Can Obama Take on the Pentagon?

Even saddled with a two-front, budget-busting war and a collapsing economy, President Barack Obama may be able to accomplish a lot.

With a friendly Congress and a relieved world, he could make short work of some of the most egregious overreaches of the Bush White House -- from Guantanamo to those Presidential signing statements. For all the rolling up of sleeves and "everything is going to change" exuberance, however, taking on the Pentagon, with its mega-budget and its mega-power, may be the hardest task he faces.

The Mega-Pentagon

Under President George W. Bush, military spending increased by about 60%, and that's not including spending on the wars in Iraq and Afghanistan. Eight years ago, as Bush prepared to enter the Oval Office, military spending totaled just over $300 billion. When Obama sets foot in that same office, military spending will total roughly $541 billion, including the Pentagon's basic budget and nuclear warhead work in the Department of Energy.

And remember, that's before the Global War on Terror enters the picture. The Pentagon now estimates that military operations in Iraq and Afghanistan will cost at least $170 billion in 2009, pushing total military spending for Obama's first year to about $711 billion (a number that is mind-bogglingly large and at the same time a relatively conservative estimate that does not, for example, include intelligence funding, veterans' care, or other security costs).

With such numbers, it's no surprise that the United States is, by a multiple of nearly six, the biggest military spender in the world. (China's military budget, the closest competitor, comes in at a "mere" $120 billion.) Still, it can be startling to confront the simple fact that the U.S. alone accounts for nearly half of all global military spending -- to be as exact as possible in such a murky area, 48% according to the International Institute for Strategic Studies. That's more than what the next 45 nations together spend on their militaries on an annual basis.

Again, keep in mind that war spending for 2009 comes on top of the estimated $864 billion that lawmakers have, since 2001, appropriated for the Iraq war and occupation, ongoing military operations in Afghanistan, and other activities associated with the Global War on Terror. In fact, according to an October 2008 report by the Congressional Research Service, total war spending, quite apart from the regular military budget, is already at $922 billion and quickly closing in on the trillion dollar mark.

Common Sense Cuts?

Years late, and with budgets everywhere bleeding red, some in Congress and elsewhere are finally raising questions about whether this level of spending makes any sense. Unfortunately, the questions are not coming from the inner circle of the president-elect.

Representative Barney Frank (D-MA) drew the ire and consternation of hard-line Republicans and military hawks when, in October, he suggested that Congress should consider cutting defense spending by a quarter. That would mean shaving $177 billion, leaving $534 billion for the US defense and war budget and maintaining a significant distance -- $413 billion to be exact -- between United States and our next "peer competitor." Frank told a Massachusetts newspaper editorial board that, in the context of a struggling economy, the Pentagon will have to start choosing among its many weapons programs. "We don't need all these fancy new weapons," he told the staff of the New Bedford Standard Times. Obama did not back him up on that.

Even chairman of the House Appropriations Subcommittee on Defense John Murtha (D-PA), a Congressman who never saw a weapons program he didn't want to buy, warned of tough choices on the horizon. While he did not put a number on it, in a recent interview he did say: "The next president is going to be forced to decrease defense spending in order to respond to neglected domestic priorities. Because of this, the Defense Department is going to have to make tough budget decisions involving trade-offs between personnel, procurement and future weapons spending."

And now, President-elect Obama is hearing a similar message from the Defense Business Board, established in 2001 by Secretary of Defense Donald Rumsfeld to give advice to the Pentagon. A few weeks ago, in briefing papers prepared for President-elect Obama's transition team, the Board, hardly an outfit unfriendly to the Pentagon, argued that some of the Defense Department's big weapons projects needed to be scrapped as the U.S. entered a "period of fiscal constraint in a tough economy." While not listing the programs they considered knife-worthy, the Board did assert that "business as usual is no longer an option."

Desperate Defense

Meanwhile, defense executives and industry analysts are predicting the worst. Boeing CEO Jim McNerney wrote in a "note" to employees, "No one really yet knows when or to what extent defense spending could be affected, but it's unrealistic to think there won't be some measure of impact." Michael Farage, Sikorsky's director of Air Force programs, was even more colorful: "With the economy in the proverbial pooper, defense budgets can only go down."

Kevin G. Kroger, president of a company making oil filters for Army trucks, offered a typical reaction: "There's a lot of uncertainty out there. We're not sure where the budgets are going and what's going to get funded. It leaves us nervous."

It's no surprise that, despite eight years of glut financing via the Global War on Terror, weapons manufacturers, like the automotive Big Three, are now looking for their own bailout. For them, however, it should probably be thought of as a bail-up, an assurance of yet more good times. Even though in recent years their companies have enjoyed strong stock prices, have seen major increases in Pentagon contracts, and are still looking at boom-time foreign weapons sales, expect them to push hard for a bottom-line guarantee via their Holy Grail -- a military budget pegged to the gross domestic product.

