President-elect Donald Trump is having an impact before even taking a seat behind the Resolute Desk. On Nov. 13, Trump announced he was establishing the Department of Government Efficiency – DOGE – and assigning Elon Musk and Vivek Ramaswamy as co-chairmen of the new organization. As the name suggests, the new Trump administration aims to drive efficiency into government and waste out. In this day and age, what could be more noble – or difficult?
Though every federal agency will present unique challenges for the DOGE team, none so much as the Department of Defense (DOD). Efficiency in the US government comes in a variety of shapes. For the DOD, the most common is doing less with a corresponding cost reduction. However, equally effective is simply doing the same thing but streamlining the processes to drive down costs. The common denominator is money. Remember the mantra, “It’s about the money.”
However, one target for efficient operation that DOGE will look at is the abuse of the “work-at-home” privilege afforded civilian employees at the DOD and other agencies during the COVID pandemic. Some estimates claim that only 6% of civilian employees are in the office for a five-day workweek. “Department of Government Efficiency co-leader Vivek Ramaswamy indicated … that federal employees will be required to return to the office full time, and that the push has left union ‘bureaucrats’ in tears,” The Daily Signal reported.
Second, if DOGE is going to be effective at the DOD, two factors are important. The only money that can be saved to reduce costs is that appropriated by Congress to be spent in the current budget year. Defense programs that DOGE will deem worth cutting or reducing will not see cost savings until the next budget year or when the end of the program rolls around. For example, if DOGE elects to reduce the number of jet fighters, no cost savings will be realized until the year the last aircraft is purchased.
Also, DOGE must calculate that each aircraft will cost more with fewer in the program. The individual item cost is predicated on an economic order quantity. In other words, if the government buys a few items, the cost of development and production is spread over a few items, and each costs more than if there were hundreds. If DOGE wants to identify major acquisition programs for cutting, closing a program will create costs that exceed the program’s annual cost in the year the program is stopped. Closing an assembly line is costly.
The second factor is approaching cost savings by taking a salami slice approach, which has not proven successful at the Defense Department. Taking a percentage cut across the board in personnel or procurement is easy and appealing but has resulted in unintended consequences. During the mid-1990s, a congressional effort to eliminate costs from the Defense Department acquisition system took a percentage reduction in the number of people involved in the process approach.
The Pentagon complied with the congressional direction and adopted the most expeditious approach. First, everyone who was eligible for retirement was asked to retire. Next, everyone close to that point was incentivized to do so. With some exceptions, these initiatives achieved the salami slice objective. However, the cost-cutting effort left the DOD with little in the way of experience in how the acquisition system worked, and new inefficiencies were introduced. The Pentagon hired back the retired folks as contractors to address the lack of supervisory and executive experience that had left. The unintended result was a DOD acquisition community that cost more than when compliance with the congressional mandate began.
To drive cost-cutting into the Pentagon requires eliminating functions and regulations, which terminate employees. Divisions that no longer provide value within major principal staff assistant organizations – the undersecretaries of defense and agencies that are direct reports to the Secretary of Defense – could be disestablished. Duplication of efforts among the military departments and the Office of the Secretary of Defense could undergo consolidation.
To drive efficiency into the Pentagon requires knowing in detail how the building works – who does what for whom and why. Without this knowledge, DOGE’s best intentions will encounter headwinds created over decades. This cage match featuring DOGE vs DOD will require DOGE experts steeped in the DOD world. Trump described DOGE aptly as “The Manhattan Project of our time.” If applied to the Pentagon, it will have to be all of that.
The views expressed are those of the author and not of any other affiliate.