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TAXPAYERS AGAINST RUNAWAY MILITARY SPENDING

Comparative Matrix
Cato CNAS (7D CNAS (!C

Comparing Defense Savings Plans Across the Political Spectrum - By Brendan Lin NC"## NSN N$%&# Street SD$" Stimson ('a Stimson (SA Co(urn

Procurement and #)D* Revise or cancel procurement plans for programs not requested by DoD Revise or cancel procurement plans for F-35 Joint Strike Fighter Revise or cancel procurement plans for -!! "sprey Revise or cancel procurement plans for #round $ombat ehicle Revise or cancel procurement plans for %ittoral $ombat Ship Reduce R&D spending Reduce '"ther (rocurement' Reduce procurement for other programs "orce Structure* Reduce si)e of *avy fleet by retiring active platforms Reduce si)e of *avy fleet by limiting ne+ procurement Reduce number of ,ir Force aircraft by retiring active platforms Reduce number of ,ir Force aircraft by limiting ne+ procurement -e.cept F-35/ Reduce nuclear force by shrinking current force structure Reduce nuclear force by limiting ne+ procurement0 infrastructure or research +fficiency #eforms* 1.tricate uniformed personnel from non-military tasks Reduce command0 support0 and infrastructure spending ,dopt more efficient business practices Reduce si)e of DoD agencies 2nitiate ne+ 3R,$ round ,dopt Department of Defense4s efficiency recommendations "ther efficiency reforms Benefits and Compensation* Reform 5R2$,R1 Reform military retirement Reform compensation Personnel Levels* Reduce ,rmy personnel Reduce 6arine $orps personnel Reduce troop levels in 1urope and ,sia Reduce number of generals and admirals Reduce civilian DoD +orkforce Reduce contractor staff augumentees ,ther Savings* $urtail missile defense and space spending Reduce or hold constant intelligence spending ,udit the (entagon7improve financial management

Table of Contents:
1. Cato: The Cato Institute - "Budgetary Savings From Military Restraint".............................................................................................................................................4 2. CNAS (7D): Center for a New American Security - "The Seven Deadly Sins of Defense Spending".................................................................................................5 3. CNAS (HC): Center for a New American Security - "Hard Choices: Responsible Defense in an Age of Austerity...........................................................................6 4. NCFRR: National Committee for Fiscal Responsibility and Reform Report.......................................................................................................................................7 5. NSN: National Security Network - "Reshaping Pentagon Spending and Capabilities: Setting Priorities for the Future"...................................................................8 6. NTU/R Street: National Taxpayers Union/R Street Institute "Defending America, Defending Taxpayers: How Pentagon Spending Can Better Reflect Conservative Values"........................................................9 7. SDTF: Sustainable Defense Task Force - "Debts, Deficits, and Defense: A Way Forward".............................................................................................................10 8. Stimson (Ma): The Henry L. Stimson Center - "Strong National Defense for Today's Global and Fiscal Realities"........................................................................11 9. Stimson (SA): The Henry L. Stimson Center - "Strategic Agility: Strong National Defense for Today's Global and Fiscal Realities"...........................................12 10. Coburn: United States Senator Tom Coburn, M.D. (R-OK) - "Back In Black: A Deficit Reduction Plan"....................................................................................13 11. Appendix (Summaries of Other Reports).........................................................................................................................................................................................14

TAXPAYERS AGAINST RUNAWAY MILITARY SPENDING

The Cato Institute


Budgetary Savings From Military Restraint
Procurement and R&D Force Structure Efficiency Reforms Benefits and Compensation
Include more components of military compensation in pay raise calculations that are pegged to changes in the civilian sector - $55b saved over 10 years

Personnel Levels

Other Savings

Cancel the Expeditionary Fighting Vehicle - $11b saved

Reduce the number of Reform DoD maintenance and Marine Corps expeditionary supply systems - $13b saved strike groups from 10 to 6 over 10 years $7b saved over 10 years

Cut the active-duty Army to 360,000 personnel - $222b saved over 10 years

Make national missile defense a research program - $60b saved over 10 years

Terminate Marine Corps V22 Osprey - $15b saved over 10 years

Keep a nuclear weapons arsenal of 500 deployed warheads - Savings Estimate Below*

Cut military construction and family gousing spending by 20% - $30b saved over 10 years

Reform TRICARE - $60b saved over 10 years

Cut the size of the Marine Corps Reduce intelligence spending from 202,000 to 145,000 - $67b by 15% - $112b saved over saved over 10 years 10 years

Cancel Littoral Combat Ship and develop a less expensive alternative - $14b saved over 10 years

50% cut in delivery platforms, including elimination of the bomber leg of the nuclear triad - Savings Estimate Below*

Cut the Pentagon civilian workforce by 30% over a 10year period - $105b saved over 10 years

Consolidation of nuclear Forgo procurement of 60 Flaboratory and testing 35 Joint Strike Fighters and facilities - *All three reduce associated reforms: $87b saved over personnel - $22b saved 10 years Air Force should eliminate six strike wing equvalents; accelerate the retirement of aging airframes - $89b saved over 10 years

Reduce RDT&E by 10% annually - $73b saved over 10 years

Retain six SSBNs, which would allow for at least four to be deployed at any one time - $3b saved over 10 years Forgo the purchase of Trident II missiles for SSBNs and upgrades to nuclear cruise missiles; shelve plans to deploy nuclear weapons on F-35 - No Savings Decommission the Nimitz, Eisenhower, and Vinson $5b saved over 10 years

Reduce number of DDGs $34b saved saved over 10 years

Reduce the number of Navy aircraft carriers to eight $40b saved saved over 10 years

Cancel procurement of CVN 79 and all future Ford Class CVNs - $16b saved over 10 years

Reach 40 SSNs in 2020, decommission SSGNs $32b saved over 10 years


"The United States needs a defense budget worthy of its name, one that protects Americans rather than wasting vast sums embroiling us in controversies remote from our interests. This paper outlines such a defense strategy and the substantial cuts in military spending that it allows. That strategy discourages the occupation of failing states and indefinite commitments to defend healthy ones. With fewer missions, the military can shrink its force structurereducing personnel, the weapons and vehicles procured for them, and operational costs. The resulting force would be more elite, less strained, and far less expensive. By avoiding needless military conflict and protecting our prosperity, these changes would make Americans more secure." Friedman, Benjamin H., and Christopher Preble. Budgetary Savings From Military Restraint. The Cato Institute. Cato.org. September 23, 2010. http://object.cato.org/sites/cato.org/files/pubs/pdf/PA667.pdf.

