With less than a month left for Congress and the White House to strike a deal to avert $500 billion in automatic defense cuts, the Obama administration has finally allowed the Pentagon to start planning how to implement them. It’s a good move and marks a full reversal for the administration that had steadfastly argued it was a waste of time to plan for cuts that might never happen.
But with negotiations appearing to be stalled — and doubtless to pressure them — the White House has cleared government departments to start preparing for wholly manufactured and entirely avoidable crisis.
Still, the administration says the Pentagon has little flexibility to plan for much.
The 2010 Budget Control Act increased America’s borrowing limit in exchange for $2.2 billion in spending cuts, roughly half of which have been taken, carving $489 billion from defense spending over the coming decade.
And unless the president and lawmakers either cut spending or increase revenues by the end of Jan. 1, another half trillion dollars would automatically be cut from Pentagon spending.
But the budget act, officials say, leaves little to interpretation: Every program, project or activity would be cut by a uniform percentage to yield $500 billion over 10 years. Given the president has already exempted military personnel accounts, cuts of 9.4 percent would hit programs, operations, civilians and benefits.
There is universal agreement that it’s both the abruptness and thoughtlessness of the cuts that makes them problematic. DoD can cut more; it just needs more time and less mindless rules to do so.
For nearly a year, Defense Secretary Leon Panetta has joined forces with industry leaders to scare lawmakers into avoiding the cuts, but to no avail. The White House remains adamant that while it will cut government spending, the top 2 percent of Americans should pay higher taxes, while Republicans are equally steadfast in refusing to budge on tax increases.
Can sequestration still be avoided? Yes, lawmakers could strike a deal at the last minute to keep it from happening or stop it shortly after it takes effect.
Three larger questions, however, loom.
First, both the administration and lawmakers must strike a balance compromise that cuts spending and raises revenue but without jeopardizing a fragile economic recovery.
Second, smoothly raise the nation’s debt ceiling to reassure credit markets and avoid the risk that they will downgrade America’s debt rating. It was the eagerness of ultraconservative Republican members to default the nation the last time around that forced the adoption of the Budget Control Act in the first place. A credit rating downgrade, or worse, a default, would set in motion an economic catastrophe for the United States with negative long-term consequences.
Third, no matter what happens in the coming weeks, DoD should use this opportunity to prepare for what most think is inevitable: another $200 billion to $300 billion in cuts over the coming decade, likely to be part of any budget deal.
The Pentagon must think ahead not only to meet immediate savings targets, but to make sure reductions are done with strategic vision by prioritizing capabilities, embracing deeper reforms and more efficient organizational structures, and slashing still-too-abundant waste. Otherwise, it will cede control of its future to powers that will cut with far less care.