USA — Flournoy: Departmental Efficiencies to Begin at Top

WASHINGTON — Defense Sec­re­tary Robert M. Gates’ call last week for more effi­cien­cy and less waste is start­ing at the top, with Pen­ta­gon com­po­nents being told they’ll lead the rest of the depart­ment by exam­ple, the secretary’s top pol­i­cy advi­sor said here today.

“We have been put on notice; we are going to start this review for effi­cien­cies with our­selves,” Michele Flournoy, under­sec­re­tary of defense for pol­i­cy, said dur­ing an appear­ance at the Nation­al Press Club.

Flournoy said she’s review­ing her own orga­ni­za­tion­al chart to iden­ti­fy how the office can do its job more effi­cient­ly. The ulti­mate ques­tion, she said, is, “Where can we get some sav­ings that we can con­tribute to the pie?”

“I think every sin­gle [Defense Depart­ment] com­po­nent is going to go through that exer­cise,” Flournoy said. For some com­po­nents, she said, the review will involve “fun­da­men­tal, exis­ten­tial ques­tions: ‘Do we need this par­tic­u­lar orga­ni­za­tion that may have been cre­at­ed 40 years ago in the new world we are in?’ ”

Flournoy empha­sized that Gates’ May 8 speech at the Eisen­how­er Library in Abi­lene, Kan., was about cut­ting duplica­tive over­head, bloat and need­less spend­ing – not capa­bil­i­ty. “It’s not [about] defense cuts,” she said. “It’s say­ing, ‘We have to become more effi­cient and make bet­ter use of tax­pay­er dol­lars in how we oper­ate.’ ”

Broad reviews of how the Defense Depart­ment is orga­nized are just one part of the equa­tion, she said. Gates’ man­date also includes reform­ing the acqui­si­tion process, con­serv­ing ener­gy and cre­at­ing greater effi­cien­cies through­out the depart­ment. Sav­ings, she said, would be rein­vest­ed where they are most need­ed to sup­port cur­rent secu­ri­ty needs and to pre­pare for future ones.

These efforts began with the fis­cal 2010 bud­get, which Flournoy said rep­re­sent­ed a “pret­ty dra­mat­ic set of deci­sions.” The Qua­dren­ni­al Defense Review and fis­cal 2011 bud­get request build on this start, she added.

Not all the deci­sions have been pop­u­lar with­in the Pen­ta­gon or on Capi­tol Hill, Flournoy con­ced­ed.

Gates has made it clear he will rec­om­mend that the pres­i­dent veto the fis­cal 2011 bud­get if Con­gress adds cost­ly items such as more C‑17 trans­port air­craft to it. “We have got to be able to make choic­es about how to invest our next dol­lar for the nation’s defense needs,” Flournoy said. “We can’t be forced to buy things we don’t need any more.” The defense sec­re­tary, Flournoy said, is putting togeth­er “far-reach­ing plans” aimed at improv­ing effi­cien­cies and pro­vid­ing the depart­ment with the capa­bil­i­ties need­ed in the 21st cen­tu­ry and beyond. Many pro­posed changes, she said, will require con­gres­sion­al approval.

“We are putting togeth­er a dra­mat­ic reform pack­age for export con­trol reforms to update the sys­tem. We can’t do it with­out Con­gress,” Flournoy said. “We are see­ing to over­haul the way we do secu­ri­ty assis­tance. We can’t do it with­out Con­gress. We need relief on the health-care front, and we absolute­ly have to have Con­gress to help us.” Flournoy turned her atten­tion to what many on Capi­tol Hill have con­sid­ered a sacred cow – mil­i­tary per­son­nel costs, par­tic­u­lar­ly for health care.

The Unit­ed States has made great progress, par­tic­u­lar­ly since 2001, in clos­ing the gap between mil­i­tary and civil­ian pay, she said, but the prob­lem is that as a show of sup­port for the force, Con­gress has reg­u­lar­ly increased pay over lev­els the admin­is­tra­tion request­ed.

“What’s hap­pen­ing, cumu­la­tive­ly, is that we are not con­sid­er­ing the trade­offs,” Flournoy said. This is par­tic­u­lar­ly trou­bling in the health-care are­na, she said, with the Defense Depart­ment extend­ing Tri­care cov­er­age to mil­i­tary retirees.

“We are now in a sit­u­a­tion where peo­ple in the pri­vate sec­tor for­go their pri­vate-sec­tor ben­e­fits because it is bet­ter for them to stay in Tri­care,” Flournoy said. “Employ­ers are say­ing, ‘Take the mil­i­tary ben­e­fit and then I will give you anoth­er ben­e­fit instead,’ so the gov­ern­ment is car­ry­ing a lot of weight for the pri­vate sec­tor in health care. “If there was an infi­nite pot of mon­ey, that would be fine,” she con­tin­ued. “The prob­lem is there is not an infi­nite pot of mon­ey. So those dol­lars are dol­lars we can’t invest in equip­ment that our mil­i­tary needs today, and in the capa­bil­i­ties they are going to need to adapt to the future.” The long-term impact will be dev­as­tat­ing, she warned.

“When you look at the bud­get pie over time, the amount of dis­cre­tionary spend­ing avail­able for invest­ment is get­ting small­er and small­er and small­er,” she said. “If we don’t some­how address this trend, you are going to get to a point where you don’t have enough invest­ment dol­lars to equip the force you need.”

Flournoy said Gates is total­ly “com­mit­ted to the care and sup­port of our mil­i­tary men and women.” How­ev­er, she added, Gates also is con­cerned for the military’s finan­cial future. “He feels this stew­ard­ship part of his job very deeply,” Flournoy said. “But he also feels that part of that is wor­ry­ing about being able to ensure he can equip the force for the future. And we are on a … bad tra­jec­to­ry there. We have some­how got to rebal­ance.”

U.S. Depart­ment of Defense
Office of the Assis­tant Sec­re­tary of Defense (Pub­lic Affairs)