Page 4

TAXPAYERS AGAINST RUNAWAY MILITARY SPENDING

Center for a New American Security


The Seven Deadly Sins of Defense Spending
Procurement and R&D Force Structure Efficiency Reforms Benefits and Compensation Personnel Levels Other Savings

Fold AFRICOM back into Prevent 5% of waste in acquisitions EUCOM - $1.4b saved over 10 funding over 10 years - $98b saved years over 10 years

Bring basic pay back in line with civilian pay increases - $14b saved over 10 years

Reduce the DoD civilian workforce by 75,000 people - $37.4b saved over 10 years

Merge NORTHCOM and SOUTHCOM - Unknown Savings

Avoid repeating weapons systems failures of the past decade - $46b saved over 10 years

Curb recent increases in allowance pay - $11b saved over 10 years

Roll back contractor spending to 2001 levels - Unknown Savings

Streamline the process for Shift to a defined contribution generating requirements and make system for all new recruits - $38b real trade-offs on systems up-front saved over 10 years Unknown Savings Adjust TRICARE free to reflect Continue to develop the acquisitions growth in health care costs - $30b workforce - Unknown Savings saved over 10 years Foster a productive two-way dialogue with industry - Unknown Savings Keep the rapid acquisitions process for fast-changing capabilities while fixing the "normal" process Unknown Savings Pursue strategic sourcing options $20b saved over 10 years Use reverse auctioning for contracts $26b saved over 10 years Reduce redundancy of IT management system - Unknown Savings Improve business alignment and auditability - Unknown Savings Authorize and conduct a new BRAC round - $10b saved over 10 years, significant savings over 20 years Close DoD schools in the United States - $1.1b saved in 2015 Consolidate the base and post exchange systems - $2.5b saved over 10 years Increase cost sharing for TRICARE for Life - $6.7b saved over 10 years Increase pharmaceutical cost sharing - $27b saved over 10 years

Reduce spending on base support and facilities maintenance - $3.6b saved through FY 2015, with increased potential for further savings through FY 2020 Consolidate the military service medical commands- $292-478m per year Reduce duplication and overall funding for counter-IED initiatives $1.2b saved over 10 years Reduce redundancy in military service intelligence organizations Unknown Savings Reduce all overhead spending by 5% - $100b saved over 10 years Reduce all overhead spending by 10% - $200b saved over 10 years
"The Department of Defense (DOD) faces a stark choice. With reductions in defense spending looming, decisions made during the next year will chart one of two paths: one that avoids tough choices about cutting excess and inefficiencies, or one that embraces painful but necessary reforms to the structural underpinnings of the department. The first path will inevitably follow the precedent of past defense budget drawdowns and lead to deep cuts in force structure, readiness and modernization, and produce a much-diminished U.S.military. The other, more difficult, path preserves these capabilities by fundamentally reforming the underlying causes of DOD cost growth. With the right choices for reform, the U.S. defense establishment can consume fewer resources and still meet Americas global strategy requirements for many decades to come but bold and resolute action is required now." Barno, David, Nora Bensahel, Jacob Stokes, Joel Smith, and Katherine Kidder. The Seven Deadly Sins of Defense Spending. The Center for a New American Security. Cnas.org. June 2013. http://www.cnas.org/files/documents/publications/CNAS_SevenDeadlySIns.pdf.

Page 5

TAXPAYERS AGAINST RUNAWAY MILITARY SPENDING

Center for a New American Security


Hard Choices: Responsible Defense in an Age of Austerity
Procurement and R&D Force Structure Efficiency Reforms Benefits and Compensation Personnel Levels Other Savings

!ermanentl" reduce #$% From FY12 to FY21, hold fleet from 11 to 1&, active From FY1- to FY21, hold spending for Research dut" air wings from 1& to spending on base support and Development 12.5% ', and 5,(&& sailors b" and facilities mainenance at below FY11 level plus retiring the )** +eorge 12.5% below FY11 level plus inflation $93.7b saved ,ashington in 2&1( inflation $32.5b saved

*tarting in FY15, reduce .rm" From FY12 to FY21, hold active dut" to /(&,&&&, spending on atomic energ" 0arine #orps active dut" to defense activities at 12.5% 1(2,5&&, and reduce 12,&&& below FY11 level plus reservists $63.8b saved inflation $21.0b saved

over 10 years

$7.0b saved over 10 years

over 10 years

over 10 years

over 10 years

#ancel $ 22 1spre" in FY1(, stopping total procurement at -(aircraft 2-1/ 0$ 22s, /' #$ 22s3 $7.9b saved

Depots5 .lter pricing Reduce strategic airlift structure for repairs, and re4uirement from -1( to ease restrictions on -&1 aircraft, and retire 15 contracting for maintenance # 5.s $2.4b saved

over 10 years

over 10 years

$6.4b saved over 10 years

Reduce the wor6force of From FY12 to FY21, hold 78/,&&& DoD civilian spending on other defense emplo"ees b" 75,&&& over 1& related activities at 12.5% below FY11 level plus "ears b" not replacing some inflation $7.7b saved retirees $36.7b saved

over 10 years

over 10 years

9nd :ittoral #ombat *hip #ancel 0; /# <road .rea program in FY17 after 27 0aritime *urviellance total ships have been 2<.0*3 )nmanned .ircraft procured $7.0b saved *"stem 2).*3 $10.0b

#onsolidate DoD=s commissar" and e>change s"stems over five "ears

over 10 years

saved over 10 years

$67b saved over 10 years

?ncrease b" 2&% the From FY1- to FY21, hold previousl" announced -&% intelligence spending 12.5% reduction in spending on below FY11 level plus contractor augmentees for inflation $88.5b saved head4uarters staff $20.4b

saved over 10 years

over 10 years

Aold procurement to one From FY1- to FY21, $irginia class **% 2attac6 *hut down Boint ?mprovised holding spending for submarine3 per "ear, 9>plosive Device Defeat @1ther !rocurement@ 1rganiCation in FY17 reducing planned bu" from 12.5% below FY11 level 1' to 1& ships during FY12 $1.2b saved over 10 plus inflation $39.4b 21 $25.0b saved over years

saved over 10 years

#ancel the !recision Drac6ing *pace *"stem 2!D**3 program and reduce spending on e>perimental national missile defense programs $37.5b saved

