In his last month in office, Robert Gates is helping shape the debates that will continue after he is replaced as defense secretary by CIA Director Leon Panetta June 30.
In speech after speech, Gates has framed numerous issues, chief among them urging moderation in defense cuts lest U.S. hard power be undermined. He worries the future holds open-ended challenges such as global terrorism, Afghanistan, Iraq, Iran, North Korea, Pakistan, WMD proliferation and China's rise.
To make the most of declining funding, DoD must continue reforming, get leaner, set better priorities, operate and acquire more jointly, he says. A roles and missions review will identify redundancies that can be eliminated and help President Obama save $400 billion by 2023.
What shouldn't be cut, he said, were funds to buy new tankers, the F-35 Lightning II, more warships, new ballistic missile submarines, and repairs and replacements for ground vehicles. He also said DoD must continue investing to counter Chinese efforts to reduce U.S. access to Asia.
Q. You came to office understanding how government and bureaucracies work, and fired enough people to be taken seriously. But you say reform has been difficult. How do you drive lasting change?
A. What discipline the department had eroded in the 2000s when it was pretty much an open checkbook, and as Mike Mullen said at one point, "We have forgotten how to prioritize and to make choices."
First of all, I really had no intention, when I came to the job, of [reforming]. I had two years and I figured my sole agenda item was Iraq and also Afghanistan, but principally Iraq, and it didn't seem to me that I would have the length of time while I was there to affect any kind of significant change in the culture or the bureaucracy or the way business was done. But I did learn a lot during those first two years about the things that troubled me.
For example, the lesson on what it took to fix the Wounded Warrior problem at Walter Reed [Army Medical Center], then get the MRAPS, to get ISR, to get MedEvac in Afghanistan, taught me a lot about the acquisition process and how screwed up it was and what kind of changes were needed.
It also told me that we were buying a lot of stuff that had been in design or development for 10 or 20 years and hadn't been rethought through since the original concept in terms of lessons learned.
The Army's Future Combat Systems was a perfect example of that. It was the fundamental design of the thing that was flawed and in my view that did not reflect what had been learned. The new vehicle was going to be thinly armored and have a flat bottom and count on perfect connectivity to provide protection and just seemed completely unrealistic to me. Not to mention outrageously expensive.
I came to see that in other programs as well, so, as I put it at the time, "I'm punting this to my successor," but I ended up being the receiver.
When I stayed on under President Obama, I decided to take on some of these issues. I didn't do it just because I believe in more intelligent management, but because of the nature and scope of the financial crisis facing the country. It seemed to me that it was impossible that DoD would be exempt on this and so we needed to get our heads into the game and begin showing Congress and through them, the American people, we could show discipline. And that led to the program changes that were announced in April of 2009.
Q. The April massacre.
A. What amuses me about some of the talking heads is these wonderful programs that have been slashed like the Airborne Laser. OK, but do they realize that it was going to require a fleet of 27 747s and that for that laser to work, it had to be within 70 miles of the launch point?
Frankly, some of those writing from the think tanks and so on [indicated] these were terrific programs. The Air Force for five years had been saying 187 F-22s is enough. It started under [former Defense Secretary Donald] Rumsfeld. The Air Force, for at least five years, had been saying that - I forget the exact number - but 193, I think, C-17s was more than enough. We now have 223, thanks to the Congress.
Congress wanted to keep adding C-17s but wouldn't allow the Air Force to decommission the older C-5s. So the question is, cutting some programs, capping others and so on.
My view, having led three huge public institutions now - the intelligence community, a huge university and now DoD - is the way you get lasting change is to establish a goal or have a vision and then immediately incorporate the professionals in figuring out how you come up with the path to get there.
The first two years I was in the job, I continued Secretary Rumsfeld's practice of having two defense senior leadership conferences a year, focused on a variety of substantive issues. I basically stopped doing that in the Obama administration and converted those meetings into [regular] meetings about resources and programs and budgets that included the combatant commanders along with the chiefs.
