Bringing The Pentagon to Heel

To understand American defense, think of an extremely wealthy man who has gone to a gambling casino for a long binge, gotten hopelessly drunk, wasted a great deal of his money and awakened with a severe hangover to find that he has married a woman who is a complete stranger. The man’s condition is scarcely fatal, but scarcely one to be desired.

— Defense Analyst Anthony Cordesman

That is a rare, fancy metaphor that can be backed up by hard numbers. The Pentagon has indeed been on a long binge: in the eight years of the Reagan Administration, Congress will have handed it $2.2 trillion — trillion! A good deal of that has been dribbled away in heedless, indiscriminate spending. Now the bills are coming due — literally, in the case of a number of supersophisticated weapons systems nearing production. Meanwhile, the Defense Department has been forced by the overall federal budget squeeze to embrace a decidedly unfamiliar, and in its eyes hideous, new bride: austerity.

Which makes Secretary of Defense Frank Charles Carlucci III the man on the spot — and, simultaneously and somewhat surprisingly, the only rising star in the twilight of the Reagan Administration. Carlucci, 57, was appointed last fall to what looked like a caretaker’s post, to pad out what was already the longest resume in Washington (positions in seven different agencies — “one ahead of Elliot Richardson,” he jokes). But acting like a caretaker is not in the nature of Carlucci, a far from faceless bureaucrat who boasts that in all his jobs “I don’t think anybody has accused me of not having my say.” Notably small in stature (around 5 ft. 5 in.), he compensates with aggressiveness and a reputation for wearing down opponents, on the tennis court or in the corridors of power, by sheer tenacity.

Carlucci also has his adaptable and diplomatic side. As Secretary of Defense, he has drained away most of the poison that his predecessor, Caspar Weinberger, left behind in the Pentagon’s relations with Congress and the State Department, largely by the simple expedient of respecting their turfs and their opinions. Coming from the National Security Adviser’s job, he has retained a major role in foreign policy. In the past month he has turned up all over the globe: chatting with top Soviet defense officials at the Moscow summit; visiting Tokyo, where he urged Japan to share more of the costs of maintaining U.S. bases; promising South Korean leaders last week to beef up U.S. forces to guard against any disruption of the Olympic Games.

But it is in how he deals with the budget squeeze on the Pentagon that Carlucci may make his influence felt beyond the final year of the Reagan Administration. His opening cost-cutting moves have by no means been adequate to the size of the problem. Nonetheless, they have won him bipartisan respect. Says Georgia Democrat Sam Nunn, chairman of the Senate Armed Services Committee: “He inherited a nightmare at the Defense Department, and he has shown exemplary leadership by turning it into merely a bad dream. He gets absolutely the highest marks.”

At the least, Carlucci’s moves will set guidelines for his successors in dealing with the new lean era. Beyond that? Well, Michael Dukakis has praised Carlucci for beginning to face up to the hard choices that must be made. This has led to speculation that Carlucci, who has already served one Democratic President (as deputy director of the CIA under Jimmy Carter), might continue to head the Pentagon through a Dukakis Administration. Dukakis “could do a lot worse,” says Senator Nunn. In a Bush Administration, Carlucci would be a natural holdover, as well as a candidate for Secretary of State.

Keeping Carlucci at the Pentagon might not exactly be doing him a favor. Over the next five years, he figures, the Pentagon will have to slash appropriations by $200 billion to $300 billion below the amounts it had planned to spend. A $300 billion cut is roughly equivalent to the current year’s total military outlays, from missiles to mouthwash, battleships to boots. And that amount is the optimistic estimate. It assumes that Congress will heed Carlucci’s request to increase the Pentagon’s budget each year by a steady 2% above the rate of inflation. While George Bush supports this idea, Dukakis talks of holding defense appropriations even with the rate of price increases.

On Capitol Hill, a chorus of voices warns that the Pentagon will be lucky to get even that much. Many members of Congress, searching for ways to cut the overall budget deficit, are in no mood to give the military any increase. According to Les Aspin, the Wisconsin Democrat who heads the House Armed Services Committee, the slash in Pentagon budget authority over the next five years is likely to be “closer to $422 billion” than to Carlucci’s figures.

