[Congressional Record Volume 142, Number 55 (Thursday, April 25, 1996)]
[Senate]
[Pages S4178-S4180]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




               DEPARTMENT OF DEFENSE INFRASTRUCTURE COSTS

  Mr. GRASSLEY. Mr. President, I would like to speak briefly about 
Department of Defense [DOD] infrastructure costs.
  DOD is expected to spend $152 billion in fiscal year 1996 on 
infrastructure. Infrastructure dollars are spent to maintain the bases, 
facilities, and activities that house and sustain the Armed Forces. 
They support costs.
  The General Accounting Office [GAO] has just completed a report on 
DOD infrastructure costs. The report was prepared by one of GAO's best 
analysts, Mr. Bill Crocker.
  The GAO's findings are truly amazing. Despite four rounds of base 
closures since 1988 and dramatic cuts in the force structure, there are 
no savings. DOD infrastructure costs are going up--not down.

[[Page S4179]]

  We have had four rounds of base closures--1988, 1991, 1993, and 1995. 
This was the Base Realignment and Closure or BRAC process. And BRAC was 
quite painful for many communities.
  Well, the driving force behind BRAC was ``to save money by reducing 
overhead.''
  Mr. President, that was the promise. Streamline Defense 
Infrastructure and save money. That was the deal. The base structure 
exceeded the needs of a shrinking force structure. The whole idea was 
to close excess, obsolete bases and save money.
  Well, once again savings promised by the Pentagon have evaporated 
into thin air.
  Now, I know that base closings require upfront costs. In some cases, 
these are quite substantial. But the upfront costs are supposed to be 
followed by down stream savings. Secretary of Defense Perry made this 
very point in testimony before the Senate Armed Services Committee as 
recently as March 5, 1996.
  This is what he said, and I quote: ``While BRAC initially costs 
money, there will be significant savings in the future.''
  To back up his assertion, Mr. Perry points to the fiscal year 1999 
budget.
  Again, this is what Mr. Perry said, and I quote: ``In the FY 1999 
budget, the Department projects $6 billion in savings from closing the 
bases, thus allowing a $10 billion `swing' in savings.''
  He went on to say:

       These and future savings from baseclosing will be devoted 
     to modernization.

