Much is riding on Pentagon's latest 'strategic review'

When Defense Secretary Donald Rumsfeld crossed the Potomac for his first full Cabinet meeting in late January, insiders say, he was carrying budget estimates for his new President, and a dire message.

Just to adequately sustain the U.S. military force that exists today, the message ran, the Pentagon would need an extra $245 billion above the Clinton administration's proposed six-year budget plan. Raising defense spending to a relatively modest 3 percent of gross domestic product--a figure favored by defense hawks on Capitol Hill--would require a $370 billion add-on to the Clinton plan.

During the meeting, Rumsfeld argued that even an essentially zero-growth budget would require an extra $113 billion to cover inflation, rising fuel costs, and increased maintenance for the Pentagon's aging arsenal. In response, Rumsfeld got the cold shoulder. "As Rumsfeld was going through these numbers, the others in the room apparently looked at him incredulously," said a knowledgeable source.

Like the other Cabinet members present, Rumsfeld was told by the Office of Management and Budget that the Pentagon would have to live under tight spending ceilings so that President Bush could afford his immediate priorities of a tax cut and an increase in education spending. Indeed, in the budget released on Feb. 28, Bush asked for $310 billion for the Pentagon in fiscal 2002, essentially hewing to the defense budget proposed by the Clinton administration.

The resulting storm of criticism from Republican lawmakers and unnamed senior military officers--and the backroom scrambling that accompanied the Bush team's efforts to get back on message as the self-portrayed saviors of a badly under-funded and demoralized U.S. military establishment-have combined to give even more weight to the Pentagon's new, insurgent, and very secretive strategic review.

Rather than wait for completion of the traditional and glacier-paced Quadrennial Defense Review, which is required by Congress every four years and would not be ready until the end of this year, Rumsfeld immediately launched this guerrilla strategic review, led by Andy Marshall, the 79-year-old director of the Office of Net Assessment, essentially a small in-house Pentagon think tank. Marshall is a legendary futurist whom defense experts regard as the foremost proponent of "transforming" the military by forgoing current-generation weapons in favor of investment in revolutionary, "leap-ahead" technologies. Military transformation was a theme Bush himself championed in his Feb. 27 address to Congress. "Our military was shaped to confront the challenge of the past, so I have asked the Secretary of Defense to review America's armed forces and prepare to transform them to meet emerging threats."

Now debate is raging on exactly what this new review can accomplish.

A number of insiders believe that Rumsfeld rushed the strategic review to gain more firepower for his argument that the Pentagon and the nation need a quick infusion of defense spending now. If he can get a coherent strategy under his belt fast, he'll have a blueprint for what to do with the money.

But a quick review won't be easy. As opposed to previous post-Cold War reviews, including the elder Bush's Base Force Review of 1991, President Clinton's Bottom-Up Review of 1993, and the Quadrennial Defense Review of 1997--each of which was conducted over many months and staffed by the armed services with a cast of thousands--Andy Marshall has just 45 days and a skeletal staff to sketch a future transformation of the military.

"You wouldn't believe the disarray of this effort," said one knowledgeable source. "I'm afraid that people are discovering that beyond some sharp rhetoric about Clinton's handling of defense, many of the Bush team are not that current in their thinking about defense issues. Their frame of reference is largely a decade old, so conceptually they are starting pretty much from scratch. Even on national missile defense, where there is unanimous agreement on the need to move forward, they don't have a concrete plan."

But beyond the disarray, there is great hope. Many defense experts believe that the insurgent nature of Marshall's effort, coupled with the rich pedigree of the Bush national security team, offers the best chance in 15 years of developing a blueprint to transform the military from its Cold War configuration into something genuinely new. In this view, the armed services have become too expert at "gaming" the Quadrennial Defense Review in a way that protects the status quo.

What's needed instead, say transformation advocates, is a strategy that addresses increasingly serious threats to the U.S. homeland from ballistic and cruise missiles, terrorists armed with weapons of mass destruction, and cyberhackers going after U.S. computer networks. Plus, the advocates say, the United States must do more to protect its own satellites from anti-satellite weapons, and its overseas bases from adversaries armed with missiles and biological and chemical weapons.