10 years

over 10 years

Dela" fielding +round From FY1- to FY21, hold #ombat $ehicle 2+#$3 #ancel two :A. (s and overhead spending for until after FY21 and three :*D2E3s scheduled commercial activities 12.5% reinvest some savings into for procurement during below FY11 level plus upgrading <radle" FY1( 21 $13.0b saved inflation $67.4b saved Fighting $ehicles $7.0b over 10 years

saved over 10 years

over 10 years

#ancel Boint :ight Dactical $ehicle 2B:D$3 $10.9b

Retire si> Diconderoga class cruisers $3.3b

saved over 10 years


)phold the decision to cut the bu" of the Boint Dactical Radio *"stem 2BDR*3 +round 0obile Radio 2+0R3 from 8(,'5( to 11,&-& $15.0b

saved over 10 years

saved over 10 years


#ut F -5. from 1,7(- to 85&, F -5< from -11 to 15&, and F -5# from -(' to -&&, and do not bu" substitutes $25.0b

saved over 10 years


From FY1- to FY21, holding spending for @1ther !rocurement@ 12.5% below FY11 level plus inflation $39.4b

saved over 10 years


This report the first in the Center for a New American Securitys Responsible Defense series outlines the ends, ways and means of U.S. defense strategy under a range of budgetary constraints. We acknowledge that these constraints are driving strategy, not the other way around, but accept this as an unavoidable reality in todays political environment. Therefore, the report seeks to highlight the strategic consequences of these constraints, so that political leaders grasp the risks and trade-offs the cuts portend. We offer four scenarios for defense budget reductions, and identify what we think are the best possible ways to cut military force structure, end strength, procurement and overhead to reach the required levels of savings. We also consider the modified roles and missions, operational approaches and vulnerabilities that might result. Barno, David W., USA (Ret.), Nora Bensahel, and Travis Sharp. Hard Choices: Responsible Defense in an Age of Austerity. The Center for a New American Security. CNAS.org. October 2011. http://www.cnas.org/files/documents/publications/CNAS_HardChoices_BarnoBensahelSharp_0.pdf.

Page 6

TAXPAYERS AGAINST RUNAWAY MILITARY SPENDING

The National Commission on Fiscal Responsibility and Reform


Procurement and R&D Force Structure Efficiency Reforms Benefits and Compensation Personnel Levels Other Savings

Reduce procurement by 15% - $20.0b saved in 2015

Cancel the Navy's Future Maritime Prepositioning Force - $2.7b saved from FY2012-FY2015

Replace military personnel performing commercial activities with civilians - $5.4b saved in 2015

Freeze non-combat military pay Double Secretary Gates' cuts to at 2011 levels for 3 years defense contracting - $5.4b $9.2b saved in 2015 saved in 2015

End procurement of the V22 Osprey - $1.1b saved in 2015

Apply the overhead savings Reduce military personnel Secretary Gates has promised Modernize Tricare, DoD health - stationed at overseas bases in to deficit reduction - $28.0b $6.0b saved in 2015 Europe and Asia by one-third saved in 2015 $8.5b saved in 2015

Cancel the Expeditionary Fighting Vehicle - $650.0m saved in 2015

Reduce spending on base support - $2.0b saved in 2015

Freeze federal salaries, bonuses, and other compensation for the civilian workforce at the DoD for three years - $28.0b saved in 2015

Substitute F-16 and F/A18Es for half of the Air Force and Navy's planned buys of F-35 fighter aircraft $9.5b saved from FY2011FY2015

Reduce spending on facilities maintenance - $1.4b saved in 2015

Cancel the Marine Corps version of the F-35 - $17.5b saved from FY2012FY2015

Consolidate the DoD's retail activities - $0.8b saved in 2015

Cancel the new Joint Light Tactical Vehicle, the Ground Combat Vehicle, and the Joint Tactical Radio- $2.3b saved in 2015

Integrate children of military personnel into local schools in the U.S. - $1.1b saved in 2015

Reduce planned levels for "Other Procurement" $8.6b saved

Reduce spending on Research, Development, Test & Evaluation by 10% $7.0b saved in 2015

"President Obama created the bipartisan National Commission on Fiscal Responsibility and Reform to address our nation's fiscal challenges. The Commission is charged with identifying policies to improve the fiscal situation in the medium term and to achieve fiscal sustainability over the long run. Specifically, the Commission shall propose recommendations designed to balance the budget, excluding interest payments on the debt, by 2015. In addition, the Commission shall propose recommendations that meaningfully improve the long-run fiscal outlook, including changes to address the growth of entitlement spending and the gap between the projected revenues and expenditures of the Federal Government." FiscalCommission.gov. The National Commission on Fiscal Responsibility and Reform. http://www.fiscalcommission.gov/sites/fiscalcommission.gov/files/documents/Illustrative_List_11.10.2010.pdf.

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TAXPAYERS AGAINST RUNAWAY MILITARY SPENDING

National Security Network


Reshaping Pentagon Spending and Capabilities: Setting Priorities for the Future
Procurement and R&D Force Structure Efficiency Reforms Benefits and Compensation Personnel Levels Other Savings

Reduce planned buy of F-35s by 25-50%, upgrade legacy aircraft No Savings Estimate Given

Reduce nuclear arsenal to 1,050 strategic warheads and 1,000 launchers; retire the bomber portion of the nuclear triad - $113.5b saved over 10 years

Adapt more efficient business practices - $95b saved per year

TRICARE Reform: Offer incentives for not overusing care, peg fees to inflation, higher fees on working Reduce DoD service enrollees, and encourage contracts by 15% - $372b retirees to use plans saved over 10 years through other employers if available - $15b saved per year

Retirement Reform: Institute a 401K style system in Reduce Army end strength which the Pentagon would to 420,000 and Marine end contribute about twice the strength to 160,000 - No private sector average Savings Estimate Given $13b saved per year

"This paper contributes to the growing body of work on strategic reshaping by presenting a particular progressive-realist approach that has tacitly evolved in the literature but has not yet been explicitly articulated." French, Bill. Reshaping Pentagon Spending and Capabilities: Setting Priorities for the Future. The National Security Network. NSNetwork.org. March 2013. http://nsnetwork.org/wp-content/uploads/2013/03/Reshaping-Pentagon-Spending-and-Capabilities_Future-Priorities_FINAL-0313132.pdf.

