Defense budget under tighter scrutiny

Lawmakers in the Senate and House are pushing initiatives to curb — and in some cases drastically reduce — defense spending, as the tough economic climate brings increased scrutiny to the massive Pentagon budget.

Sens. Carl Levin (D-Mich.) and John McCain (R-Ariz.) on Tuesday introduced a bill seeking to reform the way the Pentagon buys weapons systems. The ultimate goal of the bill is to rein in the ballooning costs of high-tech weapons and, eventually, to establish fixed-price contracts for most weapons systems, according to Levin.

{mosads}“We are going to do everything we can legislatively to put an end to these horrific cost overruns that we have seen,” Levin said at a press conference on Tuesday. The Pentagon’s largest programs are at least two years behind schedule and have exceeded their original budgets by a combined total of almost $300 billion, Levin said.

“Particularly at this time, when the federal budget is under immense strain as a result of the economic crisis, we simply cannot afford this kind of continued waste and inefficiency,” Levin said in a statement.

“As far as defense acquisition is concerned, the defense budget is concerned and spending is concerned, we are facing a train wreck,” McCain, the former Republican presidential candidate, said at the same press conference. McCain may prove instrumental in helping the White House implement the necessary reforms at the Pentagon.

The new reform bill seeks to compel the Pentagon and its contractors to pay more attention to the initial engineering going into weapons systems and institute more effective planning and management of the technology risk that comes with the development of high-tech weaponry. The legislation also emphasizes the Pentagon’s growing acquisition workforce.

The bill seeks to re-establish the position of the Pentagon’s director of developmental test and evaluation, which was eliminated several years ago, and is directing each military service to asses and address any shortcomings with its own organizations testing weapons in development.

The bill also establishes a new position for a director of independent cost assessment to ensure that cost estimates for major defense acquisition programs are reliable and unbiased.

Another essential aspect of the bill, Levin and McCain pointed out, is that it “puts some teeth” into the so-called Nunn-McCurdy law. The Pentagon is required by law to inform lawmakers when a program surpasses the cost thresholds set by Congress. Nunn-McCurdy requires the military services or the Pentagon leadership to tell Congress when the price tag of a program increases by 50 percent. Most recently, the Navy informed Congress that the presidential helicopter program has experienced such an increase.

While most programs that have breached the threshold are allowed to continue, or receive the necessary certification from the Pentagon to make the argument to Congress that they should continue, Levin said that the Pentagon will now have to give the troubled programs the same financial assessment that it would give to completely new programs and present all the alternatives. A certification of whether the new costs are reasonable would have to be supported by an independent cost estimate.

Both Levin and McCain said that they are not trying to undercut Secretary of Defense Robert Gates’s efforts to reform the weapons-buying practices — a goal he has made clear over the last several months. The two lawmakers said that everything they are doing is helping Gates “do his job” and that they will require his input. Before the new legislation gets a vote — either as a standalone bill or part of the 2010 defense authorization bill — the Senate Armed Services Committee will hold several hearings on the issue.

In the House, meanwhile, several members of the Progressive Caucus, with Rep. Barney Frank (D-Mass.) headlining the effort, are pressing harder this year for some significant cuts in defense spending. Frank, the chairman of the House Financial Services panel who has overseen much of the economic recovery effort, is pushing ahead with a plan to cut 25 percent of the Pentagon’s budget.

Frank at a press conference Tuesday said that it is “absurd” to talk about reducing the ballooning budget deficit while “giving a pass” to the military budget. The Pentagon’s budget in 2009 is nearing $700 billion.

Frank warned that without freeing up some of the military spending, the United States would not be able to overhaul healthcare, for example, or deal with other emerging social issues.

Frank said he is going to distribute some 1999 remarks by Alan Greenspan, the former Federal Reserve chairman, asserting that defense spending is one of the least productive ways to boost the economy and that a decrease in military spending at the time contributed to the lack of inflation between 1995 and 2000.

In an intense effort to save several high-profile programs, such as Lockheed Martin’s F-22 fighter jet, the defense industry has argued that defense contracts create and sustain thousands of jobs.

Frank acknowledged that he may not find immediate support among fellow Democrats in the House for the reduction, but he indicated he is going to make a concerted effort to “connect the dots” and have people understand the “opportunity cost of the military budget.” Frank’s cost-cutting plan is based on a timely troop withdrawal from Iraq that would create $100 billion in savings per year once all combat and support troops are withdrawn. According to his calculations, the net savings from a complete withdrawal from Iraq over the next four years would be $316 billion, taking into account the troop growth in Afghanistan.

According to Frank’s plan, another $60 billion could be saved by eliminating or trimming several high-profile defense programs, such as General Dynamics’ Expeditionary Fighting Vehicle, Lockheed’s F-35 Joint Strike Fighter and Boeing’s Future Combat Systems, alongside cuts for submarine programs, nuclear forces and ballistic missile defense.