This comprehensive strategy would likely put a premium on cutting-edge technologies, such as national missile defense, micro-satellites and anti-satellite satellites, space-based radar, airborne and spaced-based lasers, unmanned aerial combat vehicles, and next-generation stealth aircraft, ships, and ground-combat systems.

"We really haven't had a good strategic review since the end of the Cold War, and the result is that our force today is smaller, but very similar to our Cold War force," said Andrew Krepinevich, director of the Center for Strategic and Budgetary Assessments, a Washington think tank. The best way to ensure the survival of the status quo in military strategy, he says, is to ask all the factions in the Pentagon for their input--exactly what the Quadrennial Defense Review does. He also believes that with Marshall leading the insurgent review and with Rumsfeld and Dick Cheney backing it, the stars are finally in alignment for real change.

"Rumsfeld was a Secretary of Defense when the [current members of the] Joint Chiefs of Staff were all majors and lieutenant commanders, so they're not going to intimidate him," Krepinevich said. "Just as only Nixon could go to China, perhaps only Republicans have enough latitude on defense issues to realize dramatic change. The key will be whether the new strategy reduces the risks we face from future threats, and whether or not there are sufficient resources identified to execute that strategy."

Even conservatives who favor long-term increases in defense spending seem now to accept the Marshall strategic review as a necessary first step. "Now, I think, everyone believes that first coming up with a strategic vision before proposing longer-term increases in defense spending is a smart idea," said Jack Spencer, an analyst with the Heritage Foundation, a conservative Washington think tank. "Bringing in Andy Marshall to conduct the review is also a signal that these guys are serious about transforming the military."

Yet, as with everything in the federal budget, the key to change is money. By promising "transformation," President Bush has raised expectations about his plans for the U.S. military to such a level that many experts believe he will have trouble backing them up with real cash.

Already many observers have noted a disparity between Bush's campaign rhetoric on defense and his fiscal plans. During the campaign, for instance, Bush proposed increasing defense spending by just $4.5 billion annually, or less than half the amount proposed by his Democratic rival, Al Gore. Yet at the same time, he has promised to come to the rescue of a defense establishment that needs an extra $50 billion annually, according to a recent study by the Congressional Budget Office-or an extra $90 billion annually, according to the Joint Chiefs of Staff. Nor has Bush explained where he will find the additional funds for his national missile defense, estimated to cost anywhere from $60 billion to $100 billion over the next decade.

"The real story that no one seems to be writing about is that under Bush's own plan, defense resources are going to remain very constrained," said Gordon Adams, director of security policy studies at George Washington University and a former budget official in the Clinton White House. "The economics are pretty straightforward. Bush wants a $1.6 trillion tax cut, an 11 percent increase in education funding, and he wants to protect Social Security and Medicare. You project all that out, and you're left with a surplus that will be largely eaten up by Bush's plan for a new prescription drug benefit for seniors. So the real trick for the strategic review will be in finding the money to transform the military."

The trick to bankrolling a military transformation is in finding a "bill payer." Something has to be cut now, to pay for the new weapons that come later. Eventually, Marshall and the analysts of the Net Assessment Office will confront the same difficult choices and trade-offs that have stymied major change in previous reviews.

The choices for the Bush administration essentially are three: It can significantly raise defense spending; it can alter the Pentagon's current strategy of being able to fight two major regional wars almost simultaneously, while reducing peacekeeping and other deployments, which would allow cuts in the total number of troops; or it can call for sharp reductions and outright cancellation of major new weapons programs. Realistically, Bush and his team will probably need to fashion an unpopular combination of all three approaches if they are to achieve significant change.

The Bush administration tipped its hand about where it might begin to find its bill payer when it promised to review U.S. military deployments around the world and to work to pull U.S. troops out of the Balkans. Since taking office, however, Bush officials appear to have backed off from their plans for any imminent Balkan pullout, after vociferous objections from European allies. Nor would a pullout of the fewer than 10,000 U.S. troops in the Balkans begin to pay for transforming the military. Recent events don't seem to give much leeway on the two-regional-wars scenario, either-Saddam Hussein is still feeling his oats, and North Korea is still unstable.