Page 8

TAXPAYERS AGAINST RUNAWAY MILITARY SPENDING

National Taxpayers Union/R Street Institute


Defending America, Defending Taxpayers: How Pentagon Spending Can Better Reflect Conservative Values
Procurement and R&D Force Structure Efficiency Reforms Efficiency Reforms (cont) Benefits and Compensation Personnel Levels Other Savings

End procurement of Littoral Combat Ship - $2.0b saved in

Cut 4 submarines from nextgen fleet - $18.0b saved in

10 years

10 years

$e&uire 'A() to share Adjust military pension benefit Consolidate data centers and $educe o%erseas military in costs for *+, nuclear Unify military medical system - multiplier from 2 !" of base embrace cloud computingbombs in Europe personnel - $69.5b $4.6b saved in 10 years pay to 2 #" - $25b saved in

$30.0b saved in 5 years

10 years

saved in 10 years

$2.1b saved in 10 years

-elay refurbishment of Abrams tan. - $3.0b saved over 10

Cancel C/$$-'uclear 0acility Los Alamos - $3.7b saved in

Eliminate noncompetiti%e and Consolidate foreign language cost-plus contracts - $2.0b contracts - $1.0b saved in

years

10 years

saved in 10 years

10 years

Adjust military pension calculation from a%erage of highest three annual salaries to a%erage of highest fi%e annual salaries - $5.5b

$educe number of ci%ilian -o- employees through attrition -

saved in 10 years

$3.2b saved over 5 years


Shift Army and /arine Corps troops to reser%es4 return acti%e-duty force to pre-56,, le%els -

1old defense discretionary spending to 2#" of se&uester in 2#,3 plus inflation in outyears - $220.0b saved

per year

$estructure next generation Aegis missile - $2.1b saved in

1 year

$educe minimum airlift in%entory from 3,+ aircraft to 3#, - $1.2b over 5 years

$educe -o- ad%ertising budget by !#" - $2.7b

Combine support ser%ices at joint bases - $1.2b saved in

$aise retirement age to +2 -

7erform a full audit of 7entagon finances -

saved in 10 years

10 years

$96.7b saved in 10 years

$52.5b saved in 10 years


Eliminate -o- (uition Assistance program - $4.9b

$25.0b saved in 10 years

-elay ne8 E model of Army Apache helicopter - $1.3b

0und only one --9-!, Aegis -estroyer - $1.5b over 10

Consolidate -ogro%ery6retail stores - $9.1b

Eliminate duplicati%e :( in%estments - $1.2b saved

Cut -o- ci%ilian positions -o8nblend and sell excess uranium - $23b by attrition - $36.7b

saved in 1 year

years

saved in 10 years

in 10 years

saved in 10 years

saved in 10 years

saved in 10 years

0ree;e (rident -! missile program - $1.5b over 10

*uy only se%en 7-<A 7oseidon maritime patrol craft - $1.5b

Close -o- elementary schools - $10.0b saved in

:mpro%e supply chain $eform ($:CA$E by increasing cost-sharing - $205.4b management - $9.7b saved

years

over 10 years

10 years

in 10 years

saved in 10 years

Cut number of consultants and (erminate 7recision contractors at (rac.ing Space System head&uarters - $15.0b $1.7b saved in 1 year

saved in 10 years
$educe acti%e-duty military personnel $educe or eliminate ground-based missile defense systems -

Slo8 procurement of SS'-224 =irginia class submarine -

$educe number of aircraft carriers4 'a%y Air >ings-

Close -o- S(E/ programs -

$2.0b over 10 years

$18.4b over 10 years

$1.7b saved in 10 years

$educe re&uirements for 'a%y construction projects -

Cap increases in military basic pay - $17.3b saved in 10

$1.5b saved in 1 year

years

$8.1b saved in 10 years


$educe planned -oci%ilian personnel $7.3b saved in 10 years

$6.0b over 10 years


End 9round-*ased /idcourse -efense /issile program - $4.7b

$educe spending for ?other procurement? - $52.0b over

$educe nuclear 8eapons force structure - $79.0b over 10

10 years

years

$educe construction projeccts $educe 0@2#,4 ci%ilian pay throughout Air 0orce - $2.2b raise to ," - $2.2b saved in $10.0b saved in 10 years saved in 1 year 1 year $educe -o- tra%el budget -

over 10 years
Cancel future satellites of Space-*ased :nfrared System - $6.0b over

Use less expensi%e boosters for Air 0orce E%ol%ed Expendable Launch =ehicle - $1.1b over 1

year

Consolidate military health $educe Army military care ser%ices - $2.8b saved construction projects - $0.4b in 10 years saved in 1 year

$educe reliance on contractors - $372.0b

saved in 10 years

10 years

$eplace ArmyAs 9round Combat =ehicle purchase 8ith 9erman 7uma - $8.4b over 10 years

Adopt ?sea s8ap? policies for cruisers4 destroyers4 amphibious ships - $100.0b

saved in 10 years

End orders for obsolete spare parts and supplies for -efense Logistics Agency4 Army4 'a%y4 Air 0orce -

$7.1b over 10 years

$educe number of generals and admirals $0.8b saved in 10 years

$eplace * and C models of 0-3! 8ith 06A-,< E60 - $61.7b over

10 years

Use ci%ilian contractors to perform commercial acti%ities on bases - $53.0b saved in

10 years
Standardi;e per troop spending4 reduce maintenance costs - $34b

-elay 9round Combat =ehicle -

$7.0b over 10 years

saved in 10 years
$eplace =-22 )sprey 8ith /1+# and C1-!3 helicopter $educe spending on military bands - $1.8b saved in 10

$17.1b over 10 years

years

Additional 8eapon4 :(4 other options - $35.5b over 10

Cap experimental fuel procurement - $9.0b saved

years

in 10 years

-efer next-gen bomber -

$6.3b over 10 years

Consolidate management of retail stores on bases -

$7.1b saved in 10 years

As conservative organizations, the R Street Institute and National Taxpayers Union (NTU) believe strongly in a robust national defense. However, our groups also believe strongly in exercising fiscal discipline in all areas of the federal budget. As by far the largest portion of discretionary spending, Pentagon expenditures must not escape scrutiny as conservatives examine methods for reducing our staggering debt. Sepp, Pete, and Andrew Moylan. Defending America, Defending Taxpayers: How Pentagon Spending Can Better Reflect Conservative Values. National Taxpayers Union/R Street Institute. NTU.org. http://www.ntu.org/news-and-issues/defense/defending-america-defending-taxpayers.pdf.

