periods — 1975 to 1990 and 1991 to 2000 — is startling. For example, the Pentagon purchased an average of 78 scout and attack helicopters each year from 1975 to 1990, and only seven each year from 1991 to 2000. An average of 238 Air Force fighters and five tanker aircraft were procured each year from 1975 to 1990, as against only 28 and one per year, respectively, from 1991 to 2000.

These dramatic reductions had profound implications. When older platforms are not replaced, readiness levels drop, and the cost of maintaining inventory climbs rapidly. By the end of the Carter years, the force had gone “hollow”; by the end of the Clinton years, it had begun to “rust,” badly. The George W. Bush administration has increased procurement budgets, but nowhere near enough to make up for the 1990s. The average age of Air Force aircraft in 1973 was just nine years. Today, the average aircraft is 24 years old and aircraft-modernization funding has dropped by nearly 20 percent over the last 22 years.

The current force is too small and too old relative to the requirements of the official national military strategy. That strategy calls for a military capable of defending the homeland, sustaining four peacekeeping engagements, and fighting two large-scale regional conflicts at approximately the same time. The services today probably cannot execute even this strategy within an acceptable margin of risk. Certainly they will be unable to do so in the future unless the Army and probably the Marine Corps are made bigger and unless all the services have the money to recapitalize their major platforms with modern equipment.

For years, the Joint Chiefs have been under pressure from political authorities to reduce the budget below what they really need. So they have delayed new programs, reduced the number of new ships or planes they say they need, kicked crucial procurement decisions down the road, robbed Peter to pay Paul, and otherwise tried to avoid confronting the approaching crisis.

But the crisis is upon them, and us, now. The military is entering a crucial phase of recapitalization. Beginning with the next budget, and intensifying over the next five to ten years, the services are scheduled to field the new platforms that will anchor American security for the next generation. No one can say that this spending is not needed or that it can be delayed any further. The Army must modernize and replace almost its entire capital stock of fighting vehicles. The Navy must buy new DDG-1000 destroyers, ramp up procurement of Virginia-class submarines, and buy large numbers of littoral combat ships and the next-generation cruiser. The Air Force must buy its new superiority fighter, the F-22, as well as Joint Strike Fighters or equivalent aircraft. In addition, the Air Force must fund its strategic-airlift requirement, design and build a new tanker, and develop an interdiction bomber to replace the B-52, an aircraft almost 50 years old.

The current procurement budget for all three services is $81.3 billion. Simple budgetary mathematics shows that the services cannot possibly meet their crucial requirements without an average budget over the next five to ten years that is at least $30 billion higher per year.

The situation facing the Navy is representative of the dilemma facing all the services. Currently the Navy has 276 ships. Its shipbuilding plan calls for 326 ships by 2020, eventually reaching a fleet that averages 313 ships. The plan actually calls for a reduction in aircraft carriers, attack submarines, and major surface combatants, but makes up for this with modern destroyers, more capable submarines, pre-positioning ships that will allow us to build and defend “sea bases,” and the whole new class of multi-mission modular vessels called littoral combat ships. There is no margin whatsoever in this plan; it is the minimum necessary for American security.

The chief of naval operations, the admiral who represents the Navy on the Joint Chiefs, has estimated that the plan will require an annual shipbuilding budget that averages $13.4 billion, almost $5 billion more than was spent on shipbuilding last year. His plan calls for that figure to increase to $17.5 billion by 2012. Most naval experts believe these figures are far too conservative. But it will be utterly impossible, at current levels of defense spending, for the Navy to reach and sustain even the $13.4 billion figure; the money simply is not there. Beginning no later than 2009, there will be a growing shortfall in the shipbuilding accounts, in addition to an annual shortfall of $1 to $2 billion per year in Navy aviation procurement.

The bottom line is that the Navy needs at least an $8 billion procurement increase per year above current estimates. The Marine Corps needs about $3 billion more per year. It is not necessary to go into great detail with regard to the budgetary picture for the Air Force and Army; the pain has been spread fairly evenly across the services, and all face roughly the same shortfalls. That equals a procurement deficit over the next ten years of at least $30 billion per year. Most independent experts believe the number is even higher. For example, the Congressional Budget Office estimates that the shortfall, including expected increases in personnel costs, will be a minimum of $52 billion per year.

Add to this the fact that the active-duty Army is clearly too small. Even in an age of transformation and non-linear battlefields, America will always need the capacity to put boots on the ground. Particularly in the post-9/11 era, the U.S. needs the ability to carry on sustained, large-scale peacekeeping or low-intensity combat missions, without having to send the same units on three or four tours over the life of a mission. A nation of America’s size and strength should not have to tie up essentially its whole active-duty Army, much of its Marine Corps, and many of its reserves in order to sustain 130,000 troops in the kind of low-intensity combat we are experiencing in Iraq.

In 1992, just after Desert Storm, the Pentagon stated a requirement of twelve active-duty Army divisions, before the increases in operational tempo of the 1990s and before the War on Terror. The Army should surely have at least twelve divisions today. To their credit, President Bush and defense secretary Robert Gates have proposed such an increase. It costs at least $2 billion to stand up and sustain an addition to the army of division strength, which means we need to invest about $4 billion per year or more in increased Army force structure, in addition to the $30 billion more in new procurement funding.

So to sustain our military at the level necessary to protect our security, we must increase procurement, personnel, and support spending by at least $34 billion above the FY 2007 budget. It may be possible to fund a small fraction of this increase from reforms in the rest of the defense budget. Congress typically adds $3 or $4 billion worth of earmarked appropriations every year. Some of those earmarks are actually warranted, but a dedicated effort to reduce those that aren’t could produce $1 or $2 billion in savings per year. The cost of new programs has certainly spiraled — there are still $400 hammers floating around in the defense industry — and the right kind of procurement reform might reduce them somewhat.

The unstable and inadequate defense budgetary climate is itself a major reason program costs have increased. The Defense Department regularly projects what it intends to buy in the out years of its defense plan, but then institutes last-minute cuts, changes, and delays that allow it to meet annual budget targets but increase program costs in the long run. The Navy, for example, originally planned to buy a total of 32 DDG-1000s — the Navy’s next-generation multi-mission destroyer. A few years later, Navy officials said the military requirements had dropped to only eight to twelve destroyers, and the most recent Navy plan now calls for a total of only seven. It is no coincidence that over the same period, due to the loss of economies of scale, the cost per destroyer has increased.
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