Robert Gates Retires as The Last Defense Secretary of a Powerful America – The Erosion of the US Economy Will Cause Cuts in Defense and a Reduced US International Role

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By Paolo von Schirach

June 28, 2011

WASHINGTON– Robert Gates is about to retire as Secretary of Defense, (“SecDef” in Pentagonese), after a remarkably long tenure spanning two presidents, George W. Bush and Barack Obama who could not be more opposite in terms of their basic approaches towards national security. Whatever his merits, Gates goes into retirement with a personal awareness that he may very well be the very last Defense Chief of America as a “Mighty Nation”. Gates knows his country and Washington too well not to realize that a diminished America, if its serious economic ailments are not reversible, in the near future will simply be unable to afford not just “wars of choice” but any extended national security commitment, let alone wars.

Defense spending no longer affordable

Gates gets this simply fact: “There is no more money”. Just like for everything else, Washington has to borrow 40 cents of every dollar it spends on defense. Gates tried to salvage what he could by initiating cost savings measures within the Pentagon. His aim was to preemptively “cut the fat”, (over-staffing, inflation of general officers, command centers that make no sense, untold sums spent on consulting services of questionable value), in order to avoid reckless amputations –cuts in force structure– down the line. But this is impossible.

US defense spending, while historically low at about 4% of GDP, (by Cold War standards), is unaffordable for a country now routinely running $ 1.4, 1.5 trillion budget deficits every year. As Herbert Stein used to say, “What cannot be sustained, will not”. Gates knows this. He has been around public policy way too long not to realize that in the end the vast military machine he presided upon will be deemed to be extravagantly expensive and it will be pared down.

Cutting defense as a matter of choice or as a matter of fiscal necessity

It should be clear to all that there is a huge distinction between reducing defense spending because of political judgment, (correct or incorrect as it may be), and reducing spending as a fiscal imperative, because there is no choice, whatever one may like to do.

Let me illustrate this point. After the demise of the Soviet Union, the reunification of Germany and the end of Russian domination over Eastern Europe, it made sense for the Clinton administration, (January 1993 – January 2001), to reduce defense spending. After all, the historic existential threat, the USSR, amazingly was gone –for good. Therefore it appeared sensible to reduce spending on an enormous peace time military machine built mostly to deter the Soviets, relying primarily on deployable forces that had to be “ready” at any given time. So, no more Red Army, no need to spend so much to defend ourselves from a threat that had vanished. Time to enjoy the “peace dividend”, as policy makers used to say in the 1990s.

The post 9/11 defense build-up

Then we had the post 9/11 defense build up, the need to augment the standing forces and to replace equipment worn out or destroyed in Afghanistan and Iraq. Hence the growth of the Pentagon budget to sustain two costly wars. Now the military commitments may have peaked. In Iraq for sure, while the deployments in Afghanistan will be diminished, starting now. These may or may not be wise decisions. Time will tell.

But the deeper reality that Gates knows is that, assuming no vigorous American economic renaissance and consequent fiscal re-balancing, these and other withdrawal decisions will not be part of a range of options. As I said, “There is no more money“. $ 1 trillion is the very conservative estimate of the total cost of Iraq and Afghanistan, so far.

If you thinks that America can have a $ 14 trillion national debt, (and counting), with yearly budget deficits of $ 1 trillion or more, AND a large expeditionary force in Afghanistan, (70,000, even after the cuts just announced by president Obama), that needs to be armed, fed, and supplied, think again. By the same token, the extreme reluctance displayed by Secretary Gates himself, when it came to providing a US contribution to the European military efforts against Gaddafi in Libya, underscores the same point. Even though the enemy is puny and the “war” would have been smallish, the very thought of opening another theatre of operations with all the inevitable cost that would follow appeared too much.

The US administration finessed its decision to sit Libya out as an issue of fair division of labor between America and Europe. May be. I suspect that the decision was driven instead by fiscal considerations. If this is so, then Libya will be remembered as the campaign America could not lead because Washington was short of cash.

Of course, critics of US security policies may say, perhaps with cause, that, given the incredibly bad decisions made by George W. Bush regarding military invasions, it would have been better if America did not have the financial resources to start anything. May be so. But we are not arguing here about the wisdom of policies, we are realizing that lack of money will severely restrict the range of viable policies.

No money, reduced national security options

Now, now we are entering an uncharted territory. In the “American Century”, the US used to have abundant resources. The resilience of Pax Americana was in large part due to the awareness in Washington and across the world that America was wealthy and thus it had options in foreign and security policies.

But now it is different, as the incredible economic vitality that generated the resources that could be devoted to defense is in serious doubt. So much in doubt that it has now become conventional wisdom to say that the most basic US national security asset is the strength of the US economy.

And so everybody, starting with Admiral Mike Mullen, soon to be retired Chairman of the Joint Chiefs, remind us all of how important it is to restore a vibrant US economy. Indeed. So, we have established the connection between wealth creation and a strong military. But what if this economic renaissance does not happen? What if we continue with anemic growth and no political consensus on significant cuts in welfare programs obligations that will eventually bleed America to death?

No more carriers, no more bases around the world

Well, then you can kiss good bye to replacing Nimitz class super carriers (the last one is the George H. W. Bush). If you take into account the whole carrier group with cruisers, frigates, destroyers, submarines and the full complement of aircraft, each carrier runs at several billion dollars a copy, not to mention the cost of keeping it operational. You can kiss good bye to perennially forward deployed troops in Japan, Korea and whatever is left in Europe. And the enormously costly Iraq and Afghanistan operations will be remembered fondly (or angrily) as actions that America could undertake when it still had money. The projected spending cuts already indicate downsizing of the Army and Marines.

Leaving now, when the going is still good

Bob Gates knows all this. He understands America, and he knows how budgets are done in Washington. May be this is why he is retiring now, when there is still some semblance of prestige for a country entering a new era of diminished means that will inevitably translate into diminished options and reduced horizons. Who knows, may be all this will be reversed and America will go back to its glory days. However, looking at a rather low key, almost somber Bob Gates, one might get the feeling that he does not think so.

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