The thing that has not been commented on, to the best of my knowledge, is the extraordinary cohesion and discipline the building has shown over the last 2½ years in dealing with these really huge issues.
The nondisclosure agreements pertained only to the decisions in April of 2009. There hasn't been a nondisclosure agreement since then, but because the senior military leadership has been deeply engaged in this process, both the chiefs and the combatant commanders, I think they feel like they've had the opportunity to make their case, often successfully, but understanding the need to make choices. They understand that because of the budgetary pressures we're going to face they have to keep moving in this direction.
Partly because of what we've done over the past 2½ years and partly because of the overall budgetary situation, you are seeing a change in the culture, perhaps to a degree not seen before. The senior military leadership was made a part of the process and were asked to be the ones to come up with the ideas.
One of the things that hadn't been done before was on the efficiencies to tell the chiefs that if you come up with $100 billion in overhead efficiencies, you can reinvest in your own service in higher priorities. You've got to come up with these cuts, but when you do, I'll let you keep the money. You tell me what you want to reinvest in and I'll give you the political cover to do what you need to do internally.
Q. Some say you've had the goal posts moved on you as cut demands increased.
A. Well, that's the $78 billion . . . [which] came from a variety of different pots, but it didn't come from the services. It came from things like freezing civilian pay and hiring for several years. About $5 billion came from some stretch-outs that we had to do programmatically with the F-35 program. We were exactly where I thought we would be in last fall: $100 billion in savings that could be reallocated to tooth and $78 billion that the top line would be cut over five years.
What surprised me was the request that we come up with another $400 billion.
Now, that said, I was also mindful that that actually was the lowest number being floated out there. I mean, Simpson-Bowles was $1.2 trillion. The Gang of Six on the Hill, as I heard, was about $600 billion. So it seemed to me that if we were given time and we could do it thoughtfully and intelligently, we could figure out a reasonable way forward. And so my hope is that we're putting in place a process that will allow us to do that.
What I started out to do a year and a half ago was, how do we move? I told the president, we need 2 to 3 percent real growth on the tooth side to sustain force structure and [operations and maintenance]. What I spent the last 18 months doing is figuring out how I cut enough from the tail. The tail was actually a negative growth to provide 2 to 3 percent real growth on the tooth side.
I still think we have to figure out a way to have real growth on the tooth side, even if you have to have some changes in the force structure. I don't think there's any way you can get to that number, much less any of the higher numbers, without changes in force structure. Which means -
Q. Cutting pay, personnel and benefits, or are you talking about simply shrinking the force?
A. There are four "bins" where we're going after money. One is more efficiencies: consolidating headquarters, cutting overhead and so on. We can probably get some more there, but it won't even come close. The second is marginal missions and marginal capabilities. Part of it would be duplication; where we have similar capabilities in two services, we don't probably need both.
Q. For example, high-end UAVs in both the Army and the Air Force?
A. Why aren't we consolidating those programs across the services and so on? But, I mean, that's not a marginal capability or a marginal mission, that's just a management issue. The question is, are there marginal missions and capabilities where we can take some money?
The third are the politically difficult areas: retirement, health care, compensation. I think the most promising of those is retirement - and before all of the VSOs [veterans service organizations] set themselves on fire - I don't know politically how you would do it other than by grandfathering it. But the truth to the matter is, 70 to 80 percent of those who serve do not retire, and they walk out with nothing. We are way behind the private sector in this. Does somebody who served 10 years or 15 years - is it fair that they leave with nothing?
The other piece is, why are we making it impossibly attractive for a lieutenant colonel who has 20 years in and has reached maximum productivity? We have put maximum investment into it, why make it impossibly attractive for him or her to retire instead of trying to structure it so that they're incentivized to stay until 25 or 30 years? I think those things need to be looked at.