Page 9

TAXPAYERS AGAINST RUNAWAY MILITARY SPENDING

Sustainable Defense Task Force


Debts, Deficits, and Defense: A Way Forward
Procurement and R&D Force Structure Efficiency Reforms Benefits and Compensation Personnel Levels Other Savings

Cancel USAF F-35, buy replacement - $47.9b saved over 10 years

Phase in compensation reforms (ex. Include tax Cap routine U.S. military advantages and Require commensurate housing/subsistence presence in Europe at Selectively curtail missile Reduce U.S. Navy fleet savings in command, allowances in calculating 35,000 personnel and in defense & space spending pay raises) as Asia at 65,000 troops, and to 230 ships - $126.6b support, and infrastructure - $55b saved over 10 recommended by the then reducing force $100b saved over 10 saved over 10 years years Quadrennial Review of structure accordingly - $80b years Military Compensation saved over 10 years (QRMC) - $55b saved over 10 years

Improve the efficiency of Cancel USN & USMC FOnly retire two Navy Roll back Army & USMC military depots, 35, buy replacement - aircraft carriers and naval Prevent military retirees who growth as wars in Iraq and commissaries, and $9.85b saved over 10 air wings - $50b saved Afghanistan end - $147b exchanges - $13b saved are earning fulltime salaries years over 10 years saved over 10 years on top of their full military over 10 years pensions from opting for TRICARE when they can get health Cancel MV-22 Osprey, Retire two Air Force Reduce military recruiting coverage through their expenditures as wars field alternatives - $10b- fighter wings, reduce Femployer, along the lines 35 buy - $40.3b saved recede - $5b saved over $12b saved over 10 suggested by the QRMC over 10 years 10 years years $60b saved over 10 years

Reduce nuclear weapons to a level of 1,000 warheads deployed on 7 Delay KC-X Tanker, Ohio-class submarines interim upgrade of some and 160 Minuteman KC-135s - $9.9b saved missiles. Shift to nuclear over 10 years "dyad" of land- and seabased missiles - $113.5b saved over 10 years Limit modernization of nuclear weapons infrastructure and research - $26b saved over 10 years

Cancel Expeditionary Fighting Vehicle, field alternatives - $8b-$9b saved over 10 years

Reduce spending on research & development $50b saved over 10 years

At a time of growing concern over federal deficits, it is essential that all elements of the federal budget be subjected to careful scrutiny. The Pentagon budget should be no exception. As Secretary of Defense Robert Gates noted in a recent speech, paraphrasing President Dwight D. Eisenhower, 'The United States should spend as much as necessary on national defense, but not one penny more.' Debts, Deficits and Defense: A Way Forward. The Sustainable Defense Task Force. Comw.org. June 11, 2010. http://www.comw.org/pda/fulltext/1006SDTFreport.pdf.

Page 10

TAXPAYERS AGAINST RUNAWAY MILITARY SPENDING

The Henry L. Stimson Center


Managing the Military More Efficiently: Potential Savings Separate from Strategy
Procurement and R&D Force Structure Efficiency Reforms Benefits and Compensation Personnel Levels Other Savings

Better balancing between the Streamlining redundancy and Modernize military retirement Constructing Contracts active and reserve components duplication - $25b saved $5b-$40b saved over 10 No Savings Estimate - $35b saved over 10 years over 10 years years

Reducing infrastructure billets - $100b saved over 10 years

Adjust the formulas for cash Managing the compensation growth - $20b- Contracting Workforce $30b saved over 10 years No Savings Estimate

Concentrating service members on inherently military functions - $50b saved over 10 years

Extricate 10% of uniformed personnel from non-military (commercial) tasks- $2.7b saved in FY2015

Coming to Best Practices - No Savings Estimate

Transfer non-cash compensation into cash compensation - $10b saved over 10 years

Generating "Requirements" - No Savings Estimate

Curtail pool of health care beneficiaries - $90b-$100b saved over 10 years

Reducing civilian manpower - $200b saved over 10 years

Increase health care fees and cost sharing - $40b-$110b saved over 10 years

Relying less on contractor support $110b saved over 10 years

"This report is a compilation of recommendations made in recent years by many boards, commissions and study groups that have proposed efficiencies in how the U.S. Department of Defense spends money. If implemented fully, the recommendations would save nearly $1 trillion over a decade, though it is virtually impossible they will all be adopted. The proposals face varying degrees of political opposition some intense and some recommendations are contradictory. We are not endorsing any of the specific options but, by compiling the proposals, we have created a resource that frames the many calls for efficiencies, providing context that the broader debate on defense spending is currently missing." Leatherman, Matthew, Barry Blechman, and Russell Rumbaugh. Managing the Military More Efficiently: Potential Savings Separate from Strategy. The Henry L. Stimson Center. Stimson.org. May 2013. http://www.stimson.org/images/uploads/research-pdfs/Managing_the_Military_More_Efficiently.pdf.

Page 11

TAXPAYERS AGAINST RUNAWAY MILITARY SPENDING

The Henry L. Stimson Center


Strategic Agility: Strong National Defense for Today's Global and Fiscal Realities
Procurement and R&D Force Structure Efficiency Reforms Benefits and Compensation Personnel Levels Other Savings

Transfer remaining operational F16 squadrons in the active force to the reserve component. The active force would still maintain 500 operational high-end fighters, Cancel the Ground Combat Vehicle including F-22s and F-15s, more (GCV) and Joint Light Tactical than 100 A-10s, some special Vehicle (JLTV) - $1.2b saved per purpose F-16s, as well as an year additional 250 F-16s in the active component for training and development and large-scale operational contingencies that might arise - $5.4b saved per year

20% reduction in DoDs headquarters Implement a variation of the personnel by broadening the span of Defense Business Boards control and eliminating low-priority proposed defined-contribution and duplicative tasks and reporting military retirement plan - $1.5b requirements - $4.5b saved in FY saved by FY2015 2015

Reduce Army to end-strength to 450,000 personnel $11.9b saved per year

Slow procurement of F-35s for two years by cutting the planned aircraft purchase each year by about 1/2. The Navy and Marine Corps variants are already slated for purchase in small lots, 4 and 6 respectively. Trim that to 2 and 3. The Air Force plans to acquire 19 of its A variant in fiscal year 2014, and 30 in fiscal year 2015. Hold that to 9 each in the fiscal years 2014 and 2015. All three variants would return to their planned rampup in fiscal year 2016 - $4.0b saved in FY 2015

Currently, the Navy operates 10 aircraft carriers. It intends to increase that number in 2016 with the commissioning of the USS Gerald Ford. Forgo that increase by retiring the USS George Washington in fiscal year 2014 and maintaining a fleet of 10 carriers over the long term. This recommendation would also cut a carrier air wing in accord with the number of carriers. - $2.3b saved per year

