Hagel Plays Bad Cop, Puts DOD on the Chopping Block
Business + Economy

Hagel Plays Bad Cop, Puts DOD on the Chopping Block

REUTERS/Jonathan Ernst

After more than a month of missteps and mishaps, Defense Secretary Chuck Hagel laid out of bold and ambitious plans to cut Pentagon spending that would remake the military as it transitions to a 21st Century fighting force.

Until Wednesday, Hagel had avoided specifics when he discussed sequestration, which will remove $41 billion from the defense budget, and subsequent cuts that will remove $600 billion from DOD’s budget in the coming years. But during his speech at the Naval War college, Hagel outlined how and where the Pentagon would cut costs. He told soldiers and civilians in attendance that they must accept that the age of bottomless defense spending was over, and that Americans had grown tired of war.

New threats to national security “do not necessarily lend themselves to being resolved by conventional military strength,” he said. He added, “America does not have the luxury of retrenchment - we have too many global interests at stake, including our security, prosperity and future. If we refuse to lead ... someone will fill the vacuum.”

Hagel said maintaining force strength while vastly reducing the size of the Pentagon would be challenging. To achieve this goal, nothing is off the table: Hagel targeted nearly every part of the way the Pentagon works.

On the bloated civilian workforce he said, “Despite good efforts and intentions, it is still not clear that every option has been exercised or considered to pare back the world's largest back-office.”

On future cuts to retirement benefits, and increases in healthcare costs, Hagel said, “I'm sorry. I wish it was otherwise, but that’s a fact of life. The longer we deter these things the harder it's going to be.”

On personnel bloat at the officer level, Hagel said, “Today the operational forces of the military - measured in battalions, ships and aircraft wings - have shrunk dramatically since the Cold War era. Yet the three- and four-star command and support structures sitting atop these smaller fighting forces have stayed intact, with minor exceptions, and in some cases they are actually increasing in size and rank.

And lastly, on DOD’s enormous bureaucracy, Hagel said, “"In many respects, the biggest long-term fiscal challenge facing the department is not the flat or declining top-line budget, it is the growing imbalance in where the money is being spent internally.”

Hagel also said that while the military was not a corporation, DOD has a “good deal to learn from the private sector. We have no choice but to take a very close look to determine how we can do this better.”

Hagel’s message wasn’t warmly received. His first questioner –a civilian -  asked why he was going ahead with the furlough and that morale was low.

Hagel didn’t waver.

“I wish I didn't have to answer that question. I wish we had other options,” he said. “We've tried to be fair in analyzing where we take those [spending] cuts.”

Hagel took a few more questions, but his response to the unhappy worker -- tough luck, but this has to happen – is exactly why Obama chose him. With this speech, he now seems primed to become the budget hawk Obama envisioned. Whether he can transform the Pentagon in the face of broad institutional opposition remains to be seen.