  Well, Mr. President, what happened to those savings?
  The GAO can't find them.
  The GAO audited the fiscal year 1996 to 2001 Future Years Defense 
Program or FYDP.
  The Department's own numbers--the numbers in the FYDP--indicate that 
infrastructure costs will rise in the outyears.
  Infrastructure costs rise as follows, beginning with fiscal year 
1998: 1998, $147 billion; 1999, $152 billion; 2000, $156 billion; 2001, 
$162 billion.
  Where are the savings promised by Mr. Perry?
  Why are not those savings reflected in the department's books?
  I think the GAO report provides a partial answer to the question.
  It is true.
  Base closing did produce some decreases in base support costs.
  BRAC did produce some real savings.
  But I underscore ``did,'' which is past tense.
  Bureaucrats at the Pentagon don't look on savings like the average 
American citizen.
  To bureaucrats, it is theirs to spend. It's not the peoples' money to 
be returned to the Treasury.
  Put a sponge on it, and make it disappear. That is how they see 
savings.
  As soon as the savings popped up on the radar screen, they grabbed 
the money and spent it.
  Those savings are not being plowed into readiness and modernization--
as Mr. Perry promised.
  Those savings are being diverted into new infrastructure projects.
  Those savings are being used to create more excess overhead.
  ``Force Management'' is an excellent case in point.
  Force Management is one of the infrastructure cost categories.
  More money for force management sounds reasonable enough, but it does 
not stand up too well under scrutiny.
  Force management covers such things as military and departmental 
headquarters and public affairs.
  To me, more money in force management means fatter headquarters.
  Fattening up the headquarters doesn't come cheap, either.
  Spending for expanded headquarters will rise as follows, beginning in 
fiscal year 1998: 1988, $13.6 billion; 1999, $15.2 billion; 2000, $16.1 
billion; 2001, $17.2 billion.
  Now, Mr. President, why is DOD planning to beef up headquarters, when 
DOD continues to make dramatic deceases in the force structure?
  A much smaller force structure should be much cheaper to manage.
  Right?
  And a smaller force should mean much smaller and fewer headquarters.
  Right?
  Not at the Pentagon.
  As the force gets smaller and smaller, the headquarters are getting 
bigger and bigger. Why?
  It's needed to accommodate a topheavy rank structure.
  Base closures and realignments mean that some headquarters will have 
to be consolidated with others.
  We know that.
  But with continued shrinkage in the force structure, there still 
should be plenty of excess headquarters space.
  There is no need to fatten up headquarters operations.
  That just does not make any sense at all right now.
  Mr. President, I ask unanimous consent to have printed in the Record 
two tables.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                      TABLE V-3--FORCE STRUCTURE a --PART V: FORMULATING THE DEFENSE BUDGET                     
----------------------------------------------------------------------------------------------------------------
                                                   Cold war                                                     
                                                 fiscal year   Base force  Fiscal year  Fiscal year   BUR-based 
                                                     1990        plan b        1996         1997        plan c  
----------------------------------------------------------------------------------------------------------------
Army--active divisions.........................       18           12           10           10           10    
    Reserve component brigades d...............       57           34           47           42           42    
Marine expeditionary force e...................        3            3            3            3            3    
Navy aircraft carriers (active/reserve)........       15/1         12/1         11/1         11/1         11/1  
Carrier air wings (active/reserve).............       13/2         11/2         10/1         10/1         10/1  
Battle force ships (active/reserve)............      546          430          359          357          346    
Fighter wing equivalents (active/reserve)......       24/12        15/11        13/8         13/7         13/7  
----------------------------------------------------------------------------------------------------------------
a Dual entries in the table show data for active/reserve forces, except for carriers, which depicts deployable/ 
  training carriers.                                                                                            
b Bush Administration's planned fiscal year 1995 force levels, as reflected in the January 1993 Annual Defense  
  Report.                                                                                                       
c Shown are planned force levels, which may differ slightly from those recommended by the BUR, but which are    
  consistent with its proposals.                                                                                
d An approximate equivalent. The BUR plan calls for 15 enhanced readiness brigades, a goal that DoD will begin  
  to reach in fiscal year 1996. Backing up this force will be an Army National Guard strategic reserve of eight 
  divisions (24 brigades), two separate brigade equivalents, and a scout group.                                 
e One reserve Marine division, wing, and force service support group supports the active structure in all cases.


                                   TABLE V-4--DEPARTMENT OF DEFENSE PERSONNEL                                   
                                   [End of fiscal year strength in thousands]                                   
----------------------------------------------------------------------------------------------------------------
                                                             Fiscal year--                             Percent  
                                                ---------------------------------------                 change  
                                                                                            Goal     fiscal year
                                                     1987         1996         1997                   1987-1997 
----------------------------------------------------------------------------------------------------------------
Active military................................        2,174        1,482        1,457        1,418          -33
  Army.........................................          781          495          495          475          -37
  Navy.........................................          587          424          407          394          -31
  Marine Corps.................................          199          174          174          174          -13
  Air Force....................................          607          388          381          375          -37
Selected reserves..............................        1,151          931          901          893          -19
DoD civilians..................................        1,133          841          807          728          -27
----------------------------------------------------------------------------------------------------------------

  Mr. GRASSLEY. These two tables are taken from page 254 of Secretary 
Perry's March 1996 report to Congress.
  These tables contain the data that point to dramatic decreases in our 
force structure since the late 1980's.
  Those tables tell the tale:
  They tell me that there should be dramatic cuts in infrastructure 
costs.

[[Page S4180]]

  But the savings are nowhere in sight.
  Once again, the Pentagon is proving that it is incapable of 
allocating money in sensible ways.
  Once again, the Pentagon is proving that it is incapable of saving 
money--even with such a golden opportunity.
  Mr. President, it makes me sad to say this.
  The Pentagon bureaucrats are just frittering away the money on stupid 
projects.
  The benefits of the painful base closure process are being wasted.
  If Pentagon bureaucrats have their way, the goals of base closure 
effort will never be reached.
  The GAO has presented 13 different options for cutting defense 
infrastructure costs.
  The GAO says these options would save about $12.0 billion between 
fiscal years 1997-2001.
  Mr. President, I hope the defense committees will examine the GAO 
options.
  I hope the defense committees will consider using those options to 
recoup some lost savings.
  I hope they will do that, rather than ask for more money in this 
year's defense budget.
  I yield the floor.

                          ____________________