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National Security
4:15 pm
Mon July 23, 2012

Defense Cuts: How Do You Buy 1.8 Submarines?

Originally published on Mon July 23, 2012 4:19 pm

Congress created a monster when it decided that the entire government will face across-the-board cuts in January, unless an agreement on deficit reduction is reached.

The deadline for the automatic spending cuts — called sequestration — is now approaching, and the Pentagon, Congress and the defense industry say those cuts would be horrible.

The Pentagon, perhaps the world's premier planning agency, views the threat of a 10 percent budget cut like an invasion from Mars. It's too awful, too scary and, as Pentagon press secretary George Little puts it, too "absurd."

"We typically don't plan against absurdities," Little says.

Sequestration is an absurdity, so terrible it was never supposed to happen. Why is it absurd? Because it requires that all programs be cut equally, and many analysts say that the nature of defense spending does make it very hard to cut that way.

Todd Harrison with the Center for Strategic and Budgetary Assessments says some weapons systems are particularly tough to trim.

"Take for example your Virginia-class submarine [that] we were planning to buy two per year," Harrison says, "if we're planning to cut back by 10 percent, well you can't buy 1.8 subs."

California Republican Rep. Buck McKeon, chairman of the House Armed Services Committee, also believes the Pentagon cuts are scary but says it's best to confront our fears, and talk about them.

"I worry that the cavernous silence from the president will lead many to exit the industry or to walk away from capital investments that are in the best interest of our troops," McKeon says.

Actually, he wants the White House to explain how it will manage defense cuts, hoping the administration will end up with the blame for job losses that many say will result from a smaller military. McKeon invited defense contractors to testify before Congress this past week to share their anxieties over the coming sequestration cuts.

David Hess, CEO of aerospace manufacturer Pratt & Whitney, testified that if the administration would only talk about how it will manage these cuts, he could at least manage his business.

"Companies are limiting hiring and halting investments, largely due to the uncertainty of how sequestration cuts would be applied," Hess said.

The industry has been staging anti-sequestration rallies and releasing reports that claim 1 million people would lose their defense jobs if the cuts go forward. After a lot of prodding, the Office of Management and Budget and the Pentagon have agreed to appear at a sequestration hearing next month.

Both agencies, however, have refused to discuss actual plans so far, and there's no reason to think that will change.

Some say that this irrational fear of sequestration has made it impossible to embrace the only rational treatment in this Beltway psychodrama: looking for manageable cuts to defense. Heather Hurlburt of the National Security Network says any cuts would follow years of spending growth.

"This enormous department has grown by 50 percent over the last decade," Hurlburt says.

Sequestration would be a nightmare, Hurlburt agrees, but she says Congress is virtually guaranteeing the worst will happen by refusing to consider even limited cuts.

"There's been a lot of discussion about whether we might have a modest copay as part of military health care," she says, "and Congress has vigorously acted to prevent any kind of discussion of cost-saving reform in military health."

So there are two strategies for dealing with fear of defense sequestration: refuse to talk about it, or talk at length about how awful it will be. More research is needed to say which technique is most effective, but neither will cure the underlying disease of failure to agree on a deficit reduction package. Congress' clinical trial ends in January, when the sequestration nightmare becomes real.

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Transcript

ROBERT SIEGEL, HOST:

If you've been having nightmares about sequestration, you're not alone. Congress, the Pentagon, the defense industry - they're all having the same dreams. Sequestration is the jargon used to describe the 10 percent across the board spending cuts that could come in January?

NPR's Larry Abramson reports on the Beltway divide over how to deal with these looming cuts and the fears they inspire.

LARRY ABRAMSON, BYLINE: Sometimes people deal with their biggest fears through denial - they refuse to plan for the inevitable.

GEORGE LITTLE: We don't have any plan right now for sequestration.

(LAUGHTER)

ABRAMSON: George Little is press secretary for the Pentagon, perhaps the world's premier planning agency. But the Pentagon views the threat of a 10 percent budget cut like an invasion from Mars. It's too awful, too scary, too - what's what word?

LITTLE: We typically don't plan against absurdities.

ABRAMSON: Sequestration is an absurdity so terrible it was never supposed to happen. Why absurd? Because sequestration requires that all programs be cut equally. And many analysts say the nature of defense spending does make it very hard to cut that way.

Todd Harrison, with the Center for Strategic and Budgetary Assessments, says some weapons systems are particularly tough to trim.

TODD HARRISON: You take, for example, your Virginia-class submarine for we're planning to buy two per year. If you have to cut back by 10 percent, you can't buy 1.8 subs.

ABRAMSON: There's someone else who believes Pentagon cuts are uber-scary. But Buck McKeon, the chair of the House Armed Services Committee, says it's best to confront our fears and talk about them.

REPRESENTATIVE BUCK MCKEON: I worry that the cavernous silence from the president will lead many to exit the industry or to walk away from capital investments that are in the best interest of our troops.

ABRAMSON: Actually, McKeon wants the White House to explain how it will manage defense cuts, hoping the administration will end up with the blame for job losses that many say will result from a smaller military. McKeon invited defense contractors to testify before Congress this past week, to share their anxieties over the coming sequestocalypse.

Pratt and Whitney CEO David Hess testified that, if the administration would only talk about how they will manage these cuts, he could at least manage his business.

DAVID HESS: Companies are limiting hiring and halting investments, largely due to the uncertainty about how sequestration cuts would be applied.

ABRAMSON: The industry has been staging anti-sequestration rallies and releasing reports that claim a million people would lose their defense jobs if the cuts go forward. After lots of prodding, the Office of Management and Budget and the Pentagon have agreed to appear at a sequestration hearing next month. But both agencies have refused to discuss actual plans so far, and there's no reason to think that will change.

Some say this irrational fear of sequestration has made it impossible to embrace the only rational treatment in this Beltway psychodrama: looking for manageable cuts to defense.

Heather Hurlburt, of the National Security Network, says any cuts would follow years of spending growth.

HEATHER HURLBURT: This enormous department has grown by 50 percent over the last decade.

ABRAMSON: Hurlburt agrees sequestration would be a nightmare. But she says Congress is virtually guaranteeing the worst will happen by refusing to consider even limited cuts.

HURLBURT: There's been a lot of discussion about whether we might have a modest co-pay as part of military health care. And Congress has vigorously sort of acted to prevent any kind of discussion of cost-saving reforms in military health.

ABRAMSON: So there are two strategies for dealing with fear of defense sequestration: refuse to talk about it or talk and talk about how awful it will be. More research is needed to say which technique is most effective. But neither will cure the underlying disease: failure to agree on a deficit reduction package. Congress's clinical trial ends in January, when the sequestration nightmare becomes real.

Larry Abramson, NPR News. Transcript provided by NPR, Copyright NPR.