NDAA Installs Major Structural Reforms to Pentagon

WASHINGTON — Earlier this year, Sen. John McCain unveiled a series of sweeping changes to the Pentagon.

The thought among analysts was that the Arizona Republican — facing down a potentially dicey primary election, challenge by a well-funded opposition in the general election and with no guarantee his party would remain in control of the Senate — had put all his cards on the table. Every change he wanted to make to the Pentagon would be on considered, a potential legacy-building effort from the longtime defense hawk.

McCain won his primary. He won his general election. And his party not only kept the Senate, but captured the presidency, removing the threat from the Obama administration to veto McCain’s more dramatic ideas.

On Wednesday, his ideas seem to have won in conference, with a number of his reforms put forth in May surviving the final version of the 2017 National Defense Authorization Act (NDAA). Among those: blowing up the role of the Pentagon’s top weapons buyer, slashing the number of general officers, capping the size of the National Security Council and extending the chairman of the Joint Chiefs of Staff to a four-year role.

It should be noted that McCain’s ideas were not directly opposed by his counterpart in the House, Rep. Mac Thornberry of Texas. And Thornberry certainly got many things he wanted as well. But as he starts what is expected to be his final six-year term in the Senate, McCain has assembled a legacy-defining series of changes for the way the department operates.

“I give both the House and Senate tremendous credit for working against a dug-in Pentagon,” said Arnold Punaro, a former Marine Corps major general and Senate Armed Services Committee staff director. “These are the most significant reforms since Goldwater Nichols, without question. And they are very well thought out, documented and responsible.”
Among the big changes:

Changing the undersecretary of acquisition, logistics and technology: McCain first took aim at changing AT&L in the 2016 NDAA, a move that caught observes by surprise, and he continued that push with the 2017 NDAA.

At the time of the announcement, the language would have split AT&L into two offices: a new undersecretary of defense for research and engineering, or USD(R&E), and the renamed undersecretary of management and support, or USD(M&S).

However, the final language somewhat tweaks that, instead creating an undersecretary for acquisition and sustainment (AT&S), and create a new undersecretary for research and engineering (R&E), essentially a chief technology officer. Those new offices meet the goal of SASC staffers in creating a more focused position for developing new technology that is not, as they see it, bogged down in the day-to-day acquisition requirements that are currently balanced by AT&L head Frank Kendall.

Kendall has opposed such a splitting of his role, citing success in cost reductions during his tenure. Secretary of Defense Ash Carter has also opposed such a move, opposition that Pentagon Press Secretary Peter Cook said Tuesday still exists.
Andrew Hunter, a former acquisition official now with the Center for Strategic and International Studies, said the House staffers should be happy with how they tweaked the initial SASC suggestion.

“I would say whereas the Senate had focused on putting ‘acquisition’ and ‘technology’ together and shifting the ‘logistics’ to the undersecretary for management, it was the House that pushed to say: ‘Let’s push the "T" out and have the "A" and "L" together,’ ” Hunter said. “It’s a bit of a win-win but would say the House folks feel really good about the final answer.”

He notes that the new setup means the R&E role is now the chief focus for innovation in the department — something that could line up with Carter’s call for a chief innovation officer at the Pentagon.

Like the SASC, Punaro believes the role of AT&L had become too cluttered and gotten away from the vision of the Packard Commission in the late 1980s. He said he was “extremely positive and enthusiastic” about the changes, However, he expressed hope that the management and support role wold not be fully abandoned, given the wide portfolio, including energy and installations, that the current AT&L role controls.

Speaking to reporters on Tuesday, a senate staffer said what the two sides "continue to look at and consider for future legislation would be a role for management of the defense agencies and whether there is a possible third position — and how that would take shape, and whether the defense business enterprise would be better run now. That’s something we’ve asked the department for its input on, to really work with us on that. That would be a future project."