Reduce size of DoD agencies such as the Defense Contract Audit Agency, Defense Contract Management Agency, and Defense Logistics Agency - $1.0b saved in FY2015

Increase means-tested beneficiary cost sharing requirements for TRICARE for Life, which provides secondary coverage for Medicare-eligible Reduce Marine Corps endretirees, and TRICARE, the strength to 160,000 personnel standard health plan for retirees - $2.0b saved per year and dependents, as well as higher cost-sharing for pharmaceuticals for dependents and retirees. - $4.7b saved in FY2015

Reduce the funding levels for the Cut the planned buy of ballistic Guard and Reserves somewhat, missile submarines (SSBN-X) from but not in proportion to the 12 to 10 - $1.2b saved per year reduction in the active force $0.7b saved per year

Streamline obsolete centralized training model - $2.0b saved in FY2015

58,000 DoD civilian positions should be cut by fiscal year 2015 - $4.7b saved in FY2015

Cut spending on programs costing Maintain the Triad of delivery less than $85 million a year by an systems including bombers and amount proportionate to the the current force of ballistic missile Extricate 10% of uniformed personnel reductions in manpower resulting submarines, but retire one ICBM from non-military (commercial) tasksfrom the changes we called for in wing and reduce the non-strategic $2.7b saved in FY2015 nuclear weapons inventory force structure and management reforms - $0.9b saved per year $0.4b saved in FY2015

Decrease number of contractors at least 20% to be commensurate with the other personnel cuts -No separate savings estimate

Stop funding commissaries and post exchanges in the United States $1.2b saved in FY2015

A new BRAC round could focus on relocating units to existing bases and facilities and provide additional savings over the long-term. Defense industrial facilities also need to be consolidated. All such actions should be taken together with robust programs to aid local communities affected by the closures Significant long-term savings

"We continue to believe that Strategic Agility best achieves US interests. It seeks to avoid US involvement in protracted ground wars and emphasizes the importance of technologically superior assets that can quickly and decisively eliminate threats to the United States and its allies. The strategys value already has been demonstrated by events of the past year, including the rapid movement of air and naval assets in response to North Korean provocations, US support of the French intervention in Mali, and the US response to the Syrian conflict. The growing relevance of cyberwarfare and the remarkable advantages provided by US space-based assets underscore the need to invest in advanced technologies." Strategic Agility: Strong National Defense for Todays Global and Fiscal Realities. The Henry L. Stimson Center. Stimson.org. September 2013. http://www.stimson.org/images/uploads/Strategic_Agility_Report.pdf.

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TAXPAYERS AGAINST RUNAWAY MILITARY SPENDING

United States Senator Tom Coburn, M.D. (R-OK)


Back In Black: A Deficit Reduction Plan
Procurement and R&D Force Structure Efficiency Reforms Benefits and Compensation Personnel Levels Other Savings

Air Force: full support of Reduce aircraft carriers Consolidate DoD Adopt Secretary Gates' F-35 Joint Strike Fighter, from 11 to 10, Navy Air administered grocery and Efficiency negotiate a multi-year Wings from 10 to 9 - $7b retail stores - $9.1b saved Recommendations - $100b procurement - $7b saved over 10 years over 10 years saved over 10 years saved over 10 years

Reduce military personnel overseas in Europe and Audit the Pentagon - $25b Asia- $69.5b saved over saved over 10 years 10 years

Navy and Marine Corps: Close Department of cancel the Joint Strike Reduce nuclear weapons Defense elementary Fighter and replace with force structure- $79b F/A-18 Super Hornet schools - $1.1b saved in saved over 10 years $18b saved over 10 FY2015 years

Freeze federal salaries for Reverse the Grow the Army Keep intelligence spending DoD employees - $15.5b Initiative - $92b saved over constant - $26b saved saved over 10 years 10 years over 10 years

Delay fielding of the Army's Ground Combat Vehicle - $7b saved over 10 years

Close DoD-run Science, Technology, Education, Reduce the civilian Reduce spending on DoD and Mathematics programs workforce by 5% beginning Tuition Assistance Program for elementary school in 2014 - $22.5b saved $4.9b saved over 10 years students - $1.7b saved over 10 years over 10 years

Terminate the Medium Extended Air Defense System (MEADS) Program - $13b saved over 10 years

Reduce planned future purchases of the V-22 Osprey - $6b saved over 10 years

Reduce spending at the Congressionally Directed Double Secretary Gates Consolidate military health Medical Research Program reductions to contracting for care services - $2.8b (CDMRP) on non-military staff augumentees - $37.8b saved over 10 years specific diseases - $250m saved over 10 years saved over 10 years

Reduce spending for "Other Procurement" $52b saved over 10 years

Reduce funding for the National Guard Counterdrug Program $250m saved over 10 years

Reform TRICARE Standard and Prime for military retirees and dependents $115b saved over 10 years

Reduce spending on other options including JLENS, VTUAV, and PTSS - $35.5b saved over 10 years Reduce 10% of research and development funding - $79b saved over 10 years

Reduce travel expenditures at the Department of Defense - $14b saved over 10 years

Increase cost sharing for pharmaceuticals under TRICARE - $26b saved over 10 years

Replace military personnel Introduce minimum out-ofperforming commercial pocket requirements under activities with civilians TRICARE for Life - $43b $53b saved over 10 saved over 10 years years Standardize per troop spending and reduce spending on maintenance due to base closures $34b saved over 10 years Adopt Secretary Gates' Efficiency Recommendations $100b saved over 10 years

"A thorough review of the entire federal budget is long overdue. Such an evaluation should not be seen through political or ideological lenses, but as a practical evaluation: What works and what does not? What is a priority and what is not? What is in the national interest and is a special interest? What is necessary today and what has become obsolete? And what is efficient and what is wasteful?" Coburn, Tom. Back in Black: A Deficit Reduction Plan. United States Senator Tom Coburn, M.D. (R-OK). Coburn.Senate.gov. http://www.coburn.senate.gov/public//index.cfm?a=Files.Serve&File_id=bc1e2d45-ff24-4ff3-8a11-64e3dfbe94e1.