"Analysts have been trying to move away from the two-major-theater-war commitment for 10 years, and the reason they haven't been able to is not because our military leaders are such dunderheads, but rather because there is a good military rationale for the strategy," said Thomas Donnelly, who was a longtime aide on the House Armed Services Committee and is currently deputy director of the Project for the New American Century, a conservative think tank. "What missions do you want to give up? Do you want to stop flying the no-fly zones over Iraq? Do you want to give up your ability to fight a major war on the Korean Peninsula? Do you want to pull out of the Balkans? I'm sure despots in those regions would love to hear that message. I can tell you, from working on Capitol Hill for a long time, that trying to interest lawmakers in standing down the U.S. military presence in risky regions around the world to effect a military transformation 10 or 20 years down the road is a hard sell."

Significantly raising defense spending could bring about the transformation.The conservative Heritage Foundation recommends that the Bush administration increase defense spending to 4 percent of GDP, as opposed to the roughly 2.9 percent being spent in 2001. When Clinton took office, analysts note, the United States was spending 4.4 percent of GDP on defense.

But without a Soviet Union-style threat, even Heritage Foundation analysts concede that politically such an increase in defense spending is a nonstarter. "Congress will support ... increases in defense spending, but no one will support the increase of $500 billion to $600 billion [over the next six years] that would be required to both modernize and transform the present force," said Heritage analyst Spencer. "That means the Bush administration still faces other tough choices, such as canceling some weapons programs."

If the Bush administration is serious about transforming the current military by focusing on revolutionary technologies, there is some logic in canceling weapons designed in the Cold War era and just now coming on line. That effort will be greatly complicated, however, by the "procurement holiday" that the Clinton administration took for much of the early 1990s, with the result that many aircraft, tanks, and ships now in the arsenal are aging. In the absence of replacements, the existing weapons get more expensive to maintain as they age.

Another problem with canceling weapons is that once they reach the latter stages of development, politically they are notoriously hard to kill, because they translate into home-state jobs. In fact, one of the last major weapons systems canceled was the troubled V-22 Osprey tilt-rotor aircraft, killed by then-Secretary of Defense Dick Cheney in the early 1990s. Resurrected by Congress, the still-troubled V-22 program has suffered setbacks after two of the aircraft recently crashed, killing 23 Marines.

"What is missing from the Bush Administration's talk about transforming the military is recognition of the fact that they don't have Reagan's mandate for change," said Loren Thompson, chief operating officer of the Lexington Institute, a pro-defense think tank. "With hardly any margins in Congress, all it will take is one angry call from [Senate Majority Leader] Trent Lott or [Foreign Relations Chairman] Jesse Helms about the cancellation of a favored weapons program, for Bush to realize that military transformation is not that high a personal priority. The point is that with no Cold War threat and a President with no mandate, domestic politics are likely to determine most outcomes. Domestic politics will favor the status quo, or at best, incremental change."

As an example of the tough choices confronting Andy Marshall and the Rumsfeld Pentagon, a recent study by the Center for Strategic and Budgetary Assessments is instructive. In order to bankroll various new technologies and new capabilities such as missile defense, the center's director, Krepinevich--an Andy Marshall protege who once worked in the Office of Net Assessment--had to cut Army divisions from 10 to eight; Navy aircraft carrier battle groups from 12 to 10; and Air Force fighter wings from 20 to 17. Additionally, the study called for regional allies to take over U.S. Navy responsibilities in the Mediterranean and the U.S. Army presence in Korea, and it advised canceling or curtailing current purchases of major weapons programs including the Air Force's F-22 fighter, the Joint Strike Fighter, and the Army's Crusader artillery system. Any one of those cuts would arouse fierce opposition in Congress, and taken together, they could invite a wholesale Republican mutiny.

Congressional proponents of military transformation, however, say they will judge the Pentagon's strategic review at least in part on its willingness to tackle the difficult trade-offs.

"I'm confident that President Bush and his team are serious about military transformation, and we have an opportunity, with people like Rumsfeld and Cheney, to start making serious changes now, before this nation is confronted by some catastrophic event," said Rep. Mac Thornberry, R-Texas, vice chairman of the House Armed Services Committee panel on military procurement. "Having said that, the obstacles--in terms of bureaucratic self-interest, armed service tradition, and congressional resistance--are enormous. My rule of thumb for gauging success will look first at whether the new strategy meets future threats, such as missile proliferation and terrorists armed with weapons of mass destruction. Secondly, I'll listen to hear if anyone is squealing. If no one is complaining, you can bet that we're not making real changes."

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