A Poisoned Chalice? The Flaws in the FY2008 Defense Program

A Poisoned Chalice? The Flaws in the FY2008 Defense Program
Anthony H. Cordesman

Defense budgeting often receives far less attention than defense policy and strategy, particularly the longer-term implications of defense spending. The attached briefing, however, shows that the Department of Defense future year defense program that is part of the FY2008 is based on fundamentally unworkable assumptions and is little more than a poisoned chalice.

It has long been clear that the Office of the Secretary of Defense was submitting Quadriennial Defense Reviews that were essentially meaningless because they were not accompanied by force plans, programs, and budgets that allowed them to be transformed into practice.

The attached briefing shows that the programming and budgeting problems in defense are far greater than a failure to go from concepts to workable plans for implementation. The FY2008 budget request for the FY2008-FY2012 period, like all its recent predecessors, budgets for victory in Iraq and Afghanistan in the coming year.

It makes grossly unrealistic allocations for future operations and maintenance expenditures. It does not fund the proposed increase in permanent military end strength, and provide clear provisions for the “reset” necessary to replace the equipment and munitions worn or lost in  combat.

It also shows that it makes unrealistic assumptions about the real-world budget requirements necessary to pay for the lead procurement programs of every service. The failures in cost containment over the past six years, coupled to continuing failures to make hard choices about the need to develop workable procurement programs, had led to underfunding that will confront the next Administration with a major crisis in  virtually every area of force transformation.

The only practical answer may be still further major increases in  real defense spending – perhaps on the order of 1-2% of the GNP, or massive delays  and cutbacks in key procurement programs. The analysis shows that such increases are affordable by the standards of the historical level of defense spending as a percent of the GNP and federal budget.

At the same time, it warns that the poisoned chalice goes beyond defense spending. The failure to control mandatory spending and entitlements programs will become a critical new burden on the US economy and federal spending at the same time the Department of Defense will, in the real world, face its most serious problems in dealing with the consequences of uncontrolled cost escalation in its major procurement programs.

For a more detailed analysis of the history of these problems, their scale, and potential solutions; see   Salvaging American Defense: The Challenge of Strategic Overstretch By Anthony H. Cordesman, with Paul S. Frederiksen and William D. Sullivan, Praeger, April 2007

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