As the attention of Congress and senior leaders in the Department of Defense are rightly focused on mitigating the coronavirus pandemic, it is not too soon to begin planning for how the nation and the DoD can recover from this crisis.
The much-needed $2.2 trillion relief package recently passed by Congress — and whatever additional spending is appropriated in the coming weeks and months — comes on top of a preexisting budget deficit of more than $1 trillion for the current fiscal year. When this crisis eventually subsides, the deficit will be at an all-time high and the pressure to cut spending — including defense spending — may also be high. Now is the time to start thinking about the steps the Defense Department can take to better position itself for the post-coronavirus fiscal environment.
Historically, higher deficits put long-term pressure on the defense budget. We saw this in the mid-1980s when the federal deficit peaked at nearly $0.5 trillion (in today’s dollars). Congress reacted at the time by passing the Balanced Budget and Emergency Deficit Control Act. This law put in place a set of deficit caps and created an enforcement mechanism known as sequestration. From fiscal 1985 to fiscal 1991, the national defense budget fell by 19 percent in real terms as part of these deficit reduction efforts. And when the Cold War ended, it fell another 18 percent through FY98.
During the depths of the Great Recession in 2009, deficits spiked to $1.7 trillion (in today’s dollars). This led Congress to enact the Budget Control Act of 2011, which resurrected sequestration and put caps on the defense and nondefense parts of the discretionary budget. Despite a series of budget deals that amended the budget caps, the combination of the BCA and the drawdown of forces in Iraq and Afghanistan resulted in a 22 percent real decline in the national defense budget from FY10 to FY15.
The Defense Department was caught flatfooted in 2013 because of its stubborn refusal to plan for sequestration. It muddled through the across-the-board cuts imposed by sequestration that year by furloughing civilian employees, canceling training and exercises, and deferring maintenance on equipment and facilities. To make matters worse, many of these actions did not save money in the long run; they merely deferred expenses and made long-term costs higher than they would have been otherwise.
This history suggests that a deficit-driven and strategically uninformed downturn in defense spending could be coming in the next two to three years. While the DoD should position itself for the possibility of reduced resources, this does not mean the DoD or Congress should accept cuts as inevitable and abandon the National Defense Strategy. It merely means getting the DoD’s budgetary house in order so that if cuts materialize, it is ready to handle them in a strategically informed manner.
Past downturns in the defense budget have shown that it is difficult to make significant changes in a short period of time, and efficiency savings, while important to pursue, cannot be relied upon to generate significant savings in a downturn. When I was at the Center for Strategic and Budgetary Assessments, we ran dozens of strategic-choices exercises with a wide variety of groups to think about how budget cuts could be implemented in a strategically informed manner.
The budget and security environment have evolved since then, but many of the lessons are still applicable today. One of the key takeaways we found from these exercises is that in order to seriously identify areas to take risk and make smart, strategically informed cuts, start by identifying the “crown jewels” — the top priorities that need to be protected to execute the strategy. Developing a consensus around the top strategic priorities brings into focus all the other things that are (by definition) lower priorities.
In the 2018 National Defense Strategy, the top priority is great power competition with Russia and China. What are the key enablers and game changers needed to prevail in this competition over the next 10 years? One of the answers is being able to share data fluidly across platforms on the ground, at sea, in the air and in orbit to provide a more complete shared picture of the battlespace — what has become known as Joint All Domain Command and Control, or JADC2.
When combined with artificial intelligence that can sort through mass amounts of data and identify patterns at levels that are orders of magnitude beyond human capabilities, JADC2 enables decision-making at a speed that cuts through the fog of war. These capabilities mean that the sensor-to-shooter kill chain of the future will be not be a serial chain of connections that is only as robust as its weakest link — it will be nonlinear, meshed and far more difficult for an adversary to disrupt.
The nodes and connectors of the network are critical to making this a reality. This is where platforms and technologies that are key to forming the battle network of the future need to be identified, such as:
- Stealthy aircraft that can penetrate contested airspace.
- Communication links (such as laser communications) that are more resistant to jamming and spoofing.
- Resilient constellations of satellites that can pass over contested areas for sensing and data transport.
- Long-range strike systems from the air, sea and ground that can hit targets quickly and accurately at range.
- Special operations and light-footprint ground forces that can operate within contested areas.
All domains of warfare are increasingly contested, so the key to making the network survivable is diversity and dispersion. Every node and connection will be vulnerable, so there can be no single points of failure in the network.
If these capabilities are the “crown jewels” of the future force, then what other activities can be slowed, reduced or eliminated to keep these modernization programs on track? The Marine Corps has taken the initiative in answering this question. As part of its efforts to realign its force structure in preparation for “naval expeditionary warfare in actively contested spaces,” it plans to divest all law enforcement battalions, tank battalions and bridging companies. It is also reducing the number of infantry battalions, artillery cannon batteries, amphibious vehicle companies and helicopter squadrons.
A budgetary rule of thumb is that if you are going to reduce force structure (and associated end strength), the sooner you make the cuts, the more you will save and the less you will have to cut. If you wait to make cuts until the budgetary rug has been pulled out from under you, the cuts will be deeper and more painful.
Cutting force structure will be a difficult sell, but the National Defense Strategy was already pointed in this direction. It proposes a new force-sizing construct that abandons the decades-old two-war construct and instead aims to defeat one great power while deterring (rather than defeating) opportunistic aggression elsewhere.
Critics have pointed out the risks of this approach and, as Evan Montgomery and Hal Brands have noted, the fundamental choice it raises: The United States “can pare back its commitments to bring them into alignment with existing resources, or it can increase its resources to better meet existing commitments.” Depending on the depth and length of this recession, the latter option may no longer be a viable choice.
The Defense Department should start preparing now for an uncertain budget environment. It should clearly identify the “crown jewel” capabilities it cannot sacrifice, start cutting end strength and lower priority force structure, and prepare for a robust debate over global security commitments and budget constraints. This approach would be prudent even if the post-coronavirus fiscal environment is better than expected.
Todd Harrison is the director of Defense Budget Analysis and of the Aerospace Security Project at the Center for Strategic and International Studies, where he is also a senior fellow with the International Security Program.