Implementation of the new offices are ordered for February 2018, though the Department of Defense isn’t precluded from implementing it sooner — a move that Hunter notes leaves time for tweaks and changes to continue to happen.

“Notable is that it doesn’t go into effect for another year,” Hunter said. “I’m concerned there will be a struggle for power between these two secretaries that could be unproductive, so it is possible it could get tweaked once again with the new administration coming in to take on a character that appeals to the next secretary.
Capping general officer levels: According to a Congressional Research Service report, in February of 2016 there were 411 one-stars, 299 two-stars, 138 three-stars and 37 four-stars spread across the Pentagon — 885 total general officers. The original SASC language sought to chop that down by 25 percent, or roughly 221 spots.

However, the compromise language reduces those cuts to only 110 spots — about an eighth of the total, still a significant chop — by Dec. 31, 2022. It specifically reduces the four-star total by five and requires that the grade of an officer serving as commander of a service or functional component command be capped at the three-star level.

The language also comes with the threat of further officer reductions down the line, with the language saying an additional 10 percent reduction may be appropriate after the 110-strong reduction occurs. And yes, Congress is aware the Pentagon may look to throw a wrench into these reduction plans.

“In the context of the Department of Defense's continued requests to reduce military end strength, especially in the Army and the Marine Corps, reductions that Congress has cautiously considered and authorized, the time has come for the Department to rigorously evaluate and validate every general and flag officer position,” the report reads.

“The conferees expect that the Department of Defense and the military departments will improve efficiency by eliminating bloated headquarters and staffs while preserving the necessary number and grades of positions for general and flag officers who are responsible to train and lead our Nation's forces in battle and to bring them safely home again. The conferees expect that the leadership of the Department of Defense and the military departments will approach this effort with the seriousness of conviction that our that our men and women in uniform, and the American people deserve.”

Extending the chairman and vice chairman of the Joint Chiefs of Staff: Currently, both the chairman and vice chairman operate under two-year terms, with the president required to reup those positions for a second two-year term if it is desired. However, the NDAA language now sets those jobs to four-year terms and specifies that the appointments should be staggered to avoid situations, as often occur, where both positions are rotating out at the same time.

Punaro, who helped draft the language that created the two-term system, believes it is time for those jobs to become four-year appointments.

“We made a mistake in '86 when we shortened the term,” he said. “It hurt the independence of the chairman because they are having to look over their shoulder a little bit … so as one of the people at the staff level recommending that, I now recommend we go back to the four-year terms and acknowledge that we’ve had unintended consequences of what we thought was a good idea at the time.”

Capping National Security Council staff at 200: The initial SASC language from May capped the NSC size at 150, so this appears to be a bit of a compromise. But the NSC under the Obama administration has been a target for supporters of both the State Department and the Pentagon, with complaints about micromanagement abundant.

Loren DeJonge Schulman, a former senior adviser to National Security Advisor Susan Rice now with the Center for a New American Security, warns that simply reducing the staff may not solve the perceived issues.

“A cap of 200 substantive staff, excluding administrative and support personnel, seems very reasonable,” she said. “However, no one should assume that cutting the size of the NSC will do anything to improve its effectiveness or minimize micromanagement. The new administration, starting with the president and the national security adviser, need to have serious discussions with fellow NSC members (Defense, State, Joint Staff, etc.) about their roles, execution of the president’s priorities, transparency and accountability.”

“That sort of clarity up front, and follow through after, is what is necessary to reform the NSC process,” she added. “Without it, a smaller NSC staff will just be an overworked, micromanag[ed] NSC staff.”

And the 200 number may still shrink, following media reports that the Trump administration wants to cap the NSC staff in the 40-60 range. Schulman called that “a nice thought, but a fantasy” that would make it “impossible to execute the coordinating, advocacy and oversight roles of the NSC.”

The language also caps the total number of Senior Executive Service positions at the Pentagon at 1,260, again with a requirement that number be met by the end of 2022.