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Slip sliding global presence funding into the OCO account

Among most senior Pentagon official and national security advisors it is core strategic dogma that U.S. military forces must be deployed across the globe in continuous forward presence.

During the Cold War forward forces were oriented principally to counter Soviet formations.  After the Cold War the U.S. presence reoriented to multiple regions of perceived threat and instability.  The Middle East and Asia-Pacific were chief among these, lately joined by Africa.

A military strategy of maintaining a high degree of forward presence is uniquely expensive.  It is one of the principal reasons the U.S. spends so much more on its military than its allies.  For instance, the posture that keeps carrier battle groups forward deployed in peace time requires two or three additional carrier groups in the Navy inventory in order to provide for rotations to the other side of the Earth.  A surge operational posture could provide similar war time capability with several fewer carrier groups.

Overseas Contingency Operations (OCO) budget accounts are exempt from the sequester provision of the Budget Control Act and, as the budget caps have begun to impinge on the accustomed growth in the Pentagon's base budget, Congress has slipped more non-war spending into the OCO.

Last week the Readiness Subcommittee of the House Armed Services Committee held hearings called "Operation and Maintenance without OCO Funds: What Now?" (video)  The very name of this hearing is suggestive as in: "We've been bulking up your O&M funding through OCO accounting.  With the Afghan War coming to a close help us think about how can we keep sending you funds above and beyond BCA caps?"

Testimony from representatives of the Navy, Army and Air Force was revealing.  Inside Defense (subscription) reports that
Lt. Gen. Burton Field, the deputy chief of staff for operations, plans and requirements for the Air Force testified

"... senior officials from each of the Defense Department's combatant commands have expressed...their long-term need for the Air Force's overseas presence, especially in the area of intelligence, surveillance and reconnaissance or ISR."

"...while the Air Force does not have a very large population of airmen stationed inside of Afghanistan, it does have a group of permanent installations in the CENTCOM area of responsibility,.. including the Manas transport center in Kyrgyzstan and Al-Udeid Air Base in Qatar. Those bases' expenses are paid for using OCO dollars, not base-budget money."

Inside Defense continues:

"One possible arrangement is to create a situation like what the Navy has created in Djibouti, described by the maritime service's representative at the hearing, Vice Adm. Joseph Mulloy. In the Navy's case, the base itself is paid for with traditional dollars, but flying and sea operations in support of wartime missions out of the site are funded with OCO dollars. In such a case, an OCO or other supplemental fund would probably remain in existence for many years..."
(Italics added)

The Hill reports the Navy’s Deputy Chief of Naval Operations for Integration of Capabilities and Resources Vice Adm. Joseph P. Mulloy saying OCO funding would be needed to continue operating in the Middle East even after the Afghan War ends.

“As we reduce our ground combat forces…our demand for naval presence in the theater will remain high for the foreseeable future.”

The Hill adds that "[HASC] Subcommittee on Readiness Chairman Rep. Rob Wittman (R-Va.) said wartime funding was needed after combat operations in Afghanistan end, citing 'high-priority' activities such as training other nations’ militaries, humanitarian assistance, conducting training exercises, and performing intelligence functions." (Italics added)

It should be noted that the average troop level in Iraq and Afghanistan for the fiscal year 2012 through 2014 was 66,000.  The OCO account has also been paying for an average of 63,000 support personnel stationed in-theater, but not in-country.  The OCO has also paid for an average of 32,000 in support back in the U.S.  All together almost 60% of the personnel paid through the OCO account have not been in-country. (DoD FY14 Budget Request: Addendum A - Overseas Contingency Operations)

Even if in-country deployments in Afghanistan head downward toward zero in 2015, it is likely that 15-25,000 U.S. personnel will remain in-theater near Iraq and Afghanistan.  These will be not unlike the forward-deployed U.S. troops that remained in Europe after World War II.  They will become, in essence, another forward peace-time military presence.  It will seem logical for the Pentagon and Congress to seek to pay their bills through the OCO account.

Not only will it be tempting to continue OCO funding to pay for an ongoing presence in the Persian Gulf and in the Afghanistan-Pakistan region, but, as long as BCA caps remain in place, why not try to get a good portion of the costs of all global presence forces and their activities paid for in the exempted OCO account?  The opportunity for escaping budget restraints are manifest. 

One problem for this BCA work-around is that Title 10 of the U.S. Code defines Contingency Operation as "an operation in which members of the armed forces are or may become involved in military actions, operations, or hostilities against an enemy of the United States or against an opposing military force."
  This is a fairly restrictive definition and it will be noticeable stretch to apply "contingency operation" to routine presence missions and deployments.

However, given DoD and Congressional interest in the open OCO spigot, we should not be surprised to see the OCO account morph into an Overseas Presence and Operations (OPO) account.

