DOD budget reform panel's elephant in the room: Bad strategy

A Pentagon reform panel almost entirely comprised of industry insiders has suggested that the department scrap its budgeting system.

In its place, the group unsurprisingly proposed that the Defense Department implement a new system that the panel considers better suited to “embrace changes” so that the Pentagon can “respond effectively to emerging threats” and leverage technological advancements.

Congress created the Commission on Planning, Programming, Budgeting, and Execution Reform to evaluate and improve the Pentagon’s notoriously cumbersome acquisition and budgeting processes. After two years of study, the panel concluded that China’s rise and rapid technological innovation worldwide require a complete transformation of the Pentagon’s approach to defense resourcing. But revamping the budgeting process alone won’t address the root causes of Pentagon dysfunction.

The Pentagon is more focused on spending money (quickly and more efficiently) than it is on rationalizing spending decisions with coherent strategic thinking. Competition among military services makes matters all the worse. In Pentagon jargon, the military struggles with “jointness” — the idea that the military operates better as a whole, rather than the sum of its parts. But jointness requires a lot of thoughtful planning, collaboration, and strategic trade offs on the part of Pentagon leadership. Not everything is a strategic need and priority, and it’s Pentagon leadership’s responsibility to make those determinations.

The reform panel acknowledged the Pentagon’s haphazard spending habits, but it didn’t critically evaluate U.S. strategic thinking in any of its forms: the National Security Strategy, the Defense Strategy, the Military Strategy, or the classified Defense Planning Guidance — the latter of which is supposed to clarify the Pentagon’s “goals, priorities, and objectives” within fiscal constraints and on an annual basis. A critical assessment of U.S. military posture and the thinking behind it was beyond the scope of the panel’s work. Congress tasked the group with assessing how strategy informs budgetary decisions at the Pentagon, with the ultimate goal of improving the department’s ability to operationalize U.S. strategies through more efficient acquisition and budgeting.

To that end, the reform panel conducted hundreds of interviews with Pentagon staff, congressional personnel, industry representatives, academics, and federal researchers. It found that the Pentagon’s rank and file staff lack clarity on the Pentagon’s strategic priorities and objectives. National strategies are too high-level to inform resource allocation on a programmatic level, and the defense secretary’s Defense Planning Guidance is similarly ambiguous. The reform panel wrote that it’s “often a lengthy prose, consensus-driven document that does not make hard choices and lacks explicit linkages to prioritized goals, timeframes, risk assessments, and resource allocations.” As a result, lower-level Pentagon staff are forced to make decisions far above their pay-grade.

Lack of clarity from Pentagon leadership burns out staff and leads to “lower quality” and “inconsistent” decisions, as well as an overreliance on civilian and contractor staff to conduct strategic analysis. The reform panel made a number of recommendations intended to improve the Defense Planning Guidance and increase the Pentagon’s capacity for strategic analysis of the department’s objectives and priority missions, force size and structure, resource availability and more.

The panel correctly identified many issues with Pentagon budgeting, like insufficient capacity for strategic analysis and difficulty incorporating joint needs into the budgeting process. In total, the panel made 28 recommendations to address these challenges by overhauling Pentagon acquisition and budgeting processes, with particular emphasis on fostering innovation and adaptability to “effectively respond to evolving threats” as well as “unanticipated events.” But ultimately, the panel’s recommendations are designed to better execute what are often flawed strategic decisions grounded in “yes, and” thinking.

The panel’s final report comes at a time when Congress and the administration are struggling to balance America’s ever growing security commitments (not all obligations) with its substantial, but ultimately finite resources. And while the panel’s report will likely have profound (and variable) impacts on defense policy for years to come, it shouldn’t just grease the wheels of a machine destined to fail.

America’s war machine cannot go on forever. If the United States is concerned about great power competition, the White House should reconsider enduring global dominance. It promotes an ever growing national security budget — which, no matter how you dress it up or smooth it over — is not the jobs-producer Congress and the administration make it out to be. About half of annual military spending goes to corporations that profit off the United States meddling where it shouldn’t, for as long as possible. If economic resiliency is the foundation of military strength, we probably shouldn’t put so many eggs in arms makers’ baskets.

Strategically, sinking more and more money into an unaccountable Pentagon with a lengthy track record of wasting taxpayer money on weapons that don’t work (or that the military doesn’t even need) only hurts military readiness — and thus, America’s ability to protect itself and support allies when it counts. The pursuit of enduring global dominance serves corporations more than anything else.

So while some of the reform panel’s recommendations may ameliorate enduring challenges in the Pentagon’s acquisition and budgeting processes, the panel’s impact is limited by U.S. strategic thinking. Recommendations aside, one can hope that the panel’s findings alone will prompt a serious reconsideration of America’s strategic decisions — from funding a state committing plausible genocide to allocating more resources on preparing for a war with China than on preventing one. You can revamp the acquisition and budgeting process time and again, but if the inputs are the same, the output will be too.