On the health care, because you served, the country owes you a significant break when it comes to health care costs. But even the retirees' organizations, for the most part, have said, "OK, we get it on the fee increase." So the real issue is, what kind of indexing do you have. But still, whatever it comes out, it will be a seventh or an eighth before the regular federal civil servant pays.
The fourth bin is the hard one - where you adjust the strategies. Where can you accept more risk, and then can you reduce force structure? BCTs [Brigade Combat Teams], air wings, ships, and so on. And that's the piece where I'm trying to put the brakes on and say, "Now, let's do this thoughtfully and let's force the president, the Congress, American people to address the consequences of a smaller military and what the additional risks are for the country and are those risks tolerable?"
The one thing I am totally opposed to is the kind of across-the-board haircut that we did in the '70s and the '90s, which hollows out the entire force, no money to exercise, no money to fly, no money to shoot bullets in training, et cetera. That is the worst of all possible outcomes. But to do it the other way will require some very difficult decisions by people. And I just want to make sure people understand the risks involved.
It's one thing to throw off these big numbers, but if it's going to involve force structure, people need to understand the consequences and risks.
Q. To go to the compensation issue...
A. Of the third-rail issues, compensation is one where I think there's maybe the least opportunity and a lot of turmoil.
You know, we've got it down - I got to say it was frustrating. First year I was in this job, I ran for a 2.5 percent pay raise, and Congress gave me 3. So I said, "OK, I got it." So the next year, I went it with 3 and they bumped it to 3.5. So I kind of got on to the game at that point. By the same token, for '11, we got it down to 1.4.
So if you're paying an increase of a percent and a half, first of all, I'm not sure there's a lot of money to be found there, and second, as you say, is it worth? Is it worth the impact on morale, on families and so on?
Q. Does DoD need to rethink military compensation; for example, retirement pay?
A. Well, I don't know how you'd structure it, but just off the top of my head, it seems to me that one approach is some kind of a 401(k). Again, I'm just talking off the top of my head. I haven't read a single one of these studies on retirement reform or anything else. But why couldn't you structure it so that, just as a wild example, you have a sliding scale that the longer that you have something like a 401(k) and the longer you stay in, the more the government contributes? So that it isn't 100 percent of the government from the very beginning. But then, whatever you have, at five years or 10 years, essentially it is portable like a 401(k) and you can roll it to your next employer.
But the longer you stay in, the bigger the percentage the government would pay. And maybe the way you keep that 20-year guy in is by saying that beyond 20 years, the government pays 100 percent. I mean, I don't know whether that would work or not, but I just think we need to think more creatively about it to address the actual percentages of those who leave without anything.
Q. Years ago, you accused top U.S. officers of "next-war-itis": focusing more on possible future wars instead the ones you had. You noted that the U.S. Navy is shrinking, yet remains more powerful than all other navies combined. You now say more warships are needed. Some see a contradiction.
A. Well, I don't think so because I'm not frozen in time. First, two years I was here and I couldn't get the military to pay attention to anything but long-term needs, so how do I get them to focus on the wars we're in? I mean, that was the focus of the first couple of years on the job. They weren't paying any attention to the current wars. Everything was out there. And the irony is, once I made all the changes and bought MRAPS and everything else, we were still talking about 10 percent of the budget that went for the wars we were in, for the kinds of equipment we need for the wars we're in.
About 40 percent was basically dual-use stuff, C-17s, stuff that no matter what kind of conflict you're in you're going to use, and half of the modernization procurement budget was for future wars.
So all I was trying to do for the first time was, in terms of the base budget, get today's wars and SOF [Special Operations Forces] to the table. Because SOF was being funded almost exclusively through supplementals. And I wanted them to be part of the base budget, knowing we would need SOF long after the supplementals.
So we basically have got that kind of a focus, and now we need to focus on what are the systems and capabilities that we need for the future, for future conflicts, to have this maximum flexibility for the maximum possible range of conflict. And that's what I've been talking about for the last year and a half or two years. We've got to choose among these capabilities because we can't afford them all. So what do we do in the anti-access/area-denial environment? What do we do in terms of missile defense? What makes sense and so on?
