Hagel’s battle plan for the budget: take the flak
Secretary of Defense Chuck Hagel looks over his notes as he takes his seat before a meeting of the NATO Ukraine Commission while attending the final day of the NATO Defense Ministerial meetings in Brussels, Belgium, Feb. 27, 2014.
The first shots in this year’s battle over the Defense Department budget have been exchanged, with Defense Secretary Chuck Hagel’s opening salvo fired Monday and quickly drawing heat from Congress, veterans groups and lobbyists.
The former senator from Nebraska has prepared for an extended political fight. He’s trying to set the terms of the debate by speaking out about the fiscal 2015 Pentagon reductions and sending top aides into verbal combat a week before President Barack Obama’s budget is released Tuesday.
Hagel appears to be taking a page from his predecessor Robert Gates’ book "Duty," in which Gates described trying to limit criticism in 2009 of a newly sworn-in President Obama by announcing his own controversial cut to an inflated Bush defense proposal before the Obama budget numbers were released.
On Tuesday, Hagel discussed the budget during three appearances, two before military audiences. In addition, acting Deputy Defense Secretary Christine Fox spoke to the McAleese Defense Programs Conference on Tuesday and to the American Enterprise Institute on Wednesday. Adm. James Winnefeld Jr., vice chairman of the Joint Chiefs of Staff, spoke Wednesday at Bloomberg Government’s defense summit.
While the main target is Congress, Hagel hopes to generate early support by explaining his proposals to the troops, service families and national security experts before they get distorted during the expected debate.
"It’s going to be a tough sell," he told a group of former Pentagon officials and journalists at a Tuesday-morning session at the Pentagon. He knows that budget hawks now battle defense hawks on Capitol Hill and that there’s no guarantee all Republicans will support Pentagon spending as they did when he was a senator.
For the new times, there’ll be three 2015 defense budgets.
Obama will send up one based on numbers in the 2013 agreement between Rep. Paul Ryan, R-Wis., and Sen. Patty Murray, D-Wash. That one allows $496 billion for core defense spending but is about $45 billion below what Obama projected last year would be needed.
To close the gap, Obama has another proposal: an Opportunity, Growth and Security Initiative with $26 billion for defense and $30 billion for other spending. Hewill propose a package of spending and tax reforms to pay for it.
The third defense budget, assembled by Hagel’s team, will show what fiscal 2015 and future years would look like under sequester levels, because, the secretary said, "sequestration-level cuts remain the law . . . for fiscal year 2016 and beyond" if Congress doesn’t act. Fox noted that it would require defense cuts from earlier projects of more than $50 billion annually through 2021.
Hagel uses the sequester projections as ammunition. For example, under current planning the Army would be cut to 490,000 personnel; Hagel’s plan would trim it over the next five years to 440,000 or 450,000. Sequester levels returning in 2016 would require a cut to 420,000, a level that Gen. Raymond Odierno, the Army chief of staff, has said won’t support current strategy.
Hagel’s early efforts are an effort to address objections voiced about his plan and provide a sense of what’s to come. The main subjects:
Creating a "hollow Army." Hagel, addressing Army troops at Fort Eustis in Newport News, Va., said he is trying to reduce the force structure as is done after every war, but "in a responsible, glide-path way."
"I suppose we could just have a lot of people and just keep training them and training them and training them, thinking that, well, maybe another Iraq or Afghanistan will come," he said.
Instead, he said, the reality is that "we can’t continue to keep everybody trained and compensated. . . . We cannot allow a so-called ’hollow force’ or too many members just to have too many members. . . . That’s not fair to the members who stay in."
- The administration is balancing the budget on the backs of those who serve. Winnefeld said personnel compensation savings - limiting pay increases, raising Tricare health fees, seeking a 5 percent increase in the rent allowance - "only amount to 10 percent of the savings we’re suggesting out of what constitutes fully one-third of our budget." The other 90 percent of savings comes from "the other two-thirds, which pays for modernization and readiness as well as end-strength cost," Winnefeld said. Fox said the expectation was that "these initiatives [would] save $11 billion over the next five years."
- Over several years, commissaries are to lose $1 billion of their $1.4 billion annual direct subsidy, but still have free rent and pay no taxes. Overseas commissaries and those in remote sites will continue to get subsidies.
- No change in retirement programs is expected until after the Military Compensation and Retirement Modernization Commission report, which is expected next February. The Pentagon supports grandfathering in those now in the programs. At Langley Air Force Base near Newport News on Tuesday, Hagel said Pentagon officials had not been consulted about the Ryan-Murray proposal, now repealed, that imposed a 1 percent cut in the retirement pay of those under 62. "We would have been opposed to it," he said.
It has been almost 13 months since Hagel’s disastrous confirmation hearing before the Senate Armed Services Committee and a year since he was sworn in.
On Tuesday, he recalled the teaching of Tom Osborne, the former University of Nebraska football coach who said the first quarter of a game was the time to build internally and the second was the time to play.
The Hagel set to appear before Armed Services on the defense budget Wednesday sees himself heading into the second quarter, prepared with far more expertise than the nominee who stumbled in answering questions a year ago.