Defense Logistics Agency tackles bloated spending.

• Author: Erwin, Sandra I.
• Position: Defense Insider

The U.S. military buys, stores and maintains supply stocks that it does not need. It operates too many warehouses that have questionable utility. And it often overpays for goods that can be purchased for less at regular retailers.

In Pentagon lingo, these are the "back end" costs of military operations that have risen unchecked for decades.

Military spending on maintenance of equipment, with associated supplies and transportation, is upwards of $150 billion--about $80 billion for weapons upkeep and $70 billion for supplies and spare parts.

The officer who oversees a major portion of the Pentagon's logistics business said there is no easy way to control these runaway costs.

Vice Adm. Mark Harnitchek, director of the Defense Logistics Agency, in Fort Belvoir, Va., has directed the agency to shave $10 billion in costs over the next five years. Most of DLA's expenses--about $46 billion last fiscal year--are straight purchases of items. Overhead costs are about $5 billion a year.

Bloated inventories, rather than staff, will be targeted for savings. None of...