Use It or Lose It: The Political Economy of Counterinsurgency Strategy

• Author: John Kendall,Carrie A. Lee
• Date: 01 July 2019
• Published date: 01 July 2019
• DOI: 10.1177/0095327X18790570
• Subject Matter: Articles

Article

Use It or Lose It: The

Political Economy of

Counterinsurgency

Strategy

Carrie A. Lee

1

and John Kendall

2

Abstract

Regular budget cycles and annual evaluations of bureaucratic funding have created a

“use-it-or-lose-it” atmosphere in agencies throughout the American government,

resulting in large expenditures in the fourth quarter of the fiscal year. We show that

these spending patterns apply in a least likely case: junior officers in a war zone, and

that indiscriminate fourth-quarter expenditures are correlated with increases in

insurgent violence. Using reconstruction data from the war in Iraq, this article shows

that the tendency to overspend at the end of the fiscal year is both pervasive and

detrimental to security objectives. By combining extensive interview work with

econometric analysis, this article offers new insights into the politics of war, civil–

military relations, and postconflict reconstruction and suggests that these patholo-

gies may have a substantive, negative impact on a government’s ability to effectively

wage counterinsurgency operations.

Keywords

civil–military relations, defense policy, military effectiveness, military organization

1

U.S. Air War College, Montgomery, AL, USA

2

Lieutenant Colonel, U.S. Army, Washington, DC, USA

Corresponding Author:

Carrie A. Lee, U.S. Air War College, Montgomery, AL 36112, USA.

Email: carrie.lee.2@us.af.mil

Armed Forces & Society

2019, Vol. 45(3) 399-429

ªThe Author(s) 2018

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DOI: 10.1177/0095327X18790570

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What determines how the military spends resources on the battlefield? Do bureau-

cratic pressures and incentives take precedence over the efficient distribution of

monies over the course of the fiscal year? If so, what kind of impact does this have

on the effectiveness of programs funded by Congress, and do these domestic pres-

sures have substantive effects on national security objectives and wartime opera-

tions? Work on bureaucratic politics and organizations predict that fiscal spending

cycles will result in the relatively indiscriminate distribution of funds in the fourth

quarter as organizations seek to “use it or lose it” with the new fiscal cycle. But do

these spending cycles also apply in austere, chaotic conditions such as war zones?

And if so, what impact does that have on the way a state fights a war?

We argue that soldiers at war are res ponsive to use-it-or-lose-i t bureaucratic

incentives that correspond to the end of the fiscal year. Using a principal–agent

framework, we outline how officers are incentivized to spend money indiscrimi-

nately at the end of the fiscal year, wastin g government resources but ensuring

positive evaluations from and for superiors. We further argue that this has a counter-

productive effect on war outcomes: the indiscriminate nature of fourth-quarter

spending ends up funding adversaries and empowering insurgent groups, resulting

in increases in violence against both coalition forces and civilians. Using new data

on a subset of reconstruction spending known as the Commander’s Emergency

Response Program (CERP), we first analyze how the end of the fiscal year influ-

ences reconstruction spending decisions, then evaluate how these inefficiencies lead

to negative security outcomes during war.

In addition to our quantitative analysis, we conducted a survey of U.S. Army

officers from February 1–15, 2013.

1

The authors submitted the electronic survey to

over 31,000 combat arms officers of all ranks who served either in Iraq or Afghani-

stan. The authors received 1,206 survey responses, of which 524 provided open-

ended responses that were coded into 30 catego ries that provide evidence as to

whether CERP was effective or ineffective.

2

These responses add qualitative insight

into the mechanisms of use-it -or-lose-it and its impac t on battlefield outcomes.

Detailed written survey responses reflected a gamut of opinions on CERP’s strategic

impact in Afghanistan and Iraq, from effusive praise that the program was instru-

mental in reducing violence and improving local communities to claims that the

program contributed to fraud, waste, and abuse and put soldiers unnecessarily at risk.

Using CERP as our program of interest constitutes a tough test of a well-known

observation about bureaucratic quarterly spending patterns–there are many reasons

to expect that organizational preferences about funding and budgets would not

significantly impact tactical commanders tasked with dispersing a relatively small

amount of funding in a war zone. By applying principal–agent concepts to a well-

known problem, we are able to explain why, even in the most unlikely of scenarios,

bureaucratic budget incentives remain a powerful explanatory tool for understanding

spending patterns.

There is additionally very little literature that examines the impact of such fiscal

inefficiencies, from defense ministries down to war zones. We therefore introduce

400 Armed Forces & Society 45(3)