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TAXPAYERS AGAINST RUNAWAY MILITARY SPENDING

American Enterprise Institute


Preserving the Military Health Care Benefit: Needed Steps for Reform This report by the American Enterprise Institute (AEI) focuses on the exponentially growing personnel costs in the United States military. Since 2001, the cost of military pay, allowances, and health care has increased by 90%, while the actual number of personnel has only increased by 3%. This rapid escalation in cost is projected to continue, and, additionally, many of these benefits end up going to individuals who are no longer in the armed forces. This pattern is unsustainable, and if programs like TRICARE are to be maintained, reforms will need to be made. The recommendations in this report were proposed by John L. Kokulis, a former Deputy Assistant Secretary of Defense for Health Budgets and Financial Policy. These proposals are: Recommendation 1: Enroll All Beneficiaries Many TRICARE Standard and Extra retiree beneficiaries are not fully enrolled in the system and instead choose to use TRICARE selectively for its pharmacy benefit or to choose whichever insurance plan, private or TRICARE, is most advantageous for a particular episode of medical care. This results in poor communication between the health care professionals and the beneficiaries and ultimately results in bad medicine when beneficiaries seek care from multiple sources and care is not coordinated. Achieving 100 percent enrollment of all beneficiaries would help improve medical outcomes and reduce cost. Recommendation 2A: Create Financial Incentives to Encourage Retiree Beneficiaries under 65 to Seek Care at MTFs to Lower Cost and Enhance Readiness Mirroring best practices most other major public and private health care plans employ, cost shares for all retiree beneficiaries should be adjusted to more adequately reflect the actual cost of care with the goal of rationalizing the use of health care resources and improving accountability. Recommendation 2B: Institute Pharmacy Copays that Encourage the Use of LowCost Generics and Promote the Use of Low-Cost Distribution Options such as TRICARE Pharmacy Home Delivery In fact, in the presidents budget submission for FY 2013, DoD advanced this exact concept, proposing to raise copays for brand and nonformulary refills but keep copays for generic refills through home delivery and all refills made at the MTF [Military Treatment Facility] free. Building on the objective to strengthen the MTFs by recapturing patient care, I propose taking this a step further by lowering the generic and brand copays for prescriptions written at an MTF or by an MTF doctor via telemedicine (seeing a doctor via electronic communication) when picked up at a retail pharmacy. This will provide incentives for retirees to seek a refill prescription through an MTF. Many visits to the purchased care network are for nothing more than a simple refill for a prescription. These visits can be reduced. Better yet, coming to the MTFs to get their scripts filled may lead these retired beneficiaries to seek more of their care at that MTF. Recommendation 3: Once These Fees and Cost Shares are Fully Phased In, Index Them to Medical Inflation Part of the reason the MHS budget is in such crisis is that Congress has left TRICARE enrollment fees, copays, and deductibles mostly unchanged since it established the program in 1995. The FY 2012 and FY 2013 changes were a good step in this direction, but any future changes must be indexed to medical inflation - not simply a local cost-ofliving adjustment.
Kokulis, John L. Preserving the Military Health Care Benefit: Needed Steps for Reform. The American Enterprise Insitute. AEI.org. October 2013. http://www.aei.org/files/2013/10/16/-preserving-the-military-health-care-benefit_165011202359.pdf.

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TAXPAYERS AGAINST RUNAWAY MILITARY SPENDING

American Enterprise Institute


Shrinking Bureaucracy, Overhead, and Infrastructure: Why This Defense Drawdown Must Be Different for the Pentagon This report by the American Enterprise Institute (AEI) examines alternate avenues for military sequestration cuts. The Obama administration has, so far, primarily targeted modernization programs for these cuts. This leads to a decline in readiness and fewer next-generation programs. Instead, Mackenzie Eaglen, Resident Fellow at the Marilyn Ware Center for Security Studies, argues that the structural drivers of spending should be addressed instead. Some of her recommended targets for spending reductions include: Bureaucratic Overhead in Both the Uniformed Military Services and the Federal Civilian Workforce 1) The first step to rein in expanding military and civilian bureaucracy within DoD is for the secretary of defense to demand the collection of requirements data. Today, DoD needs more information to properly assess workforce requirements, which are critical before deciding where to downsize. 2) Once DoD has better information on hand, leaders can begin to target the elimination of excess positions. In theory, judging from historical averages, if they wish to attain gradual 3 to 5 percent reductions per year, layoffs will be unnecessary. This is because DoDs annual turnover rate (resignations, retirements, and voluntary separation) averages over 10 percent. 3) This kind of reduction, along with decreased reliance on contractors, could save an estimated $310 billion over 10 years. Excess Physical Infrastructure As the US military shrinks in size, capacity, and capability, it must also reduce its inventory of physical assets. In preparation for the 2005 Base Realignment and Closure Commission (BRAC) round, the Pentagon found that the entire department possessed 24 percent aggregate excess capacity. The most recent base closure round, however, reduced capacity by only 3.4 percent.

Deferred and In-Kind Compensation for Military and Civilian Personnel. Many reports in Washington examine the rising, and ultimately unsustainable, costs of military personnel absent change. While the cost of military personnel as a percentage of the defense budget has remained relatively flat in recent years, the cost of military pay, allowances, and health care has risen over 90 percent and the size of the active duty force has grown by only less than 3 percent since 2001. This is due in large part to congressionally mandated annual pay raises half a percent higher than inflation; three rounds of pay table reform designed to improve retention of experienced personnel; and substantial increases in basic housing allowance, health care, and retirement benefits.

Eaglen, Mackenzie. Shrinking Bureaucracy, Overhead, and Infrastructure: Why This Defense Drawdown Must Be Different for the Pentagon. The American Enterprise Institute. AEI.org. March 2013. http://www.aei.org/files/2013/03/21/-shrinking-bureaucracy-overhead-and-infrastructure-why-this-defense-drawdown-must-be-different-for-the-pentagon_083503530347.pdf.

