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June 8, 2009
 
Smart Power is Soft Power
By William S. Cohen
 
Now that the Obama administration has set forth its priorities for the military equipment it wants to buy, Congress is wrestling with how far to go in altering the president’s plan, particularly in seeking to restore the programs Defense Secretary Robert Gates has cut. An equally, if not more, important question is how to ensure the best value for the taxpayer, on-time delivery of equipment to the military and sustainment of a defense industrial base to ensure long-term defense needs.
 
Developing a long-term consensus between the Defense Department and Congress over both what and how to buy is critical. Development of a major weapons system (as well as a senior noncommissioned or field grade officer) often takes longer than the tenure of a two-term president or the average member of the House. But program stability can save billions of dollars, as well as soldiers’ lives, by shaving years off deploying a capability into the field and allowing greater quantities of equipment to be bought.
 
In a hopeful sign of consensus, last month, Congress passed and President Barack Obama signed into law the Levin-McCain defense acquisition reform bill that changes some aspects of how to buy. These include strengthening capabilities for estimating costs and assessing performance of weapons systems.
 
The new law requires tougher rules consistently applied across DOD to prevent organizational conflict of interest. Such conflicts have posed an increasing problem as the department has shifted more responsibilities to large contractors, whose growing breadth of capabilities often put them in the position of assisting in the design or management of programs while also competing to execute those programs. In most cases, industry is just trying to do its best to support its customer. Noxious outcomes, however, do not require nefarious intent.
 
The Levin-McCain bill marks a long-overdue effort to address this serious issue systematically. It also is preferable to DOD’s well-intentioned but, to date, piecemeal efforts, which risk causing more harm than good. As the new law recognizes, any fix must address the trends that led DOD to increase its reliance on industry for technical support.
 
Gates has announced his own initiative to reverse the rapid growth in DOD dependence on contractor support. He has set a goal of reducing the percentage of contractors in his department’s work force from today’s 39 percent to where it was when I left in 2001: 26 percent. While easily stated, this reduction will prove challenging to accomplish. Underlying federal work force demographics mean that we are in the midst of a massive retirement of senior, experienced managers. This pattern has been exacerbated by the demoralization of professional civil servants at the Defense Department, which accelerated the voluntary departure of some of the most talented managers, who had the best prospects in a rapidly growing private sector.
 
Gates is making notable progress in pursuing his goal, aided by a sour economy that has delayed many civil servants’ retirement plans and enabled DOD to impress contractor employees into government service. An improving economy will put stress on his plan for retaining and recruiting civil servants and place increasing importance on the use of nonconflicted firms to perform technical assistance roles.
 
Another provision of the new reform bill is aimed at the laudable goal of promoting competition throughout the life cycle of major systems. As co-author, with Sen. Carl Levin (D-Mich.), of the Competition in Contracting Act, I remain convinced of the value — cost savings, quality improvement and innovation — of competition. But this provision of the new law also calls for DOD to referee make-buy decisions by prime contractors for system components, a concept so problematic in practice that it was a major factor in my decision to end megamergers among the large prime contractors. Putting DOD in this position will lead to outcomes driven less by competitive pressures than by a de facto regulatory process, with predictable results.
 
Even under President George W. Bush’s defense plan, spending on defense procurement, research and development was slated to steadily decline over the coming five years. Fiscal constraints could steepen this trajectory and present industry and DOD with the question of how best to handle further industrial consolidation and sustain the defense industrial base; constructive dialogue between DOD and industry would be absolutely essential. Over the past decade, defense leadership grew hostile toward industry while, in the wake of the Darleen Druyun scandal, DOD employees grew fearful.
 
The Obama administration’s particular spin on “transparency” inadvertently has worsened the fear factor. The Armed Services committees could help to foster constructive thinking and dialogue by reconstituting the subcommittee on the defense industrial base, which during the 1990s helped to produce productive acquisition reforms while overseeing the last phase of consolidation.
 
Congress, in challenging decisions by Gates on major defense programs, should tread lightly — for its own sake as well as the military’s. Yes, the president proposes and Congress disposes. But after congressional action, Cabinet departments execute, with innumerable tools to affect member interests. Members and committees can undermine their own influence and objectives by alienating a Cabinet secretary either with a heavy ladleful of unrequested programs or by trying to tie the secretary’s hands with Lilliputian strings.
 
In the halls of Congress, just as in theaters of international operations, smart power often is the soft power of influence rather than the supposed hard power of legislative fiat or veto.
 
William S. Cohen is chairman and CEO of The Cohen Group. He served as secretary of defense in the Clinton administration from 1997 to 2001. A Maine Republican, he served in the Senate from 1979 to 1997 and in the House from 1973 to 1979.
 
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