"We advocate 4 percent of the GDP as a floor for defense spending. No question that has to be front and center for any new president's agenda," says Marion Blakey, president of the Aerospace Industries Association, a trade group representing companies like Lockheed Martin and Northrop Grumman.

Listening to defense industry figures talk, you could get the impression that the Pentagon's larder was empty and that the pinching of pennies and tightening of belts was well underway. While the cuts suggested by the Defense Business Board report got a lot of attention, the Pentagon is already quietly laying the groundwork to lock the future Obama administration into a possibly slightly scaled-down version of the over-the-top military spending of the Bush years.

Business As Usual?

At the beginning of October, the Pentagon's latest five-year projection of budget needs was revealed in the Congressional Quarterly. These preliminary figures -- the full request should be released sometime next month -- indicate that the Pentagon's starting point in its bargaining with the new administration and Congress comes down to one word: more.

The estimates project $450 billion more in spending over those five years than previously suggested figures. Take fiscal year 2010: the Pentagon is evidently calling for a military budget of $584 billion, an increase of $57 billion over what they informed President Bush and Congress they would need just a few months ago.

Unfortunately, when it comes to military spending and defense, the record is reasonably clear -- Obama is not about to go toe-to-toe with the military-industrial-complex.

On the campaign trail, his stump speech included this applause-ready line suggesting that the costs of the war in Iraq are taking away from important domestic priorities: "If we're spending $10 billion a month [in Iraq] over the next four or five years, that's $10 billion a month we're not using to rebuild the U.S., or drawing down our national debt, or making sure that families have health care."

But the "surge" that Obama wants to shift from Iraq to Afghanistan is unlikely to be a bargain. In addition, he has repeatedly argued for a spike in defense spending to "reset" a military force worn out by war. He has also called for the expansion of the size of the Army and the Marines. On that point, he is in complete agreement with Defense Secretary Robert Gates. They even use the same numbers, suggesting that the Army should be augmented by 65,000 new recruits and the Marines by 27,000. The Congressional Budget Office estimates that these manpower increases alone would add about $10 billion a year -- that same campaign trail $10 billion -- to the Pentagon budget over a five-year period.

The word from Wall Street? In a report entitled "Early Thoughts on Obama and Defense," a Morgan Stanley researcher wrote on November 5th, "As we understand it, Obama has been advised and agrees that there is no peace dividend... In addition, we believe, based on discussions with industry sources that Obama has agreed not to cut the defense budget at least until the first 18 months of his term as the national security situation becomes better understood."

In other words: Don't worry about it. President Obama is not about to hand the next secretary of defense a box of brownie mix and order him to hold a bake sale to buy a bomber.

Smarter, not more, military spending

Sooner rather than later, the new administration will need to think seriously about how to spend smarter -- and significantly less -- on the military. Our nose-diving economy simply will no longer support ever-climbing defense budgets.

The good news is that the Obama administration won't have to figure it all out alone. The contributors to Foreign Policy In Focus's new Unified Security Budget have done a lot of the heavy lifting to demonstrate that some of the choices that need to be made really aren't so tough. The report makes the case for reductions in military spending on outdated or unproven weapons systems totaling $61 billion. The argument is simple and straightforward: these expensive systems don't keep us safe. Some were designed for a geopolitical moment that is long gone -- like the F-22 meant to counter a Soviet plane that was never built. Others, like the ballistic missile defense program, are clearly meant only to perpetuate insecurity and provoke proliferation.

To cut the military budget more deeply, however, means more than canceling useless, high-tech weapons systems. It means taking on something fundamental and far-reaching: America's place in the world. It means coming to grips with how we garrison the planet, with how we use our military to project influence and power anywhere in the world, with our attitudes towards international treaties and agreements, with our vast passels of real estate in foreign lands, and, of course, with our economic and political relationships with clients and competitors.

As a candidate, Barack Obama stirred our imagination through his calls for a "new era of international cooperation." The United States cannot, however, cooperate with other nations from atop our shining Green Zone on the hill; we cannot cooperate as the world's sole superpower, policeman, cowboy, hyperpower, or whatever the imperial nom du jour turns out to be. Bottom line: we cannot genuinely and effectively cooperate while spending more on what we like to call "security" than the next 45 nations combined.

A new era in Pentagon spending would have to begin with a recognition that enduring security is not attained by threat or fiat, nor is it bought with staggering billions of dollars. It is built with other nations. Weapons come second.