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TAXPAYERS AGAINST RUNAWAY MILITARY SPENDING

Center for Strategic and Budgetary Assessments


Chaos and Uncertainty: The FY 2014 Defense Budget and Beyond This report by Todd Harrison at the Center for Strategic and Budgetary Assessments attempts to forecast the future of the defense budget in a post-sequestration climate. He begins by closely examining every section of the President's FY 2014 budget request, including military personnel funding ($177 billion), operations and maintenance ($177 billion), modernization ($167 billion), and war funding ("Overseas Contingency Operations," $90 billion). In each section, Harrison details where the money is going and adds his own predictions as to whether the total costs will be higher or lower than the requested amount. The report also analyzes prior defense budget cycles; he derives trends and patterns in procurement funding, research & development funding, personnel costs, and many others. He then uses this data to provide adequate context for the 2014 drawdown and to suggest likely scenarios for the direction of the defense budget. Although he predicts that the United States will significantly revise its strategic posture due to the defense budget cuts, Harrison concludes "Given the current turmoil in the overall federal budget, it is impossible to predict with any certainty how or when the current defense drawdown will end." Todd Harrison is the Senior Fellow for Defense Budget Studies at the Center for Strategic and Budgetary Assessments. A few key points (emphasis added): The 2012 Defense Strategic Guidance calls for rebalancing to the Asia/Pacific region and maintaining U.S. military presence in the Middle East. This guidance, however, was issued before sequestration went into effect. If history is any indicator, the U.S. military is not likely to emerge from this drawdown with the capacity or capability to both increase its presence in the Asia/Pacific region and maintain its current level of presence in the Middle East. While U.S. forces could still be swung from one theater to another as needed in the event of a conflict, the military may not be able to address successfully two major, overlapping conflicts in different theaters. Moreover, forces engaged in forward presence missions cannot be swung as easily from one theater to another, and yet they can be a key factor in deterring a conflict from occurring in the first place. the current budget impasse may not be resolved until the drawdown is effectively over, at which point many of the critical decisions will have already been made for the Department by incremental reductions that chip away at programs and force structure year-by-year or, worse, by the blunt and indiscriminant mechanism of sequestration. The 2014 Quadrennial Defense Review (QDR) and the FY 2015 budget request are an opportunity for the Defense Department to address the rapidly evolving budgetary and strategic situation. If the Department plans for the reduced budget caps in its FY 2015 request and uses the QDR as an opportunity to revise its strategic guidance according to these more realistic budget constraints, it will give DoD greater say in how cuts are implemented in the future. To be sure, this approach is not without risks. Proposing cuts makes it difficult to also argue against the cuts, and the specific cuts proposed are likely to meet stiff political resistance regardless of how they tie into a broader strategy.
Harrison, Todd. Chaos and Uncertainty: The FY2014 Defense Budget and Beyond. The Center for Strategic and Budgetary Assessments. CSBAOnline.org. October 2013. http://www.csbaonline.org/publications/2013/10/chaos-and-uncertainty-the-fy-14-defense-budget-and-beyond/.

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TAXPAYERS AGAINST RUNAWAY MILITARY SPENDING

The Mercatus Center at George Mason University


Defense Spending and the Economy This report by Robert Barro and Veronique de Rugy at the Mercatus Center attempts to forecast the economic effects of the defense budget cuts. They postulate that a reduction in defense spending would actually end up strengthening the economy. A large collection of empirical and historical evidence, some mentioned below, supports this assertion. The reports final conclusion is that "the adverse effects on real GDP will be minor even in the short run," and that "in the longer run, when reduced public debt and taxes are factored in, real GDP should be higher than otherwise. Robert Barro is a Professor of Economics at Harvard University and Veronique de Rugy is a senior research fellow at the Mercatus Center.

A few key points (emphasis added):

Historically, the report argues, defense-spending drawdowns have not had as severe an effect on the economy as predicted; these claims are "grossly overblown." For given taxes and other federal spending, the defense spending cut lowers the federal deficit. Hence, the public debt is lower than otherwise, and this reduction means that, in the long run, taxes will decrease correspondingly when compared to a benchmark path (if other federal spending does not change). "a dollar increase in federal defense spending results in a less-than-a-dollar increase in GDP when the spending increase is deficit-financed. Combining this with a tax multiplier that is negative and greater than one, we estimate that over five years each $1 in federal defense-spending cuts will increase private spending by roughly $1.30."

"the adverse effects on real GDP will be minor even in the short runin the longer run, when reduced public debt and taxes are factored in, real GDP should be higher than otherwise."

From 1987 to 2000, under the first Bush administration and the Clinton administration, the share of defense spending in GDP fell from 7.4 percent of GDP to 3.7 percent. The average growth rate of real GDP over this period was a respectable 3.3 percent per year, despite the 1991 recession.

Barro, Robert, and Veronique De Rugy. Defense Spending and the Economy. The Mercatus Center at George Mason University. Mercatus.org. May 7, 2013. http://mercatus.org/sites/default/files/Barro_DefenseSpending_v2.pdf.

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TAXPAYERS AGAINST RUNAWAY MILITARY SPENDING

Project On Government Oversight


Bad Business: Billions of Taxpayers Dollars Wasted on Hiring Contractors
This report by POGO examines the waste that accompanies the federal use of contractors. They found that "...the government pays billions more annually in taxpayer dollars to hire contractors than it would to hire federal employees to perform comparable services." Some key reform recommendations provided by the Project On Government Oversight include the following (emphasis added): 1. Congress should pass legislation requiring: All federal agencies awarding service contracts to use service coding systems that are consistent with OPMs job classification system. These systems should be required for all Federal Activities Inventory Reform (FAIR) Act inventories The Office of Management and Budget (OMB) to promulgate guidance establishing a uniform set of standards and guidelines for comparing the full lifecycle costs of outsourcing federal services with the costs of having those services performed by federal employees. Federal agencies to conduct pre-award contract cost analyses to determine whether the use of contractors is less costly and provides enhanced performance over the use of federal employees...

2.

Congress should amend the FAIR Acts service contracts reporting requirements to include: The occupational classification(s) of the person(s) performing the service. The actual number of all contractor and all subcontractor employees performing the service by occupational classification. The actual billing rate(s) for each occupational classification of persons performing the service.

3. Congress should pass legislation requiring OMB to submit to Congress and make publicly available an annual report on federal service contracts providing the following information and analysis: How much money the federal government spent outsourcing services, broken down by agency and legislative program. How many contractor and subcontractor employees provided services to the federal government, broken down by agency, legislative program, and occupational category.

4. Congress should amend the Office of Federal Procurement Policy Act (41 U.S.C. 1127) to ensure that the maximum benchmark compensation amount applicable to contractor employees shall not exceed the compensation paid to Level I positions pursuant to 5 U.S.C. 5312 and the Office of Personnel Managements rates of basic pay for the Executive Schedule. 5. Agencies should: Periodically consider hiring federal employees for short-term projectsexisting personnel authorities are very flexible and more than adequate for this purpose. Place much more emphasis on cost analyses in their decisions to utilize contractors. Cost analyses will provide significantly greater insight into how much contractors should charge for the work to be performed and will serve as a benchmark for project costing, whether performed by contractors or federal employees.

Bad Business: Billions of Dollars Wasted on Hiring Contractors. The Project On Government Oversight. POGO.org. September 13, 2011. http://pogoarchives.org/m/co/igf/bad-business-report-only-2011.pdf.

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