So I don't see any contradiction because frankly, I've been moving through time, depending on where I felt the building was. And for the first couple of years I was here, I was hammering on today's wars because I couldn't get anybody to pay attention.
Q. You had to lean further to drive your point?
A. To get anybody's attention. And of course, the dollars that were being moved were trivial in comparison, but I needed people's heads in the game. And so now, the last couple of years it's been focused on, OK, how do we sustain what we need in terms of the future capabilities and what choices are we going to have?
Q. Do problems have to be tackled more innovatively?
A. The problem that we face is that in these wars we have become incredibly joint operationally, but we've made very little progress in becoming joint in terms of procurement and acquisition. There are some examples that the Marine Corps and the Army are working together on some UAVs and there are some other examples, but one of the programs that I killed in '09 was a whole new helicopter program for the Air Force for search and rescue. You know how long it's been since we had a pilot shot down? So the main search and rescue that's going on is in fact medevac.
You know, the Air Force flew something like 9,700 medevac missions last year in Afghanistan. So why were they going to build a brand new search-and-rescue helicopter that was really only for the Air Force?
Q. How important is a chief management officer to DoD efficiencies?
A. This is an area where I believe the Congress is ahead of us. First of all, in law the deputy is now the chief management officer, but the department's been given a deputy chief management officer, and that's where you need the junkyard dog - a person who is utterly ruthless in making sure that the fourth estate [DoD and its myriad agencies] and the services execute the decisions that have been made, whether it's the efficiencies or something else. This person needs to be very broadly empowered and everybody has to know that person can walk in the door of the deputy or the secretary anytime to get enforcement authority.
Because as I mentioned in the AEI speech, all these defense agencies have tended to operate almost autonomously. That's the area that I complain where we hadn't gotten as much as I thought we could in efficiencies, so having somebody who can bird-dog that full-time for the department I think is really important.
Q. DoD used to vest enormous authority in guys like Hyman Rickover to develop massive projects like nuclear submarines. Now, requirements creep, oversight and micromanagement drive costs and delays. Is it better to vest more authority in fewer hands?
A. There are two key things that I think Ash [Carter, DoD acquisition chief,] has focused on very effectively. One is, except for some extraordinary niche capabilities, we need to focus more on proven technologies when we're developing new equipment. And it may be new ways of putting those technologies together. But anytime you try and have something that is going to be whole new technologies and it's a system of systems or whatever, you're going to overrun and over-cost. So I think in most cases, relying on proven technology is critical.
The second is freezing the requirements. What kills this - and it's no more complicated than adding a room on to your house - if you change the specs after you sign the contract, it's going to cost you a fortune. Same thing with military equipment. And so there has to be greater discipline in terms of freezing the requirements and then building what you said you'd build. And I think that this is one of the things that we succeeded in doing with the tanker.
This is the plane you will build, and the contractor saying, yes, and for the price you're paying, we are not adding another thing to this airplane. And the key is for both sides to have discipline.
Q. Are you buying enough to support the industrial base so it can satisfy U.S. needs in 10 or 15 years?
A. The question was if you stopped producing C-17s, [would we] lose our industrial base for wide-body cargo aircraft? Give me a freaking break. How many people build wide bodies for commercial market today? The notion that they have to have a capability that is solely applicable to military purposes, I think, doesn't make any sense. Now, there are some specific areas like shipyards and so on that are a concern, I think, when it comes to industrial base just because there's so little commercial market. But I think we have to identify those that are truly at risk and then see what we can do about that.
Education: B.A., William and Mary; M.A., Indiana University; Ph.D, Georgetown University
å U.S. Air Force intelligence officer, 1967-1969
å CIA, 1967-1974, 1979-1989
å Deputy National Security Adviser, 1989-1991
å Director of Central Intelligence, 1991-1993
å President, Texas A&M University,2002-2006
å Defense secretary, 2006-2011
Source: Defense News research