The predominant issue at all levels of government is controlling costs. In Wisconsin, this has translated into reducing labor’s collective bargaining rights as a means of improving productivity. For Costa Mesa, California the solution was to fire nearly half the city’s workforce. The Obama Administration has acknowledged the need to restrain the growth of government.
Like cities and states across America, the Department of Defense (DoD) will need to reduce costs and improve productivity if it wants to avoid draconian cuts in force structure and modernization. In recent years, DoD has gone on a hiring binge, bringing in tens of thousands of new civil servants. In many cases it has replaced private sector workers with government employees and moved maintenance and support work from private companies to government facilities. At the time, Pentagon leaders asserted that these moves would save money.
Well, like Wisconsin and Costa Mesa, DoD discovered that growing the bureaucracy and insourcing work is a guaranteed path to bankruptcy. Secretary of Defense Robert Gates acknowledged that the Pentagon had not saved money. On average public workers cost more than their private sector counterparts. In addition, lacking adequate metrics by which to calibrate performance, the public industrial base is less efficient that it’s private sector counterpart.
DoD needs to be aggressive in reining in costs if it wants to protect force structure and modernization. This means relying more on the private sector. It means expanding current efforts to promote competition in defense contracting. For example, DoD should seek to ensure competition in parts and services for maintenance, repair and overhaul work. The Pentagon should expand the use of performance based agreements in weapons support.
Above all, DoD needs to shrink its workforce and change the rules by which the remainder operate. In essence, DoD will have to do a Wisconsin.
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