Defense spending: today's 'broken' budgeting process must change.

• Author: Sledge, Nathaniel H., Jr.
• Position: VIEWPOINT

In the words of Defense Secretary Robert Gates, the Pentagon's "bureaucracies have swelled to cumbersome and top-heavy proportions and grown accustomed to operating with little consideration to cost."

Indeed, the defense budget has doubled over the past decade, as has the number of service contract personnel. Even the number of flag officers has grown by 11 percent since 9/11. Bloat, it appears, is ubiquitous.

Gates has repeatedly called for reform. He has emphasized, though, that he is not trying to cut the defense budget, but rather to reallocate its resources so the department can preserve its current force structure and fund modernization programs. He insists that his efficiency initiative does not amount to a budget cutting exercise, but it sure resembles one.

With a defense budget exceeding $700 billion, the problem for Gates is not that there isn't enough money but that the process for allocating resources is broken. Just like his predecessor Donald Rumsfeld, Gates does not have confidence in the institution's budgeting system, which is known as PPBE, for planning, programming, budgeting and execution. The 40-year-old PPBE was designed to match a well-considered defense strategy to available resources.

The problem of how to adequately allocate resources has worsened since 9/11. Possible reasons: The PPBE system doesn't have the stabilizing and organizing features it should, key players are subverting them, or stakeholders are ignoring them. All three are probably true.

A dysfunctional power structure can be blamed on partisan leadership, conflicts of interest, parochial politics, institutional inertia and complacency. These are cultural issues that must be tackled by future leaders.

The fundamental issue is that the United States needs a long-term defense strategy, while retaining flexibility to adjust to unforeseen threats and conditions. Further, this has to be done in the context of the nation's economic challenges. Invest too much national treasure into defense and Americans suffer an enormous opportunity cost, because many other national priorities such as education, debt reduction, transportation, infrastructure, cleaner energy, environmental clean-up, social services and healthcare will go begging. Allocate too little resources to defense and the nation's security will be at risk, because it will not have the superior forces and equipment needed to combat future enemies. Deftly straddling these extremes and managing complexity to achieve a balanced defense enterprise is paramount.

The budget process is ultimately a balancing act, where selected segments of the government and industry determine the allocation of resources to a vast array of requirements. The process, however, has not worked.

One problem that gets in the way of balancing resources is that the defense agency heads and service chiefs expect to be allocated their traditional shares of the defense budget pie. The allocation has not changed materially since the start of the Cold War. But the reality is that shares of the pie are only loosely traceable to military strategy.

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