Cuts on that scale cannot be carried out by any nickel-and-dime process. The U.S. will have to reassess its commitments around the world, rethinking basic military strategy and the weapons systems needed to carry it out. The $300 billion budget for fiscal 1989, now in Senate-House conference, gives only a mild taste of what is ahead. To get within those limits, Carlucci will, among other things, retire a Poseidon ballistic-missile submarine, two Air Force wings (total: 144 planes) and 620 Army helicopters, and scale back the proposed number of men and women in uniform by 46,000, leaving a total of 2,138,000. Some 20,000 projected civilian employees will also be dropped. Though Congress so far has bought these proposals, they represent the kind of compromise that pleases no one fully. Says former Defense Secretary Harold Brown: “What Carlucci cut is just tiny compared to what will have to be done.”

To carry out the slashes required in the future, the Pentagon will have to steel itself to cancel some of the shiny new weapons systems that it is about to buy. Over the next decade, the services are due to spend $80 billion for 132 radar-invisible Stealth bombers; $37.5 billion for 750 Advanced Tactical Fighters, the new jet that is supposed to replace the Air Force F-15; and an additional $35 billion for a Navy version of a similar aircraft.

Then come the Navy’s new SSN-21 attack submarine ($2.9 billion for just the first one ordered); the Army’s proposed Forward Area Air Defense system, a complex of sensors, guns and missiles to provide air cover on the battlefront ($60 billion); and the bills for two more nuclear-powered aircraft carriers, approved by Congress last year ($20 billion with escort ships and airplanes). The Administration is also asking for upwards of $5 billion a year for the Strategic Defense Initiative.

Most critics agree with Gordon Adams, director of the Washington-based Defense Budget Project, that these weapons probably can be bought “only at the price of a drastic cut in the size of the U.S. armed forces or a debilitating slash in spending for readiness” (training, ammunition, spare parts). The whole contretemps raises a harrowing but unavoidable question: Can the U.S. afford to pay for the defense it needs — and just how much does it need anyway? In his best-selling book, The Rise and Fall of the Great Powers, Historian Paul Kennedy points out that such dominant nations as Spain in the 16th century and Britain around 1900 began to fade in part because they were burdened by military commitments greater than their slipping shares of the world’s economic activity could support.

Carlucci indignantly rejects any thought that this pattern is applicable to the U.S. today. It is “ridiculous,” he says, “to say that our country cannot afford 5.9%” of gross national product, approximately the current rate for national defense. Yet Congress is reflecting a judgment that gargantuan deficits ($147 billion this year) will eventually cripple the economy. They cannot be significantly reduced without a whack at planned military spending, which constitutes 27% of the entire budget.

The fiscal bind is one that the Pentagon should have foreseen. Carlucci, who spent two years there in the early 1980s as the No. 2 man, has long grumbled, as have others, about the historic “sawtooth” pattern of defense appropriations — way up for a few years, way down for the next few. In the early Reagan years, reversing a series of deep cuts in the mid-’70s, Congress voted military-spending increases as much as 13% above the rate of inflation; from 1980 to the peak in fiscal year 1985, Pentagon budget authority zoomed from $144 billion to $295 billion. The Pentagon’s appetite for deluxe weaponry swallowed up so much of those titanic sums that the buildup failed to achieve some major goals. Overall, it did bring a much needed improvement in U.S. combat strength. But Ronald Reagan’s dream of an Army of 18 full-strength divisions, a 40-wing Air Force and a 600-ship Navy remains unfulfilled. The budget for fiscal 1989 funds 18 trimmed-down divisions, 35 wings and 580 fighting ships.

The tide began to recede in 1986, when Congress for the first time under Reagan cut the Pentagon budget below the previous year’s. It did so again in 1987, and in 1988 allowed only modest growth, well below inflation. The 1989 budget will be the fourth relatively lean one in a row. Weinberger not only fought the trend, infuriating Congress by refusing even to discuss reductions, he continued to plan for future spending as if the Pentagon could count on once again getting a blank check. Last November, however, he resigned, to be succeeded by Carlucci, a veteran of 28 years in Government service, including the No. 2 jobs at the Department of Health, Education and Welfare, the Office of Management and Budget, the Pentagon and the CIA. Heading the Pentagon quickly proved to be his biggest challenge.

Weinberger left behind a budget request for fiscal 1989, which begins Oct. 1, that called for $333 billion in military funding. Negotiators for the White House and Congress agreed to reduce that to just under $300 billion — with no guidelines on what to chop. The new Secretary of Defense had a mere five weeks before formal presentation of the amended budget to find $33 billion to slash.

