Economy & Finance

The North Korean threat in an age of Pentagon cuts: Nicholas Wapshott

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(Reuters) – It may not feel like it, but we are closer to nuclear war than at any time since the Cuban missile crisis of 1962. The temptation to dismiss the North Korean dictator Kim Jong-un as a cartoonish figure of fun belies the real and present danger his samurai sword rattling presents. A strange time, then, for Defense Secretary Chuck Hagel to set out on the most thorough reappraisal of our defense spending since the end of Vietnam.

It is no secret that Hagel relishes the chance to slim the armed forces to a more affordable size. It is what commended him to President Barack Obama. He has already commissioned a wholesale “strategic choice and management review” of the Defense Department, which has been told to think the unthinkable in terms of cutting spending. This week, before defending his vision before the House Armed Services Committee, he offered a glimpse into what he has in mind: a slimming of the desk-bound middle management whose pay and perks cost more than the value of their contribution to the nation’s defense- a clearheaded look at the generous health and retirement benefits the nation’s military and veterans enjoy- the abandonment of expensive advanced weapons that may not be necessary- and an unsentimental assessment of the need for all of our domestic military bases.

Hagel invited “change that involves not just tweaking or chipping away at existing structures and practices but, where necessary, fashioning new ones” because “left unchecked, spiraling costs to sustain existing structures and institutions, provide benefits to personnel and develop replacements for aging weapons platforms will eventually crowd out spending on procurement, operations and readiness.” The American military is too large, Hagel argued. “How many people do we have,” he asked, “both military and civilian? How many do we need? What do these people do? And how do we compensate them for their work, service and loyalty with pay, benefits and healthcare?”

Until recently, such a radical approach to military spending would have been greeted with a chorus of disapproval, not just from those whose constituencies include the military bases that provide a vote bank for those who argue for the maintenance of high defense spending, but also from the united Republican leadership. Until George W. Bush left the White House, protecting the strength of the military was a top priority for the GOP. Maintaining high spending on the military, come what may, was a key policy difference with the Democrats to be played up at every turn. Since Eisenhower, all Republican presidents have spent like drunken sailors on the military to counter fiscal conservatives in their ranks who demanded that the federal government be put on a diet. Lavish spending on our forces was used as a counterweight to fiscal conservatism: backdoor Keynesianism to pump money into a flagging economy.

Now all that has changed. Fiscal hawks from the Tea Party rule the roost, and it is hard to find a military hawk prepared to come out in the open and argue his case. The fiscal hawks are behind allowing the sequester to take effect. For defense, this means $47 billion in largely arbitrary cuts by September to forces’ pay, to reducing flying hours for air patrols, to canceling the deployment of the aircraft carrier USS Harry S. Truman to the Persian Gulf, to cutting army and marine training, and other hastily arranged improvised savings that will hamper our ability to respond to events like the craziness emanating from Pyongyang. The fiscal hawks find these hasty, careless, risky, reckless cuts to the military acceptable simply because the sequester shrinks the deficit and shrivels the size of government. In a battle between fiscal rectitude and patriotic military preparedness in today’s GOP, balancing the books wins every time.

In the meantime, the same congressmen resist adopting Hagel’s carefully planned defense budget. Hagel, a former Republican senator from Nebraska and, more importantly perhaps in this context, a distinguished Vietnam veteran who served on the front line as a lowly sergeant, plans to cut tens of thousands of jobs in the military’s middle management. “Today, the operational forces of the military — measured in battalions, ships and aircraft wings — have shrunk dramatically since the Cold War era. Yet the three- and-four-star command and support structures sitting atop these smaller fighting forces have stayed intact, with minor exceptions, and in some cases they are actually increasing in size and rank,” he said. Cutting the numbers of military fat cats “leads to more agile and effective organizations and more empowered junior leaders.” It is time, Hagel said, to “to pare back the world’s largest back office.”

Hagel also proposes closing redundant military bases at home. And he wants to cut the benefits provided to current and former members of the armed forces. In an argument that should appeal to fiscal conservatives ‑ for it is the same argument they make for cutting benefits to civilians ‑ Hagel warns that “we’re not going to be able to sustain the current personnel costs and retirement benefits. There will be no money in the budget for anything else.” If the cuts are not made, the Pentagon would become ossified, “an agency administering benefit programs, capable of buying only limited quantities of irrelevant and overpriced equipment.”

The absolutism of fiscal conservatives should work in Hagel’s favor. In a rare confluence of forces, both sides of the political divide are prepared to consider bringing defense spending into line with the change in the nature of our potential opponents. The age of the big battalions and massed tanks has long gone. We now face dangers that are best met by stealth fighters and bombers, cyber-warriors, special forces making incisive interventions, cruise missiles and drones operated from thousands of miles away.

If Hagel gets his way, we should end up with a leaner and meaner military that is within our budget. But it means some frank talking to those who prop up outdated military structures and who maintain a deleterious system that keeps large communities of families dependent on the Pentagon for their livelihoods, their housing, their education and training.

Weaning so many thousands off the Pentagon’s largesse will take courageous congressmen making hard-nosed decisions. But the temptation to dodge the bullet and continue with a bloated military may be too hard to resist, even for those who claim to put fiscal rectitude before all else.

(Nicholas Wapshott is the former New York bureau chief of The Times of London. Previously, he was editor of the Saturday Times of London, and founding editor of The Times Magazine. He is a regular broadcaster on MSNBC, PBS, and FOX News. He is the author of “Ronald Reagan and Margaret Thatcher: A Political Marriage” (2007). His “Keynes Hayek: The Clash That Defined Modern Economics” was published by W.W.Norton in October.)

(Editing by James Ledbetter)

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