The Defense Department has detailed its proposed special supplemental budget for 2015, the "Opportunity, Growth, and Security Initiative Fiscal Year 2015."  This funding is supposed to reverse "sharp cuts to training, maintenance, and support," restore readiness and prevent 'hollowness'.  However, Russell Rumbaugh of the Stimson Center finds that in the FY15 base budget proposal "Operations and Maintenance (O&M), the account that most directly affects readiness, got the biggest plus-up: a $6 billion increase, or 3 percent."  So the issue of readiness is already blunted by decisions taken in crafting the base budget proposal.

Kyle Mizokami of War is Boring reports on plans for new U.S. military basing in the Philippines, the first in twenty years.  These bases will be small and multiple.  He writes:

"...the new U.S. outposts likely will be smaller than the superbases of the past. That suits Washington fine. China has a huge arsenal of long-range ballistic missiles with high explosive warheads that are just accurate enough to hit some giant superbase. The Americans prefer to stage out of many smaller bases distributed across the Asia-Pacific, making an easy knock-out blow less likely."

Also addressing the China issue, Robert Kaplan writing in the Christian Science Monitor points out that:

"China sees the South China and East China seas as blue water extensions of its continental land mass, just as a younger America saw the Greater Caribbean that way."  And he concludes that the U.S.  "...must at some level allow China its rightful place in the Western Pacific."

Writing in the American Conservative Daniel Davis and Young Kim advocate for the Macgregor Transformation Model as a way to solve some of the Army's budget and force structure issues.  They write:

"... the MTM [Macgregor Transformation Model] force of 420,000 would include 2,320 units in armored strength (M1 Abrams Tanks/Stryker Mobile Gun System), while the U.S. Army of 490,000 (the latest size for which the Army has published data) would include a mere 1,209. According to our analysis, as a result of numerous formation and institutional reforms the MTM force of 420,000 may also cost $10 billion per year less than what the current force would cost at the same size. Thus, the MTM could produce an Army with almost double the armor, be sustainable even under sequestration, and save an additional $10 billion per year."

In a talk at the Center for
Strategic and International Studies Deputy Under Secretary of Defense for Strategy, Plans and Force Development Christine Wormuth offered an illuminating metaphor while making the case for appropriating more money to the Pentagon than allowed by existing budget caps.  She said:

"You can't live in a mansion if you're working on a middle class salary."


Huffington Post:  "Get Rid of the Pentagon's Slush Fund," William Hartung, 31 March 2014.

Defense News: "When will wartime supplemental funding end?" Vago Muradian interviews DoD Comtroller Robert F. Hale, 30 March 2014 (video).
Inside Defense: "Air Force Sees Broad Enduring Requirement As OCO Funds Draw Down," Gabe Starosta, 28 March 2014 (subscription).
The Hill: "Military officials say they need wartime funding after Afghan War ends," Kristina Wong, 27 March 2014.
The Christian Science Monitor
"Robert Kaplan: The center of military power in the world is moving to Asia," Nathan Gardels, 27 March 2014.

The American Conservative: "More Guns, Fewer Generals," Daniel L. Davis and Young J. Kim, 27 March 2014.

AP: "US military: Budget cuts hurt readiness in Asia," Matthew Pennington, 25 March 2014.

Inside Defense: "Administration Proposes $10.6 Billion For Weapons In Supplemental Spending Package," Jason Sherman, 24 March 2014 (subscription).
Council on Foreign Relations blog: "An Un-Hollow Force: Readiness in the FY15 Budget Request," Russell Rumbaugh, 19 March 2014.

War is Boring: "Base Plan Puts American Troops on China’s Doorstep," Kyle Mizokami, 16 March 2014.

Breaking Defense: "Christine Wormuth Defends Her QDR: Strategy-based, Forward Looking," Sydney J. Freedberg Jr., 10 March 2014.

Office of the Under Secretary of Defense (Comptroller): "Opportunity, Growth, and Security Initiative Fiscal Year 2015", March 2014 (slides).

Center for New American Security: "Envisioning Strategic Options: Comparing Alternative Marine Corps Structures," Frank G Hoffman and G.P. Garrett, March 2014.

Office of the Under Secretary of Defense (Comptroller):  "FY14 Budget Request: Addendum A - Overseas Contingency Operations," May 2013.

GAO: "Comparison of the Department of Defense’s Overseas Contingency Operations Funding Requests for Fiscal Years 2010 and 2011," 28 June 2011.

This post was written by Charles Knight and was originally published in the Reset Defense Bulletin on 01 April 2014. Past issues of Reset Defense from July 2013 to present are archived here.  Issues published from September 2011 to July 2013 are available here.  Access to current and archived issues is free.  To receive the latest edition of Reset Defense as soon as it is published, click here.

The Reset Defense Bulletin is produced bi-weekly by the Project on Defense Alternatives (PDA) at the Center for International Policy.  PDA seeks to adapt security policy to the challenges and opportunities of the new era. Toward this end, it promotes consideration of a broad range of defense options and advocates resetting America’s defense posture along more effective and strategically sustainable lines.

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