Carlucci met the deadline and forced the Pentagon brass to come up with real cuts rather than paper ones. The Navy at first tried what cynics call the “Washington Monument strategy.” That refers to the National Park Service practice of countering every budget cut with a proposal to reduce visiting hours at the nation’s monuments — knowing full well that Congress would never allow it. The Navy’s version was to propose delaying a 4.3% military pay raise and killing both a Trident nuclear missile-firing submarine and two Los Angeles-class attack submarines, all congressional favorites. Carlucci coldly ordered the Navy to drop that ploy and instead mothball 16 aging frigates. Secretary of the Navy James Webb resigned in protest.

Critics outside the Pentagon, however, feel Carlucci did little more than trim the margins. Carlucci scoffs at such sniping. Says he: “My phone is ringing off the hook from people on ((Capitol)) Hill who don’t like my killing this weapons system and that weapons system.” In fact, though, the systems he has hit — primarily an Army pilotless plane, the Midgetman single-warhead nuclear missile and an antisatellite system — are unpopular with either the services, Congress or both.

Carlucci is now working on some five-year spending projections, based on the idea of a 2% annual increase in the Pentagon budget on top of inflation. Robert Costello, the Pentagon’s “purchasing czar,” estimates that such stability could enable the Defense Department to save as much as $30 billion annually through efficient management of buying programs, rather than the ) fits-and-starts practices forced by wildly fluctuating appropriations. Nonetheless, Carlucci recognizes that squeezing under even a 2% ceiling will require a “very intense major reorganization of the defense program.”

He insists that he will not cut deeply into the operations-and-maintenance account, which pays for such items as training, ammunition and spare parts and has been a favorite target for past budget cutters. He is also determined to avoid “stretch-outs,” the common practice of maintaining orders for tanks, say, or fighter planes but buying fewer each year than originally planned. Stretch-outs often cause production to fall below economic rates, so that the Pentagon ultimately pays more for each tank, plane or ship.

Carlucci does talk about cutting “force structures,” meaning numbers of troops, ships and planes, and of axing “lower priority, marginal” weapons systems, especially those still in the research-and-developm ent stage. But so far, he refuses to chop any of the superexpensive weapons programs that such experts as former Defense Secretaries Brown and James Schlesinger doubt the Pentagon could have afforded even under Weinberger’s spending plans.

Should Carlucci try to cancel some major weapons systems, he would have no guarantee of succeeding. Generals and admirals have become adept at making end runs around their own civilian chiefs to enlist the support of sympathetic Congressmen. And for all their bellowing about vast sums of money wasted on weapons that do not work, few legislators will vote for military economies likely to hurt their own districts. One example: the Pentagon could save perhaps $2 billion a year by closing unneeded military bases, but Congress has not permitted a major base closing since 1977.

The upshot: many critics fear that, for all Carlucci’s vows, the necessary cutbacks will once more be accomplished largely by the tried-and-untrue methods of stretch-out and reductions in readiness. Says Lawrence Korb, a former Assistant Secretary of Defense: “Already the Air Force and Navy are flying less and steaming fewer training hours than necessary, and already there are cutbacks in necessary operations and maintenance.”

There is no painless way out of this bind. Arms control is a fiscal wash for the short term: verification costs money, and so will additional weapons systems required to replace those being scrapped. But Soviet Leader Mikhail Gorbachev, who is trying to pep up a stagnating economy, seems to be casting about for a way to cut Soviet military spending. He has talked about a shift in the U.S.S.R.’s military doctrine from offense to defense. That implies restructuring the Soviet armed forces, making them adequate to defend the U.S.S.R. but not to launch an offensive.

Defense Minister Dmitri Yazov took this line in March when he met Carlucci in Berne, Switzerland, for the first extended get-together between American and Soviet defense chiefs. Carlucci’s report: “I said, ‘Fine, I hear you. But I do not see that ((change in doctrine)) reflected in force structure, and I do not see it reflected in your activities around the world. Until we do, it behooves us not to change our current policy.’ ” If the Soviets someday suit action to words, a mutual reduction in conventional forces as well as nuclear weapons could finally save both sides some serious money.

That, however, is a future prospect that will do little soon to ease the Pentagon’s pain. And pain there will be, whoever is elected this fall. But Carlucci, limited as his opening moves may have been, has at least had the courage to point out the devilish dilemmas ahead. As a fresh and energetic figure in an Administration rapidly drawing to its close, he has brightened his already lustrous reputation — and just possibly his future as well.

CHART: NOT AVAILABLE

CREDIT: TIME Chart by Cynthia Davis

CAPTION: THREE FLIGHT PLANS

DESCRIPTION: Defense spending, 1968-1987, with proposals for spending through 1992 made by Caspar Weinberger, Frank Carlucci and Congress.