Groups Urge White House and Pentagon To Right-Size Pentagon Workforce

April 20, 2017

The President

The White House

1600 Pennsylvania Avenue, NW

Washington, DC 20500

The Honorable Mick Mulvaney

Director

Office of Management and Budget

Eisenhower Executive Office Building

Room 252

Washington, DC 20503

The Honorable James N. Mattis

Secretary

Department of Defense

1300 Defense Pentagon

Washington, DC 20301

Dear Mr. President, Director Mulvaney, and Secretary Mattis:

As you consider options to increase the efficiency of the federal workforce,[1] the undersigned organizations strongly urge you to avoid any hasty decisions that would further increase staffing at the Department of Defense. The Pentagon is the largest federal employer,[2] and numerous studies across the political spectrum have identified reforms to the size and structure of its workforce as an opportunity to increase the efficiency and effectiveness of its operations.

Specifically, some of the calls for reforms and appropriate reductions to the size and structure of the Pentagon workforce have included:

• A Defense Business Board study that identified $125 billion in potential savings from administrative waste, including excessive federal and contractor staffing.[3]
• A letter signed by 38 defense experts that identified the size and structure of the Department’s workforce as an “area in need of urgent examination and restructuring” since both the civilian and contractor workforce “is now out of proportion to need."[4]
• A Heritage Foundation study that estimated there was $29 billion to be found in efficiencies in the Department’s civilian workforce.[5]
• A Congressional Budget Office study that found the Department could save $14 billion by replacing some military personnel with civilian employees.[6]
• A joint study by the National Taxpayers Union and R Street Institute that estimated billions could be saved by reducing excess contractors and civilian employees.[7]

Service contracting has also contributed to an ever-expanding “shadow government” that costs over a hundred billion dollars annually.[8] While often justified as increasing efficiency and savings, shifting services from federal employees to contractors can significantly increase costs. A study by the Project On Government Oversight found the average annual contractor billable rate was much more than the average annual full compensation for federal employees performing comparable services.[9] Judicious cuts to service contracts would also increase the efficiency and the effectiveness of the Department. Despite these opportunities for savings, the Government Accountability Office found DoD lacked “critical” information on contractor costs needed to make workforce decisions.[10]

We appreciate this Administration’s willingness to examine costs and effectiveness across the federal government. The Pentagon’s staffing is ripe for a strategic review of the most appropriate and cost-effective workforce.

Sincerely,

Center for International Policy

Coalition to Reduce Spending

Council for a Livable World

DownsizeDC.org, Inc.

Freedom Works

Gordon Adams, Professor Emeritus, School of International Service and Distinguished Fellow Stimson Center

London Center

National Center for Policy Analysis

National Priorities Project

National Taxpayers Union

Peace Action

Project On Government Oversight

Taxpayers Protection Alliance

Win Without War

Women’s Action for New Directions (WAND)

[1] Ian Kullgren and Matthew Nussbaum, “White House calls for deep agency cuts,” Politico, April 11, 2017.

[2] Department of Defense, “About the Department of Defense,” January 27, 2017.

[3] Defense Business Board, “Transforming Department of Defense’s Core Business Processes for Revolutionary Change,” February 9, 2015. Craig Whitlock and Bob Woodward, “Pentagon buries evidence of $125 billion in bureaucratic waste,” The Washington Post, December 5, 2016.

[4] Center for Strategic and Budgetary Assessments, “Thirty-Eight Think Tank Experts Urge Defense Reform,” April 29, 2015.

[5] Heritage Foundation, “Reduce Civilian Overhead in Department of Defense,” The Budget Book: 106 Ways to Reduce the Size & Scope of Government, February 11, 2015.

[6] Congressional Budget Office, “Replace Some Military Personnel With Civilian Employees,” Options for Reducing the Deficit: 2017 to 2026.

[7] National Taxpayers Union and R Street Institute, How Pentagon Spending Can Better Reflect Conservative Values, June 4, 2013, p. 30.

[8] In FY 2015 the Department of Defense obligated $283 billion in federal contracts, with service contracts accounting for 44 percent of total obligations. Moshe Schwartz, John F. Sargent Jr., Gabriel M. Nelson, and Ceir Coral, Defense Acquisitions: How and Where DOD Spends and Reports Its Contracting Dollars, Congressional Research Service, December 20, 2016, p. 5.

[9] Project On Government Oversight, Bad Business: Billions of Taxpayer Dollars Wasted on Hiring Contractors, September 13, 2011.

[10] Government Accountability Office, Human Capital: Opportunities Exist to Further Improve DOD's Methodology for Estimating the Costs of Its Workforces, September 2013, p. 26.