But Congress can easily avoid wasteful acquisition disasters like the F-35 program. The consultants to the commission appear to feel the same, sharing that “software needs a firm focus at the beginning of requirements generation” for new acquisition programs. Furthermore, external inputs told the commission that the best PPBE process would “empower decision-makers at critical levels of the process” with expert advice to make consistently “smarter and more timely decisions.” In other words, Pentagon decisionmakers need reality checks, not more money to waste on unproven capabilities. Congress must wield its power of the purse to ground Pentagon decisionmakers by limiting funding for programs before their designs are complete and they’ve been thoroughly tested.
Beware of More Wish List Items Disguised as Suggestions
Finally, it bears mentioning that, in addition to many well-known acquisition problems, the commission’s status update contains several red flags. To the commission’s credit, they point out that several of the suggestions sampled in the update may contradict each other. And Congress did not require them to publish this status update on their research, so the report is a welcome glimpse into their work over the past year.
However, the defense industry’s voice is loud and clear in the commission’s report on its research so far. Among the most concerning suggestions made to the commission were statements that the Pentagon needs a “more fluid budget process” as well as “higher innovation risk tolerance.” There’s also mention of a defense resource allocation system that provides “flexible money when needed, with limited oversight when appropriate.”
Congress added $45 billion more than the president and the Pentagon requested for the national security budget last year. That’s more than enough fluidity and flexibility as far as funding goes, especially since the Pentagon is notoriously irresponsible about financial management. And the Pentagon already tolerates plenty of risk. To take just one example, the Pentagon risked $32 billion on the Army’s Future Combat System and received little more
than fancy PowerPoint slides in return.
Additionally, over half of defense dollars have gone to military contractors in recent years. Even with significant federal support and consistently strong revenues, contractors’ incentive to innovate only diminishes as the industry grows smaller and smaller — in part because those same companies have gobbled up so much of their competition. Military contractors constantly ask Congress for more money to innovate and meet urgent acquisition needs, but nothing is stopping them from innovating besides themselves.
When the commission’s upcoming interim and final reports are published, Congress should be wary of any recommendations to increase agility in the budgeting and acquisition processes by compromising on oversight. Specifically, Congress must maintain and expand the requirements for companies to provide the Pentagon with cost and pricing data, the department’s best tool to ensure it’s getting fair deals. The Pentagon certainly needs to deliver capabilities to warfighters on time, but reducing oversight by giving up negotiation tools like cost and pricing data is not the answer — and throwing more money at acquisition won’t make the process faster or cheaper, either.
Conclusion
Acquisition and budgeting reform at the Pentagon is sorely needed. And while POGO wishes the reform commission included budgeting experts from academia, non-defense industries, and civil society, we anxiously await the reform commission’s interim report in August.
